Lives - Not Profits
Kay R. Whitmore's problem is that he is not Japanese. If he were, his reluctance to radically reduce the Eastman Kodak Co.'s work force, his solicitude for the colleagues with whom he had worked for 36 years, would have been praised. Instead, earlier this month, he was dumped as Kodak's chairman. Leo Durocher was right: Nice guys do finish last.</br></br>Durocher, once the manager of the Brooklyn Dodgers (he was soon to go to the Giants) was talking about major league baseball. But what's true for the national pastime is true for corporate America. After Whitmore was fired, Kodak stock went up. It went up even more when, last Wednesday, the company announced it would eliminate 10,000 jobs - some through layoffs. The initial announcement was greeted with investor enthusiasm. We may presume the company's workers were less enthusiastic.</br></br>But they do not seem to matter. Investors, represented by outside directors, run the company, and they were unhappy with earnings. It's not, mind you, that Kodak was losing money and thus compelled to lay off workers. It's rather that it was not earning enough money and that its share of the U.S. film sales had decreased from 80 percent in 1988 to 70 percent by 1992. To read the financial pages, you would think that 70 percent of the market was a mere piffle.</br></br>I am in no position to evaluate Whitmore's performance as Kodak's CEO. But one criticism of him in the investment community was that he was loath to fire workers. "It is quite possible the magnitude of the cost cutting was just too difficult for him," one analyst said. "There is an old maxim: It's easier for an outsider." Sure. But why does it have to be done at all?</br></br>To ask such a question nowadays puts you in the category of the sentimentally demented: Workers? You care about workers? It is then that someone like myself gets a stern lecture on the need to remain competitive. Fingers wag and place names are dropped: Japan, Germany, Singapore, South Korea, Brazil, Taiwan, China. American industry must remain - must become - competitive lest we lose our global share of everything other than rap music and television sitcoms.