Readers Report
Deconstructing Dennis Kozlowski
"The rise and fall of Dennis Kozlowski" (Cover Story, Dec. 23) was outstanding. He set a new standard for fraud. I take exception to Harvard psychoanalyst Abraham Zeleznik's description of Kozlowski's problem as "a rampant sense of entitlement." I would call him a greedy crook.
Jim Harpham
Palm Harbor, Fla.
The Kozlowski tale can be summed up in a palindrome: DENNIS SINNED.
George V. Lehto
Silver Spring, Md.
When Kozlowski took over as CEO in 1992, Tyco's market cap was [under $2 billion]. There are three ways to increase sales: Sell more, raise prices--or make acquisitions, which is the hardest way. Dennis and his team did a great job. Corporate America is littered with ex-CEOs [ousted] for one bad acquisition. Dennis and [former Chief Financial Officer] Mark Swartz may have gotten greedy, but what they accomplished was remarkable. I hope they get fair trials.
Eric S. Bleicher
Huntington, N.Y.
Defending Sandy Weill and Dan Brewster
We must take exception to your decision to include Sandy Weill among the worst performers in "The best (& worst) managers of the year" (Cover Story, Jan. 13). In a year of extreme challenge, Sandy stood up to any test of management on any measure. Good management must be judged on many criteria: leadership through wrenching periods of change, attracting talent, financial results, and defining and realizing a long-term vision. Sandy has succeeded on every measure.
As the ground shifted in the financial services industry, Citigroup under Sandy adopted several groundbreaking reforms, leading the industry to restore needed confidence to the capital markets. He added several talented leaders to Citigroup's ranks, including Mike Masin, Sallie Krawcheck (on your list of new managers to watch), Deb Hopkins, and Nick Calio.
Even as he established Citigroup as a model for higher standards, he made sure employees were not distracted from serving customers and delivering for shareholders. In a year of economic tumult, Citigroup is likely to be the most profitable company in the world, even after a fourth-quarter charge taken toward the anticipated cost of resolving regulatory inquiries and associated litigation, as well as increased credit losses. These results extend a superior, long-term record of performance--under which an investment of $100 in Citigroup's predecessor company Commercial Credit in 1986 would be worth more than $2,500 today.
Above all, Sandy continues to lead change in the financial services industry. He is the creator of a model that works for customers and for shareholders--which is why Citigroup increased its market share in 2002 and why its common shares have held up far better than many of the company's competitors. The company's efforts to embrace new reforms will only strengthen Citigroup's power and ability to deliver.
Leah C. Johnson
Director of Public Affairs
Corporate Affairs
Citigroup Inc.
New York
Let's see--in 2002, Gruner+Jahr USA expanded its ad revenue faster than any other major U.S. magazine publisher, gained advertising market share in every segment in which it competes, and posted the greatest year-over-year profit growth in its history. Also, employee satisfaction was recently measured at an all-time high. [Instead of calling Dan Brewster a Bad Dealmaker,] surely you meant to place him among the "Best" managers. We certainly do.
Bernd Kundrun
President and CEO
Gruner+Jahr
Hamburg
Axel Ganz, President
International Magazine Div.
Paris
How to Make the Most of Human Capital
As an economist involved in the research described in "Now it's getting personal" (Working Life, Dec. 16), I want to clarify two points. Focusing on a company's "internal labor market" does not mean customizing pay and employment practices to individual employees, as the article suggests. Rather, it concerns tailoring a company's "people" strategy to its business strategy, instead of merely copying the practices of other companies through benchmarking and "best practice" approaches.
Second, there is nothing in this approach that fosters inequality. The goal is to analyze a company's workforce and performance data to see what these numbers reveal about the company's unique drivers of performance--not to push any particular reward philosophy. In fact, for one of the companies mentioned in the article, we were able to show that greater equality of pay in work groups actually enhanced performance, counter to the conventional wisdom of "paying for performance."
Human capital management gives companies the methods to bring the same discipline to managing their investments in people as they do to other investment decisions.
Haig R. Nalbantian
Mercer Human Resource Consulting
New York
A Few Suggestions for Revising the Tax Code
A great idea for a tax cut would be to restore the tax deductibility of credit-card and other nonmortgage debt--retroactively to cover taxes now due for 2002 and universal for all taxpayers, whether they itemize or not ("Inching toward tax reform," News: Analysis & Commentary, Dec. 16)? After all, it was consumers who kept this thing from being worse than it is, and they did it with debt. If you give them cash, they will spend that, too.
Ron Tripp
Binghamton, N.Y.
The "double taxation" of dividends is spurious. The corporate-profits tax reduces the amount of money available for dividends, but there is ordinarily little connection between any year's corporate profits and dividends. A corporation frequently pays dividends in a year of no profits or even of loss, and it will pay no dividends in profitable years if management thinks there are better uses for the profits.
Bernard Sobin
Laguna Woods, Calif.
Is it too much to ask to close the loophole that allows companies to skip U.S. taxes by renting a Caribbean mailbox? And how about a true consumption tax--the more resources you consume, the more taxes you pay?
Chris Cauble
Helena, Mont.
Heed the Story, Not the Picture
As a professional ergonomist, I was initially pleased to see "Look, Ma, no neck pain" (BusinessWeek Investor, Dec. 23). The information presented in the article is quite sound, but it is almost entirely ignored by the eye-catching photo of the child sitting at the computer desk.
The article calls for adjustability in children's workstations, but the computer desk pictured seems to allow no adjustment. The seat cannot be raised or lowered. The child's legs are not at right angles to the floor--he has his feet tucked under at odd angles. He needs back support. The keyboard is much too high. This child needs the adjustable keyboard tray mentioned in the article to bring the keyboard and the mouse down to a position closer to his lap. Where the article says that the top of the screen should be at eye level, the child's horizontal gaze falls about one-third of the distance from the bottom of the screen.
The configuration pictured could make children uncomfortable. Worse, it can lead to several kinds of serious injuries that are insidious in that they develop over time. So readers must heed the advice in the article and ignore the illustration.
Elizabeth D. Murphy
Fairfax, Va.
Editor's note: We agree that the boy in the photograph is incorrectly positioned.
Is it really wise to suggest that small children balance their 17-in. and 19-in. computer monitors on phone books? Aren't there risks to person and equipment attendant on perching such heavy and asymmetrical objects on a child's disorganized desktop?
Eugene Levine
Nahant, Mass.
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