AOL CEO, Tim Armstrong managed to get the WWW world very upset this past week. His remarks over distressed babies sparked a firestorm of backlash, including a blog by an AOL employees’ wife who had had a premature baby and was one of the reasons cited for the decision Mr. Armstrong made to cut back on retirement benefits. He has since reversed his decision to cut back the benefits. And he has apologized.
His remark reached new heights of insensitivity and stupidity, I wonder how he even came out with such a statement, however, an apology would have been sufficient. There was no need to reverse a sound business decision because he made an incredibly ignorant comment, and dear God, it was ignorant. The fact is health care costs ARE rising, and companies are being hit as a result. Decisions do have to be made regarding the continued cost of covering certain employee benefits. Companies have a fiscal responsibility to their stakeholders to ensure that costs are being managed.
I do not believe the decision to cut costs was made in isolation, nor without some degree of angst and discussion amongst the management team. A lot of time and work and analysis likely went into the decision…and because the CEO made an asinine remark, all of that goes to waste.
I am not excusing the remark… it should have never been made. And it was an extremely costly one to AOL. Here is a thought, maybe AOL, and other organizations could have a stupidity fee levied against their executive team. In Mr. Armstrong’s case, his net worth is around $400 million according to www.celebritynetworth.com Maybe he could pony up a million or two as a gentle reminder to keep such thoughts to himself, and still be permitted to roll out the difficult business decisions that need to be made.