Yesterday I posted a lead from a reader complaining about a holiday party that Freddie Mac hosted, the objetcion being it was inappropriately splashy (the reader used, and I repeated, the overwrought “decadent”) given that Freddie is losing quite a lot of money these days ($2 billion last quarter, almost certainly the same this quarter, no indication as to when there might be an end of the red ink).
Several readers dumped on me, in particular Tanta at Calculated Risk, for denying employees their fun given that some parties here and there aren’t going to make a dent in $2 billion and counting of losses.
Now upon reflection, I think there were better grounds for having a go at me, namely that I put up the post in haste, doing no more than checking if the source had his Freddie numbers right and providing links for same. I let his over the top indignation stand. He undermined his credibility by being overwrought, and I went along because I knew putting “decadent” in the headline would pull in more traffic.
And I don’t meant this as a jibe at Tanta; other readers echoed her views; she did the heavy lifting by being the most articulate. I have a great deal of respect for her, but to me, this shared response illustrates some deep seated cultural attitudes that I find odd. And by definition, that makes me the odd man out.
First, let me reveal a general prejudice: I think the prevailing form of holiday office party is a lousy idea and ought to be abolished. Now I am certain to get disapproving comments from the 15% of office workers who like them and 100% of the readers who work in the hotel or catering business and depend on them. I will discuss that there are some variants of holiday parties that are quite reasonable, but (at least from what I can tell) they are less common.
The prototypic office holiday party is:
For members of the company only
May or may not involve significant others
Occurs between Thanksgiving and Christmas
Occurs on a weeknight
These are objectionable features. People are pretty much required to show up at these events. At every firm I have worked for, people have regarded going at best with indifference and at worst with distaste. You are expected to act like you are having a good time, but you can’t drink too much or you might do something stupid and/or be hung over the next day. Now for companies with a frat house culture, there’s no problem, but I imagine few people work at places like that
One element that contributes considerably to the collective dread is the timing. A weeknight party is another event on an already overcrowded calendar. Between Thanksgiving and Christmas is a terrible time to have a party. Unless you are in a sleepy business and close your books early in December, most people (professional in particular) are busy on year-end deals, having to go to holiday events hosted by their clients, trying to collect outstanding fees. Even those who are fortunate enough not to have a heavier work load in December are busy on the personal front: holiday gifts, year-end tax planning, more interaction with family members, and for those who have kids, helping them buy presents for friends and going to their school holiday events.
I believe on balance including significant others makes matters worse (at least in the large party format). It puts a spoltight on single people and those getting/recently divorced if they can’t round up some arm candy. Many significant others find these events stressful and not worth the time, particularly if the have careers (the year-end time stress applies to them too).
Generally speaking support staff seem enjoy and appreciate these parities. It is a very good gesture to show that they are part of the team, not second class citizens, and get the same perk as the very top people. I think that’s the only reason to keep them.
Better types of parties:
Parties that include clients and friends of the company. For whatever reason, these events aren’t as claustrophobic and fraught as strictly internal parties. It’s also a nice gesture to throw a party for those who have helped make it a (hopefully) good year as a thank you. Staff also don’t seem to harbor the quiet resentment that lurks beneath the surface in internal parties; they understand that this is work, and because the party isn’t intended to give them a good time, their expectations are lower, and as a result they are often better able to enjoy themselves.
Small workgroup lunches. If you want to thank staff for their effort, do it on company time rather than cutting into employees’ personal time. A lavish lunch does nicely.
January party. Why be so rigid about time? One firm holds a Chinese New Year’s party rather than a holiday party. January is dead and dreary and the employees seem much more in the mood for fun then than in overstressed December.
Now to Freddie. Maybe because I’ve been employed by partnerships (I worked on Wall Street in the stone ages when they used clay tablets and abacuses) and have had primarily private firms as clients, I am used to dealing with people who see identify with corporate expenditures. They have a different attitude toward expenses, which doesn’t necessarily mean they are cheap. But they tend to be more consistent in how they spend when it’s their nickel versus the company nickel. Maybe I have an unrepresentative sample (although mine is pretty large) but I haven’t seen them engage in the behavior I seem among some employees at large companies, who will go to considerable lengths to avail themselves of corporate perks but won’t spend in their personal lives. Put it another way: they tend to be more value oriented in their expenditures. (Note the right cut may not be private versus. public, but small/medium versus large, In private companies, which also tend to be smaller, employees are more cognizant that their actions can affect the health of the business).
So one element of what I found objectionable about the Freddie event was that it was a party for adults and kids at the Ritz. That strike me as bizarre: a costly place better suited for corporate events for a family party?
The second is that I would feel uncomfortable participating in an event like that if my employer were hemorrhaging money. I guess I have a character defect, but I’d be reverse engineering the party’s costs and wondering what percentage of someone’s salary it represented.
Freddie has 5400 employees. If they spend $100 per employee on holiday parties on average, that’s over half a million dollars. That’s the cost of four or maybe five employees for a year, which is about as far out as most public companies seem to focus these days. I’d rather have no party, or a smaller party, and save some jobs.
But of course, a private company would think like that, trying to hit a target cost reduction number, but that concept is a fiction in a public company. They will announce headcount cuts to please the Street. That’s what sells. And the symbolism in public companies is terrible. The big guys almost never take pay cuts, the pain comes out of the rank and file. But still, it feels wrong to me to be holding costly parties when heads are soon to roll, particularly if one turned out to be mine.
Third (and now I will sound like a hopeless Grinch) I object to the seemingly unending escalation of holiday and other consumption in this country (although indications are that ugly financial reality is forcing people to rein things in a bit). I am simply stunned at, for example, how many presents kids get today and how quickly most of them will be forgotten. The statistics keep being manipulated, um, revised, but no matter how you cut it, America has had a close to zero or negative savings rate for some time. The “oh we must have a party” is part of that mentality. Why should we party if there is no profit? Why should we spend to the limit of our means (or beyond) because the malls are full of stuff?
Now I have some experience in living at the edge of my means, and at least in my case, there was more than a bit of retail therapy involved, I was stressed, I was working extremely hard, and buying that gadget/suit/coat/pen/wallet gave me a lift. For maybe the fifteen minutes I spent making up my mind and a day or two afterwards. And having seen this operate on various levels (at least in Manhattan, which I’ll concede is a weird microcosm), you have deferral/reward (“I deserve a present for myself”) and status competitiveness. They are both insidious.