The arrogance of power: CEOs we don’t need

It can’t be repeated too often. CEOs earn their X60 or (much) more of an average worker’s pay by holding up the business structure, not by ruling it. They’re not Masters of the Universe, enthroned on top; they’re on the bottom, the pressure point, the place where the buck truly stops. That includes listening as well as speaking. The other side of the reward coin: responsibility.

 This is a true Silicon Valley technology tale but if technology bores you click to your next worthwhile project. I regret that I have something of a Silicon Valley mindset.

Several years ago a billionaire entrepreneur, who had scored with a pioneering computer product, started a new company to make work-stations. The hardware was brilliant: a clever design, using undeniably advanced technology. Such innovations arrive in Silicon Valley weekly.

 A consultant, granted an audience with the Insanely Great Billionaire (insanely great? yes—just ask him), suggested that the company give a hundred, fully-optioned systems to selected, leading organizations in principal areas of use worldwide—microchip design, architecture, mechanical engineering, medical technology, and so forth—then pay royalties for the software applications those outfits developed in their industries.

“Why bother? We’ve got the world’s finest hardware,” said the insanely great man. “Yes,” responded the consultant, “but that’s this week, in one of the world’s most competitive arenas. You need applications software to make the systems useful, to survive and grow,” responded the consultant, before being ejected as an ignorant fool. The workstation company? Gone, vanished, poof. No apps. Tens of investors’ millions gone.

Another huge technology company, run by another Fabulous and Powerful Billionaire (ask him how fabulous and powerful; no need, actually—he will tell you) pioneered a scientific and engineering computer-programming language that became, deservedly, a global success. Sadly, the fabulous and powerful man had made a career out of doing things sane CEOs avoid: making overweening technical claims whose outcome was iffy, predicting future financial results, denigrating his competition, facing off the Press, spinning or denying problems, trashing departed executives—you know the long, sad list of idiocies. He never failed to hit them, all of them, often.

A consultant suggested that the company donate “The World Xxxx Prize in ——–” for creating Xxxx applications in key areas where the programming language was vital (aerospace, architecture, automotive, CAD-CAM, FEM/FEA, semiconductor design, etc.), then award the Prize—with the company name on it—at the leading annual or bi-annual world event in the field, for example, the aerospace prize at the Paris Air Show. This was a unique, ground-breaking concept that had never been tried this way. Remember, the company was, literally, a world leader in Xxxx.

The proposal? Flicked off. The company floundered, went through years of declining sales and big losses, returned to profitability briefly under new management, then sank back into technology’s primordial ooze, now ripe for acquisition.

If you see a pattern here, you are not psychic.

Today, in the early 21^st century, we see a long list of arrogant, powerful and grotesquely overpaid CEOs we don’t need—on Wall Street, in banking, in the auto industry . . . everywhere. In many cases their accumulated losses, now exposed, exceed all the profit they ever reported. Their corporate con game worked brilliantly. But they’re laughing all the way to the bank—you know, that Swiss bank, or Cayman Island or Isle of Man account where they doubtless stashed their ill-gotten gains before they were found out.

Greedy, self-important? Yes. Stupid? Hardly.

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