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About That Schwartz Blog, 'Nobody's Created More Jobs Than You'

The message wasn't surprising, but the deliverer was. New Sun CEO Jonathan Schwartz faced the music and announced that 4,000 to 5,000 employees will be dismissed at Sun over the next six months. What does this Schwartz have in common with the one who, upon being appointed a month ago, said he wasn't there "to take a whack to head count"?
The message wasn't surprising, but the deliverer was. New Sun CEO Jonathan Schwartz faced the music and announced that 4,000 to 5,000 employees will be dismissed at Sun over the next six months. What does this Schwartz have in common with the one who, upon being appointed a month ago, said he wasn't there "to take a whack to head count"?Sun Microsystems needs to cut its payroll, or at least that's the collective wisdom on Wall Street. And after months of resistance by former CEO Scott McNealy, new president and CEO Jonathan Schwartz called a teleconference to announce it would do just that. Over the next six months, 4,000 to 5,000 employees at Sun will go away.

It would be nice to conclude that simple business logic has prevailed over the sometimes clubby atmosphere among executives at Sun. They tend to agree that it's a really cool place to work and isn't it fun jousting with Microsoft. But more likely, the board of directors and, in particular, Chief Financial Officer Michael Lehman have prevailed over whatever tendency McNealy and Schwartz had to stay the course and avoid layoffs.

Schwartz, when asked by The New York Times the day after his appointment whether he would make cuts, responded: "That is the last thing I will do. I'm not looking at shrinking Sun." In his April 25 blog, he paid tribute to McNealy with the line, "There is no single individual who has created more jobs around the world than you." Sun's stock price is so depressed it's on Prozac, and Wall Street analysts are sending semaphore signals against investing until Sun cuts its staff. And the new CEO compliments the boss on his ability to create jobs. It could become a case study on the hazards of CEO blogging.

Maybe Sun doesn't really need to cut 4,000 to 5,000 jobs--its revenues are growing again--but Sun needs to demonstrate to the world that the company isn't mindlessly committed to maintaining jobs, that it's going to be run like a business like Intel, like IBM, like, good heavens, that printer company across the valley, which has been doing so well lately.

The author of this program isn't Schwartz, but he's become its spokesman because the world needs to be convinced that Sun has changed. What better way to demonstrate that than to have an admirer of job creation and defender of the existing Sun brain trust announce a big job cut? Welcome to the realities of the role of CEO. It's a break from Schwartz' role as McNealy's alter ego, but it's not an entirely voluntary one. Lehman and the board of directors know what they must do if Sun is to survive as a technology company. Now Schwartz has to execute that plan.

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