It is time to stop rewarding failure

35 thoughts on “It is time to stop rewarding failure”

  1. I can’t help but wonder what would have happened if Nokia had promoted Vanjoki up instead of hiring on Elop.

  2. I doubt you’re going to see top executives push for the kind of analytics-based decision making that will decide their job status & pay. As Upton Sinclair said “It is difficult to get a man to understand something, when his salary depends upon his not understanding it!”

  3. Not defending Elop, but this is not a case of a ‘lone gunman’. The Nokia board and higher ups had to know what they were doing when they handed the keys over to him. Elop’s track records is M&A guy who would navigate Nokia into the hands of Microsoft. He did just that, probably with the hopes of getting the CEO nod. Delivering Nokia probably meant that Elop got immunity from any ousting. No doubt, Elop will be somewhere else in 12 months.

    1. There is no doubt @Edwin that the Nokia board shares equal amount of blame. I think they didn’t really do a good job and can’t duck from responsibility.

        1. From what I understand, that was not part of the deal and they instead were toying with some internal options on OS, but nothing really happened to it.

      1. I read that comment as “Nokia makes excellent hardware, was more than capable of building better Android phones than Samsung and/or providing actual competition to Samsung, and therefore Google should have tried harder to pull Nokia in on the Android train.”

        That of course would’ve never happened under Elop, but imagine what Nokia would look like had they simply chosen someone else to lead them?

  4. “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.”

    Your perspective is as an outsider. It is much worse from the inside.

  5. Or, maybe it WAS the strategy from the time Microsoft “sent” him to Nokia to make the company affordable!

  6. “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.”

    Why blame Elop, or the Nokia Board? Microsoft sent Elop. Microsoft/Ballmer was already in control of Nokia when Elop was made CEO. All decisions, including the CEO choice, were almost certainly made by Ballmer. Microsoft is the Brooklyn Mafia of Tech. When Ballmer says they want your company, you don’t argue.

      1. I don’t, but the events surrounding the Nokia takeover fit. If you have some other idea about how a Microsoftie, Elop, became CEO of Nokia, the pride of Finland, I’m all ears.

        1. One other way to see the hiring of Elop as Nokia CEO is that Nokia WANTED a Microsoft candidate. Nokia always admired and modeled itself after Microsoft. It mimicked many of Microsoft’s business methods and strategies, including some of the more ruthless ones. Nokia wanted to BE Microsoft, the Microsoft of Europe. Now they are.

  7. It’s easy to blame Elop for Nokia’s 50,000 layoffs, and he certainly didn’t do anything to turn Nokia around (if indeed that was even the plan, rather than Microsoft simply plotting to take Nokia down and buy its remains on the cheap).

    However, that ignores the reality that Nokia failed to execute prior to Elop. For the first three years of iOS, Nokia watched, waited and diddled with several concurrent strategies. It then sued Apple for a patent royalty windfall. Nokia doesn’t actually have a right to exist.

    That said, Elop’s failure to even articulate a strategy for Nokia, let alone implement one, demands accountability from Microsoft’s shareholders. Microsoft paid Elop tens of millions for a “performance bonus” while cutting the Nokia rank and file from getting anything. Sick.

    1. I think *board* should set a strategy, which CEO executes.

      But on other aspects you’re correct. Nokia was the market leader with huge profits, they chose to milk the existing products, and did not have a clear vision for future nor enough software expertise. They saw iPhone, failed to understand it, and finally reacted very slowly and poorly. They saw Symbian partners (Motorola, Ericsson, Samsung) jump the ship for Android, failed to identify the situation and to act accordingly.

      Finally when they understood a next generation OS is needed they dabbled for years, co-operated with *Intel* (whose software track record is not stellar) on Maemo/Meego, which became a disaster of a software project, or multiple disasters.

  8. While I am unhappy with what happened to Nokia and consider Elop’s tenure to be a flop overall, I think this speaks to his strategy rather than his ability to execute. It is possible that he is a complete rube, but his execution at Nokia was far from terrible. Only the typical Silicon Valley/tech press sycophants would not agree that Nokia has made the highest quality hardware since the Lumia 920 launched. The camera (and camera software) has been peerless during this time as well. The phones consistently received reviews ranging from very solid to excellent among a technology press crowd that does nothing but fellate companies in California. The apps were/are a legitimate issue for the platform. I think that Microsoft bears more responsibility for the lack of success for Nokia devices and even that is a stretch. The bottom line is the devices are very good – but the public simply does not want them. It’s too bad really.

    PS. I have been a proud Windows Phone owner for years.

    1. As a former Nokian, thanks Elop, I can say the peerless hardware you speak of, was designed and engineered for MeeGo. Starting with the N9, which is still my favourite phone. The Lumia line, was basically a hijack job done by Elop and MS.

  9. Ollila would have chosen Vanjoki, but the board (US based shareholders? Dodge&Cox et al.) twisted his arm on this. I can only think this is the reason owners were patient enuf to continue watching Elop burning their money…

  10. If this were sports Elop would have been fired years ago. His strategy from the beginning was flawed. He continues to get paid while people under him keep getting laid off. I think there was a lot of opportunity in Android. Now there will be no windows mobile division moving forward.

    1. I think Elop’s strategy has been spot on, he is doing well. If you refer to Nokia’s strategy, it was chosen by the board, not by the CEO. And the strategy was disastrous under both OPK and Elop. The seeds of the fall were sown in 2004–2006, more errors were done post-iPhone. Errors did not begin in late 2010 when Elop joined Nokia.

  11. Normally I hate all conspiracy theories, but what if Microsoft doesn’t want Elop talking about the circumstances of the adoption of Windows Phone by Nokia and its subsequent sale to Microsoft? If true, they wouldn’t fire him no matter what.

    Also right now Microsoft is making another monumentally boneheaded decision: they are killing Nokia’s (beloved by many) feature phones. Where do they think all those existing customers will go? Windows Phone? No way: I bet the vast majority moves to cheap Android phones, thus marginalizing WP even farther in the platform race.

    Ted T.
    (sorry to post via my dog’s tweeter account, but every time I see the “allow to post on your timeline” login via Twitter warning, I balk at giving my own credentials. They really need to change that)

  12. Not sure why you include Silicon Valley in the “fail upward” philosophy. You are talking about massive global corporations here. Microsoft and Nokia are not what people would consider “Valley Companies”. No where else do you talk about Valley companies in the post.

    You are more likely to “fail outward” than “fail upward” in Silicon Valley. Look at the number of founders and top execs that get pushed out and then go on to lead other organizations or start their own company.

  13. Reblogged this on @stevebanfield and commented:
    While I don’t know if SV has embraced failing upwards, Microsoft, Sony, HP and too many of the tech giants have. The question is how long before the disease reaches Google, Yahoo and Facebook?

  14. I think you have a good point: “fail early, fail often” is celebrated in Silicon Valley (the place) to the point that many people feel they are successful, or close enough, even though they have never had any successes at all. And your point about corporate america is of course right on: Big investment bank executives getting bonuses and promotions while simultaneously ruining the economy and incurring the largest fines in history being a case in point.

  15. The sports analogy is poor. Lousy players and execs stay for years and make tons of money. And most leagues are rigged for “parity”.

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