Beer Bails Out

[FWAAA]

That's crap! Let's take CEO compensation! That is determined by the Board Of Directors. The Board of Directors consist of CEOs, executives and other fat cats that run other companies. And those companies that they run have a Board Of Directors who consist of CEOS, execs and other fat cats that run other companies. Do I need to continue?
EXECUTIVE COMPENSATION HAS NOTHING TO DO WITH SUPLLY AND DEMAND. IT IS THE GOOD OLD BOYS NETWORK..

Lemme see I understand this:

Executives universally try to pay their workers as little as possible, right? Constantly trying to chisel the pay of their subordinates, right?

But executives don't practice this same philosophy when it comes to other executives? If so, then why would any executive ever leave any company for more pay? Why wouldn't Arpey simply convince the board to give Beer whatever Beer demanded?

Or does this apply only to CEOs? If so, then how come some CEOs get relatively small paychecks while others get gargantuan paychecks?

The reality is that everyone in business tries to pay all of their subordinates as little as they can while keeping turnover at an acceptable level. The board pays Arpey just enought to keep him from leaving, and that trickles down - every manager similarly pays their help no more than necessary to keep attrition within acceptable levels.

 

[eolesen]

Maybe AA should star grooming from within from the lower rungs of management. That way they would have a vested interest in the company and also the knowledge of what we need vs. don't need.

AMR has done that for decades. Almost all of its promotions are from within when you get to the managing director level and higher.

With the exception of IT, I can't think of a single vice president hired directly from outside of AMR in at least ten years.

The problem is that folks with a CPA, finance degree, or even just solid experience with IT, sales or product marketing have literally thousands of places they can potentially work at and apply their skills, and there's just not a lot of reason for them to stay.

And those are exactly the areas where AMR is experiencing serious turnover. The fact that AMR is still able to keep filling positions in finance and other non-airport areas is because recruiters openly advertise the fact that having AMR on your resume will allow you to be taken more seriously when you apply for your next job....

Do you realistically believe that we can't come out of this hole if we don't give more money to management?

If you want to keep the best of the best people we've got and groom them, no.

Most people outside the front lines don't stick around just because they have seniority, covered parking and pass benefits. They stick because they like what they do, want the security (?!?) of working for a large company, or because of the promotion opportunities.

The most obvious option for enticing the good people to stick around is to offer decent salaries and raises. Since raises for management have averaged 1% since 2000 (if at all), that no longer works.

Another way to keep people here are stock options and performance shares, which y'all have pissed and moaned about for the past two months. But it did keep people around for a couple years until they realize that stock options granted in 2001 at $20 and $30 weren't nearly as attractive once they vested. (Jetblue is running into that trap right now with their pilots and others, who had counted on stock prices to make up for their lower than average salaries...)

That leaves promotion opportunities. And as AA has reduced management headcount, there are simply far fewer promotion opportunities available. For every two L5 and above vacancies in various areas, perhaps one is being filled, with the remainder either being eliminated or the position being downgraded and filled by someone at a lower level.


And yes, it is supply and demand. I know some of you don't want to hear that, but when you're one of a handful of people capable of doing a job, you can easily command more money than someone who is one of a thousand people who are largely interchangeable. There's a reason quarterbacks and pitchers are paid far more than linebackers or outfielders.

I won't defend the likes of a Glenn Tilton or Jake Brace, who are clearly overpaid when it comes to how well they've done their jobs, but that's not the case with AMR. Management at all levels is already paid below the 50th percentile when compared to the Fortune 500. If you want to see AMR ever stay in the Fortune 100, they need to keep some consistency within the management team.

 

[Hopeful]

Lemme see I understand this:

Executives universally try to pay their workers as little as possible, right? Constantly trying to chisel the pay of their subordinates, right?

But executives don't practice this same philosophy when it comes to other executives? If so, then why would any executive ever leave any company for more pay? Why wouldn't Arpey simply convince the board to give Beer whatever Beer demanded?

Or does this apply only to CEOs? If so, then how come some CEOs get relatively small paychecks while others get Yargantuan paychecks?

The reality is that everyone in business tries to pay all of their subordinates as little as they can while keeping turnover at an acceptable level. The board pays Arpey just enought to keep him from leaving, and that trickles down - every manager similarly pays their help no more than necessary to keep attrition within acceptable levels.

YOU REALLY LIVE IN FANTASY LAND DON'T YOU?


Look at the concessions that were crammed down our throats!

nEXT, why are companies outsourcing more than ever?????????????

BECAUSE THEY CLAIM THEY CAN'T COMPETE WITH CHINA WHERE THE AVERAGE WAGE IS $.25 AN HOUR!

But do you see them outsource their own suit and tie jobs?


NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!


DID ANY AA EXECUTIVE TAKE THE SAME CONCESSION PACKAGE THAT THE UNION WORKER DID!

As a mechanic:

------> 17.5% PAYCUT
------> ONE WEEK VACATION LOSS
------> 5 DAYS SICK TIME ACCRUAL PER YEAR!
------> FIRST TWO DAYS SICK EACH OCCURENCE AT 50%
------> LOSS OF 5 HOLIDAYS PER YEAR
------> NO MORE DOUBLE TIME HOLIDAY PAY FOR REMAINING 5
------> NO MORE DOUBLE TIME PAY AFTER 12 HOURS

It's nearly $20,000 a year loss when all considered except sick time and IOD pay.


HOW DO YOU LIKE THEM APPLES?





SCREW THE GREEDY EXECUTIVES! IF THEY WANT TO LEAVE BECAUSE OF MONEY, LET EM! THEY HAVE NO ALLEGIANCE TO A COMPANY EXCEPT FOR HOW MUCH THEY GET PAID.


I would rather watch little league and high school kids play baseball rather than the pros because their hearts are all in the game with no money to be paid except the glory of a title and trophy.

 

[Bob Owens]

Hopeful, don't drag me into your debate about pay differential (which doesn't belong in this thread, by the way).

There are three things that I know are true:

1. We've lost 3 CFOs in the last four years.
2. They all left for sizeable pay increases.
3. They all had no opportunity to advance within this company.

I would be willing to bet that if we even paid within 30% of market for our execs and had some sort of assurance that Arpey would move within 10 years, we would be able to retain a bit more talent.

So what you are saying is that the bonuses werent needed.

Because when you have plenty of it, "money is not a motivator". Please dont forget the first part about "when you have plenty of it".

These guys dont work for the money per se, they work for the power.

So if they were given millions more they probably still would not stay, so giving them more is a waste of money.

While they may put their pants on one leg at a time like us when it comes to money we are two different species. For us money is a means for survival. Its there to put food on the table, a roof over our heads and if we are lucky something we use to give our children a better life.We work for money, if we had enough we probably would no longer show up at our jobs. To those people however, many of whom never have children, money is about power. Material issues are really not a concern because there is so much money its taken for granted. No matter how much money they have they will still want more because unlike material desires that can be satisfied with money the lust for power can not. Like "The Boss" said, "poor man wanna be rich, rich man wanna be King and a King aint satisfied till he rules everything".

One of the concessions that pretty much slid by without notice to most workers was when they made us turn over 6 uniforms. To the executives, it was an act of humiliation, a display of their power, in that they could literally take the cloths off our back without even a word of protest. To most workers however,since no direct cash loss was seen by surrendering the uniforms it was seen as minor. But to the executives it was a display of their power over us and they probably took more satisfaction out of that than concessions that actually saved the company money.

I think connected one is pretty much dead on this time. In reality his point #3 says it all.We wont lose executives because of pay, we lose them because they dont see the opportunity to move into the top spot. Why do you think all these rich people want to be President of the US? Is it the $200k a year? Pilots make more than that! Its the power and being President of the most powerful country on earth is the ultimate power trip.


Years ago executives made much less than they do today. And thats even when you take inflation into account.

But back then they actually performed better. They provided the country with an increasing living standard and the stockholders with increased equity.

They did their jobs and they didnt need millions to do it.However they sought the same thing todys executives do, the only difference is that back then more executives tried to really live up to the image of respectable businessmen, unlike the scoundrels we have today. Back then if the companies performed badly they accepted blame and sometimes the penalty. Todays executives take all the credit when things go well and blame everyone else when they dont, then they actually have the cajones to demand pay raises or they will leave!!!!! In the past they would have been fired!

My father was a chaufeur for a large chemical company. On the weekends, when he had to work, they used to allow him to bring us with him. At the time a lot of executives were paranoid that they would be the target of kidnapping so the excecs were pretty friendly with the help. One day my father was told to pick up a retired CEO and bring him to the company's new HQ. On the ride home he said " You know I really miss working, its not the money, I have more than I'll ever spend, and this might sound terrible, but I miss the power".

Thats what these people are about. They were pissed off at the fact that they were powerless to prevent workers from getting back some of what we lost over the last twenty years and 9-11 gave them the opportunity to get their revenge.And they did. It didnt hurt that they had the union in their back pocket-that $3.1 million was the best investment ever made.

Let them all leave, the sooner the better.

 

[TWAnr]

And you still miss my point that the the upper crust dictate their own market rates!

The assault on labor in this industry...

You sound just like a rabble rousing communist apparatchik preaching to the proletariat hoards in Soviet Russia during the Lenin and Stalin years.

 

[Connected1]

Maybe AA should star grooming from within from the lower rungs of management. That way they would have a vested interest in the company and also the knowledge of what we need vs. don't need. How hard can it realistically be?

Where do you think all of our CFOs have come from? That's all AA does is promote from within. We are already doing exactly what you have suggested. The problem is that you can't lose a CFO every 1.5 years and stay ahead of the game. We still have a deep bench, but it isn't what it used to be. We're fine if we can slow the flow a bit.

What is your role? How come you aren't bailing out.

My role is to take financial goals set by our executive team, turn them into reality, and keep our management/shareholders informed on the progress. I'm still here because there are still opportunities for advancement at my level of the organization.

Why would you want Arpey to bail out? He actually has the support of most of the workers at this airline behind him.

I like Arpey and I think he has done a great job. However, in my opinion, if he sticks around for 25 years, it will be at the expense of management team quality.

It is obvious that you care or you wouldn't be reading and answering posts on all these boards.

What I care most about with respect to these boards is that misinformation is not spread. Whining and moaning is fine (and many times justified), but it needs to be about the facts and not baseless speculation. I'm not saying you are speculating about anything - just clarifying my interests here.

Do you realistically believe that we can't come out of this hole if we don't give more money to management?

Your words, not mine. I spend more time thinking about 2007, 2008, and beyond. We've got the management to get out of this hole. I am concerned that we won't have it to get out of the 2nd, 3rd, and 4th holes that await us down the road.

 

[Bob Owens]

Where do you think all of our CFOs have come from? That's all AA does is promote from within. We are already doing exactly what you have suggested. The problem is that you can't lose a CFO every 1.5 years and stay ahead of the game. We still have a deep bench, but it isn't what it used to be. We're fine if we can slow the flow a bit.

Why not? Did AA always have a CFO?

My role is to take financial goals set by our executive team, turn them into reality, and keep our management/shareholders informed on the progress. I'm still here because there are still opportunities for advancement at my level of the organization.

So in other words there is no loyalty, you are only here as long as there are advancement opportunities.A lot of us feel that we can continue to improve our productivity and gain more job satisfaction in the positions we are in without "advancement". People like you seem to think thats a bad thing, that every one of us should be scheming ways to advance.

I like Arpey and I think he has done a great job. However, in my opinion, if he sticks around for 25 years, it will be at the expense of management team quality.

Well having a long term CEO did not seem to hurt SWAs bottom line, nor did it hurt AA under C.R. Smith. Maybe you are confusing quality with greed? If these people really dont like their jobs, which they must not if they are so determined to "advance" out of them then maybe we are better off without them.

What I care most about with respect to these boards is that misinformation is not spread. Whining and moaning is fine (and many times justified), but it needs to be about the facts and not baseless speculation. I'm not saying you are speculating about anything - just clarifying my interests here.

Or information that does not suit your objectives.

Your words, not mine. I spend more time thinking about 2007, 2008, and beyond.

Thats a luxury most of us cant afford. We have to figure out how to pay the bills we have today.

We've got the management to get out of this hole. I am concerned that we won't have it to get out of the 2nd, 3rd, and 4th holes that await us down the road.

Most of them are the same ones that took part in steering us into "this hole".

 

[Connected1]

Why not? Did AA always have a CFO?

Losing them faster than you train them is the recipe for progressively less experienced CFOs.

So in other words there is no loyalty, you are only here as long as there are advancement opportunities. A lot of us feel that we can continue to improve our productivity and gain more job satisfaction in the positions we are in without "advancement". People like you seem to think thats a bad thing, that every one of us should be scheming ways to advance.

Bob, I left the company and went to school. I came back for below market pay. That's where loyalty plays a factor.

I want to advance because all of my experience, education, and interests demand that I make decisions on a higher level than I currently occupy. The job that I do now is not the job that I was made to do. I have to advance to get to that level. That may not be a part of your world, but it's a huge chunk of mine since I fill a chair in a company that pays below market wages.

You probably have your own motivations for doing a great job. I probably don't understand half of them. However, don't underestimate my commitment to the company.

Well having a long term CEO did not seem to hurt SWAs bottom line, nor did it hurt AA under C.R. Smith.

WN has done a lot of things right, but becoming over-dependent upon the personality of one individual is not one of them. When an entire company falls under the spell of a single person, you run the risk of people placing common sense on the shelf in favor of pleasing "Herb." See also Worldcom.

Has that happened at WN? I don't know, although having 3 executives in their early 50s leave the company is not normal. I also wonder how labor relations will end up in a post-Herb era. What will transpire when WN's P/E multiple comes out of the stratosphere and wrecks their employees' variable compensation? It just seems like so much has depended on Herb and the stage is set for a collapse of unreal proportions.

 

[Bob Owens]

Losing them faster than you train them is the recipe for progressively less experienced CFOs.

If they are experienced and worth millions of dollars why do they have to be trained? For that price shouldnt they show up ready to produce?

I'll agree that high turnover costs money, but the company does not seem to concerned about it where the money is actually generated.

Bob, I left the company and went to school. I came back for below market pay. That's where loyalty plays a factor.

Loyalty, or opportunity?

I want to advance because all of my experience, education, and interests demand that I make decisions on a higher level than I currently occupy. The job that I do now is not the job that I was made to do. I have to advance to get to that level. That may not be a part of your world, but it's a huge chunk of mine since I fill a chair in a company that pays below market wages.

Ah, someone who believes in "DESTINY".

You probably have your own motivations for doing a great job. I probably don't understand half of them. However, don't underestimate my commitment to the company.

Its actually quite simple, its challenging, fun and if they didnt screw us it would also be satisfying.

WN has done a lot of things right, but becoming over-dependent upon the personality of one individual is not one of them. When an entire company falls under the spell of a single person, you run the risk of people placing common sense on the shelf in favor of pleasing "Herb." See also Worldcom.

Fair enough, but AA had CR Smith. If he did it right then they should be OK.

Has that happened at WN? I don't know, although having 3 executives in their early 50s leave the company is not normal.

How old was Sue Oliver and Gregg Hall?

I also wonder how labor relations will end up in a post-Herb era. What will transpire when WN's P/E multiple comes out of the stratosphere and wrecks their employees' variable compensation? It just seems like so much has depended on Herb and the stage is set for a collapse of unreal proportions.

Do you mean like the collapse at AA or UAL, both of which still exist? Hey itf thats the case I'd still welcome that fate. Look at all the extra money we would make till that time comes! I may report to the same place and work on the same planes but I work a different job, one that is most definately less satisfying and rewarding. I am not alone, and I know that these conditions are not going to boost productivity, in fact I see it continuing to decline. All the doom and gloom talk will not make things better, talk of great times ahead for the company will make it worse, because we know that just like in the 90s we will only be observers of the good times. I dont need to "advance" up the corporate ladder. In the past I've recieved positive letters for going above and beyond. I could be very productive in my current capacity,certainly more than I am, all I expect is a fair wage. Until I get it I will do as I'm told to do and not what I can do.

 

[eolesen]

Yes, Bob, AA has always had a CFO, although the neutral descriptor for whoever is the head of finances is relatively new.

Even before deregulation, it's been a senior or executive VP position.

There was an article in one of the papers talking about the culture change that WN is going thru, now that Grandpa Herb isn't calling all the shots. They also had three execs resign in the past couple weeks, and like at AMR, it's probably a mixture of knowing they won't be replacing Gary Kelly anytime soon (although people probably thought the same thing about Jim Parker...), and probably a matter of not fitting into how Gary wants things to work vs. how Herb and Jim managed things.

Talking with people who work on Denton Drive, it sounds very much like how people reacted after Crandall retired. Even today, you have people here who probably cursed Bob on a daily basis while he was at the helm, but were openly praying back in 2003 for him to swoop back down into Fort Worth on a flaming silver chariot and set things right...



Bob, you say your job is less rewarding and less challenging, yet you've also made it clear that you're chained to AMR because of the seniority system.

If LUV were to open up a line maintenance station at JFK, and your seniority and retirement were portable because you finally got your life-long dream of a single union for all AMT's in the industry, would loyalty still keep you at AMR?

I doubt it. Even if the pay were the same, you'd probably be willing to leave just for the culture change and perhaps for the challenge of something new.

So don't knock it if someone else decides to move somewhere else where they're going to be challenged in ways they're not currently being challenged, whether that is inside the company or outside.

 

[NewHampshire Black Bears]

Arpey,(the Love/Hate guy).

On one hand, he's a sneaky no good SOB, who was right along side Carty, while DON was (trying) to do "the DIRTY" ! :down: :down:

On the other, he apperars to be a guy, who from an early (management) age has worked his way thru the ranks while appearing to "do it" from a 60/40 standpoint.

(IMHO, 60% loyalty, 40% $$$)

For what It's worth, I STILL can't quite figure the guy out. h34r: h34r:

I guess it "did,nt hurt" that Gerard was a BIG TIME favorite, on ("uncle") BOBBY'S list.


NH/BB's

 

[DFWCC]

Hey problem solved. Hire me as CFO. I'll work 80 hrs a week for 1 month (at standard CFO rate of pay of course).
If all the problems aren't solved, I'll retire keep my positive FC space and cash in all the stock awarded me and we can then hire NHBB as the next CFO. We'll get it right..
Hopeful are out there? Bob Owens get in line

 

[Hopeful]

Hey problem solved. Hire me as CFO. I'll work 80 hrs a week for 1 month (at standard CFO rate of pay of course).
If all the problems aren't solved, I'll retire keep my positive FC space and cash in all the stock awarded me and we can then hire NHBB as the next CFO. We'll get it right..
Hopeful are out there? Bob Owens get in line

I'm here. At the obscene wages being paid to the fat cats, anyone can do the job. You don't even need an MBA from the Wharton School of Business. All you have to do is cut tens of thousands of jobs, and slash the remaining workers' pay and benefits. And if the greedy unions don't want to cooperate, you file Chapter 11 and have a bankruptcy judge do it for you. Then after the juge does your bidding, you ask him for millions in compensation for yourself and your top crony butt lickers.

You shouldn't care about cuts in customer service and aircraft maintenance and safety in general. It is a very easy job.

Just ask Tilton at United who got 8% of UAL!

 

[Bob Owens]

Bob, you say your job is less rewarding and less challenging, yet you've also made it clear that you're chained to AMR because of the seniority system.

Well its the 24 x 7 x 365 schedule that makes seniority so important but its the other four mouths I have to consider that has me chained at the moment.

If LUV were to open up a line maintenance station at JFK, and your seniority and retirement were portable because you finally got your life-long dream of a single union for all AMT's in the industry, would loyalty still keep you at AMR?

Well actually I'd prefer ISP. I never claimed to have loyalty. In fact I've said that loyalty is something that you express towards people, not corporations.Being loyal to a corporation is like being loyal to a rock, dont expect reciprocity.

I doubt it. Even if the pay were the same, you'd probably be willing to leave just for the culture change and perhaps for the challenge of something new.

If I could take my pay and seniority with me? You bet, who wouldnt.

So don't knock it if someone else decides to move somewhere else where they're going to be challenged in ways they're not currently being challenged, whether that is inside the company or outside.

Is it for the challenge or for more money? Why shouldnt I knock those who dont hesitate to knock others?

 

[eolesen]

Why shouldnt I knock those who dont hesitate to knock others?

When my 13 year old says things like that, I usually respond "because you're better than that?"

Attitudes like that are why these boards suck so much lately. People just want to piss on each other instead of having decent conversations....