Re:The McNamara fallacy: Measurement is not understanding
by apohn on Tuesday February 01, 2022 @08:33PM
(#30172344)
I had guessed something like this was going on, but reading this just really makes me wonder what's really going on in the minds of a private equity folks. The C-suite and senior leadership were the ones who drove the company to the point that they ended up in the hands of private equity, but they were incentivized to stay.
I get that they exiting leadership knows the company and it's hard to find new people. But it just seems so crazy to me.
We had teams that had 50%+ percent of people gone between layoffs and attrition. It was comical to see how much stuff fell between the newly formed cracks. I still can't comprehend how much they must have been incentivized to stay when the earth was crumbling around them.
Money. Investors typically carve out equity to retain key personnel (i.e., management units/stock). The units are worthless unless the company appreciates in value, so management becomes laser-focused on doing whatever it takes to increase the company's valuation. Everything else becomes a secondary concern.