Is there something wrong with the "culture" of TVA?
The agency has received proposals from eight consultants and narrowed the finalists to three to examine several areas of TVA, including its governance, business practices and its organizational structure. The three finalists are Boston Consulting, Mckinsey and Co., and Booz and Co.
The memo outlining the proposal is titled the TVA "Culture Remediation Plan." The plan also calls for examining skill sets and the development of rewards and incentives.
One of the problems with TVA culture was the decision by previous management to encourage retirements and replace workers with those younger and cheaper. The retirement age with full benefits was reduced from 55 to 45. The retirement incentives led to the average age TVA retiree being 56, when the national average is 62. In 1980 there were 5.4 employees for every retiree. Now there are two retirees for every worker.
A consultant study says TVA's retirement benefits are above average compared to its peer group. This, and a plunging stock market, led to TVA having to commit an additional $1 billion to the TVA pension plan. Walking back from pension benefits will not be good for morale.