Spansion Fires 35% of Workforce; Reinstates Executive Pay
An interesting story (with some heated comments) with regards to a recent move by Spansion:
While Spansion Inc. was cutting 35 percent of its workforce, or 3,000 jobs on Monday, the company’s board was restoring full pay to its top executives.
The company had imposed a 10 percent pay cut last Oct. 6 for top executives. But in a securities filing, it said it was returning the executives to full pay as part of an “employee retention program.”
So I guess this is called “taking one for the team”? Seems more like a cash grab by the executives of a company that’s about to go under.
One intrepid (and mildly retarded?) commenter, “Todd Fletcher”, writes:
This story is quite biased. Understand that Spansion is in a very tight position right now, and they must remain competitive within their industry. This means not only attracting the very best executives, but retaining them.
Of course, the logical question is what metric are you using to define “the very best executives”. Why are they in a “tight position”? Could it be because management and these very same executives made some bad decisions? Perhaps they lacked foresight into the market and the technologies? Nah, surely, it’s the fault of the guys at the bottom, right? It’s always their fault, right?
Some of the better rebuttals include:
Market guy: Todd, I would stop defending these executives at Spansion. They picked the wrong strategy and direction in 2003 and now the NAND Flash Memory guys are killing NOR Flash Memory manufacturers like Spansion. That’s why Spansion is in so much trouble today. Why would you want to reward Executives for steering the boat into an iceberg? Would you invest your money on a sinking ship?
Shamless1: If you want to pay to bring in new talent I say lets pay, however increasing compensation to people who walked you down the garden path is no different then chasing down the guy who just stole your wallet to give him your watch.
OneOfTheConcerned: Having top quality executives means that Spansion can strategically lay people off and reinstate the executive’s pay…all the while ignoring that they owe Travis County overdue taxes. Ah, the ground is quickly approaching those smug noses.
Brett Stroud: What does this story have to do with retaining top executives? It’s quite clear that the executives they have led them to a position where they have to lay off 35% of their work force. Seems to me like they’re retaining failed executives.
So yeah, let’s see how much longer these guys last. Incidentally, the stock (SPSN) is currently trading at about $.06, a far cry from the $17 dollar range when I sold my shares a few years back.