With most company bosses expecting a full return to the office within three years, questions are being raised about the power they wield and the salaries they command
And soon enough shareholders and investors will be pondering whether the stratospheric salaries paid to CEOs are commensurate with the vaguely defined value they add to the enterprise. And also compare the modest salaries paid to CEOs in the EU with those of the so-called high-flyers elsewhere.
It’d result in no change, everyone at the top end is scratching each others backs.
Most annoying for me is the old argument that they need to compete internationally for CEOs etc. I can’t recall the last time an Australian CEO was head hunted to leave here.
QF is profitable because it has a stranglehold on the market; intrastate & interstate, not because of senior management.
Many (most?) firms have seen no reduction in productivity during high WFH. What is most telling is that executives never asked why. Nor do I hear executives discuss how to better manage workers at home, to make sure they aren't goofing off. Instead, they only demand a return to an office that has become more crowded than pre-Covid, often with mere hoteling space. My guess is that staff goofing off at home is no worse for productivity than meetings whose real purpose is to reinforce vanity and hierarchy.
But here's a dirty secret: managers undermine executives by encouraging staff to not return to the office, because if the line staff did return then the managers would also have to come back.
CEOs rely on acceptance of their power over staff. The sources of that power may be referral or even expert. This is where, over a long period of time, a CEO earns respect and wins acceptance. Many higher management structures, especially flattened ones, generate CEOs in this manner. This is especially true of elaborately transformed manufacturing firms, where some knowledge of the intricate production process is mandatory.
But there are other businesses where boards prefer a CEO whose power source comes only from them. This is especially true when downsizing of staff is occurring. I remember the “hatchet” CEOs of the 1990s who made their bonuses on the speed of their retrenchments.
The coercive power driven CEO has little or no regard for other employees. Even other higher management peers are seen, not as allies but, as threats. Staffing is then merely a reflection of the CEO’s ego and not the optimal level for maximum efficiency - an economics textbook ideal if there ever was one.
Coercive CEOs must have their staff under their thumb. That means they all must be in workplace locations they can manipulate. Little thought is given to the difficulties of peak hour traffic and/or the family commitments of their staff. This then affects the labour productivity at both a marginal and absolute level. Both tend to stagnate at best, but may also fall.
It could be said that the falling labour productivity, for the period from 1999 to 2019, may be partly explained by the insensitive employment practices mandated by many CEOs. It certainly is an observable trend that ever since CEOs began getting excessive performance bonuses, their concern for staff satisfaction may have diminished.
Return to work edicts are typical of the behaviour seen from coercive power based CEO. These will not improve labour productivity; and may even heighten the tendency of key staff to switch jobs on a regular basis.
Boards are liable for, but rarely active in controlling, the actions of their CEOs as long as profits continue to rise. Even if this rise is at the expense of staffing levels, boards continue to reward CEOs for doing their job in a forceful manner.
Excellent post! The most frustrating story among all these return to office mandates is that of Starbucks CEO, Brian Niccol, who responded to the backlash that arose after his employees found out he was still working from home despite the return to office mandate by commuting from his home in Newport Beach, California to Seattle, Washington several times a week...by private jet....
The usual Aussie whingeing in the comments, I see, and anything to bludge a bit more. Oh yes - and the usual gripes about the bosses. Aussies don't change. I worked in the public service in the eighties and the organisation could have functioned better with half the employees. So many on the pay roll, so many contributing nothing - the sort of employees that needed close management if one was to get any output from them at all. "Working" from home would be paid holiday for these guys and gals. There was a John Quiggin working there at the time - an original thinker and one of the workers. I assume you are not him but perhaps his son?
Yes - BAE which changed to ABARE while I was there.. We never worked together. I was in Policy & Projects to start with as a fresh-eyed Pom, then put in charge of Fisheries by Andy. That was indeed a slog getting them to work, a problem only solved by engineering the departure of 90 per cent of them and bringing in new blood.
Well, I meant that everything was new to me. I was not exaggerating about the work ethic, although I cannot say it was unique to Oz. More of a public sector thing which I had experienced to some extent in the UK. Yes, the 80s were some time ago, but I doubt the public sector has changed. It hasn't in the UK. Though I left Oz n the 90s, I left behind close relatives so am still following the country's social and political development.
My view on the idea of a 'work ethic' is that's it's largely ideological. When I worked in a factory the 'work ethic' was probably higher than the white collar world that's been the past 30 years because the oversight and measure regimes are completely different. So work ethic isn't inherent, it's constructed.
Disagree completely. It's about character. There are those that bludge and try to do as little as possible for their wages/salary and those that try to give value for money, to return the trust put in them by the employer. The public sector generally has a poor work ethic, partly because there are few sanctions against it, and poor examples all around one, so even conscientious workers can get seduced into thinking there is little point in going the extra mile. I have found no difference in different types of job - and I have had over thirty.
As I see it, "superstar" CEOs like Elon Musk and Jeff Bezos are borderline sociopaths who exploit their workers mercilessly and take credit for things done by others. Not sure about Bezos, but Musk has also massively benefited from public funds. I'm sure I'd be richer than I am now if I treated other people as expendable pawns and got millions in government subsidies.
Perhaps a right to work from home (at least for large corporations) should be enshrined in the Fair Work Act, with the onus on the employer to present a business case for why it should be disallowed. The Fair Work Commission could then settle any disputes about the bona fides of the business case.
I agree with you on CEOs but I don't think politicians are overpaid. Also, if you don't pay them well, you just create a huge incentive for corruption.
Dell workers ignore return-to-office mandate https://www.thestreet.com/employment/dell-workers-make-risky-move-to-dodge-return-to-office-mandate
And soon enough shareholders and investors will be pondering whether the stratospheric salaries paid to CEOs are commensurate with the vaguely defined value they add to the enterprise. And also compare the modest salaries paid to CEOs in the EU with those of the so-called high-flyers elsewhere.
It’d result in no change, everyone at the top end is scratching each others backs.
Most annoying for me is the old argument that they need to compete internationally for CEOs etc. I can’t recall the last time an Australian CEO was head hunted to leave here.
QF is profitable because it has a stranglehold on the market; intrastate & interstate, not because of senior management.
Many (most?) firms have seen no reduction in productivity during high WFH. What is most telling is that executives never asked why. Nor do I hear executives discuss how to better manage workers at home, to make sure they aren't goofing off. Instead, they only demand a return to an office that has become more crowded than pre-Covid, often with mere hoteling space. My guess is that staff goofing off at home is no worse for productivity than meetings whose real purpose is to reinforce vanity and hierarchy.
But here's a dirty secret: managers undermine executives by encouraging staff to not return to the office, because if the line staff did return then the managers would also have to come back.
Yes, middle managers are workers in some respects, bosses in others
We're hearing the same half-baked "get back to the office" calls here too:
https://www.rnz.co.nz/news/political/529256/the-week-in-politics-the-ups-and-downs-of-working-from-home
CEOs rely on acceptance of their power over staff. The sources of that power may be referral or even expert. This is where, over a long period of time, a CEO earns respect and wins acceptance. Many higher management structures, especially flattened ones, generate CEOs in this manner. This is especially true of elaborately transformed manufacturing firms, where some knowledge of the intricate production process is mandatory.
But there are other businesses where boards prefer a CEO whose power source comes only from them. This is especially true when downsizing of staff is occurring. I remember the “hatchet” CEOs of the 1990s who made their bonuses on the speed of their retrenchments.
The coercive power driven CEO has little or no regard for other employees. Even other higher management peers are seen, not as allies but, as threats. Staffing is then merely a reflection of the CEO’s ego and not the optimal level for maximum efficiency - an economics textbook ideal if there ever was one.
Coercive CEOs must have their staff under their thumb. That means they all must be in workplace locations they can manipulate. Little thought is given to the difficulties of peak hour traffic and/or the family commitments of their staff. This then affects the labour productivity at both a marginal and absolute level. Both tend to stagnate at best, but may also fall.
It could be said that the falling labour productivity, for the period from 1999 to 2019, may be partly explained by the insensitive employment practices mandated by many CEOs. It certainly is an observable trend that ever since CEOs began getting excessive performance bonuses, their concern for staff satisfaction may have diminished.
Return to work edicts are typical of the behaviour seen from coercive power based CEO. These will not improve labour productivity; and may even heighten the tendency of key staff to switch jobs on a regular basis.
Boards are liable for, but rarely active in controlling, the actions of their CEOs as long as profits continue to rise. Even if this rise is at the expense of staffing levels, boards continue to reward CEOs for doing their job in a forceful manner.
Excellent post! The most frustrating story among all these return to office mandates is that of Starbucks CEO, Brian Niccol, who responded to the backlash that arose after his employees found out he was still working from home despite the return to office mandate by commuting from his home in Newport Beach, California to Seattle, Washington several times a week...by private jet....
https://www.thestreet.com/employment/starbucks-ceo-employees-return-office
Do as I say ...
The usual Aussie whingeing in the comments, I see, and anything to bludge a bit more. Oh yes - and the usual gripes about the bosses. Aussies don't change. I worked in the public service in the eighties and the organisation could have functioned better with half the employees. So many on the pay roll, so many contributing nothing - the sort of employees that needed close management if one was to get any output from them at all. "Working" from home would be paid holiday for these guys and gals. There was a John Quiggin working there at the time - an original thinker and one of the workers. I assume you are not him but perhaps his son?
I worked in what was then BAE for most of the 1980s. Your name is familiar, but it was a long time ago.
Yes - BAE which changed to ABARE while I was there.. We never worked together. I was in Policy & Projects to start with as a fresh-eyed Pom, then put in charge of Fisheries by Andy. That was indeed a slog getting them to work, a problem only solved by engineering the departure of 90 per cent of them and bringing in new blood.
' a fresh-eyed Pom'
Could be a bit of chip on the shoulder here. Also, the 1980s were a long time ago.
Well, I meant that everything was new to me. I was not exaggerating about the work ethic, although I cannot say it was unique to Oz. More of a public sector thing which I had experienced to some extent in the UK. Yes, the 80s were some time ago, but I doubt the public sector has changed. It hasn't in the UK. Though I left Oz n the 90s, I left behind close relatives so am still following the country's social and political development.
My view on the idea of a 'work ethic' is that's it's largely ideological. When I worked in a factory the 'work ethic' was probably higher than the white collar world that's been the past 30 years because the oversight and measure regimes are completely different. So work ethic isn't inherent, it's constructed.
Disagree completely. It's about character. There are those that bludge and try to do as little as possible for their wages/salary and those that try to give value for money, to return the trust put in them by the employer. The public sector generally has a poor work ethic, partly because there are few sanctions against it, and poor examples all around one, so even conscientious workers can get seduced into thinking there is little point in going the extra mile. I have found no difference in different types of job - and I have had over thirty.
As I see it, "superstar" CEOs like Elon Musk and Jeff Bezos are borderline sociopaths who exploit their workers mercilessly and take credit for things done by others. Not sure about Bezos, but Musk has also massively benefited from public funds. I'm sure I'd be richer than I am now if I treated other people as expendable pawns and got millions in government subsidies.
Perhaps a right to work from home (at least for large corporations) should be enshrined in the Fair Work Act, with the onus on the employer to present a business case for why it should be disallowed. The Fair Work Commission could then settle any disputes about the bona fides of the business case.
Why wouldn't CEOs want workers who are happier and more productive through working from home?
Two questions: why do CEOs still receive bonuses when they stuff up?
: why are Australian PMs and parliamentarians paid more than those of other nation states?
I agree with you on CEOs but I don't think politicians are overpaid. Also, if you don't pay them well, you just create a huge incentive for corruption.
Because like a lot of the powerful in Australia they are very greedy.