Future of MIP! Future of this once great company

Discussion in 'UPS Partners' started by jeepguy63, Feb 5, 2013.

  1. jeepguy63

    jeepguy63 New Member

    Greetings fellow management employees. I purposely did not use the "p" word. To continue to use the word and have fanciful discussions around the topic are simply delusional.

    Yesterday, all management took a 30% haircut in terms of wages for your services.
    No one in a small package environment contributed less effort. The vast majority of decisions, from region manager on down are limited and constrained by the few at the top. Therefore, our lack of growth, our inability to complete difficult transactions around the world, our inability to influence public officials in a similar way our primary competitor creates advantages for themselves, rest squarely on the shoulders of the Management committee and the BOD who employs them.

    Since the MIP redesign in 2005, instead of a share of the profits, the management, formally known as partners, have received awards purely based on the whim of the Salary Committee (whoever they are.)

    What will be the difference in 2013? In the domestic us, 65% of total net income, UPS competes in a two player market. The revenue growth goal is 5%. Nowhere on the planet is GDP forecasted to grow 5% certainly the domestic US will not grow at 5%.

    So, the next solution that will come from on high is to hold on to the rate increase. UPS has demonstrated only a slight capability to execute this strategy, and, all decisions regarding this strategy are made within 500 feet of the CEO/CFO's offices.

    The only other solution in the domestic us is to take premium product from from our primary competitor. That means a price war. We've never engaged in a price war, and it's not likely we will any time soon. In fact, without significant infrastructure investment (buildings), we can't even handle peak season now. So if we grew 5% this year, how much volume would get rolled in November and December?

    The only solutions that have been effectively managed by this company, are cost cuts - ala eliminating mgmt vacation vesting for the future year, MIP split into cash and RSU's...MIP rolled from 2011 to 2012....paying 70% for a job that was done 100%....cutting jobs that happen to be open at a particular point in time..... On and on..... UPS is a master at cutting cost.

    Look at page 88 of the 2011 annual report! Where will that money come from in the next couple years???? Outside of continuing to squeeze mgmt salaries through a "redesigned" QPR process, and a "redesigned MIP" the last remaining large bucket of cash to go after (without negotiations) is to "redesign" and "enhance" your pension plan.

    Folks, this ain't your old retired UPS friend's UPS any more.

    So where do we go from here? Tough question. Most UPSers are good UPSers because they are hard workers, loyal, and dedicated. To think that we're going to "dial it back" and give less than 100% will only satisfy the current anger we all feel. Yet, because of our makeup, when the next challenge calls for 110% effort, 90 some percent will meet the challenge.

    How about spreading hate and discontent on all the public blogs and boards (such as this one?) The reality of that strategy only tarnishes the image others outside of Brown have of those inside. That would have zero impact for positive change.

    What are the suggestions of this board?

    If we're no longer partners, can we unionize?
  2. Brownslave688

    Brownslave688 You want a toe? I can get you a toe.

    Don't take a job in management. Salaries are usually equal to demand. If they can't find anyone to take the job. Wages will have to go higher.
  3. curiousbrain

    curiousbrain Well-Known Member

    The answer, so far as I can tell, is obvious: quit, and move on to greener pastures.

    Unfortunately, quite a few are tied down with "old timer" obligations (like wife, family, kids, etc); that chunk of management is pretty much screwed unless they get lucky. For the younger people, such as myself, don't waste your time and do something better with your time: go back to school, work less hours and find a second job, anything.

    Management is a graveyard - and that's only from my purposefully limited perspective as a PT sup; I can only imagine the disgust guys with 20+ years feel.

    I mentioned my "limited perspective" above; now, it's possible that maybe things are not as rotten as they seem, and once you are free from the world of PT management, things suddenly make sense. Based on my observations, and the views expressed on this board, however, I seriously doubt it.
  4. LongTimeComing

    LongTimeComing Air Ops Pro

    From another PT sup, I can say that I wholeheartedly understand your perspective. I'm 29, and I fit the bill for your 'old-timer' obligations. But keep in mind that what you read here is from a vocal minority. Studies upon studies upon studies have proven that people who are unhappy with a workplace, product, piece of entertainment, or service are much more likely to want to express themselves about it. When they find a platform for this (like a forum such as this) they gather together in a unproportionality high level. This can skew the truth making it seem like EVERYBODY is of the same view.

    While I'm not saying that there are going to be problems, I think your local situation will control the experience. Who you work for, with, around, and above has more to do with things than what practices corporate puts into place. It all comes down to how that information is filtered throughout the ranks.

    My opinion? Get out of the package division, and everything else won't seem so bad.
  5. curiousbrain

    curiousbrain Well-Known Member

    Perspective is a function of location.
  6. beentheredonethat

    beentheredonethat Well-Known Member

    jeepguy63... I agree with most everything you wrote. However, you understated the issue. It's not really a 30% cut in MIP. You are basing that on saying they gave us a 70% to goal. Keep in mind, their goal is fictitious. It wasn't all that long ago that the MIP was based on 15% of profits, vs the salary of all mgmt (2*sum(mgrs monthly salary) + sum(supv monthly salary). If this was the case, I'm willing to bet that the MIP would have been closer to a 3.5. So even though you are upset, the mgmt committee already has you thinking they screwed you by 30% when in fact they screwed you by a heck of a lot more then that. It's ironic you bring up unionization. I had the opinion that this is a possibility if the trends continue. Unfortunately, what they are doing is working and I see it working well for anothe r5 - 10 years. However, after that point in time, I see problems. There are a lot of mgmt people that are 5-10 years from retirement. After that we will have a serious lack of mgmt talent with lots of experience. At that point I think we will be showing a lot of cracks in our infrastructure. The main thing keeping me here is the promise of a pension. They already took away the pension as we know if for new mgmt. (New mgmt gets defined contribution, vs defined benefit - which means the risk is 100% on us, vs the company). I'm just hoping they don't enhance us too much before I get out. I'm just glad I've got 25 years in so even if they make changes I should be locked in for some kind of pension (I hope).
  7. ppHATE

    ppHATE New Member

    A company cannot survive without a a culture no more than society can. Over the last few years, what we have seen is the steady decline of that formerly great partnership that bonded everyone together. Partnership was the keyword that made it all worth it. Partnership that was rewarded at the end of the year. Not in the Q1 "like everyone else" because UPS was never "like everyone else". UPS' culture was built around partnership, it no longer is.
  8. TxRoadDawg

    TxRoadDawg Member

    Maybe the air side has has enough outside overseers to still be reasonable. As for package ops the three smartest part timers I've seen all have mastered the 'I'm too busy' or 'I wasn't trained how to' mantra. Kings of pass the buck then look good from someone else's efforts.
  9. Monkey Butt

    Monkey Butt You can call me Chappy Staff Member

    The fact that the current culture does not include the concept of the old partnership does not mean there is not a culture.
    A culture is normally looked at from a point in the future and emulated at that point in time.
    The new UPS does not have a past history ... hence the new UPS culture is evolving.
    It may be another 10 -15 years before this new UPS culture is realized and emulated ... when the current leadership that is still looking 20 years in the past to define the company culture retires ... and the new UPS leadership assumes their role.
  10. jeepguy63

    jeepguy63 New Member

    Hoax - appreciate your many posts and your wisdom from your many years of service - thank you!

    Every company has their own unique culture. Ours (ups) is special to all of us. Most of us that have been around a while want to hold on to all of it...... Like work hard, what-ever-it takes, company above self, etc, etc, etc. In exchange for the dedication and loyalty, we were paid well above our peers in the industry - and many other industries for that matter.
    The current challenge is twofold.
    One - we are being managed by a group (region manager level and below, plus the COO) who believes everyone should work the job and put their life in UPS's hands like the previous culture demanded. The expectation for hours, results, relo willingness, united way contributions, etc are the same.
    Two - the BOD and the consultants are changing the job to mirror the industry in terms of pay, benefits, evaluations, etc. Their view, in my opinion is that the cost of maintaining the culture is simply too high, and they have a view of a different culture in mind.

    GE has a strong culture. It is a culture Jack Welsh strengthened throughout his ternure. Simply put, it is a meritochracy. Perform well get paid well. Don't perform well - get tossed out. That culture clearly works well for them - in a non-network environment. At UPS, each person, each operation can look better tomorrow at the expense of someone else today. That may be where the BOD is driving this ship. Certainly the QPR / Salary increase system is driving it that way. I don't know that our customers get a better product or experience in that environment.... Time will tell.

    The salary/merit increase system is a fine example of blending old ups with new. Merit increases are larger for stronger performers......but (old ups) there are caps on salaries so we keep everyone in a tight range. Someone who has relo'ed several times and been a strong performer all their life has their salary capped out in their mid 40's. So, the system works as a meritochracy - until it runs into the old UPS brick wall called caps.
  11. jeepguy63

    jeepguy63 New Member

    Been ther - trust me - I didn't miss that at all. But I also didn't comment on the way our perscrition plan used to work, the way our healthcare plan used to work, and all the other "useta's". I commented back then that the change erodes trust when a calculatable number moved to a subjective whim of a few in control.

    My comments were intended to provoke thought and expression of "what are we going to do, collectively, about it."
  12. 2BOver

    2BOver New Member

    What can you do? You work for a very large corporation that does not care about the front-line people doing the day to day activities that makes the money for them. Unionize? Won't work....they will nip it so fast it would make your head spin.

    The only thing I see happening that will change the direction we are going is for all of the 30-40 year old management people that UPS has educated and trained leaving the company in masses headed for other jobs. Once that happens, and it already is in the BD group, the people making these "tough" decisions will realize they are driving the company into the ground.
  13. badsporh

    badsporh Member

    They now treat the Center level management like they're complete trash......my heart goes out to you guys......in my life time I don't think I've ever seen more of a can't win, catch-22 situation.........they charge you guys with unrealistic expectations and unattainable goals on a daily basis......constantly threaten your jobs, either directly or through innuendo.....and they put you on an island....an island and which they alienate themselves from you, and they force you to alienate yourselves from the union employees..................I'm a shop steward......and I've been with the company for a quarter century.................I def wouldn't want to be in ANY of your positions
  14. We work for shareholders not UPS...thats whats wrong!!
  15. brownIEman

    brownIEman Active Member

    Just out of curiosity, anyone dig into the SEC filings to see if they can determine what percentage of pre-tax profit the total MIP payout would equate to? I realize it is no longer tied to 15%, just wondering if it is still close to that in the new measure or down around 5 or less...
  16. xcessuv

    xcessuv Benhearb4

    Rumor mill, if you were born 1962 and after, possibility of dumping your pension into your 401K in a lump sum. Is that legal?
  17. xcessuv

    xcessuv Benhearb4

    We changed from United Parcel Service to UPS for a "reason"......we will be divided. The next 5 years will see a mass exodus of management from retirement and disatisfication. I hope I can survive to the retirement stage, but after 30 years, I see they can do whatever they want to you and you can't do a thing about it. Good luck and success to those I once called partners!
  18. Monkey Butt

    Monkey Butt You can call me Chappy Staff Member

    Until you retire, the pension can be changed at will.

    I considered this when making my decision to retire effective at the end of this month.

    Go to Total Rewards and take a look at how much your pension is worth according to UPS.
  19. brown bomber

    brown bomber brown bomber

    just remember.....even lions eat their own ??
  20. beentheredonethat

    beentheredonethat Well-Known Member

    If they do this, then that will cause a mass exodus of people. Lots of people are here due to the pension awaiting them. I know that's the main reason I am staying.