Month: January 2009

The Senator is dead. Long live the Senator!

This is the official announcement of the demise of Wikipedia. Wiki = Good idea. Bad execution = Wikipedia. Good idea + Bad Execution = Back to the drawing board. This math is timeless. Pay attention.
Wikipedia apparently posted entries that announced the death of both Senators Kennedy and Byrd. The latter probably choked on his pretzel seeing a black man take oath of office for the president of the United States. To be fair, Senator Byrd has done a lot to redeem himself since his KKK days – youthful exuberance is such a misguiding influence! – and deserves our respect. But some digs are just too easy to pass up!
Now, Wikipedia is going to pre-screen all entries! Well, we are back to the gilded age of editorial. We should all rest assured that the drivel that is posted there is going to be completely inane now. Some of us are not impressed with the “editorial” power and its consequences. Remember 911?
In a country that exports democracy, ala Iraq and Afghanistan, and is apparently in a fight for freedom and our way of life, the “free” press completely missed the real story behind Iraq. When was the last time you read a story about Palestine in the New York Times? We are told that there is an “A Q Khan nuclear proliferation ring.” Really?
There is nothing more Orwellian about us than our “free” press.
So, here is my friendly reminder to the people at Wikipedia – understand your value proposition. Yes, even you are supposed to have a business model.

The Commode with Legs

According to a report the American banking sector is in the hole for $3.5 Trillion. In other words, American banking system is bankrupt. Now, on to the really shocking part.

According to a report the American banking sector is in the hole for $3.5 Trillion. In other words, American banking system is bankrupt. Now, on to the really shocking part.

According to a study done by the Associated Press, 9 out of 10 executives, who were in charge in 2006, are still gainfully employed at these banks. Some, as you know, are buying $50M jets. Some others are parking their ass on $35,000 “commode with legs.

The implicit irony in a system that has commodes with legs and regulators without back-bones is not lost on some of us. Government, President Reagan famously uttered, is not the solution; it is the problem. Well put, Mr. President.

Unfortunately, this government circus is all too often repeated in “governance” everywhere. The problem is not “government” or “governance” it is this kind of governance – one that has all the bells and whistles and costs trillions but does absolutely nothing – ample proof in what went on for the last 8 years under Bush. But sometimes it does even more harm by doing something – exactly in contravention to what its charter says. Watch what the congress is going now as the nation’s plane corkscrews into the ocean.

To those of you who, as a matter of habit, want to drive past the glaring and straight to the inane, here is the story

PS: John Thain may be clueless and arrogant, but he is not alone. He would’ve sat on that commode and wiped his ass with that $87,000 rug and thrown it into that $1400 trash can had he not been a target to deflect criticism off Bank of America’s other heroes. The shareholders of BoA and Americans who pay taxes still have a lot to worry!

Congratulations, we just bought a jet!

Sometimes, the best surprises are the ones we don’t know about. Huh! Well, surprise! You and I now own another corporate jet.

Congratulations, All!! We just bought ourselves a spanking new corporate jet! No kidding folks, check out this picture…

Our jet is the state of the art Dassault Falcon 7X. Which, at $50M, is such a steal. No?

Unfortunately, we will not be able to take our family on a vacation on it any time soon because we collectively decided – don’t you remember? – to have Citi Group executives use it. Yes, these successful barons – beacons; doyens…- of business need it – yes they need it – to continue their excellent work that has led to the bank’s bankruptcy.

Wow, you must be so proud of yourself now! I certainly am.

So please reach out to your congressman or congresswoman and personally thank them! Better yet, please call Citi’s board of directors and thank them  😉

Managing by news

Leaders lead and, well, sheep follow. Which are you?

The US economy is in a tailspin. Each day brings worst news on business closings, earning disappointments, job losses and towns and people is jeopardy. Lives are being destroyed in this financial tsunami.
Here is a sampling of the business headlines today:
Each news item brings with it a slug to our collective face – each hit desensitizes us to the pain and suffering of others as it is only human to get numb after a point. Till, some aspect of this storm hits us, we will continue along our respective paths – shaking our heads, feeling sorry and feeling helpless. What can one do?
Get over your fear. Try to lead, for crying out loud.
So called “leaders,” perpetuate a problem and convert it into a calamity by putting on blinders and following the herd. If everyone thinks it is an opportunity then it must be. If everyone thinks it is a problem it must be. If everyone is cutting back then so should I.
The name of the game? No bandwagon left behind!
The bandwagon lined up now is one of doom and gloom. We are all screwed so let me set the ball in motion by simultaneously wringing my hands and laying-off people – isn’t that the fastest way to get your balance sheet in order?
It is but with a big problem. It is incredibly short sighted. Invariably, you are hurting yourself in the long run. The impact on employee moral – those who are left behind are not at their peak performance – and lost institutional knowledge is tremendous and unnecessary. Let’s face it, the moment the winds start blowing in the other direction you will be lined up right behind that wagon – eager to catch that wave.
What have these mindless cycles of hiring and firing done to shareholder value? Who cares!

A Failure of Governance

Another day, another story of corporate malfeasance. The cycle continues as shareholders look to “others” to manage their business. Good Luck!

Here is a story from the motherland that will make you stand up and take notice. Satyam – means “truth” in Sanskrit/Hindi – has been a big lie! The founder of the Indian software/consulting/outsourcing giant has just relinquished his management position admitting to widespread financial fraud – he had been cooking the books for a long time.

How could he go on reporting non-existent assets worth $1B on his balance sheet?

“What started as a marginal gap between actual operating profit and the one reflected in the books of accounts continued to grow over the years. It has attained unmanageable proportions as the size of company operations grew,” explains Mr. Raju. “It was like riding a tiger, not knowing how to get off without being eaten.”

Failure of governance,” opines Mr. N R Narayan Murthy, founder and Chairman emeritus of Infosys. But what does he know.

I like Bush’s explanation better – “the asset mistake just happened. I am sure Raju is not happy about it but what could the poor guy do?” Just kidding! President Bush is too busy setting strategy for the oval office rug and buying $500,000 china a week before he leaves the white house.

So, after the customary hand wringing and expression of dismay and disgust – after all this is only the millionth time something like this has “just happened” – let us assign blame. Who is to blame?

Mr. Raju is at the center of it and admits his role. Where is the government? Where is the accounting firm (PricewaterhouseCoopers, which has audited the company since its NYSE listing in 2001, said it was “examining” Mr. Raju’s statement and could not comment further!)? Where is the CFO? Where is the board? Where has it been? Who was on the board and how did they get on it?

My favorite, as always: Where are the shareholders? Where have they been?

The lynch-pin of corporate governance is the same as one for corporate performance – greed. Yes, that thing that got you in the stock should drive you to protect your investment. Where should you look for corporate governance? Look within.