Bombardier: senior executives brought down to Earth
Financial difficulties, delayed orders, dropping oil prices and rising duties… problems with the CSeries program were growing as quickly as the salaries of its executives.
Kept aloft to the tune of three billion dollars in public funding, the company’s senior executives turned around and asked for salary hikes of up to 50%, citing the imperative of competitive compensation. This increase was proposed by ‘independent’ experts who were paid by these same executives.
The Fail :
The company claimed that by eliminating well-paid jobs, it had delivered a solid performance in the implementation of its recovery plan aimed at cutting costs. Criticism was immediate and scathing─ Bombardier was accused of being out of touch with reality and of thumbing its nose at the people of Québec─ the salary hike was slated to go through before the funding plan was even completed in 2019.
Faced with demonstrations by angry citizens and under constant attack from the opposition, the company backed down, deferring the pay raises to 2020. A move that still left a bitter taste with the public.
The Moral :
When public funding is keeping you in business, you can expect that your every move will be closely watched. Bombardier should have carefully considered the message each of its expenditures was sending to the population.
There’s clearly an incoherency between financial difficulties, job cutting and pay raises for senior executives. In this context, the resulting cynicism and outrage is hardly surprising. Rather than trying to justify the unjustifiable, a good dose of humility was in order..
Source image : Archives La Presse canadienne