FROM THE STOOL

SEPARATION

Few words in our language are subject to as many definitions, or generate as much emotion, as the word separation.

For lovers, those in love, the happily married, occasional separation amplifies the joy of reunion.

A formal separation agreement, however, in most cases precludes reunion and leads to divorce. In a garden, separation eliminates the weak and helps the strong get stronger. For Siamese twins, separation can mean a more normal life. The great chefs create masterpieces by mixing and separating ingredients.

Only in business is the process of separation never pleasant in most cases painful even where the reasons are sound and when ultimately the company benefits.

While corporations have fine tuned the art of restructuring, downsizing, layoffs have developed new concepts like position elimination the end result is people lose their jobs, often without warning often when they are most vulnerable they are fired kids in college lots of debt close to retirement but unable to retire.

If there is anyone in business who enjoys closing a factory, phasing out a business unit, or firing a fellow employee, I never met him or her in over thirty-five years of corporate management.

Most companies are dedicated to making any separation for anyone, save thieves and muggers, as humane as possible. Policies are adopted to provide generous severance benefit continuation and intense outplacement counseling to help all but the hopelessly incompetent relocate successfully.

Jack Welch, retiring CEO of General Electric, generally considered to be the most successful and effective ever in U.S. industry, promotes the philosophy that senior management must nurture the top 20% and separate the bottom 10% quickly. Public markets and shareholders have given Welch's views the highest marks and no company has performed better than GE over the past 20 years.

Despite billions spent on in-house training, the speed and the growth of technology and resultant productivity gains dispossess thousands of loyal, hard working, effective, long service employees every year, often the only way for a business to generate rapid sales and earnings growth in highly competitive markets, which makes raising prices all but impossible. No inflation provides huge benefits for those who are working but ironically forces high levels of separation. Public markets reward companies with higher share prices for restructuring a buzzword for producing more with fewer people. While most who face separation are able to acquire new skills and to start over, they cannot escape the shock associated with the experience the unwillingness to accept someone else's perception of their failure the inability to overcome what they feel is a lack of fairness.

For most people their lives are defined by their jobs. Corporations for the last half of the 20th Century have made a religion out of team building, the development of the concept of the corporate family. It is not surprising that the separated, even where shortcomings have been identified and accepted, are devastated when asked out of the family off the team.

Free enterprise capitalism like professional sports, produces winners and losers not always fair survival of the fittest but the backbone of the most open and free society on earth.

Knowing that our system works where no other does, doesn't make the separation of a friend any easier. No single separation makes any real difference the process assures the winners keep winning.

If anyone reading this column has a suggestion universal separation insurance the separation pill please write, as I have never been able to overcome separation anxiety.