It is time to stop rewarding failure

Silicon Valley (the notion) has become very much like rest of corporate America — it has embraced the philosophy of failing upwards. I have seen many executives get bumped up the ranks, get fancier titles and bigger paychecks, even though they were disastrous at their job. Many have left destruction and dismay in their wake. And yet, there they are getting bumped up — again and again. I was reminded of this disease this morning when I read about Microsoft cutting 18,000 jobs of which 12,500 odd will be at the Nokia division. Microsoft’s board might have eased out Steve Ballmer, but man, why aren’t they thinking about Stephen Elop.

When I met him in his prior gig at Microsoft, Elop seemed to be a nice enough guy, not quite a visionary, but good enough for what was then essentially a monopoly.  The very fact that a middling executive could be brought on for a turnaround of Nokia, and compete with the iPhone/Android onslaught with absolutely zero turnaround experience was one of those decisions that has confounded me and I continue to blame the Nokia board for shooting itself in the head. On his watch, Nokia essentially eviscerated. Android might have been a better decision, but he went with Windows Mobile. The stock tanked, market share shrank and like proverbial Lord Mountbatten he was part of the last days of the Nokia Raj.

And Nokia, the once haloed and peerless brand when it came to phones was sold to Microsoft for relative pittance. Elop heads up Microsoft’s Devices Group. Think of it this way — since Elop took over as Nokia CEO, the company has  cut over 50,000 jobs (if you include today’s announcement.) That is just mind boggling. That bumbling strategy which was the hallmark of Elop’s Nokia tenure still continues — in other words, Microsoft doesn’t really have a Nokia strategy. From Elop’s memo today: “In the near term, we plan to drive Windows Phone volume by targeting the more affordable smartphone segments, which are the fastest growing segments of the market, with Lumia.” That is precisely what Nokia guys used to say — we have the low end and we can grow our share. How did that work out?

Even on that end, Microsoft is going to be embroiled involved in an expensive marketing ground war with Google’s Android One efforts in places like India. Does Microsoft want to go into battle with Google and  Amazon with Elop? I wouldn’t. But then I don’t run Microsoft either. That said, I don’t think Nokia rank-and-file should be the only ones who  get the pink slip.

Don’t get me wrong, I don’t mean to pick on Elop — though he is the latest  and most visible in a string of high-profile executives who defy gravity despite being duds. Silicon Valley needs to look at baseball or football and see how professional sports teams treat their executives and star players. If you fail — you are shown the door. Just like the players. Bobby Valentine was unceremoniously dropped by Boston Red Sox. San Diego Padres fired their general manager. The message is — big dollars means big results. What’s wrong with that — especially in this age of mega-paychecks for executives?

Update: Charles Fitzgerald who worked at Microsoft and doesn’t suffer fools has a brilliant ex-insider take on Elop:

His resume is that of a short-tenured opportunist who has left little mark on his employers except of course Nokia where he presided over the company’s collapse and ultimate exit from the mobile handset business.

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