My Biggest Mistake: Joe McNally - I failed to put long-term benefits above short-term pains
Joe McNally, now in his early 50s, went to the meat business FMC Harris, where he became a managing director. He founded Compaq in the UK in 1984
Wednesday 07 April 1999
Because it is such a low- profit business, one of the problems I had was the remuneration method for paying the slaughtermen: it was mainly for overtime and piecework. It was totally out of sync, and at some stage we just wouldn't be making any money at all. Somebody had to change the pay policy for most of the factory work but, although I recognised that quite early on, I did nothing about it. I was so terrified that I would disrupt the business in the short term that I failed to understand the importance in the longer term. I didn't follow my instincts and make changes, which would have caused the unions to pull the workers out on strike and meant I would lose two weeks of production, rather than stop the basic fabric being undermined by methods and procedures which had been running for 25 years. About two or three years from the time I should have taken the decision, the business was in such a desperate state that we were subject to a hostile takeover because profits were so weak.
I was in an environment that was quite alien - a bureaucratic, autocratic environment - with people on the old boys' network. I was about 34 at the time, and my nearest colleague on the board was 62. Unfortunately, I was swayed by the consensus and attitude of the board at that time. The lesson I learnt was never to get confused by the age of people. At Compaq, if we have young people who demonstrate a competency, we say, `Give them the opportunity to prove that. Delegate where you feel comfortable in doing so, irrespective of whether the person is young or even inexperienced'. One of Compaq's hallmarks is to have an open management style so that we listen to each other. It's a young company, and we allow people to make decisions. The message is to do it if you think it's right, irrespective of whether in the short term it may have an adverse effect, provided you are absolutely convinced there is a long-term benefit to the corporation.
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