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Tuesday, October 28, 2008
Sunday, October 26, 2008
Wednesday, October 22, 2008
Ten Tough Interview Questions and Ten Great Answers
Mental fear of the unknown is often what produces the physical symptoms of nervousness. In addition to preparing yourself physically, you need to prepare yourself mentally. The best way to prepare mentally is to know what may be coming. Fear of the unknown can only exist when there is an unknown. Take the time to understand some of the “standards” when it comes to interviewing questions.
The following are some of the most difficult questions you will face in the course of your job interviews. Some questions may seem rather simple on the surface—such as “Tell me about yourself”—but these questions can have a variety of answers. The more open ended the question, the wider the variation in the answers. Once you have become practiced in your interviewing skills, you will find that you can use almost any question as a launching pad for a particular topic or compelling story.
Others are classic interview questions, such as “What is your greatest weakness?” Questions most people answer improperly. In this case, the standard textbook answer for the “greatest weakness” question is to provide a veiled positive such as: “I work too much. I just work and work and work.” Wrong. Either you are lying or, worse yet, you are telling the truth, in which case you define working too much as a weakness and really do not want to work much at all.
The following answers are provided to give you a new perspective on how to answer tough interview questions. They are not there for you to lift from the page and insert into your next interview. They are provided for you to use as the basic structure for formulating your own answers. While the specifics of each reply may not apply to you, try to follow the basic structure of the answer from the perspective of the interviewer.
Answer the questions behaviorally, with specific examples that show that clear evidence backs up what you are saying about yourself. Always provide information that shows you want to become the very best _____ for the company and that you have specifically prepared yourself to become exactly that. They want to be sold. They are waiting to be sold. Don’t disappoint them!
1. Tell me about yourself.
It seems like an easy interview question. It’s open ended. I can talk about whatever I want from the birth canal forward. Right?
Wrong. What the hiring manager really wants is a quick, two- to three-minute snapshot of who you are and why you’re the best candidate for this position.
So as you answer this question, talk about what you’ve done to prepare yourself to be the very best candidate for the position. Use an example or two to back it up.
Then ask if they would like more details. If they do, keep giving them example after example of your background and experience. Always point back to an example when you have the opportunity.
“Tell me about yourself” does not mean tell me everything. Just tell me what makes you the best.
2. Why should I hire you?
The easy answer is that you are the best person for the job. And don’t be afraid to say so. But then back it up with what specifically differentiates you.
For example: “You should hire me because I’m the best person for the job. I realize that there are likely other candidates who also have the ability to do this job. Yet I bring an additional quality that makes me the best person for the job--my passion for excellence. I am passionately committed to producing truly world class results. For example . . .”
Are you the best person for the job? Show it by your passionate examples.
3. What is your long-range objective?
Make my job easy for me. Make me want to hire you.
The key is to focus on your achievable objectives and what you are doing to reach those objectives.
For example: “Within five years, I would like to become the very best accountant your company has on staff. I want to work toward becoming the expert that others rely upon. And in doing so, I feel I’ll be fully prepared to take on any greater responsibilities which might be presented in the long term. For example, here is what I’m presently doing to prepare myself . . .”
Then go on to show by your examples what you are doing to reach your goals and objectives.
4. How has your education prepared you for your career?
This is a broad question and you need to focus on the behavioral examples in your educational background which specifically align to the required competencies for the career.
An example: “My education has focused on not only the learning the fundamentals, but also on the practical application of the information learned within those classes. For example, I played a lead role in a class project where we gathered and analyzed best practice data from this industry. Let me tell you more about the results . . .”
Focus on behavioral examples supporting the key competencies for the career. Then ask if they would like to hear more examples.
5. Are you a team player?
Almost everyone says yes to this question. But it is not just a yes/no question. You need to provide behavioral examples to back up your answer.
A sample answer: “Yes, I’m very much a team player. In fact, I’ve had opportunities in my work, school and athletics to develop my skills as a team player. For example, on a recent project . . .”
Emphasize teamwork behavioral examples and focus on your openness to diversity of backgrounds. Talk about the strength of the team above the individual. And note that this question may be used as a lead in to questions around how you handle conflict within a team, so be prepared.
6. Have you ever had a conflict with a boss or professor? How was it resolved?
Note that if you say no, most interviewers will keep drilling deeper to find a conflict. The key is how you behaviorally reacted to conflict and what you did to resolve it.
For example: “Yes, I have had conflicts in the past. Never major ones, but there have been disagreements that needed to be resolved. I've found that when conflict occurs, it helps to fully understand the other person’s perspective, so I take time to listen to their point of view, then I seek to work out a collaborative solution. For example . . .”
Focus your answer on the behavioral process for resolving the conflict and
working collaboratively.
7. What is your greatest weakness?
Most career books tell you to select a strength and present it as a weakness. Such as: “I work too much. I just work and work and work.” Wrong. First of all, using a strength and presenting it as a weakness is deceiving. Second, it misses the point of the question. You should select a weakness that you have been actively working to overcome.
For example: “I have had trouble in the past with planning and prioritization. However, I’m now taking steps to correct this. I just started using a pocket planner . . .” then show them your planner and how you are using it.
Talk about a true weakness and show what you are doing to overcome it.
8. If I were to ask your professors to describe you, what would they say?
This is a threat of reference check question. Do not wait for the interview to know the answer. Ask any prior bosses or professors in advance. And if they’re willing to provide a positive reference, ask them for a letter of recommendation.
Then you can answer the question like this:
“I believe she would say I'm a very energetic person, that I’m results oriented and one of the best people she has ever worked with. Actually, I know she would say that, because those are her very words. May I show you her letter of recommendation?”
So be prepared in advance with your letters of recommendation.
9. What qualities do you feel a successful manager should have?
Focus on two words: leadership and vision.
Here is a sample of how to respond: “The key quality in a successful manager should be leadership--the ability to be the visionary for the people who are working under them. The person who can set the course and direction for subordinates. The highest calling of a true leader is inspiring others to reach the highest of their abilities. I'd like to tell you about a person whom I consider to be a true leader . . .”
Then give an example of someone who has touched your life and how their impact has helped in your personal development.
10. If you had to live your life over again, what one thing would you change?
Focus on a key turning point in your life or missed opportunity. Yet also tie it forward to what you are doing to still seek to make that change.
For example: “Although I’m overall very happy with where I’m at in my life, the one aspect I likely would have changed would be focusing earlier on my chosen career. I had a great internship this past year and look forward to more experience in the field. I simply wish I would have focused here earlier. For example, I learned on my recent internship…” …then provide examples.
Stay focused on positive direction in your life and back it up with examples.
In reviewing these responses, please remember that they are only to be viewed samples. Please do not rehearse them verbatim or adopt them as your own. They are meant to stir your creative juices and get you thinking about how to properly answer the broader range of questions that you will face.
The following are some of the most difficult questions you will face in the course of your job interviews. Some questions may seem rather simple on the surface—such as “Tell me about yourself”—but these questions can have a variety of answers. The more open ended the question, the wider the variation in the answers. Once you have become practiced in your interviewing skills, you will find that you can use almost any question as a launching pad for a particular topic or compelling story.
Others are classic interview questions, such as “What is your greatest weakness?” Questions most people answer improperly. In this case, the standard textbook answer for the “greatest weakness” question is to provide a veiled positive such as: “I work too much. I just work and work and work.” Wrong. Either you are lying or, worse yet, you are telling the truth, in which case you define working too much as a weakness and really do not want to work much at all.
The following answers are provided to give you a new perspective on how to answer tough interview questions. They are not there for you to lift from the page and insert into your next interview. They are provided for you to use as the basic structure for formulating your own answers. While the specifics of each reply may not apply to you, try to follow the basic structure of the answer from the perspective of the interviewer.
Answer the questions behaviorally, with specific examples that show that clear evidence backs up what you are saying about yourself. Always provide information that shows you want to become the very best _____ for the company and that you have specifically prepared yourself to become exactly that. They want to be sold. They are waiting to be sold. Don’t disappoint them!
1. Tell me about yourself.
It seems like an easy interview question. It’s open ended. I can talk about whatever I want from the birth canal forward. Right?
Wrong. What the hiring manager really wants is a quick, two- to three-minute snapshot of who you are and why you’re the best candidate for this position.
So as you answer this question, talk about what you’ve done to prepare yourself to be the very best candidate for the position. Use an example or two to back it up.
Then ask if they would like more details. If they do, keep giving them example after example of your background and experience. Always point back to an example when you have the opportunity.
“Tell me about yourself” does not mean tell me everything. Just tell me what makes you the best.
2. Why should I hire you?
The easy answer is that you are the best person for the job. And don’t be afraid to say so. But then back it up with what specifically differentiates you.
For example: “You should hire me because I’m the best person for the job. I realize that there are likely other candidates who also have the ability to do this job. Yet I bring an additional quality that makes me the best person for the job--my passion for excellence. I am passionately committed to producing truly world class results. For example . . .”
Are you the best person for the job? Show it by your passionate examples.
3. What is your long-range objective?
Make my job easy for me. Make me want to hire you.
The key is to focus on your achievable objectives and what you are doing to reach those objectives.
For example: “Within five years, I would like to become the very best accountant your company has on staff. I want to work toward becoming the expert that others rely upon. And in doing so, I feel I’ll be fully prepared to take on any greater responsibilities which might be presented in the long term. For example, here is what I’m presently doing to prepare myself . . .”
Then go on to show by your examples what you are doing to reach your goals and objectives.
4. How has your education prepared you for your career?
This is a broad question and you need to focus on the behavioral examples in your educational background which specifically align to the required competencies for the career.
An example: “My education has focused on not only the learning the fundamentals, but also on the practical application of the information learned within those classes. For example, I played a lead role in a class project where we gathered and analyzed best practice data from this industry. Let me tell you more about the results . . .”
Focus on behavioral examples supporting the key competencies for the career. Then ask if they would like to hear more examples.
5. Are you a team player?
Almost everyone says yes to this question. But it is not just a yes/no question. You need to provide behavioral examples to back up your answer.
A sample answer: “Yes, I’m very much a team player. In fact, I’ve had opportunities in my work, school and athletics to develop my skills as a team player. For example, on a recent project . . .”
Emphasize teamwork behavioral examples and focus on your openness to diversity of backgrounds. Talk about the strength of the team above the individual. And note that this question may be used as a lead in to questions around how you handle conflict within a team, so be prepared.
6. Have you ever had a conflict with a boss or professor? How was it resolved?
Note that if you say no, most interviewers will keep drilling deeper to find a conflict. The key is how you behaviorally reacted to conflict and what you did to resolve it.
For example: “Yes, I have had conflicts in the past. Never major ones, but there have been disagreements that needed to be resolved. I've found that when conflict occurs, it helps to fully understand the other person’s perspective, so I take time to listen to their point of view, then I seek to work out a collaborative solution. For example . . .”
Focus your answer on the behavioral process for resolving the conflict and
working collaboratively.
7. What is your greatest weakness?
Most career books tell you to select a strength and present it as a weakness. Such as: “I work too much. I just work and work and work.” Wrong. First of all, using a strength and presenting it as a weakness is deceiving. Second, it misses the point of the question. You should select a weakness that you have been actively working to overcome.
For example: “I have had trouble in the past with planning and prioritization. However, I’m now taking steps to correct this. I just started using a pocket planner . . .” then show them your planner and how you are using it.
Talk about a true weakness and show what you are doing to overcome it.
8. If I were to ask your professors to describe you, what would they say?
This is a threat of reference check question. Do not wait for the interview to know the answer. Ask any prior bosses or professors in advance. And if they’re willing to provide a positive reference, ask them for a letter of recommendation.
Then you can answer the question like this:
“I believe she would say I'm a very energetic person, that I’m results oriented and one of the best people she has ever worked with. Actually, I know she would say that, because those are her very words. May I show you her letter of recommendation?”
So be prepared in advance with your letters of recommendation.
9. What qualities do you feel a successful manager should have?
Focus on two words: leadership and vision.
Here is a sample of how to respond: “The key quality in a successful manager should be leadership--the ability to be the visionary for the people who are working under them. The person who can set the course and direction for subordinates. The highest calling of a true leader is inspiring others to reach the highest of their abilities. I'd like to tell you about a person whom I consider to be a true leader . . .”
Then give an example of someone who has touched your life and how their impact has helped in your personal development.
10. If you had to live your life over again, what one thing would you change?
Focus on a key turning point in your life or missed opportunity. Yet also tie it forward to what you are doing to still seek to make that change.
For example: “Although I’m overall very happy with where I’m at in my life, the one aspect I likely would have changed would be focusing earlier on my chosen career. I had a great internship this past year and look forward to more experience in the field. I simply wish I would have focused here earlier. For example, I learned on my recent internship…” …then provide examples.
Stay focused on positive direction in your life and back it up with examples.
In reviewing these responses, please remember that they are only to be viewed samples. Please do not rehearse them verbatim or adopt them as your own. They are meant to stir your creative juices and get you thinking about how to properly answer the broader range of questions that you will face.
Competitive Advantage
In any industry, businesses create a competitive advantage through price or the market. A price or cost advantage is tied directly to production costs, efficiency, or available technology. A competitive advantage in the market requires you to develop market differentiation—the aspect of your business that sets you apart from the competitors in your industry.
Companies that build and sustain a distinct market differentiator generally have unique attributes.
Competitive Advantage Using Market Differentiators:
Each of these companies has grown by using some kind of market differentiator, such as the following:
• Unique way to meet the needs of a niche market
• Brand recognition in the market
• Proprietary or trade secrets for operations
• Customized or proprietary software or technology
Companies with a price, or cost, advantage over competitors usually have internal strengths that are difficult for other competitors to replicate, including:
• Investments in production and equipment
• Expertise in designing products/services efficiently
• Access to less expensive materials
• Operational processes replicated consistently
• Outsourcing partnerships
• Patents and trademarks
• Unique combination of products/services
• Access to leading or scientific research
• Highly skilled and creative staff
• Reputation for quality and innovation
• Efficient distribution channels
• Effective hiring practices, low turnover, and highly skilled/knowledgeable staff
• Efficient production or operational systems
• Innovative equipment or technology
• Strategic alliances that support delivery to customers
Six Differentiators That Build a Competitive Advantage:
A true competitive advantage is one that is difficult for other competitors to copy and one that customers find valuable. Ultimately, your competitive advantage is why customers choose to do business with your company over anyone else. If customers don’t value your differentiator, then you don’t have a competitive advantage. Here are six ways your company can differentiate itself from the rest:
Core competencies – The core competencies can be used to develop an edge over the competition by providing products or services that customers value over products or services your competitors offer. Auntie Anne’s® specializes in making pretzels in every way imaginable. Rather than making a variety of products, founder Anne Bieler decided to focus on a competence she mastered at the age of twelve, baking pretzels. Core competencies are the strengths that allow you to meet the needs of your customers. Keep in mind: your core competencies may change over time, depending on the demands of the marketplace and the dominant position you want to have over competitors.
Reputation for superior products/services – Provide the best products or services in the industry or market. Your focus on quality will give you a reputation for expertise in specific areas. For example, Nordstrom® focuses on offering customers the best possible service, selection, quality, and value. Nordstrom sets the standard for department store customer service and a guaranteed, money-back commitment to meet customers’ expectations.
Niche market – Offer products or services to meet the specific demands of the target market(s). A niche market is a distinctive group of customers within a larger market or a smaller segment of a product line. For example, ITW® (Illinois Tool Works) manufactures specialty fasteners and products that are customized for its buyers’ needs.
Tom’s of Maine®, by positioning its toothpaste as a natural product, created a new category in the toothpaste market. Since no other toothpaste filled this need, the company was able to charge a premium price that consumers who buy organic or all natural products will gladly pay.
Unique distribution channels or delivery methods – Use a selling method that
is unique to the industry or difficult for competitors to use effectively. Provide
multiple products or services to the same or similar markets through an effective distribution channel.
Dell® sells computers directly to consumers and builds every computer system to order based on the customer’s specific needs. Dell uses a variety of suppliers who actually manufacture the computer components, but since Dell bypasses middlemen and retailers to sell to consumers, it maintains low overhead and passes the savings on to buyers.
Amazon.com was the first in its industry to use e-commerce to market and distribute books, music, and movies. Besides offering competitive prices, Amazon has an excellent distribution system and can get products into customers’ hands quickly. Amazon also developed strategic relationships with used booksellers to provide customers with the option of buying new or used books.
Organizational efficiency – Look for less expensive materials and more efficient equipment. Streamline your processes and find ways to make products or deliver services more efficiently. Outsource to efficient and highly skilled suppliers. Hire staff with expertise that can improve operations and efficiency levels. For example, Southwest Airlines® continues to be one the few profitable airlines because of its ability to provide excellent service, budget prices for fares, and quick turnaround on secondary routes. Southwest Airlines started a trend for cost-conscious, low-frills air transportation.
Unique technology and innovative products or services – Use unique, innovative, and leading technology to market, sell, and serve target markets. Consider using the Internet to offer products or services to local, regional, national, or global customers. Invest in technology to manufacture products, manage operations, or track customer information.
Apple does not produce as many products as Hewlett Packard® or Samsung®. But what sets Apple apart from its competitors is that it creates innovative products that initially are unique for the industry. Apple’s first success was its user-friendly computer icons—even three year-olds could use the computer. With the introduction of the iPod®, a miniature electronic gizmo that can hold 15,000 songs, Apple again provided a unique product to meet the diverse needs of the market.
Kauffman Foundation
Companies that build and sustain a distinct market differentiator generally have unique attributes.
Competitive Advantage Using Market Differentiators:
Each of these companies has grown by using some kind of market differentiator, such as the following:
• Unique way to meet the needs of a niche market
• Brand recognition in the market
• Proprietary or trade secrets for operations
• Customized or proprietary software or technology
Companies with a price, or cost, advantage over competitors usually have internal strengths that are difficult for other competitors to replicate, including:
• Investments in production and equipment
• Expertise in designing products/services efficiently
• Access to less expensive materials
• Operational processes replicated consistently
• Outsourcing partnerships
• Patents and trademarks
• Unique combination of products/services
• Access to leading or scientific research
• Highly skilled and creative staff
• Reputation for quality and innovation
• Efficient distribution channels
• Effective hiring practices, low turnover, and highly skilled/knowledgeable staff
• Efficient production or operational systems
• Innovative equipment or technology
• Strategic alliances that support delivery to customers
Six Differentiators That Build a Competitive Advantage:
A true competitive advantage is one that is difficult for other competitors to copy and one that customers find valuable. Ultimately, your competitive advantage is why customers choose to do business with your company over anyone else. If customers don’t value your differentiator, then you don’t have a competitive advantage. Here are six ways your company can differentiate itself from the rest:
Core competencies – The core competencies can be used to develop an edge over the competition by providing products or services that customers value over products or services your competitors offer. Auntie Anne’s® specializes in making pretzels in every way imaginable. Rather than making a variety of products, founder Anne Bieler decided to focus on a competence she mastered at the age of twelve, baking pretzels. Core competencies are the strengths that allow you to meet the needs of your customers. Keep in mind: your core competencies may change over time, depending on the demands of the marketplace and the dominant position you want to have over competitors.
Reputation for superior products/services – Provide the best products or services in the industry or market. Your focus on quality will give you a reputation for expertise in specific areas. For example, Nordstrom® focuses on offering customers the best possible service, selection, quality, and value. Nordstrom sets the standard for department store customer service and a guaranteed, money-back commitment to meet customers’ expectations.
Niche market – Offer products or services to meet the specific demands of the target market(s). A niche market is a distinctive group of customers within a larger market or a smaller segment of a product line. For example, ITW® (Illinois Tool Works) manufactures specialty fasteners and products that are customized for its buyers’ needs.
Tom’s of Maine®, by positioning its toothpaste as a natural product, created a new category in the toothpaste market. Since no other toothpaste filled this need, the company was able to charge a premium price that consumers who buy organic or all natural products will gladly pay.
Unique distribution channels or delivery methods – Use a selling method that
is unique to the industry or difficult for competitors to use effectively. Provide
multiple products or services to the same or similar markets through an effective distribution channel.
Dell® sells computers directly to consumers and builds every computer system to order based on the customer’s specific needs. Dell uses a variety of suppliers who actually manufacture the computer components, but since Dell bypasses middlemen and retailers to sell to consumers, it maintains low overhead and passes the savings on to buyers.
Amazon.com was the first in its industry to use e-commerce to market and distribute books, music, and movies. Besides offering competitive prices, Amazon has an excellent distribution system and can get products into customers’ hands quickly. Amazon also developed strategic relationships with used booksellers to provide customers with the option of buying new or used books.
Organizational efficiency – Look for less expensive materials and more efficient equipment. Streamline your processes and find ways to make products or deliver services more efficiently. Outsource to efficient and highly skilled suppliers. Hire staff with expertise that can improve operations and efficiency levels. For example, Southwest Airlines® continues to be one the few profitable airlines because of its ability to provide excellent service, budget prices for fares, and quick turnaround on secondary routes. Southwest Airlines started a trend for cost-conscious, low-frills air transportation.
Unique technology and innovative products or services – Use unique, innovative, and leading technology to market, sell, and serve target markets. Consider using the Internet to offer products or services to local, regional, national, or global customers. Invest in technology to manufacture products, manage operations, or track customer information.
Apple does not produce as many products as Hewlett Packard® or Samsung®. But what sets Apple apart from its competitors is that it creates innovative products that initially are unique for the industry. Apple’s first success was its user-friendly computer icons—even three year-olds could use the computer. With the introduction of the iPod®, a miniature electronic gizmo that can hold 15,000 songs, Apple again provided a unique product to meet the diverse needs of the market.
Kauffman Foundation
Tuesday, October 21, 2008
When One Team Member Is Ruining Your Team
- My first suggestion is to work on improving the team behavior of every team member. In this way, the one person you are having problems with won't feel 'singled out' by you.
- Have each team member ask each other team member a simple question: "In the future, how can I do a great job of helping our team demonstrate effective teamwork?"
- Encourage each team member to be positive and focused in their replies to other team members.
- Encourage each team member to listen to, learn from, and express gratitude for these suggestions.
- Have each team member discuss what they have learned from the other team members with you - in a one-on-one dialogue.
- Provide your ideas - as the manager of the team -- after you have heard the summary of the other suggestions from this person's team members.
- Ask each person to commit to following up with fellow team members on their plan for improvement to get ongoing suggestions and reinforcement.
- Participate in the process yourself - so that you are 'leading by example' not just 'leading by preaching at everyone else.'
This series of suggestions will work if the person you are trying to help has issues that are behavioral, is willing to try, and will be given a fair chance by the other team members. If the person is unwilling to try, or has a sarcastic or cynical attitude toward change, this won't work.
If she has this bad attitude, tell her that a change in behavior is critically important. Let her know that you want to help her however you can - but that she is going to have to make the effort to improve. If she still doesn't care, either fire her or, if she is a critical individual contributor who can function well without team interaction, have her work alone.
Posted by Marshall Goldsmith in http://discussionleader.hbsp.com
Is Corporate Transparency Always a Good Thing?
It's one of the tenets of corporate communications that transparency is a good thing. The history of corporations communicating is littered with examples, good and bad, of what happens when you adhere to or violate the Transparency Rule.
The modern example that has long been held as the standard is Johnson & Johnson's response to the Tylenol murders of 1982. By all accounts, the company handled the crisis brilliantly. It warned everyone, pulled Tylenol off the shelves, and ultimately re-launched the brand with tamper-proof bottles. Tylenol regained virtually all of its market share and has continued to sell well nearly 30 years later.
By contrast, the corporate graveyards are marked with the headstones of many companies that were less forthcoming, or even deceptive, in their dealings with the public: WorldCom and Enron, to go back a few years, and Lehman Brothers and AIG to pick from recent headlines.
The lessons seem to be clear: transparency is a good thing. Those who follow the rule get a chance to survive, even possibly thrive. Those who do not, suffer, and perhaps die.
Moreover, organizations today don't really have a choice. This is the era of transparency, thanks to You Tube, the 24/7 news cycle, and the Internet, and what you don't admit to in public will hit the news in a nanosecond or two anyway.
And, of course, if the news is shaped by someone else, the odds are that it will be considerably less kind to your point of view. You will add skulking to your list of corporate sins.
Given both the urgency and the necessity of transparency today, is there any argument to be made for holding back?
Let's look at a recent case: Daniel Bouton, CEO and Chairman of Societe Generale. Back in January, Daniel Bouton learned one weekend that a rogue trader in his shop had generated almost 50 billion euros in losing bets - a great deal more than the firm was worth.
How did Bouton respond? He told only a select few insiders. He enlisted the help of a couple of closed-mouth traders and spent a few intense days unwinding the trades and getting SG's financial house in order. By mid-week, he was able to report to an astonished French and world press that he had saved the firm and taken 4.9 billion euros in losses.
The bad news was that it was a huge hit. The good news was that the firm wouldn't go under that week.
Was Bouton right or wrong? Had he gone public, the firm would have most likely failed.
Had he notified the media on Monday morning, the resulting feeding frenzy would have almost certainly sunk SG, and perhaps precipitated a much wider financial mess. As it was, the damage was controlled and organizational life went on.
In the end, Bouton was relieved of his CEO title a few months later, but he stayed on as Chairman. Was that an appropriate punishment? Or was that a wink and a nod to a cowboy whose gutsy actions saved the day?
In fact, Bouton was only able to save the firm because he withheld significant information. What should we make of that?
And there's a further price to pay for this non-disclosure. Bouton and SG lose credibility with the press and the public in general. How will that affect them? In a recent press release, SG was reduced to announcing this:
Societe Generale reiterates its formal denial of the market rumors which may have circulated today. At this time, the Group has not experienced significant losses on its structured products activities, which would necessitate a recapitalization of any kind.
Paris, 13 October 2008
In the long run, my guess is that SG will indeed suffer, and die. Bouton saved the firm that week, but trust, once broken, cannot easily be re-established. And without trust, a firm that depends on credit cannot survive.
Posted by Nick Morgan in http://conversationstarter.hbsp.com
The modern example that has long been held as the standard is Johnson & Johnson's response to the Tylenol murders of 1982. By all accounts, the company handled the crisis brilliantly. It warned everyone, pulled Tylenol off the shelves, and ultimately re-launched the brand with tamper-proof bottles. Tylenol regained virtually all of its market share and has continued to sell well nearly 30 years later.
By contrast, the corporate graveyards are marked with the headstones of many companies that were less forthcoming, or even deceptive, in their dealings with the public: WorldCom and Enron, to go back a few years, and Lehman Brothers and AIG to pick from recent headlines.
The lessons seem to be clear: transparency is a good thing. Those who follow the rule get a chance to survive, even possibly thrive. Those who do not, suffer, and perhaps die.
Moreover, organizations today don't really have a choice. This is the era of transparency, thanks to You Tube, the 24/7 news cycle, and the Internet, and what you don't admit to in public will hit the news in a nanosecond or two anyway.
And, of course, if the news is shaped by someone else, the odds are that it will be considerably less kind to your point of view. You will add skulking to your list of corporate sins.
Given both the urgency and the necessity of transparency today, is there any argument to be made for holding back?
Let's look at a recent case: Daniel Bouton, CEO and Chairman of Societe Generale. Back in January, Daniel Bouton learned one weekend that a rogue trader in his shop had generated almost 50 billion euros in losing bets - a great deal more than the firm was worth.
How did Bouton respond? He told only a select few insiders. He enlisted the help of a couple of closed-mouth traders and spent a few intense days unwinding the trades and getting SG's financial house in order. By mid-week, he was able to report to an astonished French and world press that he had saved the firm and taken 4.9 billion euros in losses.
The bad news was that it was a huge hit. The good news was that the firm wouldn't go under that week.
Was Bouton right or wrong? Had he gone public, the firm would have most likely failed.
Had he notified the media on Monday morning, the resulting feeding frenzy would have almost certainly sunk SG, and perhaps precipitated a much wider financial mess. As it was, the damage was controlled and organizational life went on.
In the end, Bouton was relieved of his CEO title a few months later, but he stayed on as Chairman. Was that an appropriate punishment? Or was that a wink and a nod to a cowboy whose gutsy actions saved the day?
In fact, Bouton was only able to save the firm because he withheld significant information. What should we make of that?
And there's a further price to pay for this non-disclosure. Bouton and SG lose credibility with the press and the public in general. How will that affect them? In a recent press release, SG was reduced to announcing this:
Societe Generale reiterates its formal denial of the market rumors which may have circulated today. At this time, the Group has not experienced significant losses on its structured products activities, which would necessitate a recapitalization of any kind.
Paris, 13 October 2008
In the long run, my guess is that SG will indeed suffer, and die. Bouton saved the firm that week, but trust, once broken, cannot easily be re-established. And without trust, a firm that depends on credit cannot survive.
Posted by Nick Morgan in http://conversationstarter.hbsp.com
The Next 8 Years of Indian IT Industry
Forbes has some scary statistics on the salary hike rate in India. The 2007 rate is 15.1%, up from 14.4% the previous year. 2008 forecast: 15.2%. This is the fifth consecutive year of salary growth above 10%.
Good lord!
Is Death of Indian Outsourcing all that far out?
Assuming a 15% y-o-y salary hike rate, and a 2007 cost advantage of 1:3 in favor of India, and assuming that wages remain constant in the US, in 2015 the cost advantage disappears.
So what would need to happen in the next 8 years to find another sustainable competitive advantage for India, considering that India doesn’t do IT products?
It could be, that the IT skill-base in India is substantially larger than what exists in the West, in which case the outsourcing will continue purely on the basis of skills and not cost.
However, a large portion of the 4 Million people that the IT/ITES industry employs are not exactly skill-differentiated. That segment of the industry will need to go to a lower cost-structure.
In India, the bottleneck for going to that lower cost-structure will be finding English-speaking people. Cleaning up accents is one thing. Teaching people to converse fluently in a new language is quite another. My sense is that the Call-Center work will move back to the US.
BPO, at least to some degree, would become automated via SaaS. Even Indian BPO shops would start streamlining by deploying SaaS solutions to make their own processes more efficient. Trimming of fat will definitely be in order.
One final point - Politics.
If the Democrats get the White House for these next 8 years in question, chances are, they would try to offer incentives to US companies to keep jobs in the US.
Couple that with instability in Pakistan post-Musharraf, as that country learns to operate with a new system called Democracy, for lack of a better word. It will hang over India like a dark cloud.
So, overall, are we to expect the Indian IT/ITES industry growth momentum to subside in 2015, or even before?
Adopted From: Indian IT Industry: The Next 8 Years, www.sramanamitra.com
Good lord!
Is Death of Indian Outsourcing all that far out?
Assuming a 15% y-o-y salary hike rate, and a 2007 cost advantage of 1:3 in favor of India, and assuming that wages remain constant in the US, in 2015 the cost advantage disappears.
So what would need to happen in the next 8 years to find another sustainable competitive advantage for India, considering that India doesn’t do IT products?
It could be, that the IT skill-base in India is substantially larger than what exists in the West, in which case the outsourcing will continue purely on the basis of skills and not cost.
However, a large portion of the 4 Million people that the IT/ITES industry employs are not exactly skill-differentiated. That segment of the industry will need to go to a lower cost-structure.
In India, the bottleneck for going to that lower cost-structure will be finding English-speaking people. Cleaning up accents is one thing. Teaching people to converse fluently in a new language is quite another. My sense is that the Call-Center work will move back to the US.
BPO, at least to some degree, would become automated via SaaS. Even Indian BPO shops would start streamlining by deploying SaaS solutions to make their own processes more efficient. Trimming of fat will definitely be in order.
One final point - Politics.
If the Democrats get the White House for these next 8 years in question, chances are, they would try to offer incentives to US companies to keep jobs in the US.
Couple that with instability in Pakistan post-Musharraf, as that country learns to operate with a new system called Democracy, for lack of a better word. It will hang over India like a dark cloud.
So, overall, are we to expect the Indian IT/ITES industry growth momentum to subside in 2015, or even before?
Adopted From: Indian IT Industry: The Next 8 Years, www.sramanamitra.com
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