Adidas, 2022 May.
A long queue of people, happy enthusiastic faces, entering the adidas campus. The call was given. All employees must return to the campus, the Linkedin and yammer posters started their night job, lauding the great return, followed by a myriad of emoticons.
Yet, nobody is really happy. The price is 180 per share, lowest since almost a decade, even lower than during the pandemic. One might wonder what happened, when 75% of the employees are dejected with the current management, yet elated faces everywhere. Feverishness, painting a very grim state of affairs, the mass layoffs of the previous years, a culture of discomposure permeating through the pores of every employee, from P levels all the way to M and some S level. The same state of things of several years ago at Henkel.
Employees NPS has reached an all time low, with the company having more detractors than promoters, to a level where managers instruct reports to share the inputs upfront, before submitting, just to make sure they chose the right answers. Truth be told, more people would prefer the company goes bankrupt - a fair retribution, most think, for all the pains and horrors of the last years, and the ones to come, no doubt. The source of all this? Nobody will dare to say the name - the one that shall not be named, the one that has been in a constant cold and hot war with people from his near circle, middle management, down to the people packing the shoes in the oursourced factories.
"Bottom line by all means!"
Workers Council, a mere group of people with no capacity. They are the foe that must be disbanded. The offshoring of positions to Spain, Portugal, Colombia, India, illegal layoffs, has taken its toll on the willingness to do anything worthwhile for the employees, be it salary increase on par with the inflation, or fighting the masqueraded layoffs. There always is a g-n pointed at their head: "WoCo must disappear, they do not let us progress" Detailed reporting of employees' performance, abusive layoffs, abusive contracts, discrimination, racial scandals, prioritized hiring from low cost countries - "some things must be hidden, we cannot let them stop our growth! We must find a scapegoat, be it a new diversity quota HR hire, or whoever. No matter the costs! WoCo must be reorganized, we must find the right people that play our cards right!"
Yes, racism is rampant, even with a diversity quota HR head. "No one can say now we don't do the right thing! We even had the antidiscrimination training thing! It was mentioned all over the place" Yet nothing has changed, it just looks better on paper, gloss and emptiness. Hires and salary ranges are done based on ethnicity or country of origin, which show up in the resumes one way or another. Not too high expectations on this matter, from a company where the big boss said "we love our new brand promoter, Wozniacki. What a beautiful Danish name!" That remark in one of the quarterly meetings, went silently unnoticed, like many other remarks in a highly competitive, cut-throat, discriminatory environment.
The Reebok sale and the subsequent adidas shares buyback plan had no outcome, no boost in the stocks price.
Back to the return to office queue. People talking about hopes that the office work policy is just transient and that the work from home will be the new way to go, soon. Yet, detailed reporting of presence in the campus are expected - "we are rooted in sports! We must sweat in the campus! We must make sure people are here! We are not Google, we are not Apple, we are not a work from home company, we don't want that! Consequence management must be enforced, examples be made!"
Yes, consequences, fear, and lack of any vision about the labor market, neglect of employees and their health. adidas is well known in the region for the sweatshop type of work, sick people, massive turnover, high number of people who develop health problems, unpaid work and overtimes, all hidden under the flexi-time word. And also white collar deaths by exhaustion, very well hidden under NDAs and supposedly chronic illnesses.
They went down slightly, during the pandemic, but will soon have a comeback. Smiling empty zombies are about to have a comeback. Bottom line it is!
A group of students are marveling at the babylonian buildings, huge and posh, Ikea and dream job thoughts cross their mind. "One day I will work here" thoughts cross their minds. Yet, the percentage of working students that were sick due to burnout caused some schools to stop the collaboration with adidas and send the students to some other companies. "We need fresh blood, not old people. We need to get rid of them! They do not fit in the campus image. Do it!"
People brought over from across the world, singles preferred due to self-evident reasons, happy to sweat for the best brand, yet, getting into a spiral of hopelessness, with no exit opportunities, in a region and country where true opportunities for foreigners, mostly, are missing altogether.
"Did you hear X left last month? Did you hear that Y left? Z's been with adidas for 15 years, yet they left adidas". Long standing employees, leaving a company that no longer matches their core values.
People are looking enviously across the street. They say people in the jumping cat brand have it better, many adidas people made it there, and they have a normal life now. Yet the other brand is also plagued by some rumours, alas on a much much lower scale.
"I can't wait to bring this to X in my one on one. I hate her guts anyway. Z got now an M2 promotion, so she should stay overtime and make it happen" The girl looks quite passionate about what she is saying. A toxic environment and culture, where team members will do anything to score first in the team lineup. Friendships end, where future promotion promisses are made. Broken promises mostly, included. A culture of mistrust, deeply rooted in the company's core values that they like to brag about. "You cannot trust anyone, even if you do the right thing or play by the book, you will be sacked anyway. Watch your back, dude!"
"More than 100k applications just last year - we clearly are a sought after employer" Yet this is just the PR. adidas faced challenges hiring, even in low cost locations, potential employees do not even show up for the interviews, first requirement not being satisfied - "do you support home office?" "We do", for now. The devil is in the employment contract, small print and "subject to change".
"We must force them all back into the office. The remote work contracts and jobs can be reorganized, closed, made redundant, we must find a way. I want to see them work hard, here, in the office, every day. Herzogenaurach, Porto, Zaragoza, Portland, Amsterdam, all!"
Q2 quarterly meeting: "We had outstanding results!" Yet, no more hires, the hiring must be abruptly stopped and they must take advantage of the great resignation. "I don't want to hear this is a hiring freeze" says some finances hot shot, "but we will not hire new people", perhaps he was missing the word for what it actually is, a hiring freeze. "Our HR costs are too high! We must save! Projects must be cut! Prioritization!" New layoffs looming.
So who's to blame for the 175 per share?
An over-adversarial and gluttonous leadership, a numbers first, employees are disposable direction, broken down and petrified middle management, petulant workers? The self-gratulatory WoCo that does not do anything to raise mindfulness about Unions, protect the employees from ill treatment and be articulate, overall? Is it the wrong HR approach for hiring overcompetitive and fair play lacking people sometimes, in just the right positions?
There are marvelous people at adidas, yet they tend to be less and less, all looking across the street or elsewhere.
Some still hope things will change, that things will be how adidas was when people worked as a big family, earlier, and wishing for themselves to get to reach the retirement age, or early retirement in Aarhus, for some others.
Bottom line it is!
123 replies (most recent on top)
Auschel, Shankland, Ohlmeyer. The holy trinity of what s wrong with German companies. adidas is what it is despite of them, not because of them. Bring in an American CEO who will not stand for the German political bull of these guys who pay lip service to the flavor of the day but really are all about ME ME ME. After so many years desperately holding on to power tge actif ho-k they own the company. How about not paying Auschel his 20 million retirement package because he has pocket more than that through the various schemes he has built in adidas.
Who wants to work for a board and leadership team of white Men, this company talks about diversity but just look at the construct of the board, Boys Club! Says it’s all.
The truth is that many at the people at the top of adidas are tight together through knowledge of corrupt practices. Don’t fool yourself the board will only fire someone who disappoints investors not employees. Above a certain pay grade, and when in decision making power, many become corrupt and there is a code between thieves to protect other thieves. Everyone knows that many MDs sponge off the year-end unused marketing budget by having agencies fake invoice adidas and then split the funds with the executives of those agencies. Everyone knows because lower ranks need to be involved in that and those guys talk because they don’t benefit from the scheme. This is just one of many corrupt practices and Roland is the master of them. Look at the two examples India and Emerging Markets, once headed by probably the most corrupt disciples of Roland the schemes blew up and what happened? Roland promoted one of the chief architects of the scheme to MD to the most important adidas market (with resulting immens potential for corruption). My point is, Shankland will become a liability for the board only if the investors think so. Until then it is torture as usual.
The issue with a bully is you need to stand up to them, the issue with this bully is if you stand up to him, you get fired! And there are countless examples! Supervisory board for the people who work for you at adidas please send him packing! Would be such a huge step towards bringing us all back onboard!
The supervisory board must have known all of this, they just turned a blind eye. Adidas leaders are famous for only seeing what they want to see.
How many complaints have been made about Shankland, particularly from Women such as me and never listened too or acted on……shame on adidas.
Yeah Shankland. Nike probably put him in place to eat adidas from within. Unbelievable that a modern day corporation would tolerate someone who uses medieval torture practices on his employees (and seemingly gets some form of perverted enjoyment out of it). Like Nero he probably likes to see everything burn.
I always wondered what a board meeting looks like with Roland the master of political backstabbing and Martin the bipolar brute both trying to impress the danish ice queen. But who cares, it s what goes on in a regular German company. Politics is king and you get away with mu---r.
Truer than true but nothing is going to change. No one can scrape the amount of dirt and grime that has accumulated over the past decade. Bring back the old folks that used to make adidas a joy to work for.
Less presentations and leadership bull and action. No one seems to know the business anymore, everyone is busy with presentations and leadership stuff which seems to be more important than product and customer. Stop recruiting from McK and start recruiting from McD:)
Hey, insanely on the spot article! The truth on the toxic culture is worse than anyone can imagine. Just look at Shankland’s firing of 160 employees in one day in the Energing Markets office…applauded by the board. And two of EMs super corrupt leaders get rewarded, one with an MD position in China and the other with a nifty retirement package.
Most of us knew that a former cut-throat detergent manager is not the right person for a company that depends on the creative culture of it’s employees; but somehow the supervisory board didn’t. To restore the company culture that KR destroyed will take years and the current S level put in place will not be able to do it. Complete reboot, new (decent human) managers and executives and a serious cleanup of the corrupt and psychotic practices of Roland and Martin must end.
This was long overdue! Unfortunately the damage is already done....he and his companions bullied employees that once created the success of adidas long enough! One can only hope he will take all of his companions with him as well as all the McK's he brought in. They can take their shiny yet useless, never-ending PPT slides right with them. If you want to turn things around - just bring back the people who loved to WORK for this company.
I’ve been physically Ill before meetings with Shankland knowing the abuse I was going to face. Hard to do your best work or be creative when working in constant fear. he enjoys pushing people around.
Right after Shankland, the architect of the worst Strategic Business Plan in company history, A. Schreiner must be terminated. He’s also one of the closest whisperer to the Dane and accountable for two profit warnings.
Time to start cleaning the house!
Agree the Australian leaving would be a huge sign to all our people that real change is coming!
Shankland make a career out of bullying people and abusing his position as a Leader, he can be herd shouting and screaming at people down the corridors! Maybe should have spent more time concentrating on building flexible supply chain! Less time shouting and more time listening would serve him well. No care for his people. The Australian must follow the Dane!
Couldn’t have said the last post better!
So interesting, that it took adidas till 2022 to finally get Kaspar out in 2023. The company got more efficient over time in terms of sales, but generally the product pipeline has dried up already back in 2017 on the height of adidas' momentum. From that point onward General Management and VPs were more focused on working for Kaspar and investors than for their teams and for the customer.
Lots of talented young people left long before the GMs and VPs silently exited, which left this company in a state where culture and innovation is at ground zero.
It's a pity for such an amazing brand that Kaspar's yeahsayers will continue to define the future of the 3-stripes long after his departure.
Good first step today, but it’s gonna take a while to clean up the garbage he is leaving behind. So much poor senior leadership in the company still that he hand picked, enabled and fostered during his time.
Hope the next CEO is a sports fan and realizes in order to create athletic brand heat you need to win on the field and not the fashion runway!
Stating the obvious: "...the company needs a CEO now “who has experience in product, marketing and/or merchandising from adjacent industries to sporting goods,” said Piral Dadhania and Richard Chamberlain, analysts at RBC Europe in a note to clients."
Any employee could have told you this in 2016...
https://www.law.com/dailybusinessreview/2022/08/22/adidas-seeks-new-ceo-following-rorsteds-surprise-departure/?slreturn=20220722163653
Long overdue - still all his allies and yes men must be chased out fast. Shankland and Ohlmeyer and the entire propaganda machine should be shown the door asap. Plus send home ALL former McK people and lock the door for those terrible strategy consultants.
A visionary leader with product, innovation and marketing skills must follow this dark era of Danish incompetence and tyranny.
Doubt though that this Supervisory Board is capable to see all the harm done to brand, product and culture.
I work at adidas right now, and I will stay. Because I believe that with K gone, and the belief that we need to make changes, we will. Trying to be an optimist even while witnessing team members leaving, or go on sick leave. There will be change, and we need to stay and support the brand through this. There are good - great people at the brand! we need a new leader who will make us feel like a supported community again.
Best news in a decade. Hopefully they do not repeat the same mistakes with the new one.
Your wish has just been granted.
I had worked for adidas for more than 20 years. Whereas the company was very iconic and sympathetic during the legendary Robert-Louis-Dreyfuss-period (it was him and the team around him who brought the company back to life) and also during the early Hainer-years, it already begun to get worse during the early 00-years. It is true that financial figures had developped brilliantly among Hainer but he forgot about the people. A culture was established in which unfair behavior was awarded and Open-mindedness was punished. Already in the early 2000 the culture of freedom of speach was erased. It used to be more important to win those ridiculous HR awards of which everyone knows that they aren‘t worth the paper they are written on. And all crowed by completely ridiculous, selfish and cpmpletely Head of HR who has always lacked any competence and fair play. Employees were unable to convince by means of competence but by being a part of the clique and mainly by agreeing to Top-management. Self-thinkers were not welcome.
Get woke, go broke
Having worked at adidas from 2012 to 2020 I experience how a great company to work Collapsed into the mud.
It definitely shows hard work and consistency on how to destroy adidas work-force!
Being willing to re-locate to Herzogenaurach shows people used to be passionate about the brand, nowadays you witness daily how talent is leaving. Just have a look at linkedin post “today it’s my time to say goodbye”…
The Dane and its leadership style (assuming you can called it leadership) need to be erased from the campus, where freedom of speech is almost non existent. Just heard you cannot access this post from a laptop in the adidas network…
Sad but true. It’s the leadership team that made me and lot of others leave….and trust we, we have been considered high performers in the Dane’s language. but the culture and hypocrisy is just unbearable. culture eats strategy for breakfast, that’s why adidas will be falling behind, unless the leadership changes completely.
Very accurate and potentially not damming enough. The culture there stinks and it turns amazing people in to very sad souls, stuck in a weird trap that somehow still feels good. Kind of like an abusive relationship where you hang on to the hope that at one point it will get better.
Everyone comes to the brand bright eyed, bushy tailed, full of dreams and ambitions and over time there’s only 3 lanes of existence, leave, burnout or remain and loose the ability to care any more.
In the end the short sighted commercial only mentality will fail, you can only reduce the bottom line so much before a leader like him becomes redundant himself. And when a 5 year contract for him is at play what drive does he even have to think about the big picture. I predict a soon-to-be firing with a nice payout that should leave him high, dry and very happy. The perfect out for him.
I got out, and from the outside in, you can really appreciate how toxic the place is. Do the same as soon as you can. It’s not worth the risk to your mental health.
Funny how this article is now blocked at HQ
The Dane has surrounded himself with a board of ageing white men. diversity and inclusion should start from the top. There is nothing diverse, equitable or inclusive about this board. Angry old men. Leadership at adidas is out of touch with its employees and it’s consumers. Leadership has lost its people, majority want to fail to force change. time for change and a new direction. Staff are disillusioned and exhausted and the products are too. Toxic board lost its people.
Wow! I thought I was alone with my opinion. I thought i was too sensitive about my observations and what colleagues said. But looks like i was wrong. Unfortunately everything adds up. This company needs to return to its DNA. It’s family values. Back to a nice team and even greater products!
Mucho texto
Well written. This is a management that drowns hard earned money into buybacks that have given negative returns. What they understand is that to make money, you need to be a smart investors. This management will not be in a position to make a single penny, if they have to run their own business.
Sadly, a lot of it does not fall far from the truth. People are chronically stressed. It’s all about short-termism and visibility culture, which works ok for those who are loud and not afraid to be obnoxious.
It’s a shame since the brand itself is still quite iconic.
Well written and unfortunately very true.
One of the challenges facing the Dane is the mediocrity across the brand. So many new VPs over the last few years are at best M2 average talent, who have just done the time in the stripes and have the network.
They know they are overpaid and become toxic with trying to protect their paychecks.
So much talent has left the brand since EL and what remains is mediocre people throwing slander at the departed and sh*ting on those that stay.
New leaders come in from the outside and are so freaked out that keep their options open or live in other cities or countries. What does that say?
Telling.
As soon as I can.. I am gone and I will be healthier and happier for it.
Amazing writing and a great reflection of today's reality on the campus. The Dane couldn't remember the word "Champions League" when he was interviewing Serge Gnabry during his latest townhall...but hey...bottom line it is...
I left a few years ago after a relatively long service and was worried I made a mistake. Seems not. I remember the bad old days when the adidas brand chased every sale and we had a random assortment of product and stories (remember the Japanese brown leather walking shoes with zips?). Then the shift to focussing on the brand with inspirational leadership and world class product. However it is obvious it has stagnated. Average performance product stands out with the exception of terrex. Product is King was the phrase I always heard, however I have seen a mass exodus of really talented product people in the last 6-12 months. There seems to be a preference for McKinsey or BCG types over an adidas education with many former talents seemingly leaving due to lack of internal backing and being looked over for positions. It’s quite insane to me that adidas has invested in people and created some industry leading talents but overlooks them for an MBA, or people willing to say yes to the MBA folk. Now these people are ki----g it at some of their competitors who are winning in product. It is not the adi dassler brand anymore and the spirit of sporting excellence and world class product has been replaced by short term sales goals. As an adidas fan I hope they get their sh-t together pronto.
100% spot on......it all starts at the top......the board is toxic.......no team players......one fighting the other....no trust.....ne empathy......no understanding what sport is, what it means.....where adidas is routed