Sometimes as a CEO, you just gotta do what you gotta do

There's a level of responsibility that hits like a ton of bricks when you realize decisions you make can directly impact peoples' lives.
Written by David Gewirtz, Senior Contributing Editor

Over the past few days, I've been examining the issue of telecommuting which has been re-introduced into our collective consciousness by Yahoo's sudden and surprising demand that all workers work from Yahoo offices. This was followed a week or so later by Best Buy demanding that workers it had previously allowed to work from home must now change out of their pajamas and come to work.

How To Save Jobs
(Image: David Gewirtz)

I pulled a lot of my material from a year of research I'd done back in 2009 and 2010 writing How To Save Jobs (free download). While those two articles, The enormous societal benefits of working from home, and What if more Americans worked from home?, looked at the working-from-home question from a policy point-of-view, this article looks at the management question.

Some quick background

I was a CEO for about 20 years. While I never had tens of thousands of employees, like Yahoo, or hundreds of thousands of employees, like Best Buy, I managed between two and 50 people at various stages of company growth.

Back in the mid-1980s when I started my first company, I worked out of my one-bedroom apartment for almost six months, until I'd hired some staff and rented office space. Back then, there was a tangible business prejudice against people working from home — and for good reason.

We didn't have the technology resources we have today. Faxes were just beginning to find their way into business, email was rarely used to communicate outside of the walls of a given company, there was no such thing as video conferencing, desktop sharing, voice-over IP, or any of the other remote work technologies we now take for granted.

In a strange foreshadowing of today's virtual assistant, a few weeks after I started my first company, I hired an answering service. They set up a special patch line, answered my phone, and then called me to patch calls through. All of that was because the distributors who I called on to sell my software products categorically refused to deal with any companies they perceived as too small.

While there will always be some prejudice against working from home — particularly among those people who drive hours each day to work — working from home is now a much more well-accepted mode of doing business.

Working from home is not just for small businesses.

I work regularly with senior executives at very large companies who work from home, with home offices often halfway across the country from the divisions or departments they manage.

While the benefits to the newly minted entrepreneur are obvious, many larger companies are embracing the work-at-home work style because it saves money and time. Rather than having that key employee in the car for two hours a day, that time can be better put to work at home.

Office space doesn't need to be rented, furniture doesn't need to be purchased, power for heat and air conditioning an office isn't consumed (although that might be balanced by home consumption), and there's a lot less internal battling over who gets the office or cubicle near the window.

There are challenges, of course, and this is where the Yahoo question comes up in tangible way. If you work from home, you need to be more responsible for your output. If you're an employee, you have to establish trust with your managers. You have to set boundaries with your family and you have to develop the discipline to stay away from the TV — and the fridge.

Another challenge, one I discussed in How To Save Jobs, is that once you've convinced your boss your job can be done from a few miles away, what's to stop him from sending it across the ocean to India or China?

There's also the very real issue of isolation. Working from home tends to reduce those water-cooler moments, the times you stand and chat and brainstorm with colleagues.

I honestly think that one of the reasons Twitter and Facebook have blossomed is that they take the place of water cooler chatter. Rather than asking Bill what he's working on while walking back to your cube from the men's room, you can see his updates from his Twitter feed.

This level of short communication is not to be discounted, but it'll never take the place of rubber-band wars, fought over the rims of cubicle walls while the departmental administrative assistant was at lunch. Ah... the memories.

All that brings me back to Yahoo and the basic premise of this article, which is sometimes as a CEO, you just gotta do what you gotta do.

The big chair

If you've never been the head of a company, if you've never sat in the big chair, you may not know — really — what I'm talking about. There's a level of responsibility that hits like a ton of bricks when you realize decisions you make can directly impact peoples' lives.

Making a necessary business decision, like a layoff, hits real people where it hurts. It's not just numbers on a spreadsheet. It's not even just your individual employees. Families might not be able to make ends meet, they might not make their mortgage payments, and they might not be able to survive in a down economy. And yet, as a CEO, you have to make that decision.

I learned this lesson hard in my third year as a CEO. I was in my mid-20s and the market had compressed quite a bit. Our particular market segment was in transition, and I had a few too many employees. Was it my fault that I had too many employees? Probably. I suppose could have read the minds of our partners better and had better psychic friends so I could have predicted the future better.

We weren't funded by some big venture capital infusion. We ran on our own income (and my credit card balance). If sales went down, we had less money to work with. Around Thanksgiving, we lost a big customer, not because of anything we'd done wrong, but because they were getting out of the market we were in. The right move would have been to layoff people right then and there. But holidays were coming and I just didn't want to be a Scrooge.

I kept paying payroll for everyone throughout the holiday season. It was a mistake. I didn't have money in the bank to cover it, so I charged up my credit cards to make payroll. It took almost a decade to clean up that mess. Worse, I put the company at risk because the situation was unsustainable. We needed a course correction, and instead I ran a charity for three critical months. I eventually had to do the layoffs, anyway, but I had waited too long and the financial repercussions took years to overcome.

We bounced back, but it was a rough time. The point is, unless you've had that personal responsibility, unless you're the person staying up nights trying to find the best, most honorable, and most strategic path, and unless you're the person people scream at when you layoff their spouses, you'll never truly understand how CEO decision-making works.

I'll tell you another short story of my early days as a CEO and then I'll move on to this Yahoo thing. Don't worry. It's relevant.

This was a few years after the layoff I mentioned above. We had grown to about 14 people, and like all good newbie CEOs, I'd read all the management books. Delegating responsibility was the big thing. Don't over-manage. Create teams, and let those departments be managed by capable managers.

So that's what I did. The change in company-wide behavior — almost overnight — was breathtaking. Where in the days before departments, everyone jumped in to help with whatever needed doing, now it was Shipping's problem. Or it was Sales' problem. Or it was Engineering's problem. The almost-universal teamwork ethic we'd organically created went away. Instantly.

Nothing I could do could get everyone to work together again. Each department tribed up, and suddenly it was them against the world. It was breathtaking how quickly this change in culture happened, and it was a completely unexpected result of simply creating an org chart for a business plan.

Productivity was rapidly sinking. I had to do something. No amount of meeting and talking seemed to work. I finally decided to get draconian. I banned the use of the word "Department" anywhere in the company. Anyone heard uttering the word was disciplined in some way. Almost 20 years later, I can't remember if it was a fine, a public mocking, or they had to bring in the donuts -- that memory is lost to time.

Everyone thought banning the departments and the "D-word" was stupid, but slowly, after about a month, people started working together again, putting the strategic needs of the company before their own departmental fiefdoms. We were meeting customers' needs again, we were making money again, and we were once more shipping on time.

Yahoo and CEO Mayer's decision to ban remote workers

This decision has been picked at, dissected, criticized, and turned upside down by the tech press, by employees, by stockholders, by pretty much everyone.

It might not have been the best decision from the perspective of setting an example for an industry. It might not have been the best decision from the perspective of keeping employees from jumping ship to Facebook or Google. It might not have been the best decision from the point of view of hiring new employees. It might not even have been the best decision from the perspective of convincing the world that Yahoo is cool again.

But it might have been the best decision to keep the Yahoo ship afloat.

You know, because I've been making the case for days, that I think encouraging remote working and working-from-home is not just a viable strategy, but one that may be critical to America's economy and even our breathable atmosphere, going into the next hundred years.

So you know I'm not saying that banning remote working might have been a good decision for Yahoo because I'm against people working from home.

But, sometimes as a CEO, you just gotta do what you gotta do. Sometimes, you can't take into account what all the pundits will say. Sometimes you have to take notice of the storm your ship is about to encounter, batten down the hatches, and make course corrections.

Sometimes you have to make the unpopular decision, just to snap people back onto mission and get the ship pointed in the right direction.

Sometimes, despite what everyone says, despite the criticism, despite the screaming and yelling and anger and hatred, sometimes as a CEO, you just gotta do what you gotta do.

Only time will tell whether Mayer made the right decision or not. But I give her points for not just sitting in the big chair, but making the tough, unpopular decisions that come with job of CEO.

Her willingness to make this decision — which from the outside looks short-sighted and even regressive — may, in fact, be evidence that she's the right person for the job. If Yahoo is to be saved, if it's to be turned into something effective or meaningful once again, tough, unpopular decisions will need to be made.

I've said it before, and I'll say it again. Sometimes as a CEO, you just gotta do what you gotta do.

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By the way, I'm running this article in ZDNet Government rather than my DIY-IT column because so much of working at home can be aided or hindered by government policy. I am on record as strongly recommending major changes in American employment policy designed to encourage Americans to work from home.

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