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Posts tagged "economy"
Wednesday, Apr 8th, 2009 ↓Shangri-La
One of the great things about meeting with a lot of different businesses is the insight you get into management styles and business culture. A few weeks ago I met with a fantastic company. Extremely well-funded, its mission is as much humanitarian as it is profit-making. Highly technological, the people who work there all graduated with sciences degrees from top universities and are extremely polished and polite. They also have beautiful offices and seem to really enjoy what they do. This was one of the rare instances where researching the company and interviewing for a position was enjoyable in and of itself. At the time of the interview, I felt as though I found a common language with the folks there i.e., that we hit it off. I was wrong - not only did I not get the job, but I did not even make it to the next interview round.
Had I been looking for them, there definitely were warning signs that the fit was not there. For instance, when I asked questions about the function of the role I was pursuing; or why the organization had pursued strategy “x” rather than strategy “y” with its flagship product; or why it had been decided to organize as a “for-profit” rather than a non-profit - the answers were polite, but rapidly became more guarded. “David,” the head of the organization and its sole investor, had made the decision and the interviewer “couldn’t really say why.” And the while the educational credentials and level of the folks who were interviewing me were unquestionably extremely high, it was also clear that their backgrounds were pretty homogeneous (and different from my own). My own philosophy is that a heterogeneous workforce and a tolerance for internal disagreement are important ingredients for successful businesses. While I certainly wish this group well and hope to read about their successes in the future, I wonder whether the absence of these qualities will prevent it from reaching full potential.
Postcard from the Edge (3)
Our friend has left the small company where he started working just over a month ago. He explains -
“Certainly, the adjustment from large IT products corporation to a small light manufacturing group was a big one. There were lots of positives in the lack of red tape, the ability to work across functional lines and learn new skills. However, in small business even more than in a corporation, you realize that your success depends on the owners’ and on your colleagues’ work. It is a “partnership” in the true sense if not the legal meaning of that word. And I quickly came to realize that the owners of this firm were not managing to ethical/legal standards that are very important to me and as a result they had not been able to attract class-A employees to the organization. This was very disappointing since the industry is very promising and is an area for public/private investment under the Federal stimulus package. We reached a point where I realized it would be either “fish or cut bait” and I decided to continue fishing in other waters.”
Postcard from the Edge
A friend who just started a new work assignment writes:
“Just started with a small (fewer than 20 employees) company this past week. The contrast with the Fortune 500 company where I spent the previous 11 years couldn’t be greater. I started working on President’s Day, which is a difference right there. At my old company, not only is President’s Day observed as a holiday, but many employees take the whole week to go skiing. Stuff that takes ages in a big company - getting an email account, for instance - took about 20 minutes. Also, in contrast with a corporation, the learning curve is quick and the time allowed for getting up-to-speed is short. I started diving into my work right away: someone asked me to do something within 20 minutes which I figured out and completed within the hour. I spent much of the week learning the firm’s production process and getting different perspectives on strengths and weaknesses of the operation. It’s going to be a hectic assignment, but I feel fortunate to have landed anything in the midst of our current economic turmoil.”
Field Notes on the Economy
What I am seeing in the field now:
- Consensus that this is not a regular recession, but a fundamental economic reset. This is not clear from the “noise” in the US media, but a number of commentators including Microsoft CEO Steve Ballmer have hit the nail on the head. According to Ballmer, the three important milestones that need to be passed to get to the reset point are 1) de-leverage the economy (i.e., reduce percentage of private debt to GDP which will mean restructuring or writing off loans); 2) restoration of confidence (which requires #1 and that the economic stimulus pass; and 3) a return to growth built on innovation and productivity.
- Large companies are shedding employees and will continue to do so for at least the first half of the year. As the economy went increasingly sour during 2008, corporations stopped hiring for new positions, but refrained from wholesale cuts until they had “better visibility” into the economic forecast. The big job losses started in November and will continue until companies feel like they are staffed appropriately to the present market opportunities. The job losses started in the US, but seem to be happening even more quickly in emerging markets right now.
- Smaller firms adapted to the “new” reality more quickly than corporations and are already honing in on the few bright spots out there. Not to say that things are good for SMBs, but they are more agile than their big company brethren. The few interviews and business opportunities I have discussed recently, have been with smaller companies.
Dispelling the Myths of Summer →
Excellent NYT article about the economy and myths about the economy. As someone who is riding the high seas in a rubber life dinghy, I am living this news as well as following it. I particularly commend the couple paragraphs describing the US educational system and the “innovation deficit.”
