@WAB,
@VertigoBE,
@Red Leg,
First, I never said shareholders should not have a say in the company they own part of, quite the opposite if you go back to my post you see that. In my opinion however shareholders do not run a company, a CEO does and so does his executive team. When the CEO and his team are however so motivated by short term stock price, so they will manage.
Now perhaps I've spoken little too broadly. I can speak most intelligently to my own direct experience. And this is what I've observed where I'm employed. I'm not inclined to reveal much about that as I still need a job for a bit.
One of the reactionary triggers CEOs so often like to pull when their so well laid out plans is failing to live up to its promises is to cut costs of course. Cutting costs in and of itself is not a bad thing. One should always be monitoring costs in a business. in my world the success of my company however is predicated on a product pipeline and a steady cadence of introducing new and better products into the market. And it takes time (years) in order for that to happen.
When you start cutting costs, i.e. taking away funding from R&D you are mortgaging your future for the hear and now. You may justify it for any reason you wish, however in the end you never cost cut your way to prosperity. You may cost cut your way to improve profits, but alone you never improve sales that way.
We can go back and forth on this, but I've lived this at my current company, including under the current leadership. Our CEO has been in place for quite awhile now. So if the thing is that the bottom line is the bottom line, all I can say is our stock price is a fraction of what it was at the start of this regime. And this is at a time with the market sitting at or near all time highs. Could be for any number reasons other than what I'm saying. But it seems I'm not the only one with such observations.
Ask the folks over at Boeing. They may never recover. If they do, it'll take years. And just how did they get to this point?
The combination of a misaligned merger, a lack of in-house skills and experience to run a global network, and other major factors compromised the future of the once-great company, Yves Doz and Keeley Wilson write.
www.euronews.com
Boeing arrives at this crossroads in the wake of two crashes within five months, in late 2018 and early 2019, of its best-selling 737 MAX jetliner that took the lives of 346 passengers.
www.forbes.com