NCR Aloha Update – Legacy of Mike Hayford

As NCR splits from one turd into two, the king turd-maker is stepping down.

From the first experiences we had with Mike Hayford in 2018, this is exactly how we would have told you the story would end.

It truly takes a special kind of person to dissolve a 139-year-old institution, and that’s just the kind of guy Mike Hayford is.

In some small fairness to Mike, he wasn’t put in the best position: his predecessor, Bill Nutti, was a near equivalent defecator-in-charge.

But good operators know how to turn around a business.

Unfortunately for NCR employees, partners, and shareholders, Mike Hayford is not a good operator.

From taking the helm to splitting the company, NCR’s share price was down 19% under Hayford’s tenure: $32 when he took over in April 2018 and $26 right before the split in October 2023.

Meanwhile, the Dow was up 40% and Nasdaq 65% over the same period of time.

Here are all the reasons we knew Mike Hayford would gut NCR.

Already Knows Everything

We offered to help Hayford, no strings attached, but he already knew everything.

This was only further reinforced when talking with customers and resellers, who left with nothing but shock and contempt.

“THIS guy is the CEO?! He’s making how much?!”

You’d think this character flaw would be immediately outed during a screening process but guess who benefits from hiring a turd?

The board of directors.

The board gets six figure annual compensation to work < 10 hours a year.

And half of those hours are probably travel time.

$60,000 an hour to rubberstamp incompetence and fleece shareholders?

So the less competent the CEO, the better.

The board served themselves excellently.

Me Before You

Hayford was the epitome of bilking shareholders.

And NCR’s board was behind it from day 1.

Here’s Harvard’s assessment of median CEO compensation by company revenue.

NCR does $7B in revenue. You’d anticipate CEO compensation of $7M based on these metrics. And by the way, these compensation data were gathered from companies in the S&P 500 and Russell 3000, two indices that ROSE by 105% and 50% respectively in the five years Hayford sunk NCR’s share price by 19%.

So basically the CEOs in this study, on average, created 95% MORE value for their shareholders than Mike Hayford over the same time period.

(Note that because Hayford delivered negative returns the mathematical underperformance is technically infinity, so we found the difference between -19% and 76%).

And you know how NCR handled it?

They paid Hayford $14.2M in 2018, $12.8M in 2019, $28.3M in 2020, $14.8M in 2021, and $12.7M in 2022.

Hayford made $82.8M dollars while the median CEO of a public company with NCR’s revenues would have made $35M.

Hayford made 140% MORE than the expected CEO while underperforming by 95%!

A fair, performance-adjusted compensation package for Hayford should have been $1.75M over that same 5-year period – that’s 5% of the median $35M compensation for underperforming the median by 95%.

You achieve 5% of the performance of the average, you deserve 5% of the pay.

In classic do-as-I-say-not-as-I-do, the entire lot of NCR leadership decided that they couldn’t find someone to crash the company as eloquently as Mike Hayford, so they had to “pay up” for that level of ineptitude.

A Suit, Not A Founder

One of Hayford’s requirements was use of the private jet for him and family.

You will have access to NCR’s planes for business use and for up to 100 hours of personal use per year. In the event NCR sells its aircraft, you will have access to private air travel through Net Jets or equivalent.

https://www.sec.gov/Archives/edgar/data/70866/000007086618000024/exhibit104employmentagreem.htm

Hayford: Look guys, if you want me to underperform my peers by 95% AND make 140% more than they do I need full disposal of company aircraft.

Shareholders: Hmm, this seems really irresponsible. You’re already making materially more than unobjectionably better executi-

NCR Board: This is totally justified. None of us have built fuck-all and we couldn’t start a lemonade stand to save our lives. But we’ll be goddamned if we’re not going to keep collecting $60,000 an hour for doing nothing, and the weaker and more mentally challenged our CEO the better our lives will be. Fuck you, shareholders. We’re in charge.

Hayford: That’s what I thought. Now warm up that fucking Gulfstream.

Here’s a video to show you how it went down, but replace K Swiss with NCR.

No founder we can think of – you know, the people who actually build products and move society forward – would ever consider private business flight anything but profligate. Especially as the company bled market share and the stock price tanked.

Even a venture investor would question the use of funds.

But who needs fiduciary responsibility?

Not NCR, baby.

Contrast that with how PAR won Burger King.

Gee, we wonder why NCR didn’t win…

This is why life isn’t fair: NCR employees and shareholders get holed out while NCR’s leadership gets fat.

There are supposed to be protections against this kids of racketeering but what happens when the police – ie the board of directors – are in on the take?

NCR has been operating no better than a banana republic.

NCR will now dither as two companies, with one (Atleos) gobbled by competitors in different geographies as the ATM market flames out due to modernization, and the other (Voyix) on the march to zero as it loses share to POS and banking competitors.

Toast is worth more than twice as much as Atleos ($1.6B) and Voyix ($2.2B) combined… and Toast was founded in 2011.

And is just a single solution company as far as NCR would view it (i.e. no ATM, banking, etc. – just POS product).

That should underscore the magnitude of financial destruction wrought by Mike Hayford and his cronies.

Now you see why activists exist.