Two large corporations that have announced amazingly stupid and borderline suicidal things are now reconsidering. This is a good thing as it shows that there may just be hope after all and that common sense may still exist.
Bank of America ignited an absolute sh*tstorm this month when it announced a new $5 charge for debit card customers amidst plans to lay off 40,000 workers. As a private company they are within their rights to do this, the controversy stemmed from the fact that they didn’t appear to be within their right minds – charging people to spend their own cash (albeit in plastic form) just doesn’t have a good connotation to it, especially after you’ve enticed so many to open accounts with precisely that convenience in the first place. Here’s Nelson Schwartz in the New York Times writing about the public outcry that met the company’s initial announcement of the charges:
Bank of America officials were caught off guard after the planned $5 fee was disclosed late last month. Days later, President Obama said customers should not be “mistreated” in pursuit of profit, while Vice President Joseph R. Biden Jr. called the move “incredibly tone deaf.” Senator Richard J. Durbin of Illinois, the No. 2 Senate Democrat, took the unusual step of denouncing the bank on the Senate floor, urging customers, “Vote with your feet. Get the heck out of that bank.”
Well it appears that the “New BAC” is not going to move forward on that particular measure – at least not as originally envisaged. Supposedly the bank is reconsidering how many more of their customers to exempt from the cost. I recommend they exempt all of them and just make that whole concept go away. But what do I know, I’m not Too Big To Fail or anything.
One other example of this kind of reawakening of logical reasoning is the decision this week not to commit suicide by Hewlett-Packard, a company that has done more damage to itself than a morose teenage girl standing in front of a mirror. After making a criminally-stupid and desperate announcement about spinning off it’s $40 billion PC business to “unlock shareholder value”, the company appears to have reconsidered and come to its senses. Here’s new CEO (and longtime board member) Meg Whitman on the change of heart (via the WSJ):
“H-P objectively evaluated the strategic, financial and operational impact of spinning off” the PC business, said Whitman, who assumed the CEO post after she and other directors dumped her predecessor, Leo Apotheker, last month. Keeping the business “is right for customers and partners, right for shareholders and right for employees,”
After a series of ridiculous and highly ridiculed strategic missteps (firing Hurd, hiring Apotheker, buying Palm, killing Palm, and on and on), it appears that the venerable Dow component and autochthonous American technology giant is ready to start acting its age again and not its share price. Thank god, the last thing we need to see is another Eastman Kodak stumble off into the jungle of obsolescence.
$BAC $HPQ $EK