Science to the Rescue?

It's at least twenty years ago that I had a notion: the mathematical and statistical worlds of statistics, mathematics, physics, astronomy, biology and chemistry must have a lot to teach the world of accounting and business. Due to a lack of knowledge of these areas and a lack of time and opportunity to garner such knowledge, I let it lie.

Now, I have been proven prophetic and, I suppose, impotent at the same time. I still know very little of the areas I have just mentioned but articles have appeared over the last twenty years that show how right I was.

For example, I have just read this mini article, officially called a conversation starter, ‘Power curves’: What natural and economic disasters have in common from the McKinsey Quarterly journal. It shows the relationship between frequency and magnitude and so on in terms of power curves. Accountants are wont to use straight lines, with some justification I should add, whilst those of us more gifted can work with power curves, logarithmic curves, exponentials and so on.

Here's one such curve to whet your appetite: the corporate bankruptcy curve

Where X = rank by size of assets; and Y = size of 15 largest US public company bankruptcy filings by assets, 2001 - 2008 in billion real 2000 Dollars

See

http://www.mckinseyquarterly.com/Strategy/Globalization/Power_curves_What_natural_and_economic_disasters_have_in_common_2376 for a much larger version and the whole conversation starter. Forgive me if you need to be a subscriber to the McKinsey site to see this in full ... I am so I never get a message telling me to sign up!

If you can access that page, you can join in the conversation ... one or two very interesting points being made there!

You should also read Using ‘power curves’ to assess industry dynamics. I am pretty sure you need to be a subscriber to read this one. http://www.mckinseyquarterly.com/Using_power_curves_to_assess_industry_dynamics_2222

Gradely as we say in Yorkshire!

DW

Ten Fatal Flaws That Derail Leaders

Another one from the current issue of the Harvard Business Review. It’s a list along the lines of those things that Tom Peters and his ilk love to tout around the world. Take them for what they are but as you do so, consider whether they are valid, all valid, some valid …

Poor leadership in good times can be hidden, but poor leadership in bad times is a recipe for disaster … Every bad leader had at least one and most had several ... the ineffective leaders we studied were often unaware that they exhibited these behaviours … those who were rated most negatively rated themselves substantially more positively. Leaders should take a very hard look at themselves and ask for candid feedback on performance …

The Worst Leaders:

• Lack energy and enthusiasm. They see new initiatives as a burden, rarely volunteer, and fear being overwhelmed. One such leader was described as having the ability to “suck all the energy out of any room.”
• Accept their own mediocre performance. They overstate the difficulty of reaching targets so that they look good when they achieve them. They live by the mantra “Underpromise and overdeliver.”
• Lack clear vision and direction. They believe their only job is to execute. Like a hiker who sticks close to the trail, they’re fine until they come to a fork.
• Have poor judgment. They make decisions that colleagues and subordinates consider to be not in the organization’s best interests.
• Don’t collaborate. They avoid peers, act independently, and view other leaders as competitors. As a result, they are set adrift by the very people whose insights and support they need.
• Don’t walk the talk. They set standards of behaviour or expectations of performance and then violate them. They’re perceived as lacking integrity.
• Resist new ideas. They reject suggestions from subordinates and peers. Good ideas aren’t implemented, and the organization gets stuck.
• Don’t learn from mistakes. They may make no more mistakes than their peers, but they fail to use setbacks as opportunities for improvement, hiding their errors and brooding about them instead.
• Lack interpersonal skills. They make sins of both commission (they’re abrasive and bullying) and omission (they’re aloof, unavailable, and reluctant to praise).
• Fail to develop others. They focus on themselves to the exclusion of developing subordinates, causing individuals and teams to disengage.

Jack Zenger and Joseph Folkman (2009) Ten Fatal Flaws That Derail Leaders Harvard business Review June page 18

Duncan Williamson

Key Factors in Executive Career Advancement

The title of this post is the heading of the summary of kep points that we need to observe and live by if we are to try to guarantee that we get the promotion(s) we think we deserve. Take a look at this list and see whether you agree with everything you see there: I don’t. I think we can all find examples of people who fall foul of several of these key factors and yet have still made the grade.

Key Factors in Executive Career Advancement

Non negotiables___________________________________

Factors that are absolutely necessary for you to be a contender

• Demonstrating consistently strong performance a Displaying ethics, integrity, and character
• Being driven to lead and to assume higher levels of responsibility

Deselection Factors________________________________

Characteristics that prevent you from being considered as a serious candidate

• Having weak interpersonal skills
• Treating others with insensitivity or abrasiveness
• Putting self-interest above company good
• Holding a narrow, parochial perspective on the business and the organization

Core Selection Factors_____________________________

Capabilities that breed others' confidence in your ability to succeed at the senior executive level

• Setting direction and thinking strategically; spotting marketplace trends and developing a winning strategy that differentiates the company
• Building and continually upgrading a strong executive team; having a "nose for talent"; establishing an adequate level of team cohesion
• Managing implementation without getting involved at too low a level of detail; defining a set of roles, processes, and measures to ensure that things get done reliably
• Building the capacity for innovation and change; knowing when new ways of doing business are required; having the courage, tolerance for risk, and change-management skills to bring new ideas to fruition
• Getting things done across internal boundaries (lateral management); demonstrating organization savvy; influencing and persuading colleagues; dealing well with conflict
• Growing and developing as an executive; soliciting and responding to feedback; adjusting leadership style in light of experience

Source: John Beeson (2009) Why you didn’t get that Promotion Harvard Business Review page 103 June

Duncan Williamson