Why are we burning down so many libraries?

I was listening to a story on Bloomberg News a few weeks ago about Boeing engineers who had been asked to retire as a cost cutting measure, but their retirement was not the focus of the story. They were asking them about the recent tragedies involving the 737 Max.

Those interviewed were deeply saddened, but not shocked. Most seemed to have been working on the 737 Max project and had voiced concerns about the loss of experience and knowledge walking out the door.

I will be the first to say, correlation does not necessarily mean causation, but it does make you pause and think.

One of my favorite anonymous quotes is: “Every time an old man[sic] dies a library burns down”. Retirement certainly is not the end of your life. For some it is the beginning. Others want to continue to contribute. When you leave the firm though, the library is no longer accessible.

I live in Atlanta, and I’m sure my city is not unique. Over the last few years we have seen many of the fortune 500 offer early retirement packages for experienced employees. Being intelligent, experienced managers, they got the message.

This is how capitalism works and we accept it. Besides no one wants to remain someplace where they’re not wanted. I’m certain the financial savings boosted the stock price, for a while.

So why are we burning down so many libraries?

One reason is short term thinking. American public firms, maybe like no other, manage quarter to quarter to appease markets and maintain the value of options being held as compensation. No one likes to get those nasty margin calls.

Firms in Japan manage to a longer time horizon because it is part of the business culture. They have issues, but short-term thinking isn’t one. Private firms tend to think longer term because they aren’t pressured to maintain their market value hour to hour.

I am sure there are other reasons for why we choose to suddenly devalue experience. I just can’t think of any good ones.

The current economic recovery, while tepid, has lasted longer than most, but another recession is coming we just don’t know when. If you accept this, wouldn’t you want some managers in your firm that have experienced tough times along with their ability to guide less experienced employees. Cooler heads if you will.

How valuable is an employee that has designed and launched multiple products and campaigns? What value do you place on someone who is experienced at talking to your customers? For example, someone who knows just what to say to the customer when things don’t go as planned because they have done it before. What is the value of having a younger employee with them when they do these things?

We can’t know for certain short sightedness affected Boeing’s 737 Max, but is it worth the risk?

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