Some Fudged Numbers

[2022 Commentary] In this entry, I seem to be getting a sense of things being out of balance in my life, and in the world, and there was a feeling of my trajectory being in parallel to the world at large, and the corporate world in particular. I had a beef with corporate management, with standard business practices. In later years, I would begin to recognize my motivations going all the way back to the Anderson experience, and the response of a powerful institution - the University of Michigan - to the complains of hundreds of students with something critical to report. Nortel acted like all other powerful institutions. It tolerated unethical practices as long as the numbers were made, and the can could be kicked down the road, hopefully far enough that the main instigators could move on to another company, or perhaps retire altogether. I had friends during these years, both at Nortel and in the companies that followed, that would agree there was some shady stuff going on. But for the most part people always seemed exhilarated at this game of chicken and its ethical and legal undertones. Perhaps this is the most plausible reason why these things happen in the first place. ]

The 1990s saw an incredibly vibrant expansion of the economy, resulting from the de-regulation and tax policies of the Reagan-Bush years. It gave rise to the Information Economy, also known as the "Dot Com Bubble". Internet companies, both hardware and software, appeared from out of nowhere, enjoyed wild growth that benefited investors and consumers alike. But all expanding bubbles finally burst. Or do they? Is it possible for a speculative economy to continue in growth, indefinitely? Can things be done to shift the paradigm, thus preventing a crash and a reset to Square One? It's possible. Some friends of mine, and I, observed and commented on corrupt management practices that would lead to long-term failure. But again . . . average people are not listened to when they point out bad practices. They are punished, and silenced. We always expected more from the idealistic Baby Boomers, to whom the torch of leadership had been passed, in 1992.

I completed my third rotation in the MLDP, in June of 1991. I did not plan to stay in Atlanta (I didn't want to stay there). But in the same building in Norcross, same floor, but in a separate wing, I was offered a position to stay in the Transmission Division, doing more Sales Operations work, reporting to a Director of Strategic Sales, a guy named John Barber. John was nearing retirement, as were several others in our group. It was a very relaxed environment. I kept crunching the numbers, interfacing with Accounting and Sales, and creating reports for senior management. I was always asked to handle things like the annual United Way Campaign, and the division's mandatory training in things like The Seven Habits and Total Quality Management.

We were under pressure to hit our targets, to keep the investors interested. The first year that I was there, we enjoyed a very strong year in sales. Not so the following year, 1992. As we entered the month of December, we were way off on our total projections for the year. The Division had never missed it's annual revenue targets. It was the beginning of the weakening of the bubble.

But, the unsound management practices I alluded to, were the kind of thing to push the economy over the edge.

It was the week before Christmas. The company closed during the week between Christmas and New Year's Day. This meant that the Sales function would have to continue working all day on the 24th. They would have to work long hours for the next week. This did not affect me . . . I could not do my work until the sales came in, and Senior Management would not meet until the new year, anyway. I could drive home to Michigan for the week.

On the 24th, John announced that they had extended the closing of the fiscal year, to some date in the middle of January, something like the 15th. We would have two extra weeks. Our division was short its sales budget for the year, by about five million dollars.

I went to Michigan, returned to Atlanta. For the first two weeks of the year, our entire Atlanta Transmission group was engrossed in making up the difference. Finally, at 5pm of the last day of the extended fiscal year, John told us that we had our sale. In a meeting somewhere in Alaska, a team of some of our executives, Sales professionals, and engineers were meeting in a bar, to close the deal on a sale. A representative of Alaska Telecom wrote out a Purchase Order, literally, on a bar napkin, for $5 Million dollars of new transmission equipment.

I said to John "So we've got a non-executable contract which we are going to declare as revenue for the company, for last year. Meanwhile, we will start out this year in a five million dollar hole?" He smiled, shook his head and said "Yeah I know. I've played this game before. It is what it is."

But many of the other 30-something year old middle managers and I would talk about it around the water cooler. "They shouldn't be able to do this." Words like "unethical" were bandied about, and worse. In 1993, nobody used the word "unsustainable," but that's what it was.

Through my MBA, and into my corporate career, I had entertained thoughts that I may be in a position like this, one day, and would be bold and courageous enough to make a stand. I would appeal to senior management. Wasn't "ethics" one of the new buzzwords? Hadn't we all been told that the future belonged to creative, and ethical business professionals?

This time, at least, I kept my mouth shut, but it's certain word got around that I had been talking about it, in private.

Within years, the dot-com crash devastated the portfolios of so many investors. Businesses folded, and people lost their jobs. During the next ten years, Nortel would begin selling off divisions, closing plants, and by 2015, it would be defunct.

Our Alaska Telecom purchase order, of course, is not what caused the failure of Nortel. It takes uncountable decisions throughout an organization, to make that happen. But it's a sure bet: organizations, companies, communities, and countries, that do not give people the freedom to vent, to critique, to suggest, are just asking for trouble.

Experiences like mine, in Sales Operations at Nortel in the early 1990s, are the ingredients that, aggregated over a generation, erupted into the social unrest of 2020.

You've got to listen to people, and treat all of them with respect and dignity.

Next: Do What You're Told