August 14 2006 by Chief Executive
Where Will Engineers of the Future Come From?
Pradeep Khosla’s article, “Keeping U.S. Leadership in Engineering” (“Thought Leader,” April/May), attempts to make light of the fact that the U.S. is suffering from a very serious decline in engineering enrollees and engineering graduates from our colleges and universities. The
Today, while the caliber of the graduate engineer may still represent yesterday’s graduate, the numbers simply do not support the argument that the
A delineation of the “10 Top Jobs in the
Students choosing a course of study are at least in part influenced by the marketplace and the likelihood of securing a position upon graduation. The reason for the decline in the number of people choosing to study engineering is simply that there are not as many opportunities for engineering graduates in the
Mr. Khosla admonishes the student “to think globally.” (Doesn’t this statement prove my point?) He goes on to say that the
But the opportunities simply are not in this country. It is further alleged that by the year 2010 (less than four years from now), only 10 percent of the work-hours will be in the
The facts are, as Mr. John Naisbitt predicts in his best seller Megatrends, that the
In the interim, lawmakers and chief executives continue to support such policies as NAFTA,
Robert A. Kegel, P.E.
White-Collar Witch Hunt or Failure of Nerve
You can assert that Sarbox is less than perfect and that it was passed in haste. But you know quite well if the legislative process had been more drawn out, the eventual result would have been some toothless clauses that would have allowed the thieves to continue their actions. The hordes of lobbyists within the beltway would have seen to it-and been well paid by the thieves.
Your quoting Hank Greenberg is ludicrous. Why should anyone believe his undocumented assertions? I cannot wait to vote for Eliot Spitzer for governor. Can you name one other public official with the guts to go against the largest investment banks for phony research and win? Or do you have some “free market logic” to support the pressure by investment bankers on researchers to issue “feel-good reports”?
As for Alan Hevesi, I hope he stays in
Assume for a moment that a relative of yours beseeched you to invest his or her funds in “small companies.” Wouldn’t they be a tad more confident investing in companies with capitalizations of $75 million and above instead of investing in those companies with capitalizations of less than $75 million, in which the same old nonsense could well be taking place? If not, your relative would be well advised to go elsewhere.
If today’s capitalists prefer
I’d be curious to hear your opinion as to what actions should be taken with respect to executives who, mirabile dictu, managed to be granted options at several successive bottoms for their company’s stock. Or would investigations on the part of public officials constitute interference in the free market? Nothing could be finer than for officials to round up the evidence and then arrest the miscreants while they are in the midst of a very important social event at their country clubs. The more members who see them led out in handcuffs, the better. Prima facie case, anyone?
Interestingly, the hastily passed Sarbox Act appears to have snuffed out that practice by requiring far more prompt reporting. Would you call the requirement for more expeditious reporting to be “interference in the free market for information”?
Daniel P. Doyle,
Former Treasurer and Chief
National Consumer Marketing
P.S. What do you say that you and I obtain the prison photos of the various executives serving time and publish them as a book? We could research their backgrounds so as to be able to name their prep schools, their graduate schools, their country clubs and all their affiliations in bios under each photo. Every institution should get its place in the sun. The patterns that we see will be fascinating, don’t you think?
The interesting thing about Sarbox is that most of the provisions in it were already in place, so say many CFO friends and associates of mine. What was missing was enforcement. I think that people in responsible positions who have compensated appreciably for that responsibility should fear the negative side of their performance as they should benefit from the positive. Their compensation should not be based solely on market performance as it has become today. A good portion of it should, but some of it needs to be held over the head of each executive for how he/she performs and how they generate the numbers.
As a senior executive with years of experience in both Fortune 100 arenas and also small, entrepreneurial enterprises, I have seen corruption that, due to lack of enforcement, has been allowed to flourish and be reflected in the numbers-or should I say buried? Who pays the price? Shareholders and employees, 99 percent of the time. Why has there been a large departure from the CFO ranks? They don’t want the responsibility or, more importantly, the accountability. But they sure wanted the compensation.
Executives should think about how they can run a business within the rules and please the shareholders and employees and make a buck. If they cannot do all three, they should not aspire to such positions of accountability.
The increase in whining about that legislation is deafening. It is not perfect, but it is better than what was there and not being enforced.
William F. Holbrook
Eagle Wing Strategies
In an “ideal world” there would be no need for laws, rules and regulations. But no one is living in such a place. Therefore, there is a need to keep a level playing field with regulations, etc., so that all may compete and succeed based on skills, product quality and efficiency.
What is also needed is for every CEO to have a moral compass, a sense of right and wrong in a business setting. This can, and in most cases does, come from a religious background. But it does not have to.
A CEO should have a list of rules/ commandments by which he lives his personal life and conducts his daily business affairs. These principles should be the same at work as they are at home. They should be such that every person sees him as fair, honest, trustworthy and a man of his word.
Next, these principles should be reflected throughout the organization. So that when hard decisions are made, the company knows that the decisions are in the best interest of the company first, then the stockholder and, by no means last, the rank-and-file employees.
There needs to be a lessening of the discrepancies in compensation between the top tier of management and the rest of the organization. It needs to be more of a partnership, with the CEO leading the way and setting the moral course.
Once the high ground is reclaimed, CEOs should become the leaders of the country by setting moral examples, then demanding of our political leaders nothing less than what our business leaders are providing.
Successful business leaders are ones that are helping to create the society in which we will want to live and raise our families and grandchildren.
There is definitely a failure of nerve among large corporate CEOs to stand up to this witch hunt. Another example is in the securities industry-the Putnam market timing issue. Market timing is not illegal, never has been illegal, yet how many billions has Mr. Spitzer gotten out of the fund companies? How many cases have actually been brought to trial and won by Mr. Spitzer and Mr. Galvin on this? As far as I know, the only cases that have gone to trial have been won by the defendants.
Giving these regulators the benefit of the doubt, let’s assume the crime in question is as heinous as they say. In Putnam’s case, four bad apples and something like $700,000 in trades started the issue. The fallout from the regulators ended up costing shareholders over $2 billion, not to mention costing 2,000 people never accused of any wrongdoing their jobs. Mr. Spitzer claimed that one problem with the market timing situation was that large billionaire investors were getting a better deal than small investors. Yet state pension funds are notorious for using their billions for exactly the same thing, including specially negotiated mutual fund pricing.
There is a double standard and a witch hunt with SOX and with securities industry compliance, as well as other industries. Litigation has become less of a way to protect the small investor and more of a way to build political name recognition and boost the budgets of the regulators. People can’t say these things in public because they are viewed as somehow in cooperation with the accused. The best bet for a CEO, particularly of a public company, is to simply roll over, play dead, pay the hundreds of millions in fines (rather than twice that in legal defense costs) and hope that they can spin PR to come out ahead.
Bruce C. Fenton