Morality and public companies…..can they really coexist?

September 18, 2010

I’ve been thinking about personal responsibility and how this ties in to those of us who run businesses, large and small.

I find that most of the time those who run and own their business will operate with much more integrity, authenticity and morality than those who run businesses for others, but are not major shareholders in that business.  Public companies are a great example of businesses that often are run with anything but integrity.

I believe the reason for this is the lack of personal responsibility and accountability that exists in most public companies.  At the end of the day those who are in senior management rarely if ever have to pay for bad decisions on a personal basis.  In fact, many times they are sent away with a huge golden parachute that allows them to move to their next venture being financially independent.

We have a problem with morality in large organizations whether they be in the private sector or government.  Both are charged with working in the best interest of the shareholders or the public.  Too often we find the leaders of these organizations did not work in the best interests of their stakeholders.  In the financial management world we often are asked to be a fiduciary for our Clients.  The same is or at least should be true with public corporations as well as government.

Unless there is a personal price to pay, we won’t see any significant changes.  When the leaders of these organizations get caught doing unethical things, they usually don’t pay a personal price  If they ruin their company, they just leave and sit on the sidelines to re-appear in another company within a few months.

Greed is not good, although many in our society think it is.  Being morale pays off.  For those in small companies the owners know this from first hand experience.  If they don’t run their companies with integrity, eventually their business will go away and they go out of business.  If this happens the owner pays a huge personal economic and psychic cost.  In the public realm this doesn’t happen.

Until we can figure out how to hold the people who run pubic companies accountable personally for their actions, we won’t see any changes.

As always, let me know what you think.  Starting a conversation is always a good thing.

Josh Patrick

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Making public companies act in the best interest of their Shareholders

September 13, 2010

Last week I got into a conversation with a friend of mine about the large amount of money that public companies accumulate, but seem to often not distribute to their shareholders.  This conversation fits in with other public companies who pay huge bonuses to people who work in their organizations but don’t necessarily get outstanding results.  Finally, this all comes together with a huge brain drain we have in our country with our best and brightest going to work at places that don’t really add value to our society.  I hope to deal with each during this post.

The question for me is who is the real “owner” of the cash assets that public companies accumulate.  I’ve recently read that Apple Computer is sitting on fifty billion dollars in cash.  Research has shown that companies rarely add value through acquisition, but they often add a tremendous amount of value through organic growth.  The question for me is does Apple really need the fifty million dollars they’re sitting on or would that money have a better use as dividends paid to their shareholders?  My opinion is it would be better used by the shareholders as dividends.

The second question is about bonuses paid to employees of public companies.  In the case of the financial industry, traders are paid bonuses that are in line with what professional athletes and other entertainers earn who are the top of their game.  The difference between the traders and others who earn huge amounts of money is traders get paid well whether they perform or not.  Entertainers only get paid top dollar after they’ve proven they in the outlier range of those who practice their craft.  We’ve too often seen executives of companies who are more or less fired walk away with a pay package that often is close to ten million dollars.  To me, this is  an extremely poor use of corporate cash.

This leads to me to the real problem we face as a country.  When a huge amount of our economy is produced by industries that don’t add value, like the financial services industry, we start to lose our competitiveness around the world.  When our best and brightest want to have careers on Wall Street because they have a chance to reach for the brass ring without being ridiculously good we have a general societal problem.  We aren’t getting our best and brightest interested or taking careers in areas where manufacturing real products that add value and wealth to a society are being made.  We are seeing our best go to the fake world of derivatives where fantasy rules and stupid money is paid.

I can’t blame new graduates for going to where the money is.  I blame our society and political system for not having the guts to change our system and make intermediary industries less attractive, especially when we as a society hold the bag when things don’t work out.

Do you have any interest in seeing the focus change and if you do, what are your suggestions?

Josh Patrick

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Communities, yes they still exist……they just morph more often today

August 22, 2010

Today is Alexa’s (my daughter) wedding day.  I’ve been thinking about the concept of community and how it fits in with getting married.

I’ve also been thinking a lot about both my mother who died over 26 years ago and Suzanne’s mother who recently passed on.  Both had a huge impact on the communities they were involved with and both left a large footprint on the world.

We all choose to participate in communities or pass on them.  We have so many communities to choose from today it often is difficult to decide which one to involve oneself with or which ones to pass on.  In addition, there are communities we may decide to participate in that are fleeting and only joined for a particular purpose or short time frame.

Today I’ll be participating in the community that has come together to celebrate Alexa and Rob on their wedding day.  For most of the people the community that I participate with will be a short time one.  For some, it’s a lifetime community and some, in between.  But, no matter what the time frame is the community will exist for today.

I’ve written and talked a lot about become a non-person after you sell a business or leave an industry for something else in your life.  This is a good example of joining a community and then moving on.  The problem for many is that they don’t realize they’ll be moving on as soon as they sell their business or leave an industry.

It’s not a bad thing that you’re moving on, and it’s not a bad thing when people don’t call as much as they used to.  It’s just that you’ve moved out of a particular community whether you wanted to or not.  For some, the surprise of being moved out of a community causes significant issues.  For some, they don’t realize their life will change.

I recommend that you think about the communities that you’re a member of and realize that as you move out of the circle of a particular community you think about joining a new one.  If you think about what you want in your new community the transition from one community to another can a fulfilling process.  We are all social and we all need community.  And, we all stand on the shoulders of those who have come before us and those who have moved on.

So, today I not only will be celebrating Alexa and Rob and their marriage I’ll be celebrating a unique community coming together to recognize their union.  I’ll also be remembering the community and footprint and both grandmothers had on both Suzanne and I and through us our daughter, Alexa.  It’s one of the bittersweet thoughts that I’ll dwell on today.

Josh Patrick

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Getting married at the perfect place

August 21, 2010

Tomorrow my daughter is getting married.  The event is going to be held at Mary’s Inn at Baldwin Creek.  Suzanne and I have known and patronized Doug and Linda’s restaurant for over thirty years.  For us, it’s a real pleasure doing business with them and I personally really like many things about not only how they run their restaurant, but their philosophy of eating.

Since my cancer treatment and side effects from side effects I’ve dramatically changed the way I eat and Mary’s fits right into my philosophy and practice changes that I’ve made.

The first thing about their operation that makes a lot of sense to me is using a local focus on procurement of their food.  If they don’t grow the vegetables on their property, they try to source them locally.  Most of the meat comes from local small farm growers as well as their breads.  What this means is the food they serve is locally grown and, or raised.  From both a health point of view for the body and the economy this is a good thing.

The second thing they promote is slow eating.  This movement started in Europe and is now moving to the US.  The slow eating movement is just what it sounds like.  When a restaurant promotes slow eating, it means that food will be prepared slowly and not pre-cooked.  It also means that you as a diner will need to take your time.  Your food is going to come out of the kitchen slower than you may have come to expect from many restaurants.  For me, slow eating means relaxing with my wife and or friends and having a leisurely meal where I get a chance to taste great combinations of food and wine.

Tomorrow is a big day in many people’s lives.  Alexa, our daughter starts an adventure as a married person.  Suzanne and I will be adopting a new person as our son in law.  Both of us are thrilled with Alexa’s choice.  We think Rob is a kind and thoughtful person.  One who will wear well over a long period of time.

I’m thinking that it’ll be a day I remember for a long time.

Josh Patrick

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Let’s think about a new way of organizaing our companies

August 20, 2010

I just finished reading Daniel Pink’s most recent book Drive.  This is one of those books that is good to read whether you agree with him or not.

His thesis is that we work better with more enthusiasm when are allowed to control how we do our work.  I think that thought makes sense.  Today we work more in a conceptual world than we do in a manufacturing or agrarian world.  In the conceptual world tight control over employees and partners is counter productive.  The more controls we put in place, the less creative our work becomes.

There is a move towards allowing people to spend up to twenty percent of their time working on any project they desire.  I like this idea.  It gives people working with us the chance to learn, spread their wings and take more responsibility for their work experience.

This idea is a tough one for first generation entrepreneurs who thing and want to control everything in their business.  Letting our employees and co-workers have more freedom about how they do their work can be a daunting experiment.  Many times we feel that if we don’t tightly control what’s going on, the wheels will come off our business.  Pink would say, that is actually the opposite.  The more tightly we control conceptual work, the more likely bad things will happen.

The research shows that what we do in managing most companies is the opposite of what we should do if we want high performing organizations.  And, in fact many of the companies I respect and enjoy doing business with the most have adopted strategies that allow employees to choose how, where and when they will do their work.

I strongly suggest that you take the time to read the book yourself.  If nothing else, it’ll cause you to think about your role as a manager or owner.

Josh Patrick

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The new new doesn’t look very good

July 12, 2010

When I talk with others about the state of society, there seems to be a general malaise.  I believe this consistent with where we are as a society and from a demographic point of view.

We are at the point in human history where there likely are to be events or an event that will cause significant pain and suffering with many.  I would submit that we are seeing this pain and suffering already.  If we’re not in the middle of the Fourth Turning that Howe and Strauss talk about then we’re coming awfully close to it.  Life is getting disruptive and I expect that over the next eighteen months it will become even more so.

People are frustrated.  Some with very good reason and some are just in the wrong position and the wrong time.  Those who thought they had a social contract with society are finding out that those social contracts are  thin at best.  Our local governments are going to re-neg on the promises they made to long-term employees.  I believe we’ll see pension plans slashed if not completely forsaken because demographically they can’t stand on their own two feet with the funding mechanisms that had been put together years ago.

Actuarial assumptions  had been made about them and just like Medicare, Medicaid and Social Security, the promises won’t be able to be held.

In addition to Government Pensions falling apart the promise that if we worked hard and learned a craft, we would have a good paying job till retirement is out the window.  The world saw what the developed world had and decided it wanted part of it.  In fact, the world was willing to work for far less money than we were and with many, many more hours.  Now, we have a situation where much of basic manufacturing is done in an another country by those who will work for less, work harder and provide the same quality if not better than we can.

We’ve worked hard for the promises that we’ve been given.  Those promises are quickly being eroded.  My concern is not so much the promises are being eroded is that we as a society don’t have an answer for this.  It appears to me we don’t have the answers for how we’re going to take care of this huge group of seniors rapidly coming down the pike.  Our present business structure can’t afford it.  I don’t think we’ll see manufacturing coming back.  And, we have to find some way to fund at least part of the promises that we’ve made.

If nothing else, this should make for an interesting couple of years.  A couple of years that could be really scary.

Josh Patrick

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We really do need medical coordination

July 11, 2010

I’ve been out of pocket for a few days.  Three weeks ago when my cancer toxicities started to kick up I was put on all sorts of drugs.  Unfortunately, some of them were tapered at a rate that was too quick.  Along with the taper, I manged to get a case of pneumonia.  All of this was going on while I was trying to work full time.

I thought I could stay at 60% work and 40% cancer world, but that wasn’t possible.  So, right now I’m 90% out of pocket and 10% ready and willing to do things that I used to think of as “normal”.  I also understand that I have to get used to this as a reality from time to time while we try to regulate my body.

With all the conversation going on around medial care, I thought this would be a great topic for a blog post.

Right now I have four different health care providers taking care of me.  As of this date, there has not been a coordinated phone call about me.  When I first started down the cancer road a couple of years ago I thought there would be pretty good coordination between all of the docs.  I was wrong.  In fact, it seems most of the time, they glance at your records as they pass their desk, but unless the issue you are working with them on is in their specialty, they don’t have any real interest.

We could save tons of money in our medical care system and get a much better outcome is we had intelligent people coordinating complicated processes……Especially after the supposed “cure” is done.  In my case, the coordination while going through treatment was pretty good.  The different docs talked when they had to and my case was presented to a clinical trial board on a semi-regular case.

The challenge in my own particular case is that since the treatment has ended, the oversight that went with my case has also pretty much ended.  It’s no up to me to coordinate something i have little skill in doing.  The challenge becomes who to talk to about what and where to raise a stink when things are going well.

I’ve also been having about 50% of the problems after chemo than before chemo.  And, some of the issues are keeping me from being sharp at work.

It’s the not being sharp at work that has had me down.  I’m used to having my brain work two or three steps ahead of where we’re going.  At different parts of the day my brain is now two three steps behind where the conversation is going.  We are working on this issue because it’s drug related, but it might take a little bit of time for everything to catch up again.

The healing touch person has suggested that I let my body cool down  That means I have to step back, eat cooling foods and do activities that don’t add to the natural fire in my body.  This is a challenge for me.  I’m used to spending my time charging ahead.  Now I’m having to use my body in reflection and get some balance back.

For me the bottom line is I’ll have to take a step back for at least a few weeks and see if balance returns…..that is a balance that i’ve never really had in my life.

Josh Patric

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It’s hard enough to attract a good Customer, why throw your old ones away?

July 1, 2010

Do what you say, answer your phone, respond to questions and put your Customers issues ahead of yours.  Seems pretty simple, but these days is becoming a rare commodity.

Not answering phones or dealing with issues that are challenging doesn’t make them go away.  Leaving other Stakeholders out of the loop and not having them know what your intentions are doesn’t serve you or them well.  Saying you’re going to do something and then not communicating about not being able to or wanting to do it makes you sit in a difficult situation.

It’s hard enough to get a good Customer today.  Why is it that many companies are bound and determined to get rid of the good Customers and focus on attracting new ones.  We all know that it’s easier and less expensive to keep a Customer than trying to attract a new one.  We need to pay attention and work very hard, especially in today’s environment.  Otherwise, we keep living the same song over and over again.

Josh Patrick

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Steroids are a terrible thing to put up with

June 29, 2010

I’m back on steroids again and am finding that along with this drug comes an awful lot of “extra” energy.  Unfortunately, the energy comes across to others as being pretty manic, or at least that’s what I’m told.

The other problem that I’ve been having is my blood sugar from the steroids is high enough where I have to think and take actions to treat myself like a diabetic.  This puts me back in part time cancer-world and part time real world where one can work.

The question that I believe needs to be answered is how does one balance time, energy and focus on work and at the same time get one’s health to take up less of my time.

I’ve become a huge fan of David Allen’s Getting Things Done.  I find that when I use this system I’m able to look at what I’ve got going on in my life and make priorities for the amount of time I have available for different parts of my life, meaning work life, home life and health life.  Those three areas are part of the seven or eight contexts that I manage every day.  Along with the contexts are projects that fit within different contexts that I have.

Looking at projects from a point of view of energy and time allows me to focus on important things that are both urgent and not urgent.  When I stay in those two quadrants for most of the time, I find that whatever time I have is enough to provide the outcomes I think I need.

I’m hoping that my health issues start to recede again and I’ll be able to focus on life and the good things we can all have.

Josh Patrick

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More on mind maps and presenting complicaed processes

June 27, 2010

I’ve been thinking about the changes we’ve made in communicating with our Clients over the past couple of years.

My buddy Nate Sachs has reminded me that our Clients don’t like complexity and they don’t like activities that take a long time.  I’ve been coming to the same conclusion over the past year and have taken what I think are good steps to deal with both issues.

I believe that our Clients are interested in the following things:

  • Staying in control of their own situation and be the team leader.
  • Not have meetings that drag on forever.
  • Have a method of seeing our suggestions that show the connections.
  • Have us ask questions more than give answers, meaning work from their point of view not ours.
  • Be allowed to choose what they want to work on.

Our solution for communicating a complicated solution is to provide our Clients with a mind map that integrates all the activities they think are important.  As we go through the mind map, we ask them to choose which activities and strategies they have the interest and or time to work on.  These choices are things the Client has indicated they have an interest in doing through our interview process.  We keep the mind map as a strategic tool and over time we start to fill in the boxes at the Clients convenience.

This often means that we aren’t doing all the things we think the Client should do, but we are moving in a direction that supports what the Client wants done.  Using a mind mapping tool to present this information allows us to use one page.  We find the visual representation of the work we do not only simplifies the process in the Clients mind, but shows them all of the things that we are doing behind the scenes.

Our Clients often forget that there is work that must be done when they’re not around.  They can give us assignments and then if we’re good they can forget about it until we’ve kicked some tires and thought about possible solutions.  When we get together with our Clients we can use a mind map to easily allow our Clients to make choices that will make their life better.  And, after all isn’t that the point?

Josh Patrick

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