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How Things Fall Apart – Investment Watch

by IWB
December 13, 2022
in Investing
Reading Time: 3 mins read
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by Charles Hugh-Smith

That’s how things fall apart: insiders know but keep their mouths shut, outsiders are clueless, and the decay that started slowly gathers momentum as the last of the experienced and competent workforce burns out, quits or retires.

Outsiders are shocked when things fall apart. Insiders are amazed the duct-tape held this long. The erosion of critical skills and institutional knowledge is invisible to outsiders, while everyone inside who saw the unstoppable decay either left or burned out.

Those who remain are the ambitious who lack the experience to reverse the decline and the self-awareness to realize they’re way over their head. They’re ambitious enough to want the managerial title and power but don’t have the necessary experience and competence to lead a brutally difficult and painful turnaround.

So they either “stay the course” doing more of what’s failed or they flail around, trying one reorganization-fad-of-the-day after another, pushing the few remaining competent staffers to leave and thus steepening the decline.

Everyone who cared and was competent in the support staff either left or burned out trying to doing three jobs at once. The most prescient and experienced staffers noted the decline in managerial competence and the decay of the operational skills needed to keep the ship afloat, and so they found a better position elsewhere or retired early.

The less prescient but competent then tried to compensate for failing management and poorly trained staff by doing more of the work themselves. First they do the work of one-and-half less competent employees, then of two and after that, three for a brief time until their health is destroyed and they burn out. They either go on medical leave, retire or quit as the sole means of retaining whatever health they still possess.

In this manner, those who care are weeded out, leaving only those who don’t care whose sole ambition is to do as little as possible to get by and cling on long enough to vest stock options or retirement benefits.

Since training fell apart long ago, when the old timers retire their replacements don’t know enough to keep things operational. The replacements think they know enough from studying textbooks and sitting through training videos, but once something happens that isn’t entirely routine, the holes in their experience become visible, and they are soon calling the retired workers begging for advice.

Those who care soon realize the hopelessness of keeping the ship afloat and they leave to avoid the misery of collapse. Those who are left are those who don’t care: when the whole mess stops functioning, they’ll walk with whatever they can salvage and move on.

Should a competent manager be appointed, it’s too late. The middle managers and operationally critical staffers needed to reverse the decay have already left, leaving only those who over-estimate their experience and competence and those who pretend to care and pretend to work.

As the last best leadership hope burns out and quits in disgust, the last die-hards who held out hope for a turn-around finally accept that it’s hopeless, and they finally quit, go free-lance, transfer to another location or retire early.

That’s how things fall apart: insiders know but keep their mouths shut, outsiders are clueless, and the decay that started slowly gathers momentum as the last of the experienced and competent workforce burns out, quits or retires.

As noted above, outsiders are shocked when the enterprise / institution collapses, while the insiders who got out while the getting was good marvel it lasted as long as it did.



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