Losses force CBS to cut corners in staff expenses

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Directives to TV and radio station employees indicate CBS has started to tighten its belt.

At a number of the 14 CBS owned-and-operated TV stations, employees were told last week that tips exceeding 17% of a business meal's cost were unacceptable. Business travel at a number of the TV stations has been significantly curtailed, except for trips made by general managers and the sales staff, according to CBS insiders.


Packages sent by overnight delivery services now must be cleared through general managers at some of the TV stations, and limits on long-distance phone calls has been discussed at a number of the stations.

The penny-pinching is largely a result of massive losses at CBS' network and station groups. In the first quarter, CBS owner Westinghouse Electric Corp. reported losses of $151 million, much of that attributed to CBS.

As a result, CBS management reportedly wants to make $100 million in cuts.

In a memo about expenses to CBS radio stations, forwarded to TV-station general managers, even the subject of cellular phones was addressed. "This area of reimbursement is so out of control it's scary," the memo reads.

At some TV stations, insiders said, a number of employees will be asked to turn in corporate cellular phones. "We are spending entirely too much time and money entertaining each other! Not every meeting has to be a meal. If two employees want to have lunch together, great, but it is not a company expense unless there is a good reason why it had to be at lunch time that they decided to speak to each other!" the memo reads.


Also, "No matter how much money you saved the company on airfare by going to your destination on a Saturday instead of during the week, thanks but--a stay at the Four Seasons Hotel is still unacceptable!"

The memo was written by Terry Malia, VP-administration, CBS Radio, and CBS Station Group Chairman-CEO Mel Karmazin was carbon-copied.

Said one CBS insider: "We've gone from being Tiffany's to Woolworth's. This company might have some problems, but nickel-and-dimeing us to death isn't really going to make a big difference to the bottom line."

A CBS spokesman declined to comment on the memo.

Copyright July 1997, Crain Communications Inc.

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