Vol 6 Chapter 845: Professional Manager Controversy

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Charlie Kidder, who is responsible for the poor development of the business, has guessed Feng Yiping's purpose today. Yes, he brought his senior executives to tribute Nortel, the former giant.

The purpose, of course, is to learn from it.

It should be said that Nortel, which is also not well known to outsiders, really has this qualification.

When it became a world-class supplier of telecommunications equipment, our domestic related companies, it can be said that they have not really started.

In the past, Nortel’s stock was also favored by capital. At its peak, it rose to more than US$120. Therefore, its market value rose to a high of US$267 billion in 2000. At that time, Nortel’s market value occupied the Toronto Stock Exchange. 1/3 of the top.

You know, Toronto is Canada’s largest city and economic center in a developed country. The total GDP of the city has always been among the top ten cities in the world. In 2000, its total GDP was higher than that of North, Shanghai, Guangzhou and Shenzhen. Add up to even higher.

That is to say, Yahoo at that time was also when the market value was the highest, but the highest was only $125 billion-less than half of Nortel.

You can also use other data to see how good Nortel was that year. Judging from the highest market value of last month, the market value of our Universe and Microsoft are both around $230 billion.

In addition to the numbers, we can still understand how good Nortel was.

From the current reality, in some key Canadian cities, such as Toronto and Vancouver, their housing prices have risen. Everyone will say that it is because of the Chinese.

But in the past, the reason for the increase in housing prices in Toronto and the nearby Canadian capital, Ottawa, was Nortel.

Nortel’s strength made Nortel’s employees very wealthy, so they bought homes, so that at that time, if you wanted to buy a house in Ottawa, you had to line up in the middle of the night to get the number before you could have the chance to choose a land.

Just one company caused housing prices in the capital to rise. It is no wonder that Nortel was called a national treasure by Canadians at that time.

But now Nortel...I believe that after selling out their last important asset, that is, this batch of patents, it shouldn't be long before it will disappear completely.

"I think the main reason is the wrong direction," Ma said first, "and, they believe in new technologies too much,"

"Technology is good, but it's not that companies can develop well if they have good technology."

Of course Ma's words are right.

The rise of Nortel is because they have bet on the right when Internet companies are developing rapidly. When other companies, such as Lucent, have only 2.5G of their optical fiber products, Nortel began to fully invest in the development of 10G products.

Next, the Internet developed rapidly at a speed beyond everyone's imagination. Telecom operators launched new broadband systems one after another. Nortel’s 10G products once occupied more than 90% of the market’s monopoly share, and thus achieved a huge market share. Success.

However, with the burst of the Internet bubble, the former star products have become unmarketable ballast, and the inventory was once as high as 4 billion US dollars.

If this can barely be classified as a force majeure factor, then they will spend huge sums of money to develop 40G or even 80G capacity optical fiber, which is one of the main reasons for the rapid deterioration of the company's financial situation.

"One step ahead, that is a genius, two steps ahead, that is a lunatic," the old horse said again.

At this time, another voice rang, "I think it is mainly because of several responsible persons."

That is Meyer.

"We saw that it was the wrong decision of the person in charge that caused the results Jack mentioned."

Feng Yiping agreed, "I agree with Mayer's opinion,"

Ma Xin said, you are two in-laws, of course you will agree.

Feng Yiping followed his conclusion, "I think the decline of Nortel is mainly due to this aspect."

Lao Ma now understands that this is, to teach everyone!

The reason why Feng Yiping made his conclusion at this time was that he was worried that everyone's discussion would go wrong.

Why would Mayer speak when the old horse still has some ideas? That's because she doesn't quite agree with Lao Ma's views.

The same is true for Feng Yiping. Relatively speaking, Lao Ma still values ​​commercial methods more, but he still hopes that his company can invest more in the research and development of new technologies.

"We can see that the one who made Nortel glorious and the one who made Nortel decline rapidly happened to be the same person, John Rose,"

"Everyone, we have to keep this in mind. The people who have led the company to create brilliance are also likely to be the ones who ruin the company."

"Of course, it is the successor of John Ross, Frank Dunn, who really made Nortel start to fall into a desperate situation. In order to satisfy shareholders, he chose to make false accounts and falsely report profits."

An accounting firm that was puzzled by Nortel’s data finally found out that they lied about more than $200 million in profits.

Under strict securities laws and regulations in Europe and the United States, a financial scandal like this is almost equivalent to a death sentence.

"Of course, it is not ruled out that he did this to get a high bonus,"

Everyone, look at me and I will look at you. We never even thought about such a thing.

Feng Yiping stood up, "What I want to say is that if we analyze further, at several critical junctures that matter to Nortel's life and death, some seem to be very good professional managers who have made irreparable mistakes."

This is the main reason why he brought everyone here. He felt that Nortel’s lessons could give them a lot of reference.

At this time, many people were a little bit unable to sit still.

Some of you here, whether it is Netflix’s Hastings, the three on Twitter, or the coin star’s Merbach, etc., although they are all company founders, they can only be regarded as careers after being acquired. Manager.

The rest, let alone, including Meyer, are all professional managers.

"Silicon Valley's development over the years seems to have also shown this point. When the founder is in charge, the company often develops better, but after being handed over to professional managers, even though these professional managers are recognized as outstanding individuals, But it often fails to allow the company to continue its rapid development,"

"The well-known Apple is a very good example,"

"Everyone, all our companies will inevitably be handed over to professional managers in the future, so I would like to ask everyone to think about how we can make our company less like Nortel."

"What kind of governance system should we develop?"

This is what Feng Yiping wants to discuss with you today.

I always have to let go, that is, the founders such as Hastings, as well as the old horses, will always retire. In the future, they will only be handed over to professional managers.

Everyone is watching each other again, because this is a problem closely related to most of them.

"Is it because professional managers do not necessarily have deep feelings for the company, nor do they have to advance and retreat with the company, and their own interests are not consistent with the company's interests, or are there other reasons?" Feng Yiping looked at everyone and asked.

"If so, how can we solve it?"

In the luxurious lobby of the cruise ship, there was a moment of coldness, and in the end, it was Sandberg who broke the silence.

"Feng, there are many reasons for professional managers to perform improperly, but I think one of the most important ones is the performance pressure they suffer, and these performance requirements are generally short-term."

"KPI pressure, to a certain extent, will force them to pay more attention to short-term benefits, or to decompose the long-term goals of the company into specific, objective and assessable ones, which can supervise the work of employees in a timely manner. index of,"

"The result of doing this is often that it will eventually deviate from the original goal of the company."

Feng Yiping nodded, "That is, we have to pay more attention to long-term goals. Fortunately, we are doing this right now."

"The problem is, I think everyone knows that whether it is a 5-year plan or a 10-year plan, there must be relevant indicators, right?"

"This is a contradiction... Do you have any other opinions?"

Merbach, who has never talked much, cleared his throat, "I think professional managers enjoy high salaries and high benefits, and they also have golden parachutes (retirement compensation). This means that many times, even if their work is bad, But still get generous compensation, just like Nortel’s last CEO, Zafirovski,"

"With this kind of system, the utility of incentives is now getting smaller and smaller, but the negative utility is getting bigger and bigger,"

As soon as he finished speaking, Jack Dorsey of Twitter immediately retorted, "My opinion is just to be countered. I think it is this clause ~www.wuxiaspot.com~ that has greatly aroused everyone's enthusiasm."

"Yes," "Yes"

Many people agree with him more, the reason is simple, it is more beneficial to them.

Hastings also said, "Without such conditions, it is difficult to attract outstanding talents,"

Lao Ma disagrees, "The common vision is more important..."

Such competing opposition quickly heated up the discussion.

Feng Yiping, who provoked such a scene, rarely spoke afterwards, sitting quietly and listening to everyone expressing their opinions.

He is also uncertain about this. Of course, he is relieved of the current group of people, but what about the people in the future?

The most ideal situation, of course, is that professional managers closely link their own interests with the interests of the company, but how can we ask everyone to do this?

He only knows that this is related to corporate development and involves huge conflicts of interest, which are often difficult to resolve peacefully. After resigning for various reasons, there are not a few professional managers who choose to go to court with their former owners.

Let’s say that Nortel’s last CEO and former Motorola CEO Zafirovski, after leading the bankruptcy of Nortel, once went through the courts to ask for pensions, salaries, dividends and other expenses of up to 12.25 million US dollars. Some payments.

It is a bit ugly to eat, but in the face of tens of millions of dollars, how many people can calm down?

Facial or something, is it a thing...

The current fierce debate and the collision of opinions of people with different demands are, to a certain extent, equivalent to a preview in advance.

After that, the discussion extended to more and more specific aspects, and by lunch, it was still very intense.

Feng Yiping also received relevant news. In the first round of bidding for Nortel's patents that just ended, Intel immediately quoted a high price of US$1.5 billion...