Masters of the Silver Lining

I like hunting for silver linings as much as the next guy. But there is one group of people who are so good at finding them that I can only dream of matching their prowess.

I am talking, of course, about C.E.O.’s.

It is earnings season and we are of course in the grip of a recession, so you would expect to find some super-optimistic proclamations from C.E.O.’s even when the news is bad. For instance:

In a Times report yesterday, by Brooke Barnes, about the Walt Disney Company’s 97 percent quarterly drop in operating income in its movie division, C.E.O. Robert Iger mentions that “I think we have some real opportunities in terms of reducing expenses.”

I love that reducing expenses is seen as an “opportunity.” With opportunities like those, who needs problems?

Iger is of course just one of thousands of executives who are paid to find and highlight silver linings. Please send along any other examples you come across in the business news — or, even better, from previous downturns.


Yes - where I work I get fed this dilbertish stuff daily. There are very few that don't pull this crap (Buffett is one good example). Why do they all dance around the elephant? I know the's a sign of lack of self confidence and lack of intelligence, and I'm dead serious about the intelligence part...they are only fractionally as smart as they think they are.


Specific wording, I cannot remember, but I can remember this:

At my previous job, we would get a memo towards the end of the year that shouted on about how the company had recorded record profits, or whatever rah-rah positive fiscal news the pres could put together for the publicly released memo for the shareholders.

A month or two later we would get the employees-only memo about how "due to budget issues, raises this year will be minimal."

This would happen year after year. How does a company stay afloat when they deliberately crush morale?

Michael F. Martin

There are a few companies where the CEOs do send negative feedback to the market. Not surprisingly, those companies tend to have less stock price volatility. BRK is an example.


You could read Iger's statement as saying "I think we can do this without completely quashing all productivity." That's how I read it. It's not that he thinks that cutting costs is an opportunity for the company, but that he sees that there's room for budget cuts.


last year, in the AIG boardroom, there was alot of doom and gloom because of the recession- the rumor was that the bonuses may be lessened due to bankruptcy- the CEO said "well, look at the bright side- someone may decide to just give us so much money, that we'll get our bonuses after all"- an awkward giggle circulated around the room...


I interpreted Iger's assertion that they have the opportunity of cost reductions as meaning that in this climate it will force the company to find innovative ways to cut costs and be more efficient. This will benefit them in the long run, even after the economy picks up again.


How bout Ken Lewis raving about Merryl and Countrywide aquisitions? or saying Paulson and Bernanke pushed him to aquire Merryl and then taking it back. Is that an example of finding the silver lining or government strong arming so everyone stays in line?


It's not a case of dancing around an elephant. Rather it comes from the fact that during "business as usual" expenses only ever increase.

You can't cut costs without upsetting people. Change is strongly resisted. It is difficult to fire people without disruption and discontent.

So you quietly make a list of things you want to deal with, and once you get a reasonable excuse, you deal with them.

In this sense, bad times *are* a real opportunity to cut expenses.


I've been through the last 2 recessions at my current company and both times, the CEO said "...we will emerge a stronger company" probably a thousand times. Of course, both times the company "laid off" a large portion of the work force. I guess the company was stronger because there are less costs after the lay-offs?

The problem I see is that, in order to make money and meet the short term demands of Wall Street, the company cuts back on long term investment. I don't see how that makes anyone stronger.