Taking Charge

The kids were playing nicely, when suddenly the youngest started to howl. Apparently, the elder brother had hit him.

“Hey, what happened?” I queried.

“Dad, he made me hit him.” my second eldest was apparently trying to justify his action.

He made me hit him? Isn’t that an incredible story? I can give an allowance since it came from a nine year old kid ( though I must slowly reorient him that taking responsibility for your own actions as well as its consequence is important) , because even in the workplace, and among adults, we hear this story. He made me fail… – we hear this said or implied often.
The knack is that we think and act like we succeed because of our own efforts, but we fail because of circumstances and people beyond our control. Maybe we can have a better success rate if we believe we are responsible for our own success … and failure.

In the last few weeks, I have been sitting down with my department heads to try to quantify objectives and set goals. I have also tried to nail hard as to why some initiatives were not progressing. As a result, I have been getting a lot of emails sent by one department to another ( cc’d to me) trying to follow up. The apparent reason for this is to let me know that they are not able to move their own objectives because of certain bottlenecks created by other people.

Apparently, for many people, it is OK not to succeed as long as there is a good reason for failing.

The first thing in managing when your team acts like that is to stop the fingerpointing, and start to change culture and attitudes towards being responsible in getting things done.
For me, that means also setting clear guidelines, and I have set it at thus — if you set your goal at 100%, and for some reason you hit only 85% to 90% of that goal, then it is OK to justify that certain people or circumstance is preventing you from hitting 100% or more.

But if you are only hitting 30 or 50% of your goal, then the problem has to be you.

In short, I believe that other people and circumstance may make you less successful ( can also favor you sometime!) in the short term, but they cannot make you consistently fail in the long term.

What do you think?

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Yin and Yang – It goes Both Ways

I remember a friend who said he wants to be a banker.  When asked why, he said that even when you are sleeping your money is earning more money.

Maybe that is why also many people want to be entrepreneurs — they see entrepreneurs ( especially the established ones) who can afford to take the day off, and still be earning money – the organization and its people, as well as your money goes ahead and work for you earning more!

My aunt who is a doctor keeps saying she envies me — She says as a doctor, if they stop working , the income stops coming, unlike my business.

But it works both ways.

If you are a banker, you are earning even when sleeping. If you are a borrower, you are paying interest as well even if you are sleeping, or even if your business is not functioning.

As an entrepreneur, you earn once it is established.

But what if it is not yet established?

If you are quitting a job to be an entrepreneur, you normally have to invest money in the venture. But your biggest investment could well be your time — you are not going to get a salary ( or at least your outflows will be more than your inflows) while you are trying to get it going.

It could well be that at least at the start, your earnings will be less than your regular job – plus no promise when you are going to get payback.

Most businesses may take awhile to establish.  As they say, an overnight business success takes seven years.

This is something to think about before you take the plunge.  If you are not sure, it might be a good idea to start conservative or part time to test your ideas first.

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Business Transformations

I’ve always been fascinated by corporate transformations – how companies totally reinvent themselves in order to remain competitive.  Sometimes the original reason or products of the company are no longer relevant and then the owners have to reinvent themselves in order to continue or grow the business.  Of course, we know SM stands for Shoe Mart – and it was selling shoes as its primary ware before it became the all encompassing brand that means almost everything to the Filipino.  Jollibee started off as an ice cream parlor before it became the quintessential fast food company. Nokia has been well in existence since 1865 when it was a pulp mill.  It eventually expanded to rubber, forestry, cable, electricity and electronics business.  It is most well known for its mobile phones, because for a  while, it was the world’s biggest cell phone company.  Now it has transformed itself after selling its mobile phone business to Microsoft, and went back to telecommunication infrastructure.

HP used to Hewlett Packard, a manufacturer of scientific instruments and calculator before it went to become a printer company.  Then it bought Compaq and became a dominant personal computer and server company.  IBM  came from the other side.  A hundred years ago, it used to sell cash registers, and tabulating machines,and typewriters, Then Thirty Years ago, it was a computer mainframe company that got almost all its sales from computers ( with services and software bundled in).  Now IBM is no longer International Business Machines, because machines or computers account for less than 10% of its sale.  IBM is primarily a service company that gets almost 90% of its sales from software and services.

Another famous personal computer DELL is famously also reinventing itself.  From a personal computer, it has started buying scores of software, services, and storage companies to transform itself.  Most recently, it bought EMC, a company that is twice its size that is well known for storage, and also with it, a stake in VMware, which is a virtualization software.

It is expected that when this is done. Dell will get less than half of its revenues from personal computers.

The one that fascinated me, and is probably a very bold step is Playboy.  For over 50 years, Playboy is known for one thing – nude women.  Playboy has announced that starting March of 2016, it will stop publishing nude women.  The CEO said that they want to transform the business, because there is so much prevalence and ease of seeing nude women in the internet, that there is no more value in producing that.  They may be right. Last year, they had an experiment.  Playboy.com, their website, stopped publishing nude pictures, and the traffic purportedly shot up from4 million to 16 million unique visitors per month. That is because without nude pictures, their website suddenly become a forum for serious life and business discussions, and many corporations now allow its access from the office.

How about you. How is your business doing?  Do you see any need to reinvent your product or transform your company.  You may need it – because no product is forever.

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Managing Change

The difficulty in managing the organization is not only a financial or technical issue. It can be cultural or emotional. Many projects that are viable from a technical or financial point of view fail. It may be failure of prioritization or of management. In other cases, it can be mostly cultural – it fails because of the non-support or even plain sabotage of members who may not want the project to succeed.

In most companies, many projects will be in the product or process development area. It may be to introduce changes that may impact some people, and requires people to change, which most may not welcome. We are creatures of habit, and set ways of doing things don’t change easily, irregardless of what a company claims. It is noteworthy that the only time ( and it is still difficult) that a company can realistically change its culture or the set way of doing things is when the company is on the verge of financial problems. New managers are called in from outside ( inside managers who grow up in such culture may be a victim of such set ways themselves, and occasionally, personal ties or other concerns inhibits them to introduce change radically) , who can introduce the change that there is some small chance of success. In his book, Who Says Elephants can’t Dance, Lou Gerstner aptly asks how supposedly smart managers never saw the complacency and ineptness that have started to beset IBM on the early nineties.

Some possible areas of concern by stakeholders may include the change in relationships, work hours, nature of work, the learning of new skills, the preservation of jobs, the disappearance of benefits, privileges or authority.

In these cases, it should be recognized that cultural changes are more difficult and time consuming to initiate and execute than technical changes. If there is any factor that should be considered carefully, it should be the people factor. People resist change, especially if imposed on them. Therefore the project manager should recognize such conflicts, and be able to initiate change effectively. This is through slowly overcoming the resistance by building motivation and commitment through their involvement.

If the project will really be of benefit, conflict or resistance can be mainly due that the person not understanding or not being consulted. Or as in the case of changes made previously that was not too successful, they may become fed up or cynical about the constant change which they feel have not exactly benefited their status. 

At any rate, the people factor can be every bit as important as the technical one.

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Changing Ourselves

Over the last 30 years, I have probably gone over hundreds of books and articles about motivation and positive thinking.  A lot of them dispense good advice, but many are really just ‘feel good’ articles.  You are more unique, or talented that you think yourself, so feel self confident, and don’t be afraid of failure.  However, while this kind of advice works for some, it did not do good for others.  When you encourage people to not just walk, but jump and fly, its great, because some people really found that they can fly. Its not so great, because  some people really can’t.  I know lots of people who have good jobs, but who quit and start to put their life savings into a business, only to fail, and face financial hardships.

What I am going to write now is not a feel good, but a feel bad article.  When things don’t go well, people don’t want to feel that its their fault.   Nobody wants to hear that they really are the problem.  But when things are not going as well as it should, or sometimes even much worse than you ever imagined, and things are falling apart, including the sky coming down, there are 2 attitudes that you can take:  First is that there is nothing wrong with you, and everything is caused by bad circumstances, or other people who are not willing to support you.   Or the second is to assume that you have this problem because you have a weakness or made a mistake, and the key to solving the problem is really to start with yourself changing your attitude or your direction.

Trying to assess whether you did the right thing, or even being honest whether you were at fault is very painful. It is almost like trying to rub salt on a wound that you already have.  But it can be necessary. The more intelligent a person is, sometimes the more he is in denial.  But sometimes just plainly being honest with yourself, and understanding your limitations could well be the antidote you are looking fro to heal yourself. 

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Train to be an Entrepreneur Early

” …. Unlike other entrepreneurs who quit their jobs to start their own business, I grew up with the thought inculcated to me daily that my father would turn over his business to me, eventually. Our family was of Chinese lineage, and the Chinese were of the belief that the way to prosperity was to own your business, however small. In fact, there is a Chinese proverb that says “it is better to be the head of a chicken than to be the tail of a bull, ” and we absolutely believe and practiced it. While other friends dreamed of becoming lawyers and doctors, most of what I dreamed was what business I would own.

I remember as early as 9 years old, I was already helping the business during vacations and after school. We had a small gasoline station, and I would fill automobiles myself, and receive the money. I would receive deliveries, and occasionally, I would go with the driver to deliver goods. I would order supplies occasionally, and I was also asked to collect receivables. I would fill up the deposit slip to deposit the cheques, and at the end of the month, I would take the challenge of balancing the bank statement. Occasionally I would be the one to make statement of accounts.

I remember my father would talk business in the meal table with my mom, and tell her about his frustrations, and what products sold and what products did not, and who were the bad customers. They would talk about how to price certain products, and what margins would be ideal. When we had business visitors, we would bring them to lunch or dinner together, and hear him work out the deals.

By the time I was 21, I not only had a business management degree under my belt, but also over 10 years of hands on experience of all aspects of a business.

I had always thought that this early training give me an edge over competitors, and in fact, I believe sincerely that this training give the Chinese an edge in many countries, and the main reason why the Chinese own so many businesses worldwide. No, they are not smarter. They just helped the family mind the business, and learn the ropes early.

I believe competitive business advantage by Chinese in SouthEast Asia, at least in the 20th Century was garnered that many chinese people own not only their little businesses, but they live in the shop themselves. So while most others play in the house, they play in the store.

If your family does not own a business, don’t let that pull you down. I have interviewed many people who after graduating college at age 21 has not even hold a job. Know that having a job while going to college actually will give you invaluable experience that will not make you only enhanced your skills, but give you insights and experiences that will make you get promoted faster.

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Its the Software !

I remembered a few years back I was visiting some cities in China with a Hong Kong friend, and commented on the rapid beautification and transformation of the various cities there. He then commented that China still has a long way to go, that while skyscrappers were going up all over the place, it was all hardware and no software. What he meant that in spite of the great buildings and roads that you see around, China still has a long way to go because the people’s skills and thinking ( the software) will take a long time to transform than the hardware. So while Shenzhen looks every bit as impressive as Hong Kong, or Shanghai every bit like New York, the comparison ends there. Beneath the impressive glass buildings, the software still needs a lot of retooling and works.

Recently, I have read Thomas Friedman, a noted New York Times journalist commented it in even greater detail in his book, Lexus and the Olive Tree, which talks about the trends of globalization.

In fact, he compared the country to the basic choices you get in the computer. First, he says, is the hardware, which for him was the actual shell around the economy. Here, he says, is whether the country choose to have a free-market economy or a communist one, or something in between. Basically like the computer war, the hardware war is over — people all over the world have chosen that it would be the capitalist , laissez faire market economy.

What is the competition now of nations is how well they implement the ” operating system” of the hardware, and also the software application itself ( which essentially and paradoxically is the same issue in the world of IT — it is the software plus how it is properly implemented and executed that counts. Hardware nowadays is almost a non-issue). A large number of countries, including countries in South America, Eastern Europe and all over Asia now are adopting the basic hardware of liberalized markets, but many of them are not implementing the software components or managing it effectively.

What does ” software” consititute? It is the measure of all things that fall broadly in the category of the rule of law, and the degree of which its officials and citizens understand, embrace and make it work. It includes banking laws, commercial laws, contract laws, business codes of conduct, property rights, judicial integrity, accounting standards, regulatory agencies, and others. As he say, the hardware is easy, but the software works is difficult.

It is easy to open a stock market, but the challenge is really how to enforce the law so that it will protect also the people and its investors. It is easy to permit free press. What is difficult is to establish a free yet responsible and credible press. It is easy to open up a country to importation liberalization. What is difficult is how to put the process to execute it properly so that local manufacturers, and even legitimate importers will not get burned.

Similarly for businesses, the argument is no longer that you should have a good inventory and logistics system. Rather it is how comprehensive and well-implemented your whole process become. There is no more argument that you should computerize your payroll system, but rather how well it is executed. Merely having one is no longer a competitive edge, because everybody is supposed to have one. Database and groupware systems abound, but how well the features work together in enhancing communications, and retaining as well as presenting important information and analysis so that data becomes intelligence and a source of important decision making will determine the winners.

The software challenge continues, for countries and governments, as well as businesses. The challenge and the winners will be determined how countries and businesses choose and execute the various aspects of the software.

In most business situations, similar challenges are — whether you are talking about technology, music, movies, and others. Software determines the hardware. There is a similar cry that what will make a person valuable is not anymore his technical skills, but his soft skills.

I close with a quote from Lao Tzu ( although made in another context, and with a different presumption) , made over two thousand years ago, but as relevant today , “The softest things in the world overcome the hardest things in the world”.

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Do you have an Entrepreneurial Mindset?

You have had it. You have been toiling in the corporate world for so long that you feel you have mastered the ‘business’ and thus will take the plunge. You want to be an entrepreneur, or at least be part or full owner of the business so that you will be able to finally benefit partly or wholly from your labors.

You put up your own money, or borrow from friends and family. Or better still, got some investors who believed in you…. But before that, check out first your mindset — evidently you want an investment in the future, and therefore is willing to sacrifice something in the present for it …. or are you?

How you perceive yourself when you start the business, and the lifestyle that you seek at that time determines whether you are really serious in ‘making’ it or not. for those that forego their present income, and even some of their ‘perks’ to start something, you are on the right mindset.

However, let us say that you are one of those ‘lucky’ ones. You got somebody to invest, and not only are you getting x percent higher salary, but they promised you also a bigger office, a better car plan and perks, a longer vacation, a ‘golden’ parachute in case things don’t work out, plus a 5% ownership of the business or stock options.

Man, you might feel like you have a deal made in heaven, and that you have the best of both worlds. Either the investor is very stupid or very smart in granting you these benefits. The only thing I can say is good luck, but no, these kind of deals are not the stuff great entrepreneurial successes are made from.

I believe that for entrepreneurial ventures to work, there has to be fire in the belly, and a desire to make it work. The only way to have it done is to take out the safety net below, and start to sarifice something ‘now’ in return for better returns when the business makes out.

Thus, instead of better salary, and perks, but only 5% of the business, you could have negotiated to have a lower salary, plus no perks, but 20% of the business… I am sure a smart investor would be willing to grant you that. It is in his/her interest to make sure that you have the right mindset to grow the business rather than taking what is due you now….

At any rate, the way for a start up to work is if the entrepreneur focuses initially not on getting the best pay, perks, or benefits from the business at the start, but in growing and building it for a better return in the future. The more he stand to lose by the venture not being successful, and the more he stands to gain when it works, means the harder and more motivated he will be to see it through.
In short, it has to be one or the other. As they say,’ you cannot have your cake and eat it too.’

What do you think?

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Do you Stereotype?

One of the most important thing to understand in business is making conclusions and generalizations, and to understand that while there are rules, there are also exceptions to the rule.  As one of my favorite saying goes, “ All generalizations are wrong, including this one.”.   Let us say for instance, that you hire a lot of people coming from a particular college, and have found that the standards are no good.  To simplify decision making you may decide that you won’t hire anymore from that school.  Or you have issues with some products that you bought from China, and therefore conclude that all their products must be inferior in quality.

These kind of stereotyping can simplify our lives, but it can lead to wrong choices.  So there are now employment rules for example in the United States, that you are not supposed to hire on the basis of skin color, religion, origin, marital status, and the like.

Let me illustrate how stereotyping can be wrong – because when you stereotyped, you start to color your perceptions, and it might well become a self fulfilling prophecy.

Once there was a woodcutter who lost his ax.  He looked around, and concluded that it was probably been stolen by the neighbor’s son.  So he secretly observed all the movements, and utterances of the small boy, and every action and word of the boy seemed to confirmed  he indeed must be a thief.  He resolved that after a day or two, he would confront the boy, and get at the truth.

Early morning, he went to the usual spot where he usually chopped wood, and near the tree, found his lost ax.  He had been too busy wrapping the firewood the other day, and bringing it home, that he must have forgotten the ax.

So now, he went home, and was now apologetic why he ever thought it was the boy.  He again secretly observed the boy.  The boy was so sincere, and lovable!  The more he saw and heard the boy, the more he was sure that the boy could never had been the thief.  Oh, how could he be so wrong!

Next time,  you look around, try to ask yourself – did you form the conclusions first, and then find the justification later, or did you really make the decision with an objective and open  mind?

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Always Be prepared !

Every year is almost always bad in terms of calamities and disasters for the Philippines, but last year was amongst the worst, a big earthquake, and a world record hurricane hit central Philippines.  Once more, the preparedness of the Philippines was called into question.   As somebody from the tech industry, we have lots of responses from governments and businesses – what do we do in order to insure business continuity? That means how do we prepare so that when disaster struck, we can minimize the damage and recover and bounce back fast?  Obviously, we can minimize life lost, and we can insure property so that we can somehow spread the risk.  However, in the last 20 years , another factor has been called into question – what about our data and operational capability?

The 9/11 tragedy on the world trade center, and the several disasters have highlighted something about businesses — those that lose their data ( like for example a business, you lose your inventory or receivables data as it is wiped out) would have very big difficulty to recover. In fact a study by McKinsey showed that upto 93% of companies who could not recover their data within a few weeks and get back to their operational capability would become bankrupt.  So it is imperative that we understand the risks, and be prepared.

In this context let me tell a story.  There was a group of college students who went out to a picnic. It was summer, and therefore nobody prepared anything to anticipate a rainy day, except one.  In the middle of the picnic, the clouds started to darken, and eventually rained poured.  The students knowing that they did not bring anything, started running for cover, except one.  This person was very confident. After all, she did prepare by bringing an umbrella, so she did not panic.  She went about slowly gathering her things.  However, the rain suddenly poured all the way down, and it was too much for her umbrella, which was damaged.  That was the only time that she started running.  I guess you know what happened – the person who prepared something actually became the most wet.

This was what happened to Leyte, though we should not discount the ferocity of the typhoon.  IN many ways, the people had prepared something, and was overconfident.  So they were not unduly alarmed, and I guess that was the reason why so many people suffered, and it took them so long to get back.  So next time, always be prepared, and always save something for a rainy day. Always back up your data, and make sure you have another copy of your data elsewhere!  And  be aware of one thing – a little preparation can actually be more dangerous than no preparation at all, if it causes you to be careless and overconfident.

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