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PostMore on Ross Perot (Randy Black, USA, 12/02/14 7:54 am)
John Heelan's response (30 November) to my post about Ross Perot is spot on. John correctly surmises that Perot would not have "allowed" EDS to fail to the extent that it did under General Motors' watch regarding its UK operations.
When you were hired at EDS, new employees signed employment agreements that spelled out the expectations regarding honesty, honor, integrity, ethical behavior, grooming and dress code. I still have my signed employment agreement. By the way, contrary to lore, white dress shirts were not required. I even had a mustache in those days.
In the 1982-83 era, I was invited to lunch in suburban Washington by one of our new clients. I was in the area for three days of shooting an industrial video for that client. My video would target the client's 20,000 employees from the leadership to the clerk typists. Many, well nearly all, were skeptical about an outside-their-system contractor doing such work.
Ours was groundbreaking in concept, and the old-time, inside operators were downright hostile early on. I'd written the scripts, managed them through the approvals at both ends--in Dallas and in Washington--hired the talent, ordered the plane tickets, and now it was time to shine.
My leader in Dallas encouraged me to sit in in his place with this important client at lunch. The contract was in the near billion dollar range. We had beaten out IBM for the deal, so the pressure was on.
What should have been a low-risk PR luncheon turned out to be in an "adult-themed" bar and grill, if you get my drift. The client was driving, thus we were at his mercy. He ordered pitchers of beer for his six or seven underlings and me and my cameraman.
As EDSers, we were under the employment agreement that forbids the consumption of any kinds of alcohol during business hours, or in the presence of clients or potential clients. There was no exception allowed, and I knew it.
I whispered to my camera operator, a contractor not under the same restrictions, to "tread very lightly" on the glasses of beer put in front of us by some very lightly dressed waitresses. He took the hint and ordered tea.
We both managed to avoid the issue when I explained that booze combined with the afternoon's camera work at their nearby offices might hamper our ability to function at 100%.
The client scoffed and ordered us to "drink up." "At the risk of offending you," I said, "we are charging you way too much to risk not providing our very best effort and product. Please understand the position that you are putting us in. Surely you don't want anything but the best from us do you?"
The client relented but it didn't slow down him and his colleagues. Whew, I thought. By the way, my video production was awarded "Best in World" that year by the International Television Association in the industrial category.
I found out later that the client ratted me out to my boss in Dallas and complained that "Randy doesn't know how to have fun when his clients are picking up the tab." My boss quietly commended me later for my tact and let me keep the trophy that came later.
On John Eipper's comment on the Perot-Roger Smith dust-up, John is probably referring to the "700 million dollar bonus" as I called it when he noted that "Perot came out the winner, to the tune of at least $700 million."
On the front end of the GM buy-out, Perot sold EDS for something like $3.5 billion, which netted Ross about $1.2 billion, plus a seat on the GM Board of Directors. Readers should understand that for years, Ross took most of his EDS salary as stock options and really only drew a modest salary of about $100,000 annually, as we were reminded from time to time.
Later, after Ross shot off his mouth in the media one too many times about GM's management style and practices, Smith strong-armed the Board into "buying out Ross" to the tune of an additional $700,000,000.
What did Ross say to the media and the public that got Smith so riled up?
"Revitalizing General Motors was like teaching an elephant to tap dance," Ross said in an interview. That was the quote that made the evening news.
Below are a few more Perot thoughts back then that might have irritated Smith and GM:
"I come from an environment where, if you see a snake, you kill it. At GM, if you see a snake, the first thing you do is go hire a consultant on snakes. Then you get a committee on snakes, and then you discuss it for a couple of years. The most likely course of action is--nothing. You figure, the snake hasn't bitten anybody yet, so you just let him crawl around on the factory floor. We need to build an environment where the first guy who sees the snake kills it. (My favorite.)
"I told General Motors very openly that the only reason I was selling my company to them is that I couldn't think of anything more interesting to do with my life than to work night and day to help revitalize one of the world's great corporations and help it achieve its full potential.
"One day I made a speech to some senior executives. I said, 'Okay, guys, I'm going to give you the whole code on what's wrong. You don't like your customers. You don't like your dealers. You don't like the people who make your cars. You don't like your stockholders. And, to a large extent, you don't like one another. For this company to win, we're going to have to love our customers.'
"One old guy stood up and said, 'Ross, I've been a Cadillac dealer for 35 years, and this is the first time anybody has ever given us an opportunity to tell them what is wrong.' I said, ‘What about the surveys?' He said, 'There are no surveys.'
"Two top (EDS) managers, who were already rich before the GM merger, refused to accept any shares because they wanted them to go to the younger people who didn't have any. The General Motors guys went crazy. They said, 'It must be nice to be so rich that you thumb your nose at several million dollars' worth of stock.' I said, 'No, you're missing the point. It goes to the troops. That's what leadership is.' By contrast, the General Motors guys closed the plants, said no profit sharing, and the next day gave themselves a $1 million bonus.
"You should walk around the 25th floor of the General Motors Building in New York. An entire teak forest must have been decimated for that floor--and this is something they use one afternoon a month.
"What is an EDSer? An EDSer is a person that goes anywhere, anytime, twenty-four hours a day, seven days a week, to make sure that EDS is the finest computer company in the world and that nobody beats us in the competition."
In case you're wondering, I'll be 69 next Sunday, December 7, and I'd go back to work for Ross early on Monday.
JE comments: Not a Day of Infamy for Randy Black! Happy imminent 69th, Randy!
Randy has given us a thorough portrait of an American icon. I wonder if anyone at GM, c. 2009, regretted ignoring Ross Perot's advice. Probably not--but they could have used the $700 mil.