Slack in the company.

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When CEO Marissa Mayer decided to cancel work from home for the employees of Yahoo!, the news was first met by a wave of protests, but soon she found supporters. The protest was voiced by feminists, publicists, remote workers and last but not least by executives from companies selling collaborative software for remote workers. The decision was, however, not intended to be a political one but aimed at solving the problems of one specific company, Yahoo!. Yahoo! is a former darling of the internet industry, the name and the exclamation mark in it express the positive spirit of pioneering internet entrepreneurs. In fact, the company was known for its search engine, technological zeal and its humorous note with regard to the content of the portal and its self-presentation. The humor is long gone. Yahoo! missed the trend away from portals, lost out against Google in the battle of the search engines, never established itself as a media venture and in the end no convincing business model was left. Consequently, the stock tanked and the company lost 35% of its revenue in the last five years. CEOs were exchanged in fast pace. Marissa Mayer is now the fifth CEO in four years called upon to solve the existing problems and turn the company around by focusing it. To find out on what is the most complicated aspect of her job.
She came from Google, is a geek with excellent programming skills and an iron work-ethic. The corporate culture of Yahoo! most likely first surprised and later shocked her. She looked at empty parking places in front of its headquarters, and as some media report, through the companies’ logfiles indicating that many remote workers worked on private projects. Her call back to the offices was nothing else than a call of “all hands on deck” for the employees of a struggling company. Having lost ground with customers and trust in an ever-changing leadership, many of them seemed to have turned their back already. The sails of the boat slackened.
Slack is fairly common in companies with problems. Some months ago, new incoming leadership at J.C. Penny, a US retailer deeply bruised from the battle between brick-and-mortar stores and internet retailers, discovered by an analysis of logfiles that about 5,000 staff employed at its headquarters had retrieved 5,000,000 YouTube videos in just one month. On average every employee watched about 50 hours assuming a length of 3 minutes per video.
Summarizing data over a variety of customers, a software producer for log file analysis presented last year its “latest beautiful” info-graphic. By a classification of the applications used, the time spent on the internet was divided into three classes, productive, unproductive, and neutral. Unproductive applications like Twitter, Facebook and Youtube accounted for about an hour a day, productive ones for about five hours, and neutral ones such as search for an hour.
How accurate such time budgets reflect working activities is difficult to assess. There are a lot of educational videos on YouTube and watching a music video can be a good idea as a short break in between work. The concept of “working time” is over a hundred years old and does not fit many professions and work activities anymore. The more complex, creative, and reflective an activity is, the less time seems to be an accurate unit to measure achievement. Unfortunately, many activities also do not qualify for a results oriented assessment. A “good idea” like the Walkman or the iPod can carry a company for many years, but one cannot expect an engineer in R&D to come up with such a good idea every month. As much as we like success to be systematic and thereby foreseeable and controllable, externalities and good luck play a major role in corporate life.
Slack in the company frequently begins as bad luck for the company. A change in the wind is missed or due to broader economical developments, there is just no wind, and the ship sails slowly. Of course, setting the right course and avoiding doldrums is the job of the captain. Especially in big companies, size is regarded as a comforting security. With little to do on deck, the hands retire to their bunks waiting for better weather or a more capable captain. Less work means more time to fill. Leisure activities which have previously been recreational begin to dominate the day. In the comfort of the still big and floating ship it is barely noticed when supplies begin to run short, and due to a lack of maintenance vital parts of the ship’s gears begin to rot. This slow decline, the motivational shift, the setting sight on weather and the captain makes slack so dangerous. While in a storm everybody would run on deck and fight for the preservation of the ship, a slacking ship offers delusionary safety and an often welcomed rest from the hard work before.
Ship’s captains from centuries ago were aware of the danger that slumps in the wind may lead to slack on board. Often rigorous exercises, cleaning procedures and trainings were employed to keep the crew going through otherwise idle days and staying prepared for the better times to come. Also today there are organizations from firefighters to the military which fortunately spend much more time preparing than actually doing their job. However, the captains of most modern corporate ships are as unprepared for a slump as their crews.
Consequently, the captain is exchanged and the new one is at least for some time greeted with hope. However, he or she will do both, focus on a new course and on the crew. Since the problem of the expenses connected to an overstaffed crew can be solved easier and faster than setting the new course, layoffs regularly precede a new beginning. They will, however, create uncertainty and increased interest in the job market also for those spared.
To get their companies going, the new CEOs of Yahoo! and J.C. Penny will first of all need a business concept which is convincing in its formulation and translates into results fast. Busyness in close cooperation is the best way to overcome slack, but, as the reaction to Marissa Mayer’s decision with regard to remote workers demonstrated, it is not easy to convince staff that creativity and the development of a new esprit de corps require local proximity. Especially when, as is the case with Yahoo!, a new business model affecting the company as a whole has to be implemented, many professional roles will be reconsidered. If successful, such a turnaround will be beneficial to all and offer unexpected possibilities of professional development for many.
It is remarkable that incoming CEOs are viewed in such situations as new captains with messianic abilities. As fitting as the picturesque ship metaphor may appear on first sight, in the age of professionalism, participative leadership, and teamwork it is also an anachronism. The focused sight on the captain indicates a readiness to accept a hopefully stabilizing authority in times of uncertainty. Historically, however, many ships survived the demise of their captains. A good organization does not depend on one person but instead prepares for turbulences. The new captains at Yahoo! and J.C. Penny are not to be envied.