How Long Can You Live on Your Severance and Savings if You’re Downsized?

Organizational downsizing has other negative effects that are not always very visible.  For example, today’s Wall Street Journal profiles several laid-off individuals who have had to rely on their severance packages and savings while they seek reemployment:

SILVER SPRING, Md. — Paul Joegriner hasn’t worked since March 2008, when he was laid off from his $200,000-a-year job as chief executive officer of a small bank. But you wouldn’t know it by appearances.

His wife, Marzena, shuttles their two young children to private school every morning. The family recently vacationed in Virginia Beach, Va., and likes to dine on Porterhouse steaks. Since losing his job, Mr. Joegriner, 44 years old, has had several offers. He’s turned each down in hopes of landing a position comparable to what he held before.

The family’s lifestyle over the past year and a half has been propped up by a $200,000 severance package and another $100,000 in savings — funds the family has burned through rapidly. By Mr. Joegriner’s own calculations, the family will be out of money in six months if he doesn’t find work.

“It will be D-Day,” he says. “But on the outside, no one has any idea that we’re in trouble.”

The article writes about the several ways in which the Joegriner family tries to save money, but they don’t seem very significant in terms of actual dollars saved. I know this is not how we would respond if one of us lost our jobs.  How would you respond?

Aneil

AT&T Wireless Keeps Our Trust by Providing Outstanding Customer Service and Listening to Us

As regular readers of this blog will know, I’m not shy about expressing my likes and dislikes, especially when it comes to customer service.  I’m happy to report that AT&T Wireless, which in my case is our cell phone/mobile phone (pick your term depending on what country you live in) provider and has been for the past several years.  Whenever we’ve had a billing issue, and there have been a few but not too many over the years, AT&T has readily fixed the problem.

Importantly, when there have been miscommunications or conflicting information provided between two of AT&T units (e.g., a local AT&T store, an AT&T representative retail store like Wireless One, or their corporate 1-800 people, AT&T usually and quickly resolved the matter in my favor.  They refunded several hundred dollars in international roaming charges for me once when I complained that I received conflicting information about whether unlocking my phone before traveling abroad would invalidate my cell phone warranty.  They’ve provided me with seamless transfer of phone numbers for all of our phones, and worked to get me easy-to-remember phone numbers when we moved from North Carolina to Michigan.  They quickly fixed a phone bill error this morning that saved me almost ninety bucks.

When our car was recently broken into,less than five minutes after my Karen and my daughter went into a local Starbucks, they quickly shut off our daughter’s cell phone and data services in case the phone was stolen (we couldn’t find it initially because luckily it had fallen under the car seat as the thief was scared away).  They just as quickly and seamlessly reestablished service on our daughter’s phone when we realized it hadn’t been stolen (she now takes it with even if she’s out of the car for only a few minutes).

I don’t like the amount of time I’m on hold occasionally waiting to talk to a support person, but usually the wait is very short.  Everyone I talk to at AT&T is both professional and unfailingly polite.

Occasionally our phone calls drop.  Sometimes we don’t get 3G speeds inside buildings or other places.  We pay a lot of money each month for our calling minutes and data services for our family’s phones.  Nevertheless, we’re very satisfied AT&T customers and expect to continue to be so in the future.

Aneil

Does Texting Destroy Trust?

I’m still not as big a fan of of David Brooks as I used to be before he wrote a column back in August of 2008.  Nonetheless, I did agree with much of what he had to say in his New York Times essay yesterday.  (That is, once I waded through the first part of it which was designed to hook you in I suppose.  All it did was remind me that there a lot of shallow weirdos out there that Mr. Brooks comes across or reads about more often than I do.):

But texting and the utilitarian mind-set are naturally corrosive toward poetry and imagination. A coat of ironic detachment is required for anyone who hopes to withstand the brutal feedback of the marketplace. In today’s world, the choice of a Prius can be a more sanctified act than the choice of an erotic partner.

This does not mean that young people today are worse or shallower than young people in the past. It does mean they get less help. People once lived within a pattern of being, which educated the emotions, guided the temporary toward the permanent and linked everyday urges to higher things. The accumulated wisdom of the community steered couples as they tried to earn each other’s commitment.

Today there are fewer norms that guide in that way. Today’s technology seems to threaten the sort of recurring and stable reciprocity that is the building block of trust.

Karen and I had lots of the kind of help to which Mr. Brooks refers.  Some of it was wanted, and a lot of it unwanted.  It came from our families, our church, our friends, and others to guide us in our five year courtship before we got married.  Because I’m not a patient person, I know I didn’t enjoy all of the deferred gratification that I had in my younger years, whether it was waiting to marry Karen, finishing my education, or achieving other important goals.  The guidance we received and fun we postponed (and still postpone as we raise our two children) nonetheless did help Karen and I learn how to develop unconditional love and total trust in one another.

Aneil

Weight Watchers Loses My Trust by Refusing to Listen to Me

Update 11-4-09:

Victory!  I finally achieved my objective of obtaining a refund, but even so, Weight Watchers refused to admit they had any responsibility.  At least they escalated my problem to a “Team Lead” rather than a mere “Customer Service Associate.”  I’m sure the amount of time they spent on my problem exceeded the amount of the refund

Dear Aneil,

In researching your request, we discovered that you have set up more than one subscriber account with us.

Username: XXXXXXXXX

Username: YYYYYYYY

We apologize, but we do not access or monitor individual accounts and therefore had no way of knowing that you had overlapping subscriber accounts. In accordance with our Subscription Agreement, the individual subscriber is responsible for making choices concerning subscription options, including selecting the price plan to be billed and canceling the account before it is automatically re-billed.

We offer several different options for cancellation from our cancellation page. In searching our records with the information you provided, we are unable to locate a previous cancellation request for the overlapping subscription.

Although you are not eligible to receive a refund, customer satisfaction is very important to us and we have been authorized to credit your account $xx.xx, which is the maximum amount we are authorized to credit. It covers ___  months of billings to your account.  You should see this credit on your next credit card statement.

Sincerely,

Tim
Team Lead, Customer Service
www.weightwatchers.com

Update 11-2-09:

I managed to find my actual record of my cancellation back in August, and just sent this to Weight Watchers.   I hope they recognize their mistake and respond immediately.

Aneil

Your account has been cancelled

Hi Aneil,   As per your request, we’ve cancelled your Weight Watchers subscription as follows:

User Name:
Account End Date:		End of the prepaid term,8/9/2009
Amount Refunded:		$0.00
Credit Card Number:		xxxxxxxxx

Although you’ve cancelled your subscription, we make it easy to come back at any time. We’ve saved all your favorite recipes, meals and other information, so you can pick up right where you left off when you log back in with the user name above. Staying at a healthy weight is one of the best investments you can make, so we hope to see you back soon.Attention Monthly Pass Subscribers: If you’re a Monthly Pass subscriber, please visit www.weightwatchers.com/monthlypasscancellation for details on our refund policy. Please note that unless a special refund circumstance applies to you, there are no refunds for the current month. Also, it is possible that even if you cancel you may still receive next month’s Monthly Pass card in the mail. In that case, since you have been billed for the next month, you will need to return your next month’s card to us to receive a refund for that next month.   If you cancelled your MP subscription and and are attending meetings on a payment plan other than Monthly Pass and would like to continue using eTools, you need to sign up for it separately. To sign up for eTools, you need to get an Access Code at your meeting and log in with your existing user name.   Please contact Customer Service at customerservice@weightwatchers.com with any questions. Thank You. And we wish you continued success on your weight-loss journey. Weight Watchers

Original Post:

When we moved, I no longer could attend the local Weight Watchers class, nor was I getting much use out of its website, so I decided to cancel my online membership.  It turns out that even though I did cancel using one of their online options, Weight Watchers never processed it.  I noticed this when we paid our American Express bill.  Here begins the saga of trying to get a refund for the last two months of my membership that I didn’t use:

Server:  www.weightwatchers.com
Date:  10/9/2009
Category:  Accounting and Billing
First name:  Aneil
Last name:  Mishra

I canceled my online subscription more than two months ago, and yet I’ve received charges to my American Express account at both the end of August and September.  I would like those charges reversed and my subscription canceled immediately.  Please inform me when you have completed these requests.

Thanks.

Aneil Mishra

I then received one of the more legalistic responses from a customer service person I’ve ever received:

From: WeightWatchers.com [mailto:SignUpSupport@WeightWatchers.com]
Sent: Saturday, October 10, 2009 4:08 PM
Subject: Re: Help: Subscription Process

Dear Aneil,

Thank you for your inquiry regarding the charges to your credit card. By subscribing to our product, you agreed to and accepted the terms of our Subscription Agreement. Section three of our Subscription Agreement clearly sets forth the payment and billing terms. Our subscription process is the same as many other online subscription processes, which automatically renew your account and bill your credit card unless you cancel.

Additionally, there is a billing message on the page where you select your payment plan during sign up which reads:

“For your convenience, your subscription will be automatically renewed at the end of your payment plan at the standard monthly rate until you notify us.”

The billing message also appears near the bottom of the welcome page that you are taken to after you have successfully completed the subscription process. You are given the option to print the welcome page, as it is your receipt.

Pursuant to the terms of our Subscription Agreement, we are unable to refund fees paid for months with billing dates that have come and gone.

As per your request, your subscription with us has been cancelled. You will have full access to your subscriber tools until your expiration date of 10/27/2009.

After your subscriber account expires, it automatically becomes a FREE registered user account. You will be able to log in and enjoy the free features found on the site, such as message boards, recipe of the day, and the community recipe swap. In addition, you will continue to receive our newsletters and announcements. If you would like to opt out of this service, please unsubscribe.

Sincerely,
Jean
Customer Service Associate
www.weightwatchers.com

Get recipes for success. We’ll deliver delicious low POINTS recipes to you every week. Sign up now!

http://www.weightwatchers.com/util/news/index.aspx

I tried to explain that I had canceled my account online:

Jean:

As I said in my original email, I canceled my account online back in August, yet I continued to receive monthly bills on my American Express account.  I understand that I would be responsible for monthly subscription fees if I had not canceled two months ago, but that is not the case.  I would like to you please reconsider my request to have the last two months’ fees refunded.

Thanks very much.

Aneil Mishra

Obviously, my reply didn’t convince them:

Dear Aneil,

Thank you for contacting WeightWatchers.com.

We offer several different options for cancellation from our cancellation page. Using the information you provided in your e-mail we searched our database, but did not find any previous e-mail requests for cancellation.

Furthermore, we show no record of a cancellation request from you using alternative cancellation options. We apologize, but if you are unable to provide evidence of a previous cancellation request, you are not eligible to receive a refund.

The individual subscriber is responsible for the terms of their subscription and for canceling their account.  Eligibility for refunds is based on the date we receive your cancellation request.  If you have any additional information that you would like to provide, we will be more than happy to research it for you.

Sincerely,
Alex
Customer Service Associate
www.weightwatchers.com

I’ll let them know that I’ve posted these emails on our blog, and see if that makes any difference.  Stay tuned.

Aneil

Today’s reply obviously did not take into account any of the previous emails I had sent to Weight Watchers, nor did it reflect their own previous responses:

Dear Aneil,

Thank you for contacting WeightWatchers.com.

We researched your account and found that it has already been cancelled from a previous request or by using our on-site cancellation process. We want to take this opportunity to thank you for trying our site and to confirm that your subscription was set to expire on 10/27/2009.

You will have full access to your subscriber tools until the cancellation date above.

After your subscriber account expires, it automatically becomes a FREE registered user account. You will be able to log in and enjoy the free features found on the site, such as message boards, recipe of the day, and the community recipe swap. In addition, you will continue to receive our newsletters and announcements. If you would like to opt out of this service, please unsubscribe.

FOR WEIGHT WATCHERS ONLINE SUBSCRIBERS ONLY:

If you sign up again within six months of your cancellation date, your sign-up fee will be waived. To take advantage of this, please log in with the user name and password from your cancelled account prior to re-subscribing.

Sincerely,
Ibrahim
Customer Service Associate

This will probably be the final response, unless they actually start listening to me:

Dear Aneil,

WeightWatchers.com values our customers and takes pride in making sure our products meet and exceed their expectations. We have made efforts to ensure our customers understand our products and what they are purchasing. In your case, we took several steps to inform you that your subscription would automatically renew unless you canceled.

On step one of the sign-up process you entered your information on the payment plan and health profile page. On that very same page, there is a paragraph located directly under the payment plan options that explains your account will be renewed automatically until you cancel. Clicking the link below will take you to this page.

https://www.weightwatchers.com/util/sig/step_one.aspx

On step three of the sign-up process you were asked to read and accept the subscription agreement. The message reads, “By clicking on the “I agree, pay now” button below, you agree to be bound by the following subscription agreement and for us to charge your credit card in accordance with that agreement.” The Subscription Agreement, which you agreed to before gaining access to the subscriber tools, clearly sets forth our automatic renewal policy.

By clicking on the link below, you may refer to our subscription agreement for additional inquiries you may have regarding our automatic billing policy.

http://www.weightwatchers.com/legal/subagreement.aspx

In addition, when your subscription was processed successfully, you were brought to a welcome page. The billing message in step one of the sign-up process, also appears on this page. You are asked to print this page so that you can keep a copy for your records. It is your online receipt.

The individual subscriber is responsible for the terms of their subscription including the price plan under which they are billed and for canceling their account before it is automatically re-billed.

We evaluate eligibility for refunds on the basis of when the e-mail, fax, or letter requesting cancellation was sent. Due to these terms, you are not eligible to receive a refund.

Sincerely,
Ariel
Customer Service Associate
www.weightwatchers.com

Update 10-26-09:

They’re still trying to get me to rejoin, and obviously not listening to me:

Weight Watchers(R)
Stop Dieting. Start Living.

******************************

****************************************GET SMARTER ABOUT EATING

 

FEEL GREAT FOR THE HOLIDAYS

SAVE $20 – COME BACK NOW

HURRY! EXCLUSIVE FREE REGISTRATION* OFFER ENDS 12/5/09
Don’t let pumpkin pie, eggnog and holiday cookies get you off track.
Now’s the time to come back to meetings for personal support, weekly
accountability, and exclusive savings.

FIND A MEETING >>
http://info.weightwatchers.com/cgi-bin9/DM/y/eqlN0Pr7mx0iG30BQzK0Ex

PRINT THIS EMAIL and bring it to your first meeting to take advantage
of this special offer.

Using Social Networking to Enhance Your Career Prospects

There’s a very good column today in today’s Wall Street Journal that discusses the benefits of using social networking tools such as Facebook and LinkedIn to market your talents and capabilities:

Except in the case of bulk hiring positions, employers and recruiters are Googling candidates’ names as well as searching on Facebook, LinkedIn and Twitter, according to Mr. Schawbel. “This is done primarily to ensure the integrity and behavior of candidates and to make their resume piles smaller,” he says.

Kate Ruddon, vice president of talent acquisition at Activision, says that she uses sites like LinkedIn early in the recruiting process. She and her staff use social-networking sites to obtain background on a candidate’s work experience, area of expertise and education. “We utilize a number of professional networking sites and search sites like Google for the purposes of conducting research on a particular candidate, like press information,” she says. “Has the candidate spoken at industry events? Have they received any awards or public recognition? Additionally, we conduct research from multiple sites on specific companies we are targeting to recruit from.”

I am increasingly using my LinkedIn.com page as my online resume and set of references/recommendations, as it’s easy to keep up to date, it’s accessible by a wide variety of professionals, and it allows me to incorporate lots of good biographical information that I can’t easily summarize in a resume or curriculum vitae.  It’s also part of my email signature which aids people in finding out more about me when I first communicate with them.

What is your experience with using social networking and other Web 2.0 tools as part of your career strategy?

Aneil

This is How Starbucks Rewards My Loyalty?

Update 10-22-09:

I’m still not impressed with the Starbucks Rewards program.  Karen received one of Starbucks’s key chain loyalty cards several weeks ago with few dollars loaded on it, but I still haven’t received one, and I spend a lot more at Starbucks than she does (because I’m the one who usually who goes out to get the coffee).  So much for recognizing my loyalty!

Aneil

Update 3-15-09:

Starbucks clearly has its work cut out for it, as coffee drinkers continue to seek less expensive ways to imbibe at the expense of premium coffee providers, according to the Wall Street Journal:

As consumers gravitate toward cheaper beans, higher-quality coffee retailers have been affected to a greater degree by the economic downturn.

Caribou Coffee Co., of Minneapolis, earlier this month reported fourth-quarter 2008 earnings of seven cents a share on net sales of $68 million, a 3% decline from a year earlier. Net sales at its coffeehouses open more than a year fell 5.1%, as 230 stores have closed their doors since the 2007 fourth quarter.

Caribou is the third-largest company-owned gourmet coffeehouse operator in the U.S. As of Dec. 28, 2008, the chain had 414 company-owned coffeehouses and 97 franchised stores.

Starbucks Corp., the world’s largest coffee chain, posted a fiscal first-quarter revenue decline of 5.5%. In February, the company began the process of cutting 6,700 employees, or 4% of its work force.

In an effort to offer more attractively priced fare, Starbucks has entered the instant-coffee market and is pairing breakfast items with a cup of coffee for $3.95.

High-end coffee retailers “have to convince the consumer that they can drink much better quality coffee for just a little bit more than what you can make at home for a lesser-quality coffee,” said James Cordier, coffee analyst and founder of OptionSellers.com. “That window may have closed already, but there’s a chance they can keep their customers by offering quality coffee at a discounted price, because once people invest in that good coffee maker at home, you’re done,” he said.

Karen and I continue to cut back on our own Starbucks visits, both to save money and to cut down on our caffeine usage.  It doesn’t help Starbucks that they have done nothing to increase my loyalty over the last several months.

Aneil

Original Post 10-31-08:

Karen and I spend too much at Starbucks, but it really is one our one indulgence (that and eating out or doing take-out dinners with the kids when we’re both too tired to cook).  Starbucks knows how much we spend there, because we both use its card which automatically reloads a set amount when ever the balance goes below $5 (or any predetermined amount).

Why then do I have to shell out even more money, or make the drive out to Costco (where we do have a membership), wasting gas in the process, to get rewarded for my loyalty:

One of the moves is a new loyalty card aimed at Starbucks’s most frequent users. In the next few weeks, the company plans to introduce a Starbucks Gold card. Customers will pay a $25 annual membership that will give them 10% off most purchases and other perks. The company also has started selling Starbucks cards at Costco Wholesale Corp. outlets for a 20% discount. Mr. Schultz said Wednesday he doesn’t anticipate the chain will make any changes in its price structure.

It wouldn’t be too hard to automatically integrate with my current Starbucks card, providing me with a 20% rebate or adding free drinks if I spend a certain amount of money at their coffee shops each month.  Starbucks may think it is getting more new customers by selling its 20% off card at Costo, but they are irritating me in the process.

Starbucks is giving me yet another reason to quit going there and put the money I’ll save into my heavily depleted pension account.

Aneil

The Dangers of Outsourcing Too Much: Boeing and its 787 Dreamliner

Back in the 1990s, I would often lecture my MBA students that the Big Three auto manufacturers (back then, GM, Ford, and Chrysler) were risking too much by outsourcing large amounts of their manufacturing, engineering and design to automotive suppliers while relentlessly pushing those suppliers to reduce their costs simply by mandate.  In contrast, the Japanese automakers, while also using suppliers extensively, were much more collaborative in their relationships with their suppliers and their equally aggressive efforts to reduce costs.  One important risk was that eventually those firms supplying GM, Ford, and Chrysler would simply do their best work for the Japanese and other OEMs who pursued a partnership model.

In its efforts to cut costs, it appears that Boeing has not learned much at all from the failures from the domestic automotive industry, and the results are hardly surprising, according to today’s Wall Street Journal:

Boeing Co. Chairman and Chief Executive Jim McNerney said the company had overreached in outsourcing production on its marquee 787 Dreamliner program, leading to a string of problems and contributing to a $1.56 billion loss for the third quarter.

Mr. McNerney’s comments were the most explicit acknowledgement to date about the limits of one of the company’s major strategic shifts in recent years. One of the hallmarks of the Dreamliner program, which is more than two years behind schedule, was Boeing’s strategy to outsource most of the work to a network of global suppliers and perform final assembly at its Washington factory.

But Mr. McNerney said problems emerged partly because engineers were scattered around the world. He said Boeing needs to bring more engineers back in house. “When you look back, you see that we lost some of the disciplines, particularly within the context of outsourcing so much of the work,” he said on an earnings conference call Wednesday.

Beyond the Dreamliner, Boeing’s revamped 747 jetliner also has been beset with delays. Shuffling engineers from the new 747-8 program to the Dreamliner earlier this year contributed to delays and another write-down on the new 747, which mostly is being ordered as a freighter.

Boeing recorded $3.5 billion in previously announced third-quarter charges on its 747-8 and 787 Dreamliner jets in development and on Wednesday slashed its earnings forecast for the year.

I’m still rooting for Boeing to have a big success with the 787 Dreamliner.  Let’s hope it applies its lessons learned quickly.

Aneil

Downsizing with Downsizing Employee Morale — The Latest from France

The French business magazine, Business Digest, recently interviewed us as part of their profile of publication this spring in the MIT Sloan Management Review.  We were able to elaborate on our study and provide additional information not available in our original article.  Here is an excerpt from the Business Digest article:

In the face of a downturn, many companies turn to downsizing to cut costs. Yet, they often fail to achieve the expected payoffs, and in some cases, they end up worse off than they started. According to Aneil K. Mishra and his co-authors, downsizing doesn’t have to spell corporate disaster. When companies increase flexibility, innovation, and communication, they can emerge stronger, faster, and smarter.

“When leaders use open, empathetic communication (that is, they listen to employees with an open mind and try to understand their thoughts and feelings) and are clear about how the organization needs to improve, employees will feel ‘heard,’” says Karen Mishra. This in turn fosters trust, empowerment, and innovative behavior.  A.Mishra explains, “When people have the necessary information to make informed decisions, they will start to say, ‘How can we get better?’ The only way they’re going to [get better] is by being flexible and innovative—because they’re typically not going to get new resources.” And, Gretchen Spreitzer adds,
“Flexibility and innovation also encourage empowerment because they allow the possibility of new ways of doing things—not just one way—the bosses’ way.”

For a copy of the full article in French or in English, please go here, or contact us.

Aneil

Downsizing at Harvard: Hold the Eggs and Bacon

Cost-cutting and downsizing is all relative, as evidenced by this article about Harvard.  At least we got powdered scrambled eggs for breakfast each.  day when I was an undergrad at Princeton (I assumed they were powdered as they didn’t taste like fresh eggs; maybe they weren’t chicken eggs…).

By the way, Wake Forest U typically did offer cookies or similar snacks at many faculty meetings during the decade I was there.  One year, we even each received a $100 American Express gift check for achieving excellence in some now-forgotten category.  That was all before the Great Recession of 2008-2009, however.

Our boss has recently sprung for lunch at MSU for one faculty research brown bag, which was truly welcomed as the nearest lunch spot is at least a good 10 minutes’ walk, and there was no time between the faculty meeting and the brown bag guest lecture.   I hope that practice survives all of our cost-cutting.

Aneil

Can we trust bloggers?

An article in AdAge explains why the FTC is trying to crack down on bloggers who take pay or products for their endorsement.  The result if caught is that bloggers can face fines for blogging about products without disclosing their conflict of interest.

This does get at the concepts of authenticity and trust–if we read a blogger we like, can we trust that they are being open and honest and authentic about their claim about a product or service or do we expect that if the review is positive, that they must be getting paid.

For the record, we have never been paid or given free product to talk about any products or services we discuss here–we share the good and the bad based on our experience only.

An op-ed in the NY Times today dispels the notion that fines would actually help.  The author claims that we as consumers are savvy enough to sniff out the difference between an authentic evaluation and a paid one.  If not, the author says that it is our own fault.

I think if we read a certain blogger long enough, we know whether or not we can trust their judgement.

-karen