Comments on: Prisoners of the past http://www.connectioneconomy.com/2007/05/30/prisoners-of-the-past-2/ Blogging about Tomorrow's world Today Fri, 19 Mar 2010 11:41:15 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Dragon http://www.connectioneconomy.com/2007/05/30/prisoners-of-the-past-2/comment-page-1/#comment-149285 Dragon Tue, 19 Jun 2007 04:04:30 +0000 http://www.tmtd.biz/2007/05/30/prisoners-of-the-past/#comment-149285 <strong><a href="http://www.eurekalert.org/pub_releases/2007-06/uow-cwi061807.php" rel="nofollow">"There are major personal financial gains to be made by CEOs after any merger or acquisition so even if it ends up being a financial loss, shareholders suffer but CEOs nearly always come out ahead financially</a>," says Jarrad Harford, an associate professor of finance and business economics at the UW Business School and co-author of the study. "The net effect is that a CEO's wealth actually increases even if he makes a poor acquisition decision. The experience is quite different for the shareholders."</strong> “There are major personal financial gains to be made by CEOs after any merger or acquisition so even if it ends up being a financial loss, shareholders suffer but CEOs nearly always come out ahead financially,” says Jarrad Harford, an associate professor of finance and business economics at the UW Business School and co-author of the study. “The net effect is that a CEO’s wealth actually increases even if he makes a poor acquisition decision. The experience is quite different for the shareholders.”

]]> By: Dragon http://www.connectioneconomy.com/2007/05/30/prisoners-of-the-past-2/comment-page-1/#comment-143933 Dragon Sun, 17 Jun 2007 02:20:51 +0000 http://www.tmtd.biz/2007/05/30/prisoners-of-the-past/#comment-143933 Beacon looks like a disaster waiting to happen, according to what you wrote. I did try the online comment form to get a message to them about the non-functioning link. The message, which was automatically CC'd to the webmaster, as well as someone named "Loraine Madonsela", was returned. With BP, if you look at the lifetime of the Alaska pipeline as being 30 years, you'll see the recent corrosion leaks being a year shy of that 30 year limit. According to news reports, they've taken full responsibility. I can't defend any actions of stripping capacity in order to reap a temporary financial benefit, I just wanted to give a slightly different perspective on what I did know. I still think to myself, what can a company do to transform itself. Keep in mind I'm thinking about smaller, regional companies that don't reach across borders. Sometimes I wonder if the leadership is doing all it knows how to do. Or, if presented with an idea -- say, starting a seed company making pallets from a newly developed process of mixing plastic with wood -- the leadership's first instinct is to reject it, especially since it is a complete departure from what it's currently doing. Or, I wonder if the leadership's response may be if it had gotten a suggestion for opening up for ideas from all employees on what direction we thought the company could take, or what new things could be done in order to improve profits or edge out competitors. I can relate my experience with a former company. It was losing money. A vice president came to talk to us. Actually it was more of a speech. He had all kinds of ideas we were going to implement to make the company more profitable. I was very happy. These ideas were pure genius! I felt like cheering. Unfortunately, none of these ideas were put into practice. Why not? Who knows. Beacon looks like a disaster waiting to happen, according to what you wrote. I did try the online comment form to get a message to them about the non-functioning link. The message, which was automatically CC’d to the webmaster, as well as someone named “Loraine Madonsela”, was returned.

With BP, if you look at the lifetime of the Alaska pipeline as being 30 years, you’ll see the recent corrosion leaks being a year shy of that 30 year limit. According to news reports, they’ve taken full responsibility. I can’t defend any actions of stripping capacity in order to reap a temporary financial benefit, I just wanted to give a slightly different perspective on what I did know.

I still think to myself, what can a company do to transform itself. Keep in mind I’m thinking about smaller, regional companies that don’t reach across borders. Sometimes I wonder if the leadership is doing all it knows how to do. Or, if presented with an idea — say, starting a seed company making pallets from a newly developed process of mixing plastic with wood — the leadership’s first instinct is to reject it, especially since it is a complete departure from what it’s currently doing. Or, I wonder if the leadership’s response may be if it had gotten a suggestion for opening up for ideas from all employees on what direction we thought the company could take, or what new things could be done in order to improve profits or edge out competitors.

I can relate my experience with a former company. It was losing money. A vice president came to talk to us. Actually it was more of a speech. He had all kinds of ideas we were going to implement to make the company more profitable. I was very happy. These ideas were pure genius! I felt like cheering. Unfortunately, none of these ideas were put into practice. Why not? Who knows.

]]> By: Graeme Codrington http://www.connectioneconomy.com/2007/05/30/prisoners-of-the-past-2/comment-page-1/#comment-132642 Graeme Codrington Mon, 11 Jun 2007 05:55:40 +0000 http://www.tmtd.biz/2007/05/30/prisoners-of-the-past/#comment-132642 Dragon, I think it is all companies that are afflicted by this malaise. I have written many times on this type of thinking on this blog, and my concern is shared about all companies. Throughout the global business world, there is currently a deadly focus on short-term gains, fuelled mainly by an over emphasis on increasing today's share price, this quarter's published results, and the share options of the CEO before he retires (in about 3 years time). If you want to read other entries on this, check out: * <a href="http://www.tmtd.biz/2007/02/20/cost-cutting-for-competitiveness-really-what-about-executive-pay/" target="_blank" rel="nofollow">Beacon</a> - cost cutting while overpaying Executives * <a href="http://www.tmtd.biz/2007/01/28/cutting-costs-reaches-its-event-horizon/" target="_blank" rel="nofollow">BP</a> - stripping capacity is creating danger for the future, but the current CEO doesn't care, because he's retiring as a hero of profit increase * <a href="http://www.tmtd.biz/2005/05/26/apres-moi-le-deluge/" target="_blank" rel="nofollow">Aprois moi, le deluge</a> - a lesson from history about short term thinking Dragon, I think it is all companies that are afflicted by this malaise. I have written many times on this type of thinking on this blog, and my concern is shared about all companies. Throughout the global business world, there is currently a deadly focus on short-term gains, fuelled mainly by an over emphasis on increasing today’s share price, this quarter’s published results, and the share options of the CEO before he retires (in about 3 years time).

If you want to read other entries on this, check out:
* Beacon – cost cutting while overpaying Executives
* BP – stripping capacity is creating danger for the future, but the current CEO doesn’t care, because he’s retiring as a hero of profit increase
* Aprois moi, le deluge – a lesson from history about short term thinking

]]> By: Dragon http://www.connectioneconomy.com/2007/05/30/prisoners-of-the-past-2/comment-page-1/#comment-130530 Dragon Sun, 10 Jun 2007 01:31:30 +0000 http://www.tmtd.biz/2007/05/30/prisoners-of-the-past/#comment-130530 When I see an article like this, I imagine cutting-edge type companies or companies that require production or companies that make new products or services. I'd like to envision how a more traditional type business that isn't national, a brick & mortar and so forth, go about "innovation surges," "disruptive technologies," and the like. Are certain types of companies restricted to only certain types of changes? When I see an article like this, I imagine cutting-edge type companies or companies that require production or companies that make new products or services. I’d like to envision how a more traditional type business that isn’t national, a brick & mortar and so forth, go about “innovation surges,” “disruptive technologies,” and the like. Are certain types of companies restricted to only certain types of changes?

]]> By: WizardMan http://www.connectioneconomy.com/2007/05/30/prisoners-of-the-past-2/comment-page-1/#comment-117350 WizardMan Wed, 30 May 2007 14:37:55 +0000 http://www.tmtd.biz/2007/05/30/prisoners-of-the-past/#comment-117350 Interesting article... I love it! It's funny because I recently left a company a couple of months ago where I think this very problem arose. We started off as a small company of 6 people. Grew in 4 years to a company of 100. Our CEO tried to make the jump. Brought in 6 partners, started hiring and hiring and expanding, but like you said from GOOD to GREAT is not easy. I'll be honest, I think the best way to go from GOOD to GREAT is to keep your foundations then continue to grow at a SLOW rate while you start changing the companies structure to suit the growth. Companies too often try to jump the gun! That's my 5 cents! Interesting article… I love it! It’s funny because I recently left a company a couple of months ago where I think this very problem arose.

We started off as a small company of 6 people. Grew in 4 years to a company of 100. Our CEO tried to make the jump. Brought in 6 partners, started hiring and hiring and expanding, but like you said from GOOD to GREAT is not easy.

I’ll be honest, I think the best way to go from GOOD to GREAT is to keep your foundations then continue to grow at a SLOW rate while you start changing the companies structure to suit the growth. Companies too often try to jump the gun! That’s my 5 cents!

]]>