Posted 11:57 PM by Blah blah

A fool's paradise for CEOs (Salon.com):
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For those of us with experience selling complex products to corporate information systems departments, a comment made by Sun Microsystems CEO Scott McNealy in a New York Times article published Monday says reams about what's going on in corporate America today.

McNealy was discussing a new requirement that CEOs attest to the accuracy of corporate financial statements.

"I haven't convinced myself that it is in the best interest of our shareholders," McNealy told the Times. To comply fully with the requirement, he explained, would mean attending quarterly meetings to close the books, usually chaired by the chief financial officer.

"That's what I'd be doing instead of being out here on the road, talking to customers and trying to generate more business for Sun," he said.

What investors should actually read McNealy as saying is: "My job as CEO of Sun is to be the chief pitchman, to glad-hand executives at my own level and convince them that Sun products are the right 'solutions' for their corporate needs. Determining whether the solutions actually work -- or whether it's even profitable for my company to sell them (and how would I know anyway?) -- is not my primary responsibility. In fact, if they don't work, or if our accounting is misstating our long-term profitability -- well, frankly, I resent the suggestion that I ought to have any legal accountability for my ignorance."

McNealy's attitude is the culmination of the last decade's ascendant ethos for U.S. business: near worship and lavish compensation for people who "make things happen" coupled with near contempt and minimal rewards for people who "make things work."

What "happened" is exactly what could have been expected: a tidal wave of scandal, corporate reverses, meltdowns and bankruptcies -- set to a chorus of denials from the people at the top that they had the slightest idea of the accounting, organizational and product "solution" deceptions on which the appearance of success was based.

Accounting scandals aside, another huge shoe is waiting to fall for many large organizations: many of the products and services supplied by companies offering "solutions" never worked, or never worked properly....

Many a CEO, or even a CIO, would be shocked to discover, were they to inquire (or encourage their subordinates to discover), that some of their employees are manually entering data (from two quarters back) into one system from printouts produced by another. Or that some 20 people buried in the customer service department do nothing, all day, but correct errors created when salespeople (after a half day's training) enter orders into a system so complicated and cumbersome that it takes weeks to train the people in customer service and accounts receivable delegated to picking up the pieces to use it properly. Or that out in the warehouse the complicated wireless system (which took years, not months, to really get working and cost four times what was budgeted) is randomly on the fritz, and stock must be picked manually several hours a day.

During the high-flying decade of the 1990s, CEOs sold each other such systems -- they "made it happen."

But the people who attempted to install and maintain such systems shrugged their shoulders, did the best they could, put each disaster and disappointment on their résumé as product experience, and moved on to the next job. And the rank and file worked double time to make it work.