Two cautionary tales appeared side-by-side in today’s Wall Street Journal, one for the rich one percent, the other for the poor working stiff. First the news for the boss:
The Era of Overconfident CEOs Is Ending
“Strong-headed managers who rarely admit mistakes are struggling in an era of flat organizations, greater transparency” says the headline. This is surely good news. The stereotype of our financial leaders in this and the last century as Gordon Gecko or the Wolf of Wall Street (see photos above and below) and the hedge fund manager who told us he recruited his traders from the football backfield have seemed to us to reveal the problem with American business, not its proud solution. Let us hope that this article heralds a turning away for America from the previous winner-take-all era.
“Was all this legal? Absolutely not.”
By JOANN S. LUBLIN, March 7, 2017 for the Wall Street Journal
. . . Executives cannot succeed without self-confidence, but too much can be a career killer. Strong-headed senior managers who exaggerate their abilities and struggle to admit mistakes may find themselves on the outs in an era of flat organizations and greater transparency, recruiters and leadership experts say.
“Companies have become so complex that they increasingly prefer executives who are open, inclusive and collaborative rather than overconfident,” said Stuart S. Crandell, senior vice president of Korn Ferry Institute, the research arm of recruiters Korn/Ferry International .
Before recent corporate scandals, “overconfidence would not typically derail a CEO,” he said.
Companies that failed during those scandals, such as Enron and Lehman Brothers, were led by overconfident executives, says Don A. Moore, a professor at University of California-Berkeley’s Haas School of Business. Mr. Moore has published 26 research papers on overconfidence.
Often hailed as charismatic innovators at first, overly confident bosses tend to pursue destructive acquisitions or get forced out, researchers have found. “They take too many risks,” Mr. Moore says.
Top executives are especially susceptible because they “attribute their success to their own brilliance and neglect the role of circumstance or good fortune,” he continues. . . .
The bravado that helps senior managers in early stretch assignments may not suit a higher-level role.
“Effective leaders use a quieter confidence,’’ observes Duane Petersen, a top manager at Walsh Construction Co.
* * *
Who’s to Blame for the Trucker Shortage?
So much for the 1 percent. What’s new for the working man? This warning is for the truck driver, a job skill that has traditionally served many generations of men who didn’t go to college as a profession of which they could be proud. No longer.
By LAUREN WEBER, March 7, 2017 for the Wall Street Journal
. . . [U]pward of 25% of long-haul truck drivers are independent contractors, also known as owner-operators. They are attracted by promises of being their own bosses, but the arrangement often saddles them with unsustainable debt and high expenses, he adds.
Drivers typically receive training from big trucking companies or schools affiliated with them. Those who become independent contractors sign lease-to-own deals to purchase their vehicles, often with those same companies. But the terms are onerous, and drivers owe so much that they may end up working 70 or 80 hours a week just to pay back what they owe and cover expenses such as fuel and insurance. Drivers are suing some companies that use this model, saying they should be classified as employees rather than contractors.
Even those working as employees have a hard time making ends meet, partly because they are only paid for the miles they drive, not time waiting to load and unload their rigs or sitting in traffic. Mr. Viscelli recounts a 16-hour day spent crawling through traffic in the New York area, only to get stuck at a New Jersey rail yard for the night. That day he drove 215 miles and earned $56.
The result of these conditions? Drivers burn out quickly and quit.
The industry could fix its labor shortage, Mr. Viscelli says, by raising pay enough to compensate for the hardships of the job or improving the terms for independent contractors. In 2015, heavy and tractor-trailer truck drivers earned a median wage of $40,260, according to the Bureau of Labor Statistics. Mr. Viscelli says that number masks the reality that most drivers work far more than 40 hours a week to get to that income. . . .
Hanging over any discussion of the truck industry’s future is the specter of automation. Driverless vehicles will lead to significant job loss, says Mr. Viscelli, “but it’s further out in the future than most people think,” partly because of the web of local, state and federal regulations that guide trucking.