salty justice
Registered User
found this on www.blackhawkzone.com thanks Rick10!
ABC manufactures and sells widgets (made for optimal use in cold weather situations, not the kind used in weapons of mass destruction). For many years, the widgets were a well-manufactured, high-quality product sold in regional markets. During this time, many employees of ABC were not paid well, but they worked very hard and with great pride. (Their labor representative was a dirty rotten ******* who should rot in hell for stealing money from the employees to line his pockets and those of the board of directors. Unfortunately, Beelzebub isn't sure he wants the labor rep in hell, either.)
Word of the quality and workmanship of ABC spread. Aggregate demand for the product grew, and ABC realized that they had a great opportunity to expand business in a healthy manner. (More business= happy customers and a happier company!) They brought in a new CEO, Mr. X--one who knew nothing about widgets, but he seemed to understand something about selling BLT sandwiches (so he's got that going for him, which is nice).
Mr. X started to expand to new consumer markets to sell these widgets. He sold them on a boat, he sold them with a goat. When he realized that beach resorts weren't very interested in buying widgets, he changed the name of the widgets to "thingamajiggers." The old buyers liked the name widget--it rolled of the tongue so much more nicely; besides, the name "widget" had such a wonderful meaning because a kindly two kindly old men, Mr. Widnoomer and Mr. Poudget, donated a lot of time, effort, and money to help ABC get off the ground. (Without them, ABC would likely still be only the first three letters of the Roman alphabet.)
Changing the name didn't work to draw business--thingamajigger was too, too... well, it was too "done before." Mr. X decided to try something new--build new manufacturing plants near the beach resorts. Unfortunately, the raw materials used to build the widget were finite, so he began to institute that 20% of all widgets be made of soap. (An odd choice, but Mr. X was an odd man.) Thus the quality decreased, but the quantity increased. A success right? Not so much--the soap made widgets slippery, so people who bought them were forced to clutch and grab them in their hands in order to not drop them.
At the same, the employees were able to bring in a new labor rep, Mr. Z. This one was known as a battler, one who would make every employee rich. (He was also a successful thumb wrestler, something that may seem irrelevant until you realize that Mr. X had abnormally large thumbs.) He pontificated that the employees should make as much, if not more, than the board of directors. A noble effort, indeed.
After years of battling back and forth, Mr. Z had successfully helped the employees make more than quite a few of the board of directors. They made so much that ABC went into the red (that's losing money for those of you who are color blind.) While revenues rose, employee salaries increased at stratospherically greater rate. The pendulum had swung in the employees' favor. At the same time, consumers' demand for thingamajiggers waned. The soap would melt in warmer temperatures, thus rendering them useless (except in Tampa Bay for one year, when Brad Richards and Martin St. Louis miraculously turned soap into titanium). With less people interested in buying widgets, revenues were in danger of decreasing. Thus prices rose, forcing the original buyers to pay more for a lesser product in order to maintain a short-term image of economic success. Something had to be done. Mr. X, at the behest of the board, did something drastic. The staged a lockout.
Mr. Z was furious. He implied that the board did this because they didn't care, that they only wanted to squash the employees and force them into poverty. After all, who could live on an average of $1.3 MM per? The employees would have to give up one of their mistresses and sell their homes in Cabo San Lucas, leaving them only with 3 other homes! The reality, however, was that the majority of employees were fine with where they were, but a select few would be affected by the changes being implemented. But that wouldn't be true, according to Mr. Z (and his trusted sidekick Forget-Me-Not). All of the employees will suffer immeasurable harm, because money grows on trees--the revenues will always grow at high levels, even though the biggest buyer recently said "Thanks, but no thanks."
Mr. Z's argument was that all employees should be able to make as much money as they wish, regardless of the revenue stream. Mr. X's argument was that revenue growth was slowing and would soon become very nearly stagnant, so salary levels needed to be kept under control. What neither would recognize was three major issues:
1. The rate of economic growth had already begun to suffer;
2. The decreased quality of the product (despite leading to new jobs for underskilled employees) and overexpansion of manufacturing plants around the continent contributed greatly to the waning demand for the product;
3. The end users could find a new product to replace the thingamajigger--it may or may not be as good of a product, but quite a few didn't care that much (especially in the cities in and around the beach resorts).
History will show that the employees' desire for more money is moot, since there isn't enough money to run the business and support their growing salary demands. It will also show that quality is greater than quantity, since higher quality not only sustained a successful business plan, it also led to a controllable and steady growth of business in markets that would buy such a useful product in cold weather. Because of the hubristic nature of Mr. Z and the embodiment of the Peter principle in Mr. X, ABC would be lucky to get back to business levels supported before either man was hired to their respective position.
ABC manufactures and sells widgets (made for optimal use in cold weather situations, not the kind used in weapons of mass destruction). For many years, the widgets were a well-manufactured, high-quality product sold in regional markets. During this time, many employees of ABC were not paid well, but they worked very hard and with great pride. (Their labor representative was a dirty rotten ******* who should rot in hell for stealing money from the employees to line his pockets and those of the board of directors. Unfortunately, Beelzebub isn't sure he wants the labor rep in hell, either.)
Word of the quality and workmanship of ABC spread. Aggregate demand for the product grew, and ABC realized that they had a great opportunity to expand business in a healthy manner. (More business= happy customers and a happier company!) They brought in a new CEO, Mr. X--one who knew nothing about widgets, but he seemed to understand something about selling BLT sandwiches (so he's got that going for him, which is nice).
Mr. X started to expand to new consumer markets to sell these widgets. He sold them on a boat, he sold them with a goat. When he realized that beach resorts weren't very interested in buying widgets, he changed the name of the widgets to "thingamajiggers." The old buyers liked the name widget--it rolled of the tongue so much more nicely; besides, the name "widget" had such a wonderful meaning because a kindly two kindly old men, Mr. Widnoomer and Mr. Poudget, donated a lot of time, effort, and money to help ABC get off the ground. (Without them, ABC would likely still be only the first three letters of the Roman alphabet.)
Changing the name didn't work to draw business--thingamajigger was too, too... well, it was too "done before." Mr. X decided to try something new--build new manufacturing plants near the beach resorts. Unfortunately, the raw materials used to build the widget were finite, so he began to institute that 20% of all widgets be made of soap. (An odd choice, but Mr. X was an odd man.) Thus the quality decreased, but the quantity increased. A success right? Not so much--the soap made widgets slippery, so people who bought them were forced to clutch and grab them in their hands in order to not drop them.
At the same, the employees were able to bring in a new labor rep, Mr. Z. This one was known as a battler, one who would make every employee rich. (He was also a successful thumb wrestler, something that may seem irrelevant until you realize that Mr. X had abnormally large thumbs.) He pontificated that the employees should make as much, if not more, than the board of directors. A noble effort, indeed.
After years of battling back and forth, Mr. Z had successfully helped the employees make more than quite a few of the board of directors. They made so much that ABC went into the red (that's losing money for those of you who are color blind.) While revenues rose, employee salaries increased at stratospherically greater rate. The pendulum had swung in the employees' favor. At the same time, consumers' demand for thingamajiggers waned. The soap would melt in warmer temperatures, thus rendering them useless (except in Tampa Bay for one year, when Brad Richards and Martin St. Louis miraculously turned soap into titanium). With less people interested in buying widgets, revenues were in danger of decreasing. Thus prices rose, forcing the original buyers to pay more for a lesser product in order to maintain a short-term image of economic success. Something had to be done. Mr. X, at the behest of the board, did something drastic. The staged a lockout.
Mr. Z was furious. He implied that the board did this because they didn't care, that they only wanted to squash the employees and force them into poverty. After all, who could live on an average of $1.3 MM per? The employees would have to give up one of their mistresses and sell their homes in Cabo San Lucas, leaving them only with 3 other homes! The reality, however, was that the majority of employees were fine with where they were, but a select few would be affected by the changes being implemented. But that wouldn't be true, according to Mr. Z (and his trusted sidekick Forget-Me-Not). All of the employees will suffer immeasurable harm, because money grows on trees--the revenues will always grow at high levels, even though the biggest buyer recently said "Thanks, but no thanks."
Mr. Z's argument was that all employees should be able to make as much money as they wish, regardless of the revenue stream. Mr. X's argument was that revenue growth was slowing and would soon become very nearly stagnant, so salary levels needed to be kept under control. What neither would recognize was three major issues:
1. The rate of economic growth had already begun to suffer;
2. The decreased quality of the product (despite leading to new jobs for underskilled employees) and overexpansion of manufacturing plants around the continent contributed greatly to the waning demand for the product;
3. The end users could find a new product to replace the thingamajigger--it may or may not be as good of a product, but quite a few didn't care that much (especially in the cities in and around the beach resorts).
History will show that the employees' desire for more money is moot, since there isn't enough money to run the business and support their growing salary demands. It will also show that quality is greater than quantity, since higher quality not only sustained a successful business plan, it also led to a controllable and steady growth of business in markets that would buy such a useful product in cold weather. Because of the hubristic nature of Mr. Z and the embodiment of the Peter principle in Mr. X, ABC would be lucky to get back to business levels supported before either man was hired to their respective position.