Thread by @mmjukic

It's unbelievable how many dynamic companies broke their streaks of engineer-CEOs for the first time in the 2000s, installing their first MBA/finance CEOs, who then promptly made fundamental strategic errors that nixed the company's future, that are now becoming obvious.

"He/she was the first CEO not to come from an engineering background" is not something that happened once or twice, it looks like it was an economy-wide trend, not just in the U.S. but Japan too.

Boeing, Sony, IBM, Intel... we will probably find more examples as we research.

Intel is maybe the most egregious example. First non-engineer CEO manages to say no to Steve Jobs to the offer of manufacturing CPUs for the iPhone. Then of course Intel just totally drops the ball on ARM, GPUs, EUV... literally misses every single development in computing.

The irony is that many of these MBA/finance CEOs in fact succeeded at greatly increasing revenues, profits, and shareholder value—even while making fundamental strategic errors that would effectively kill the company in the future. And they were lauded for it at the time!

You would think having an MBA/finance CEO for a few years wouldn't be that bad, surely inertia and some basic competence goes a long way... but no, the MBA/finance CEO immediately begins making catastrophic mistakes and vengefully purging any remnants of engineer-executives.

Boeing's first MBA CEO immediately starts designing planes that fall out of the sky.

Intel's first MBA CEO immediately forgoes the smartphone revolution on a silver platter.

Sony's first MBA CEO decides that Sony doesn't need to make new consumer electronics products anymore.

You would think that a company in the process of being murdered by its own CEO would see worse financial performance and lower stock valuations by investors, but in fact murdering a company seems to greatly increase profits and excite investor enthusiasm to unheard-of heights.

The apparent conclusion—uncomfortable if not unthinkable for free marketeers—is that MBA/finance thinking and decision-making is not just not helpful but actively hostile and destructive to running a successful, functional company.

How could that be? Well, if you accept there are such things as trade-offs between short-term profit vs. long-term viability, in the examples above we see MBA/finance dogma ruthlessly maximizing those trade-offs in favor of short-term profit. Including killing the company!

Maybe, as part of industrial policy to protect the American economy, the SEC should ban anyone with an MBA or CFA from being CEO of a publicly-traded company. They can be CFO or COO, but not CEO.

The core problem is that MBA/finance thinking teaches you to see every company not as a fragile organization of human beings with idiosyncratic skills and knowledge, competing against other such organizations, but as a financial product in a portfolio.

https://x.com/mmjukic/status/1811012873373491577

You can read the excellent and meticulous @bismarckanlys Brief on Boeing below; other company case studies are coming soon. Become a subscriber to read them and join us on our investigations of key American companies! Link: brief.bismarckanalysis.com/p/the-decay-of…

I increasingly view the MBA/finance type as the capital-C Capitalist equivalent to the Marxist ideologues and economic commissars of capital-C Communism:

https://x.com/mmjukic/status/1811697602720637039

In the same way communists tortured the actual economy in a vain attempt to make proletarian ownership or whatever real, we are torturing the actual economy in a vain attempt to make all economic functionality fungible, trade-able, and speculate-able to passive investors.

Maybe we shouldn't all be trying to become full-time passive financial speculators on a line that only goes up, up, up. Maybe we should, you know, get a job. Do something useful and risky. Under true capitalist free market theory, the line is also supposed to go down sometimes!

It's hilarious when some people on here call me statist or communist when I explicitly propose putting the economy under the untrammeled control of founders and engineers.

To be honest, I might even be in favor of outright abolishing income taxes. It makes no economic sense to tax work from any ideological perspective. Plenty of other ways to tax.

https://x.com/bjornsing/status/1825946753004351699

"Oh, come on, MBAs aren't that bad! It's not like they would take over America's premier aircraft manufacturer then build a plane that is programmed to randomly crash itself into the ground and omit mentioning this feature to anyone!"

*stares in Boeing*

https://x.com/mmjukic/status/1825946868339323319

Certain libertarians get unhingedly upset if you compare modern America to the USSR or communist China, and yet when you put into plain language the kinds of things that happen and get utterly covered up in modern America...

Consider: Boeing killed more people than Chernobyl.

At least people went to prison for Chernobyl. For Boeing, nobody!

https://x.com/mmjukic/status/1825951218264416264

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