« August 2006 | Main | October 2006 »
September 11, 2006
Creating Shareholder Value
We are fascinated with this month's lead article in Harvard Business Review Ten Ways to Create Shareholder Value (subscription required for full article but you can get the abstract here or contact me for more details.)
In one way, we really wonder how 'shareholder value' became such unchallengeable corporate orthodoxy. We wonder how people working in corpotations can ever be motivated with the goal of making money for someone else. But that's what we expect them to do. We expect them to turn up at work every day and think to themselves "how can I make more money for shareholders today." We expect them to be over the moon with this prospect. Everything else they may put their heart and soul into is expendable in the service to shareholder value. Even their own jobs are expendable to this purpose. Then we treat them with disdain because they are lazy and they don't have any commitment to the corporation.
On the other hand we know how this came to be — see Agency Theory and Shareholder Value.
Given all that at least Harvard Business Review turns the emphasis from short term to long term value. A small step. A step nevertheless.
Posted by chriscurnow at 9:23 PM | Comments (0)
September 8, 2006
Easy Answers
Perhaps the most fundamental quest in human history has been to find ‘the path to a fulfilled life.’ Throughout time, men and women have sought to address this question at various levels of depth. For some it has been a shallow ‘tell me everything I need to know in five minutes’ while for others it has truly been a life’s work. For many this search has been expressed through a religious journey, some through exploration of the natural universe, some through personal conquest, and increasingly today many find expression in the world of business. (Indeed we have heard it said that business has replaced religion as the source for meaning in people’s lives.) People in this category may attempt to find fulfilment through building huge organisations, by amassing personal wealth or perhaps creating something of enduring worth.
Hand in hand with the individual quest, have been those who offer to provide either “the answer” or guidance along the path. In the field of religion we have priests, rabbis, mullahs and teachers. We also have heretics. In personal health we have doctors and medical practitioners of all varieties. We also have quacks and snake oil salesmen. In business we have consultants on the one hand and charlatans on the other (See Thomas Szasz). Somewhere in that mix, and across all fields of endeavour we have ‘gurus’.
A few years ago Spiral Path worked for a one of the Big Five professional services firms in Melbourne. It was an eye opening experience. we could see in the eyes and hear in the words of our clients two very different perceptions of us. One the one hand there was a deep distrust. Our fees were higher than anyone else in town and they knew, or suspected, that we were looking for ways to broaden the engagement (and hence charge more fees) in almost every conversation. In short, they felt we were out to ‘screw them’.
On the other hand, they engaged us because our fees were so high. Our fees must be the highest because we must be the best. When they came to a presentation in our offices, they met us at the hallowed thirteenth floor. There was a hush when the lift opened. We did everything we could to make them feel it was their privilege to be invited to come here. We provided them with a magnificent view of Melbourne (a metaphor for our omniscience), the meeting was attended by waiters who would serve tea, coffee and biscuits individually and when they went to the bathroom they were regaled with marble walls stone floors and gold fittings.
Throughout all this, Spiral Path felt they entertained (and we encouraged) one abiding fantasy about us. Yes they could come to Level 13. But there were parts of the building only staff were allowed. Surely there was, somewhere higher in the building that they could only dream of where only the most devout staff could go. A place where there was a huge book laid out on an alter. In the book were all the possible scenarios that could face a business. More importantly, next to each scenario was “the answer” — what the business needed to do to solve the problems it faced or to obliterate its competition. In their heart of hearts, Spiral Path believes this is what they hoped they were paying for.
Spiral Path keeps this experience in mind whenever a new book, article or theory comes across our desk. When we evaluate any leadership theory, the most fundamental question we need to address is to what extent it provides practical and useful direction in the art of leading and to what it extent it feeds our fantasy that it is a shortcut that will enable us to lead and be successful without doing the hard work of being a leader.
Posted by chriscurnow at 10:43 AM | Comments (0)
September 7, 2006
Fate vs Destiny
We were at the AHRI dinner the other night. A gala event by any standard and we were delighted to make the acquaintence of Colin and Patrina.
During the course of the conversation we started discussing the difference between Fate and Destiny.
Just semantics perhaps, but for some reason Spiral Path felt there was a difference.
Fate, we associate with fatalism. A feeling that there are things we can't do anything about. We don't understand them but they happen anyway. We associate fate with things we don't want to happen. Of course literature is replete with counter examples - for example "that fateful moment" may refer to the one were two lives first intersected and from which a lifelong partenership arose. Regardless, we feel we had no control over what happened. The meeting was determined by something outside of us.
Destiny on the other hand Spiral Path believes is something we partner with. In the strict sense of the word it sounds like, and probably is, from the same derivation as 'destination'. Destiny though feels to us as it is something or some path, that we were designed for. When we spoke about it the other night we used the expression "you might miss your destiny." Perhaps it is something we feel in ourselves. It is our path. We of course would say it is our Spiral Path.
Hmmm. We wonder what you think?
Posted by chriscurnow at 10:46 AM | Comments (0)