A simple typo has led to record earnings for Nortown Techniques.
It began with this January 3 memo from CEO Jerry Widleman to VP/Human Resources Marilyn Nils:
To provide a more positive return to shareholders, we must improve our revenue picture in 2017. I am therefore mandating that the workforce be reduced by 97 percent within the week.
Believing he had meant to type 9.7 percent, Nils felt she had cause to ask for clarification. “With only 100 on staff,” she says, “that would have meant eliminating 97 positions.”
Her three fellow VPs, however, dissuaded her from going to the boss.
“Wildeman always says that asking for clarification is a sign of weakness and stupidity,” says VP/Production All Hollis. “For her to have questioned him would have made us all look bad.”
So the four VPs put their heads together, and within two days came up with a plan to eliminate the 97 jobs. It entailed increased hours, reduced vacations, dividing the work among the three staffers who would remain, and the elimination of “employee morale days.”
The layoffs were implemented, and more than three months later productivity has not been impacted. Earnings have risen 76 percent, mainly due to reduced payroll costs, and the stock is up 46 percent to over $15 per share.
“If we had asked and he said it was a typo our stock would still be around $10.50,” says Hollis. “There’s a lesson to be learned.”
As CEO Wildeman rarely leaves his office he apparently hasn’t noticed all the empty cubicles – which may explain his note to Nils on April 16.
As we’ve been able to maintain productivity, it seems that we could further improve the bottom line by eliminating an additional three positions…
