Gibson CEO rumours

Jez6345789

If that memo, that is well circulated on the web is real, it really only demonstrates he is not exactly winning hearts and minds with his people.  I have always felt once you have to explicitly enforce this sort of thing, other than the odd bad apple, you have lost the passion and commitment from your management and workforce.  As for his Coat and tie dress code for management, it further goes to create the good old us and them leadership style which does nothing to build loyalty in a workforce. 

I noticed on the factory tours I did Martin in particular blue jeans or whatever you wanted ran through that place including Chris Martin who was walking the floor talking to people when I went. 

Hey Henrys Harvard management style seems to be from the 50/60's management

fandango

WezV said:

Hmm.  Carrying the responsibility does not mean you have to be there constantly.  

I consider my teams to be well managed because I can afford to step away and leave them to it.  I wouldn’t dream of micromanaging them, that would be annoying for them and more work for me. 

Henry J (and every other micromanaging CEO) could learn a thing or two from Ken Blanchard & Spencer Johnson in their book “The New One Minute Manager”.

It take a savvy CEO to get the best out of the workforce. And it takes a very savvy CEO to keep his staff sweet so they give him their best.

ICBM

crunchman said:

It's worse than that.  There is $145m that matures in June, and then you have the $375m.  Total is $520m.

https://www.thestreet.com/story/14280618/1/gibson-guitar-may-default-if-company-can-t-refinance-its-debt.html

They are "rationalising" some of the other businesses they bought.  They have stopped development of Cakewalk.

Well that will save a fortune…

I'd be surprised if there's any way of 'rationalising' the other businesses except selling them, and then the question is whether anyone would pay enough for them to cover Gibson's debt, given that it's now clear that they're not very profitable.

The good news is that if (or more likely when) the inevitable happens, Gibson - the guitar making company - is very definitely worth something. Someone will certainly buy not only the brand and the intellectual property, but probably also the factories. There's no way that an iconic brand like this will disappear.

The irony is that in 1986 when more or less the same thing happened and Norlin was broken up, the person who stepped in to save the Gibson name was Henry Juszkiewicz.

SteveRobinson

Gibson launches search for new CEO to replace Henry Juszkiewicz

https://guitar.com/gibson-is-looking-for-a-new-ceo-replace-henry-juszkiewicz/

Neil

SteveRobinson said:

Gibson launches search for new CEO to replace Henry Juszkiewicz

https://guitar.com/gibson-is-looking-for-a-new-ceo-replace-henry-juszkiewicz/

Should be plenty of applications from random people on guitar forums who all think they can run a guitar company profitably. 

UnclePsychosis

Neil said:

SteveRobinson said:

Gibson launches search for new CEO to replace Henry Juszkiewicz

https://guitar.com/gibson-is-looking-for-a-new-ceo-replace-henry-juszkiewicz/

Should be plenty of applications from random people on guitar forums who all think they can run a guitar company profitably. 

Another post that needs a lolwiz button! 

octatonic

Neil said:

SteveRobinson said:

Gibson launches search for new CEO to replace Henry Juszkiewicz

https://guitar.com/gibson-is-looking-for-a-new-ceo-replace-henry-juszkiewicz/

Should be plenty of applications from random people on guitar forums who all think they can run a guitar company profitably. 

Brilliant.

This is welcome news though, provided the new CEO moves the company away from being a lifestyle brand and concentrates on the core business.

Fretwired

Gibson guitars is seriously profitable - it's a sound company. The problem is the debt and losses from stupid acquisitions like Phillips. Henry says he'll be CEO for a while and will then stay on in the company in an advisory role (Music Radar interview yesterday).

He also ruled out following Fender into making instruments in Mexico or the Far East. He said Gibson is a US brand. You get bet the new management will see things differently. A stripped down, high quality Les Paul Studio style guitar or Junior made in Mexico at a reasonable price point would sell.

peteri

I think it's pretty clear Henry is completely delusional, it's almost inevitable since the alternative is to admit just how much he's stuffed up.

The idea that given the state of affairs he'll be given any degree of power or say is to me just a joke, this is just PR to imply a 'continuity of management' etc for shareholders/the market/creditors.

I think the most he'll do is be consultant in charge of paperclips etc.

He certainly will not have a say on what is built and where - they're tried that, and that didn't go so well

crunchman

Neil said:

SteveRobinson said:

Gibson launches search for new CEO to replace Henry Juszkiewicz

https://guitar.com/gibson-is-looking-for-a-new-ceo-replace-henry-juszkiewicz/

Should be plenty of applications from random people on guitar forums who all think they can run a guitar company profitably. 

It would be hard to do a worse job than Henry has the last few years.

Just hire some decent people to run marketing, finance etc.  Don't waste money on idiotic designs no one wants.  SOrt out the quality control.  Treat your staff well.

With a brand name and heritage like Gibson, you have to be utterly incompetent to make a loss.

guitars4you

As many suspected, they want a businessman at the helm and not a guitar player - Chances are it will be someone from outside our trade, maybe with, or without guitar related interests - Similar to Andy Mooney CEO of Fender - That does not mean an inferior product in anyway, but it does mean, product ideas and development will not be created from the top down - Maybe a good thing or not - depends how much the appropriate powers listen to the staff who surround them, plus players and dealers who support them - Obviously unknown at this stage what manufacturing back ground a new CEO will have - The worry is of a walking suite, who is profit only, to the point of big price increases

Far to early to know how this will impact on build location - ie USA only, MIM or MIJ etc - Plus what the product line up will be - It will probably mean that only good profitable lines will continue within the range

The Fender Custom Shop recent price hike in the last 2 years from 2Kish in the UK to over 3K ish is based on such CEO activity - Granted a falling pound has not helped, but Brexit has had little/no impact on this pricing policy, as mainland EU are the same/similar prices as UK - It is finance + CEO driven, for a company to make a far stronger profit in  a market place that is not growing

crunchman

guitars4you said:

The Fender Custom Shop recent price hike in the last 2 years from 2Kish in the UK to over 3K ish is based on such CEO activity - Granted a falling pound has not helped, but Brexit has had little/no impact on this pricing policy, as mainland EU are the same/similar prices as UK - It is finance + CEO driven, for a company to make a far stronger profit in  a market place that is not growing

I've bought a CS Fender around £2k in the past, and if they were still around that price, I might again.  I'm not paying £3k plus though.  When they are at that price, I'll look at other options.

If they want higher margins, then that's their choice, but it will be at the expense of a smaller number of sales.

The other thing that will count against them is that there are more and more second hand ones out there all the time.

terada

crunchman said:

guitars4you said:

The Fender Custom Shop recent price hike in the last 2 years from 2Kish in the UK to over 3K ish is based on such CEO activity - Granted a falling pound has not helped, but Brexit has had little/no impact on this pricing policy, as mainland EU are the same/similar prices as UK - It is finance + CEO driven, for a company to make a far stronger profit in  a market place that is not growing

I've bought a CS Fender around £2k in the past, and if they were still around that price, I might again.  I'm not paying £3k plus though.  When they are at that price, I'll look at other options.

If they want higher margins, then that's their choice, but it will be at the expense of a smaller number of sales.

The other thing that will count against them is that there are more and more second hand ones out there all the time.

+1. I’d be tempted at 2k but not at all at 3k. I’ll just stick with my avri fenders and be done with it. 

ICBM

Sustaining profitability without continuous market growth seems to be a difficult concept for business-school corporate types, for some reason. Likewise maintaining a consistent product range and quality without constantly trying to cut corners...

So my nomination would be someone from Rickenbacker, because they seem to be the only company which knows how to do both those things.

They also have plenty of experience of high-handed behaviour towards their customer base without harming sales, so should be a good fit for Gibson .

guitars4you

crunchman said:

guitars4you said:

The Fender Custom Shop recent price hike in the last 2 years from 2Kish in the UK to over 3K ish is based on such CEO activity - Granted a falling pound has not helped, but Brexit has had little/no impact on this pricing policy, as mainland EU are the same/similar prices as UK - It is finance + CEO driven, for a company to make a far stronger profit in  a market place that is not growing

I've bought a CS Fender around £2k in the past, and if they were still around that price, I might again.  I'm not paying £3k plus though.  When they are at that price, I'll look at other options.

If they want higher margins, then that's their choice, but it will be at the expense of a smaller number of sales.

The other thing that will count against them is that there are more and more second hand ones out there all the time.

the amount of used guitars out there is probably the biggest single issue for any one involved in the new guitar business - almost period and full stop on that - All figures released by the MIA/NAMM etc do not take into account one Iota the used market - Their sales info is based on manufacturing and distribution - All manufactures only make a profit once on a new guitar - I can sell the same used guitars over a number of years and make a cut on it each time - they  can't

No one can make any individual buy a new guitar, at any price, but the cost of production and related costs, be it staff, financing the business etc, means the days of a  2K C/Shop model are long gone - We might not like it, but it is here to stay - Any potential future down turn in sales will not re-create low prices on this product line - They can't make for £10 and sell for £9 - For many of us, such purchases are made on a want, not need, basis, and of course an excess of available funds

I read a recent article about the current world excess stock  of high end boutique brands - Mainly in the clothing and accessory sector - They will rather destroy excess stock, than flood the market, with lower prices - they need to keep it exclusive and low prices won't help the related image  - Obviously such losses from a such a policy are either off set against taxable profits and/or built into the price of what they do sell

It does beg the question of how much more can they keep making and we keep buying - especially in  a market place with no/little obsolescence

guitars4you

ICBM said:

Sustaining profitability without continuous market growth seems to be a difficult concept for business-school corporate types, for some reason. Likewise maintaining a consistent product range and quality without constantly trying to cut corners...

So my nomination would be someone from Rickenbacker, because they seem to be the only company which knows how to do both those things.

They also have plenty of experience of high-handed behaviour towards their customer base without harming sales, so should be a good fit for Gibson .

agree with your comments - perfectly valid - the perpetual growth issue - Many looking for % growth and £/$ growth year on year - No longer acceptable in corporate board rooms to grow say £100K retained profit each year - They want 100K, then 110K year on year etc etc etc - Yet achieve 100K retained profit each year, for 10 years and you now have built up a Million £ retained profit basis - Not bad in my opinion - But not good enough for the city and venture capitalist, who only are interested in growth, plus return on capital invested + acquisition - It is such 'city greed' + globalization that gives true capitalism a bad name !!!

Rickenbacker have a big advantage in that the Hall family, who own/run Rickenbacker, have a serious portfolio in real estate - Granted it still has to stand on its own 2 feet and it has done this year in year out without trying to be #1 in sales - It is proud of its history - But it is more of a 'hobby' for the family, compared to the bigger picture

ICBM

guitars4you said:

Rickenbacker have a big advantage in that the Hall family, who own/run Rickenbacker, have a serious portfolio in real estate - Granted it still has to stand on its own 2 feet and it has done this year in year out without trying to be #1 in sales - It is proud of its history - But it is more of a 'hobby' for the family, compared to the bigger picture

I know, and I wasn't entirely serious . Although Rickenbacker is totally successful at what it chooses to do with a very niche product, I don't actually think the same approach would translate to the much larger volumes of Gibson. Although it would possibly be not a bad idea to at least take on board some of the same concepts.

Sooner or later the whole industry is going to need to radically re-think the entire standard corporate business model though - if it doesn't then there will eventually be high-profile failures. If I was being optimistic I would say that Gibson have been given a golden opportunity to be the first, but I think it's unlikely.

warhead

ICBM said:

crunchman said:

It's worse than that.  There is $145m that matures in June, and then you have the $375m.  Total is $520m.

https://www.thestreet.com/story/14280618/1/gibson-guitar-may-default-if-company-can-t-refinance-its-debt.html

They are "rationalising" some of the other businesses they bought.  They have stopped development of Cakewalk.

Well that will save a fortune…

I'd be surprised if there's any way of 'rationalising' the other businesses except selling them, and then the question is whether anyone would pay enough for them to cover Gibson's debt, given that it's now clear that they're not very profitable.

The good news is that if (or more likely when) the inevitable happens, Gibson - the guitar making company - is very definitely worth something. Someone will certainly buy not only the brand and the intellectual property, but probably also the factories. There's no way that an iconic brand like this will disappear.

The irony is that in 1986 when more or less the same thing happened and Norlin was broken up, the person who stepped in to save the Gibson name was Henry Juszkiewicz.

He had the luck of Guns `n` Roses happening in 1987......we should never forget about that "detail".....

p90fool

crunchman said:

Neil said:

SteveRobinson said:

Gibson launches search for new CEO to replace Henry Juszkiewicz

https://guitar.com/gibson-is-looking-for-a-new-ceo-replace-henry-juszkiewicz/

Should be plenty of applications from random people on guitar forums who all think they can run a guitar company profitably. 

It would be hard to do a worse job than Henry has the last few years.

Just hire some decent people to run marketing, finance etc.  Don't waste money on idiotic designs no one wants.  SOrt out the quality control.  Treat your staff well.

With a brand name and heritage like Gibson, you have to be utterly incompetent to make a loss.

It isn't making a loss. 

guitargeek62

Neil said:

SteveRobinson said:

Gibson launches search for new CEO to replace Henry Juszkiewicz

https://guitar.com/gibson-is-looking-for-a-new-ceo-replace-henry-juszkiewicz/

Should be plenty of applications from random people on guitar forums who all think they can run a guitar company profitably. 

It says the role is for CEO/President, but that's still not the Chairman of the Board, which Henry J may still retain. This could still be a good move though, and brings with it a nice PR opportunity even if that's the case. I suspect we haven't seen the last of him just yet!