MANAGING TO MAKE A MESS OF THINGS

2/27/09

On January 23, 2009, GE CEO Jeff Immelt was adamant about GE’s dividend: It was secure and would stay intact, right where it was at 31 cents a quarter. Today, February 27, 2009, a little over a month later, GE cut its dividend to 10 cents a quarter. Jeff Immelt lied, is clueless, or both. GE’s argument that the economy is far worse than it had thought when Immelt made his statements last month makes no sense, given the time frame. But if that argument has even a shred of credibility, it says plenty about the skill and ability of GE’s executives, Mr. Immelt especially, to see what is in the plain sight of everyone around them. So Mr. Immelt is either a liar or an incompetent.

One hates (but not all that much) to generalize, but Mr. Immelt is not at all unique among this generation of blow-dried yahoos, “educated” and steeped in the latest actionless, pointless babble that constitutes modern American management, that runs America’s major corporations. They are so used to lying that telling the truth becomes an unnatural act. Like politicians (which, in this era of the iron big business/big government axis, they are), they lie simply because it comes more naturally than telling the truth. On top of that, they are hopelessly incompetent at anything but self-congratulation and self-enrichment. Their only qualifications for their jobs are, as I have said before, are a thick set of knee pads for their superiors (on their way up) and a heavy cudgel for their underling (forever).

It was especially ironic and laughable when Jack Welch, Mr. Immelt’s predecessor whose last act of complete mismanagement was hand-picking Mr. Immelt as his successor (I suppose it could have been worse—one of the candidates for the GE CEOship was Bob Nardelli.), entitled one of the paeans to himself he calls books “Straight from the Gut.” Any CEO of a major U.S. corporation, and especially Mr. Welch, has never said anything straight from the gut. These non-entities are in the business of peddling unadulterated codswallop in order to obfuscate their glaring incompetence.

Perhaps the solution to the dearth of management ability that characterizes the top brass at the typical large U.S. corporation is for their lap dog boards to replace the maladroit mountebanks who run these myopic mastodons with people who really know how to run a company. There are plenty of such skilled managers among America’s small businesspeople. But it is doubtful that your typical small businessman, steeped in quaint old notions like common sense and actually working for a living, would have the patience to deal with the Frankenstein monsters that years of “modern management theory” and top management pilfery have made of our former great corporations.

And, again, we wonder why we are in such trouble.