2012 The Year of Fluidity

I’ve dubbed 2012 the year fluidity.  From necessity in life and the markets.  2011 was, in my humble book, the year of resistance.  We ranted and railed and defaulted on a big brash country scale.  We held on as tightly as possible not really  getting ‘what was’ had already escaped us in 2009, discarded us in 2010 and made it felt in 2011.

Cause and effect have changed.  If we do this we get that.  Actually, if we do this, we get a lucky dip.  Perhaps curiosity is the only sanity.  If we do this, what will we get?  And if we do it again, what else will crop up?  Somehow, one has to have a sense of humour regardless of the outcome.  And fluidity – are we able to move with the tides, the natural ebb and flow and stay on our toes knowing we can control little above our state of mind or the context we operate in – or in navel gazing speak, our consciousness?

A great dins last night with a diverse, influential group of people.  All involved in the markets in some way shape or form.  And the debate, well it was varied.  And it was fluid.  No conclusive answers and many searching Q’s?

Taking stock in a new year seems to be a natural phenomenon.  What was 2011 all about, am I doing more than treading water, and what do I want to achieve this year?  No small Q’s and yet little steps are the only solution.  Stay fluid, take a small step at a time, be mindful and present to every nuance.

This, incase you are wondering, is as much of a note to you as to self!   Wishing you and yours the best of the best this 2012.

The economy – in bovine terms

The Economy in bovine terms

The Economy in bovine terms

SOCIALISM

 

You have 2 cows.

You give one to your neighbour.

COMMUNISM

You have 2 cows.

The State takes both and gives you some milk.

FASCISM

You have 2 cows.

The State takes both and sells you some milk.

NAZISM

You have 2 cows.

The State takes both and shoots you.

BUREAUCRATISM

You have 2 cows.

The State takes both, shoots one, milks the other, and then throws the milk away…

TRADITIONAL CAPITALISM

You have two cows.

You sell one and buy a bull.

Your herd multiplies, and the economy grows.

You sell them and retire on the income.

SURREALISM

You have two giraffes.

The government requires you to take harmonica lessons

AN AMERICAN CORPORATION

You have two cows.

You sell one, and force the other to produce the milk of four cows.

Later, you hire a consultant to analyse why the cow has dropped dead.

ENRON VENTURE CAPITALISM

You have two cows.

You sell three of them to your publicly listed company, using letters of credit opened by your brother-in-law at the bank, then execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows.

The milk rights of the six cows are transferred via an intermediary to a Cayman Island Company secretly owned by the majority shareholder who sells the rights to all seven cows back to your listed company.

The annual report says the company owns eight cows, with an option on one more.

You sell one cow to buy a new president of the United States, leaving you with nine cows.

No balance sheet provided with the release.

The public then buys your bull.

THE ANDERSEN MODEL

You have two cows.

You shred them.

A FRENCH CORPORATION

You have two cows.

You go on strike, organise a riot, and block the roads, because you want three cows.

A JAPANESE CORPORATION

You have two cows.

You redesign them so they are one-tenth the size of an ordinary cow and produce twenty times the milk.

You then create a clever cow cartoon image called ‘Cowkimon’ and market it worldwide.

A GERMAN CORPORATION

You have two cows.

You re-engineer them so they live for 100 years, eat once a month, and milk themselves.

AN ITALIAN CORPORATION

You have two cows, but you don’t know where they are.

You decide to have lunch.

A RUSSIAN CORPORATION

You have two cows.

You count them and learn you have five cows.

You count them again and learn you have 42 cows.

You count them again and learn you have 2 cows.

You stop counting cows and open another bottle of vodka.

A SWISS CORPORATION

You have 5000 cows. None of them belong to you.

You charge the owners for storing them.

A CHINESE CORPORATION

You have two cows.

You have 300 people milking them.

You claim that you have full employment, and high bovine productivity.

You arrest the newsman who reported the real situation.

AN INDIAN CORPORATION

You have two cows.

You worship them.

A BRITISH CORPORATION

You have two cows.

Both are mad.

AN IRAQI CORPORATION

Everyone thinks you have lots of cows.

You tell them that you have none.

No-one believes you, so they bomb the **** out of you and invade your country.

You still have no cows, but at least now you are part of a Democracy….

A NEW ZEALAND CORPORATION

You have two cows.

The one on the left looks very attractive.

AN AUSTRALIAN CORPORATION

You have two cows.

Business seems pretty good.

Austerity is the new black…

Austerity is the new black

Austerity is the new black

I don’t know about you, but I am seeing a real resistance to anything wildly ostentatious, overly blinging or downright wasteful. The expansiveness of recent years divorced us all, with zero alimony in 2008 – like a severely wronged, disenchanted, now ex-spouse.

I recently attended the launch of a new restaurant in London. Fabulous décor, attentive service, sublime food. The only glitch? The portions were way, way too generous. Silly generous – so silly that half of each plate either went to waste or into a doggy bag. The saving grace. At least we could take our leftovers home and feed ourselves for the next day or two. There are many countries where doggy bags and BYO (bring your own bottle of wine) are par for the course, and who knows, perhaps we will start to see more of this in London establishments.

I was chatting to a Texan friend over the weekend – she was complaining about the waste when traveling first class. Sleeper suits issued to first/upper class passengers are binned after use – it costs more to launder used suits than to produce new ones. Oh, and once opened, the wash bags go in the bin too. She may well be one of the few left traveling in style, but in her own personal protest to wastefulness, she now takes her own Juicy, lip balm and moisturiser.

And with Martin Weale, director at the National Institute of Economic and Social Research (NIESR) this week stating, “So far as we can say, the recession is over” (UK), is there any chance that the new austerity is over? Somehow I think not. The world, as we know it has changed inextricably forever in ways we are yet to comprehend. And with it, an altered perception and a self-regulating awareness of how we go about living our lives.

What do Microsoft, Dyson and HP have in common?

The Tree of Corporate Life

The Tree of Corporate Life

Is this the right time to start a new business? We are expecting the largest reduction in GDP since 1946 in the next 12 months – and unemployment levels are set to rise to over 3.25 million by the end of 2010.

And interesting to note that Bill Gates founded Microsoft in the recession of 1975, James Dyson launched his vacuum company in the early 90’s and Hewlett-Packard emerged out of a garage at the end of the Great Depression. According to Ernst & Young’s ITEM Club, the recession may well be the catalyst for the next generation of UK entrepreneurs.

The current situation may well fuel an increase in entrepreneurial activity, which will undoubtedly play an increasingly important part in re-energising the economy. On the other hand, investors are cautious and unless the people driving the ideas are creative and persistent, they may not find the funding they need. Low start-up costs, quick routes to market and a high perceived value are vital for customers and investors alike. But without charismatic, passionate people with strong personal brands leading the way, it will be tough, very tough.

Leadership brands – the banks

Leadership Brands - the banks

Leadership Brands - the banks

I was watching the Treasury Select Committee’s grilling of four former bankers last week. The interesting face of this story is the perception of banks in the broadest sense. When we look at the global brands that had until September last year have been synonymous with institution, due diligence, risk management, trustworthiness, solvency – we are now faced with an entirely different perspective. Bankers on the other hand have in recent years been perceived as risk-takers, financial wizards having a magic touch earning bonuses in multiple millions. The two have never really been congruent.

And with bankers bonuses being limited in bale-out banks, and the banks themselves being institutionalised, I believe that we are going to see very different leadership brands.

The premise of a strong leadership brand is that the leaders in the organisations they work for personify the aspirations of the corporate brand – and the successful application of this has a direct effect on the bottom line. So we expect that those working for Nike, swoosh, just do it – will in turn display the fundamental characteristics and personality of this well-known brand – if they don’t it, it has a negative effect on investors and customers alike.

And how will this now translate to the banks… with a whole new set of criterion, will the leadership in turn change dramatically to reflect the current situation? Somber leaders for somber times?

Job Losses

Whilst trying to get a feel for the number of job losses à la crunch I stumbled across an article in the Telegraph by Jamie Dunkley on the 2nd February titled Financial Crisis: Job Losses. It’s worth a read as he diligently lists the 83,368 job losses in the four months prior (UK). And according to an influential report from the Chartered Institute of Personnel and Development due to be published tomorrow, it seems that two out of five employers plan redundancies in the next three months.

This all begs a key question – what criteria will those who decide the fate of this soon to be unemployed workforce use to make their decisions? The obvious – closure of unprofitable business units will see unnecessary, un-transferable skills and expertise go first. The fat will be cut and under performing individuals will be next on the list. Plans for growth and expansion will be shelved for the time being and with it the associated headcount. And then the difficult bit. The bit that is based on how people are perceived vs. any of the above.

I was consulting with a client who was employed by one of the financial giants that lost its footing recently. He and a number of his team were subsequently re-employed by the organisation that bought out selected business units. He described the agonising process of picking the few who would stay. The cut was 30 out of an original team of 100. The under performers and skills mismatch were a no brainer, which left him with 60. Losing the remaining 30 was difficult to say the least. All qualified, experienced, skilled – all technically right for the roles.

Personal Branding - The Competitive Edge

Personal Branding - The Competitive Edge

It eventually boiled down to perceived soft skills and relationships. Now we all know that perception is reality. Or I should say, perception is a form of reality. It can be demonstrably false, and all too often it is. Those with the perceived soft skill smarts stayed, and those without, left.

There could not be a more urgent need for all of us to take a good look at the impressions we are creating in the minds of those who can and may affect our success in the future. And I am talking all areas that have an influence – our bosses, clients, investors, employees, suppliers, business partners, colleagues. Its not rocket science, its not complicated – but it does need attention, soonest.

At times like these, extraordinary times, some settle into an inertia born of a perceived lack of control over their destinies. And others reach determinedly for the next rung. They both take the same amount of energy with very different outcomes.

Learn how: Personal Branding – The Competitive Edge

Credit crunch fallout

This week, the world as we know it changed forever. Well, at least for the foreseeable future. The inevitable fallout from the credit crunch happened. Shockingly, it was all concentrated into one brutal week. The bastions of unshakable establishment on Wall Street and in the City of London crumbled. Lehman, Merrill Lynch, AIG, HBOS. Bank failures, rescue takeovers, government bailouts all came thick and fast. Massive, intense, relentless.

And the markets roared into life yesterday and bounced – a hugely energetic bouncy bounce that reverberated around the world. Shanghai gained 9.5 per cent, Hong Kong’s Hang Seng 9.6 per cent, the FTSE 100 had its biggest daily gain in its 24-year history with 8.8 per cent and the S&P 500 closed up 4.0 per cent, having risen 4.3 per cent on Thursday. And the surges in London and the US were partially fueled by a ban on short-selling announced on Thursday night.

With friends and clients describing their week as hellacious, many feel they have literally been to hell and back. Most feel that there is more to come. No one seems terribly sure about anything. The markets may be closed for the weekend, but the floors and desks and corridors are occupied as exposures are calculated and able minds grapple to find a way forward in unchartered terrain.

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