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Dish network the meanest company in America For 2012, the website 24/7 Wall St. determined that the worst company to work for in America was the Dish Network, the Engle-wood (Colo.)-based company that provides satellite TV to more than 14 million subscribers. To pick its winner, the site began by sifting entries on glass door.com , an online service where people gossip about their jobs. It was hardly the most scientific of methods. Still, the volume of miserable tales about Dish is impressive; 346 former or current employees had taken the time to write not-so-nice things about the company. On a scale of 1 to 5, they ranked their company an average of 2.2, beating Dillard’s and RadioShack (RSH) for the spot at the bottom. The most common com-plaints were long hours, lack of paid holidays, and way too much mandatory overtime. Some posts suggest that merely setting foot in Dish’s headquarters is a danger to the soul. “Quit” was the recommendation to one Dish employee who sought management advice. “You’re part of a poisonous environment . . . go find a job where you can use your talents for good rather than evil.” The roundup noted one other thing: The share price was up more than 30 percent for most of the year. Much of the malice, and value generation, can be traced to one man: Charlie Ergen, 59, the founder and chairman of Dish. Although he turned over the role of chief executive officer to former Sirius XM Radio head Joseph Clayton in 2011, Ergen remains the core of Dish—and its largest shareholder, with 53.2 percent of the outstand-ing shares and 90.4 percent of the voting rights. Ergen founded Dish more than 30 years ago, installing satellite systems with partner Jim DeFranco. Dish is now the sec-ond-largest satellite TV provider in the U.S., with 26,000 employees. Ergen, according to the Bloomberg Billionaires Index, has an estimated net worth of $11 billion. Michael Neuman knew the risks going in when he accepted Ergen’s offer to be Dish’s president and chief operating officer in 2005. Before Neuman, no president had lasted more than four years. Still, for Neuman, a man who’d known Ergen for more than a decade and had run a Dish-like satellite service in Canada, the opportunity was too tempting to pass up. Unlike its major competitor, DirecTV (DTV), Dish was fully integrated: It engineered, built, and sold all its own set-top boxes and ran its own installation fleet and customer service. (The company split in 2008, with EchoStar [SATS] building the boxes and Dish doing everything else. Ergen remains chairman of both companies.) “If you’re a student of management like I am, it was irresistible,” says Neuman. At first, Neuman loved working at Dish but over time he came to realize why former presidents such as John Reardon, who lasted less than a year, described Ergen as “pounding people into submission.” The hours were long, yes, but it was Ergen’s habit of unilaterally making decisions that most irked Neuman. Although Dish had more than 100 people employed in its marketing department and reams of customer data to analyze, when it came time to figure out how much it was going to charge for satellite service, Ergen went into his office and came up with the final number alone. “It would be like the CEO of Kraft getting up in the morning and determining how much they were going to charge at retail for 12 slices of American cheese,” says Neuman. “It wasn’t that he didn’t invite input or share his thought process, because he did both. It’s just that he’d had his hands on the wheel for so long that he trusted his own judgment the best.” What made it worse, Neuman says, is that Ergen was almost always right. Eight months after accepting the job, Neuman resigned. Judianne Atencio left Dish not long after. As head of communications for a decade, she had witnessed some of the company’s biggest triumphs, including the successful launch of its satellites and the signing of its 10 millionth subscriber. She had also been around for some of its most crushing defeats, such as Murdoch’s last-minute cancellation of a planned merger and the federal government’s denial of another with competitor DirecTV. “I didn’t have a life for 10 years,” she says. “I couldn’t even have a dog.” There were times when Ergen screamed so loud at Atencio that she packed up her stuff and had to be persuaded in the parking lot to return to work by an apologetic board member. A friend who had worked in the White House even tried to comfort her by saying, “Charlie’s like Clinton—he only screams at the ones he cares about.” A selfdescribed “country boy from Tennessee,” Ergen is capable of a Warren Buffett–style folksy charm. He often packs his own brown bag lunch and has lived in the same house for 20 years. Ergen and his four siblings grew up in Oak Ridge. His father was an Austrian-born nuclear physicist who worked on the Manhattan Project. Ergen’s first real job out of school was as an accountant at Frito-Lay. He quit to work as a professional gambler, with black- jack his preferred game. He was so good at counting cards that he has told reporters he was once tossed out of a Las Vegas casino. At Dish, he still keeps a counter’s eye on the numbers. Up until a few years ago, as he noted at a recent talk at the University of Colorado, Ergen signed every check that left Dish headquarters, a process that took him three to four hours a week and left him with an un-paralleled understanding of how money was moving out of the company. He still signs company checks today, though now that Dish has $14.3 billion in annual revenue and $2.4 billion in operating expenses, Ergen reserves his signature for anything over $100,000. At Dish headquarters in Engle-wood, a suburb of Denver, the day begins no later than 9 a.m. Badges used to be the preferred method of entry into the building. But a few years ago, after noticing that some employees were taking advantage of the system by having others badge-in for them, Ergen upgraded to finger-print scanners. If a worker is late, an e-mail is immediately sent to human resources, which then sends another to that person’s boss, and sometimes directly to Ergen. Multiple ex-employees say it’s not uncommon to see Ergen publicly berate an executive for scanning in a few minutes late, even if that executive had spent the previous 12 hours at home working through the night. Neumann, when he was still president, refused to implement Ergen’s pro-posed strict badge-in policy. He worried it might be “demoralizing.” Employees, both current and former, describe an Ergen created culture of condescension and dis-trust. Vikas Arora, a manager on Dish’s international content acquisition team, had never worked anywhere else in the U.S. until he left the company last year. That’s when he discovered that “outside of Dish, people are actually treated like adults.” Whereas many companies are doing their best to cater to millennials who demand flexibility among other benefits, Dish doesn’t allow its employees to work from home. It offers no company credit cards. And according to a former regional manager, for many years, if an employee expensed a meal where they’d tipped more than 15 per-cent, the extra amount was then subtracted from his paycheck, even if he’d only gone over by a nickel. Turnover is said by many employees to be constant, and while no one knows exactly how many employees are laid off during regular quarterly culling’s, all employees are aware of the company’s euphemism for the blood-baths: “talent upgrades.” There’s a running joke on glassdoor.com that Dish is an acronym for “Did I sleep here? “We’re a one-trick pony,” Ergen has said of Dish, which has a sole product: satellite TV. In a November earnings call, Ergen talked about how his five kids—most of whom don’t even have cable subscriptions—think he’s “crazy” to be in the pay TV business. To address that, Ergen has spent nearly $3 billion in the past two years buying wireless spectrum from bankrupt companies and just received word of a favor-able Federal Communications Com-mission decision that may allow him to deliver video to tablets and cell phones. He’s also made it clear that he’d like to try again to merge with DirecTV and have his own mobile network to compete with telecom giants such as AT&T and Verizon, though a succession of recent wire-less industry consolidations has possibly imperiled those plans. Since Ergen relinquished the CEO role, Dish employees say the company has relaxed some. It is, according to the former regional manager, now possible to leave a 17 percent tip without incurring a personal charge. But austerity and meanness still have their place. In response to the economic down-turn, it takes longer to accrue vacation days, and holiday parties have been scaled back. The company reports earnings on February 22. It’s beaten estimates five out of the last eight quarters. Questions 1. How would you describe CEO Ergen’s approach to output control? Give examples to support your view. 2. How would you describe CEO Ergen’s approach to behavior control? Give examples to support your view. 3. Given his approach to control, what kind of values, norms, and organizational culture has he created for Dish?
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