Aurevoir L’artiste: A tribute to Steve Jobs

By Patrick Mayoh

On my table next to the laptop sits a copy of Richard Rumelt’s acclaimed Good strategy/bad strategy[1]. The book embarks on a journey to explain readers what a good strategy is and is not. It was just released this year but I can tell it has all the potential of a classics in Business and strategy literature. Ok back to my table! I read the first case study about successful turn-around strategies and unsurprisingly Steve Jobs’ turnaround of Apple is the first case. Ominous!

Tributes keep pouring in on my facebook page, I click on one link from HBR[2] (havard Business review) and there is a PDF file on sales about him. Oh my! I just cannot keep from reading pages after pages of tributes from major publications and other great world changers like Bill gates. And I wonder how a few lines from this blog can actually capture what this unique person means to the world today. But I want this to be a personal but open letter to the world about what Steve Jobs represents to an MBA and a potential entrepreneur.

Thanks for showing me how being successful in business is all about:

• · Being Unique
• · Being Resilient
• · Seeing the big picture
• · Pursuing excellence
• · Great design

Unique

When you made your come back into Apple in the late 1990s the world held a breath, wondering how you could turn around a company on the brink of collapsing. But you actually performed one of your magic tricks that was quite obvious on second thought but to which the corporate board was inexplicably oblivious to. You chose to ditch all underperforming apple products and focussed on just a few ones creating. You were a true Blue Ocean thinkers not satisfied with more but little and simple. I wish your Apple remains true to that philosophy. Simplicity is better than variety. I got that.

Being Resilient

It is not just the way you fought your battle with cancer or how even after being evicted of your own company you still went on to create the most successful animation company in the world and ended up racking 7 billion in sales to Walt Disney and sit on their corporate board (talk about a rebirth). “I am going to wait for the next big thing”. This is actually what you told Richard Rumelt[3] eager to know about your strategy to upset the WINTEL[4] monster. And true to your word you fought a fierce battle to convince the music industry to help them combat piracy and revolutionize the way we access music nowadays.

Seeing the big picture

Michael Porter rightly lamented the fact that American corporate board were too much focussed on quarterly and annual profits. It is annoying how a nonsensical market fluctuation can send CEOs scrambling for small gimmicks to try and re-establish their images. But you were never drawn into that kind of silliness always choosing to pursue your dreams of what the world should be like and you succeeded. The IPHONES and IPADS have changed forever the way we interact with technology. No wonder people would run to buy your latest gadgets at unbelievably high prices and in the worst recession in human history. Thanks to you I know that focussing on the big picture is the recipe to changing the world and achieving greatness.

Excellence

People like you taught me that excellence is not just a goal but a culture. Is it any wonder that you were a hand-on manager always assessing all the details of your product designing process to make sure people like us get the most amazing gadgets? How you would carefully prepare each of your slides, how you would cultivate respect from your colleagues how you would oversee just about everything on your Apple planet should be a benchmark for any CEO or Entrepreneur.

Design

You once famously said that design “is a funny word. Some people think design means how it looks. But, of course, if you dig deeper, it's how it really works. You have to grok what it is all about”. AMEN.

I have to meet a friend tonight. I wonder if I should wear a turtleneck polo and a pair of blue jeans, where are my snickers? Thank you Steve and good bye.

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[1] http://www.amazon.co.uk/Good-Strategy-Bad-difference-matters/dp/1846684803/ref=sr_1_1?ie=UTF8&qid=1317914884&sr=8-1

[2] http://hbr.org/product/decoding-steve-jobs-select-commentary-from-hbr-org/an/10973-PDF-ENG

[3] Remember the book i told you about in the beginning

[4] Windows and Intel in the mid-late 1990s

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Crisis management made easy

By Patrick Mayoh

Whatever the title suggests to you, a crisis is never easy to resolve, actually mishandling one could prove to be fatal to your team and your career as a manager. Recently read through an article from the Wall Street Journal about handling corporate crisis, and although the tips seem to apply only to senior executives, I reckon they could be useful for any manager or team leader.

You will surely go through a crisis, no matter how prepared you are or in spite of all the precautions you take as a manager, you will have to deal with one. Some are quite minor, like all staff turning up late at work or major like a 50% profit loss due to hefty competition. As a manager I think the guidelines provided by the WSJ might well apply to you; this is nothing new by the way, the tips contained here are surely contained in countless management books and journals around the world but this is still worth a read they include:

· Resisting the temptation to resign

· Coping with anxiety and scant sleep

· Building esprit de corps within your team

· Seeking outside help (from your informal network for example)

· Always keeping records of what goes on

Do not resign yet

The circumstances never determine the end of a story. Just because it starts catastrophically never means it is going to finish this way. Even a dive in your market value or the loss of your major customer need not mean you are doomed to fold up as a company. There should always be a solution to ANY type of problem; therefore a crisis might actually be the opportunity you need to show your senior manager your unique problem-solving abilities while on a personal level reveal qualities you were unaware of as a manager or a person. Great leader usually emerge in times of crisis, they (crises) provide the ideal opportunity to actually showcase all what you are worth as a manager.

Anxiety and sleep management

Do not neglect your sleeping time WSJ suggests. Anxiety usually precludes insomnia and a sleep deficiency could have tremendous consequences on your productivity as a manager during a crisis. So it is well worth making sure you actually take time to rest. A study carried out by Harvard[1] Education actually shows the negative effects of sleep including how it (helps) consolidate learning and memory; “Sleep helps the brain commit new information to memory through a process called memory consolidation. In studies, people who’d slept after learning a task did better on tests later.” So the best way to actually find the “waouh” idea or solution is to get some sleep. People usually suggest to “sleep” on problems that could probably be the only way to make things happen.

Esprit de corps is the key

Isolation is suicidal. The last thing to do in a crisis is to hibernate to your own world to try and find solution there. That is surely the reason we have teams. As a manager your team’s unity might be the only difference between success and failure. Isolation is equally contagious and usually breeds suspicion, gossip and fear (you get the picture right?); by bringing your staff together you can actually share the burden and find the solutions you need to make things happen for your team. John Wooden once famously said that “the main ingredient to stardom is the rest of the team”. The danger when solving the crisis is to put too much focus on who get the credit rather than who gets the job done, individual might get the credit but team always get the job done.

Outside-in help

You probably have an informal network of colleagues and alumni, if not friends and family could actually provide the vital equilibrium you need between work and life. Of course you do not want everyone in your network to know about what you are facing. But it is still worthwhile to open to two or more friends that will listen and say one or two kind words to boost your morale. Did someone say there was wisdom in many counsellors[2]?

Records make all the difference

Ethan M. Rasiel and Paul N. Friga in the Mc Kinsey[3] mind actually recommend writing a note at the end of each working day to record anything new you learned in a particular day. The key to crisis management in this sense is to chart the progress while keeping notes of the things you are learning and how they are changing you as a manager. This will serve as future references for yourself but your team as well. Memos, minutes and decision-making processes have to be carefully documented and serve as reminder of what should not happen or what needs to be done in the future.

I will be writing something on perceptual mapping next week, let me know what you think about this one in the meantime.

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[1] http://www.health.harvard.edu/press_releases/importance_of_sleep_and_health

[2] Solomon in the book of proverbs in the bible

[3] http://ebookee.org/The-McKinsey-Mind_102118.html

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N.O.W saga: four things Businesses should never fail to learn about customers

By Patrick Mayoh

I have had to take a break from writing and I was thinking about posting again from August. But then everyone is talking about what I call the News of the World saga. To the point that one of my friends actually suggested I should write a post about this. Once I studied Journalism and needless to say from an ethical point of view that the hacking scandal is indeed well...a scandal.

It really never got my attention to be honest. I was wondering what the media and the public furore about N.O.W was all about. After all, phone hacking allegations have been around for well over 2 years. But then it began (the scandal) to get my attention when I read about SKY, Virgin and other big giants withdrawing commercials from the paper. And then there were shocking revelations about 7/7 victims’ families’ phone conversations listened to. I read with great dismay how Miley Dowler’s phone was also hacked and how even her parents’ private conversations with friends were monitored by N.O.W staff. From then on the phone hacking scandal just got uglier every single headline. Her majesty, Gordon Brown (other victims) and then the death of the whistleblower Sean hoare just a few days ago.

I believe this is what happens when an organization fails to adopt an outside-in perspective. Reflecting on the unfolding of this catastrophe I cannot help but draw lessons for all businesses in light of what we are witnessing in N.O.W. Organizations when it comes to the public (customers) should never fail to:

· Lose touch with reality

· Listen

· Fulfil expectations

· Realise people are in charge not CEOs

Organizations should never lose touch with the reality

I think what has happened is clearly a case of that. A paper that can go as far as listening to people’s private conversations just to get the big scoops has lost a sense of reality. Likewise organizations have to operate within clearly defined frameworks that protect them and the people they serve is that why we have codes of ethics? I honestly believe people should go into business because they want to help others meet their specific needs. I do not believe in the “profit first” culture. I genuinely believe you have to achieve a margin if you sell a product but when this is done at the expense of others reality always catches up and the N.O.W should serve as a stark warning. Like Muhammad Yunus I believe businesses’ goal to make profit is only one part of the story; much more has to be paid attention to.

Organisations should never fail to listen

N.O.W should have proactively reacted in 2009 when rumours about phone hacking of celebrities began to emerge. Foresight would have dictated the editors and the management to adopt a more ethical approach. Businesses will inevitably make mistakes sometimes big ones. But before mistakes move from minor to major ones there is always an opportunity to repair, amend and improve those aspects the public is not happy about. Actually the customers will always be useful in terms of reminding you as a business of what you need to be wary about before things get too ugly. When in 2005 Dell noticed that many of its customers were furious about the quality of their products; the CEO reacted by creating a blog: Direct2DellBlog entirely dedicated to answer queries customers had as well notifying them of all the measures being taken to provide an outstanding service to users. Dell even allowed like Amazon, customers to directly rate products on their website. According to Dick Hunter head of Customer service at Dell, measurements show satisfaction among customers at about 77%[1].

Fulfil expectations

Customers want good products; full stop. Meeting this need in a meaningful way is what companies should strive to do. A customer wants to buy a paper that reads well but also that excels on accuracy of facts, equilibrium and respect of privacy especially those that infringe on vulnerable sources’ basic rights for tranquillity like victims or distressed parents. In the same vein, organizations have a crucial responsibility to meet our needs without resorting to indecent means.

People are in charge not CEOs

This is probably the biggest lesson from the N.O.W saga. People are always in charge. It was not Rupert Murdoch who decided to close the paper. The advertisers did because they knew people would not buy the paper. What company would genuinely desire to be associated with a media outlet people resent?

No doubt Rupert Murdoch is a genius and a revolutionary in the true sense of the terms. However he is what he is because somehow people like what he brings to the media world and approves of his style and management. But the recent reactions to the hacking scandal have sent a clear message. People make and unmake, therefore organizations should be mindful of that and always adapt to changes outside the organizations.

I have always been a big proponent of the outside-in perspective. Although the inside-out approach can be best suited for some companies like Apple, the majority of organizations cannot afford to function without ascertaining what people outside think, what their concerns and interests are and how they can be met adequately. This is what we expect of media outlets and businesses in general

See you next week!

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[1] See Understanding digital marketing by Damian Ryan and Calvin Jones

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Brainsteering: An alternative way to conduct your brainstorming session

By Patrick Mayoh

First of all can I just observe I prefer the term Brainsteering to brainstorming? Think of it; what comes to your mind when you consider brainstorming is where/when people in a group blurt out all kinds of ideas and propositions sometimes with a serious lack of focus or perspective. When it comes to Brainsteering you can think of the steering wheel in your car providing a clear sense of direction and leading you exactly to where you want to go.

Well Brainsteering is still a very new term out there; actually my Google search yielded very scanty information. However this is worth talking about for my post this week. And I came across the concept a couple of days ago in the MC Kinsey Quarterly. Simply put Brainsteering is a refined or an improved way of brainstorming. In a traditional brainstorming session, people sit around a table (with tea or coffee, pens and papers) and have to think “out of the box” to come up with the latest ideas on issues ranging from cost reduction, pricing, market entry strategies and all the rest.

While this has been greatly lauded in organizations and by virtue of the fact it has often yielded great results, MC Kinsey believes it could be done much better. So do me. They have therefore identified seven ways of completely turning your brainstorming session upside down. It is a combination of very commonsensical principles and details managers have to take into account when they meet up with their teams.

Bearing in mind that the cardinal rule for great products and services is to have great ideas Brainsteering therefore revolves around the followings even steps:

1. Knowing your organization’s decision-making criteria

2. Asking the right questions

3. Choosing the right people

4. Dividing and conquering

5. On your mark, get set, go

6. Wrapping it up

7. Following up quickly

Assessing your decision-making criteria

This pretty much makes sense doesn’t it? Before you get your team to think about your market entry strategy for South Asia, you should as a coordinator check and ensure which decisions your team can or not make. The old cliché according to which brainstorming is all about “thinking out of the box” is very misguided. Because like it or not you operate in a specific context governed by particular rules and regulations pertaining to your organizations. So although going into China for example (everyone wants to) would be a fantastic idea for your business do you have the means as a team to make such a decision? The point here is Brainsteering strategically and wisely delineates the confines of an idea generation process. Members suggest ideas based on their collective decision-making power. Good ideas not matter how good they are, are discouraged if they cannot be implemented by the group.

Asking the right Questions

Quality is definitely better than Quantity. It is not about the number of ideas but about the pertinence of those in a given context. Therefore the ideal Brainsteering session manager carefully identifies a problem, pattern or issue and then articulates specific question built around finding key answers to the problem. This is about saving time; frankly going into a brainstorming session where the manager says “any idea?” is catastrophic. Rather the “any idea?” could be replaced with something like “any suggestions about providing better customer service for new mums that come to our store”.

Choosing the right mix of people

This does not need much explaining does it? Ideally when it comes to decision-making you should have a mix of people working within all the layers of the organization. This is even when the decision to implement for example is just affecting the operational layer. The idea is to obtain perspectives from key sectors of the organization. Say your Brainsteering session decides you should upgrade your computers. Sounds great; but what if unbeknownst to you, the top management has decided to freeze capital investments in IT. So the idea is to ideally have a Vice-President, Middle managers and Customer service reps for example. Ideas are guaranteed within such a context to flow better and to be generated in a more coherent way.

Dividing and Conquering

Sounds like a line from the Iliad or the Lord of the Rings. But this is probably one of the very important and attractive aspects of Brainsteering. It is common wisdom that when you have a large group of people three things happen. You have those who never run out of ideas and keep on suggesting off the wall perspectives. Then you have those that enjoy contradicting those who have the good ideas without suggesting anything of value. And then you have the stone faced, those who never say anything and that are hardly noticed in the course of the brainstorming session. This is usually a waste of time, ideas and resources. Because that quiet member could surely contribute something given the right context/atmosphere; and it is up to the manager to acknowledge that. An ideal Brainsteering session means you have to divide a large group say of 8 into small groups of 3 or 2 members. The tendency is to talk more when there is smaller group. The taciturn colleague will undoubtedly contribute something if he finds herself or himself in a smaller group. Conquering is then about assigning each group the task of finding specific answers to pre-articulated question (before the meeting).

On your marks, get set and go

This is most likely to be at the beginning of your meeting having prepared already (the four steps above). Here your participants will have to briefed on what you are up to (as the manager) many of these might find your paradigm shift very strange. Ideally you will set out the problem, the pattern or the issue and then proceed to lay out the key questions to be answered and therefore assign people to their various groups.

Wrapping it up

There is still the likelihood that your participants will come up with many ideas although they are in sub-groups (you can’t help it can you?). Wrapping it up is the stage where you get your team to summarize their main points. It could be done in two steps. First each group indicates how many ideas they have regarding a specific question assigned to them. Say 4 ideas per group about 16 for the whole group; the next step will be then to get them to narrow down their points to 2 or just 1 depending on your context and end up with 8 top ideas.

Following up quickly

Once you have generated ideas you should with a decision-making team (CFO or COO) tick in or out the best ideas. Informing the members even those whose ideas have not been implemented is critical at this stage. You need to thank everyone and clarify the fact that decision making based on capabilities is actually the reason why one idea gets rejected or accepted.

You are ready! Find it very useful actually. Hope you do as well. I am still thinking about my article on Phone applications. See you next week.

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Dupont Analysis – Understanding what factors affect your profitability

By Patrick Mayoh

A lot of you guys had a look at my article on cloud computing and I really appreciate that. I Hope you agreed with me that, this was a must-have IT applications for organizations wishing to save on capital investments, willing to improve their team’s flexibility and mobility, mindful about the environment and overall desiring to be trendy.

This week I am going to talk about something quite different. But it is still about efficiency, that is focussing on the elements around your organizations or units that really matter to your profitability and productivity overall.

The Dupont model or analysis is one of those frameworks that allow you to see the big picture, compare yourself to competitors in your industry and make informed decisions regarding where and why you allocate financial resources as well as how you can improve those elements that add value to your organization.

The big picture

Traditionally organizations across all industries and sectors measure profitability using such key indicators as ROCE (Return on Capital employed), ROE (return on equity – for investors and shareholders) and ROA (return on assets – how well your company uses its assets relative to its overall performance). While each of those ratios provides analysts with key figures or proportions regarding their organizations, they fail to tell the whole story. This is with regard to individual factors affecting each of the ratios. Take for example the ROE, which is obtained by simply dividing the net income from the income statement by the owner’s equity from the balance sheet. What you end up getting is simply a single figure that does not tell you much apart from how well or bad your company is doing. A Dupont analysis will break down the same figure and give you a clearer picture of what affects (positively or negatively) that measure of your organization.

Say you want to understand what affects your shareholders’ profitability using the ROE, the dupont analysis breaks it down in the following manner:

ROE=Net profit/Equity=Net profit-pre-tax profit x Pre-tax profit/EBIT x Ebit/Sales x Sales/Assets x Assets/Equity

The good thing is you do not need to calculate each of the elements that can be found in either your balance sheet or income statement, so just playing with the same figures around means you will understand which of those between EBIT, Sales, Assets or Pre-tax profits affect the performance of your organization and in this case the profitability of your shareholders.

This equally works when you want to look at those elements affecting your return on investments say for one of your flagship product.

ROI= Net income/Total Assets= Net Income/Sales x Sales/Total Assets

Lastly the profit margin that helps you to know how much sales affect your net income can be decomposed in the following manner:

ROE= Net profit/Sales x Sales/Assets x Assets/Equity

Conclusively each of those figures helps you and your team to understand what individual factors between assets, sales, EBIT, Equity, Net profit affect your performance.

Comparing yourself to competitors

In an age of free access to financial information, it is easily possible for you to gain access to key financial information of your competitors. The Dupont analysis will actually help to make a comparison between what affect your performance and theirs. In terms of benchmarking, you have the opportunity as a business to understand how the leaders positively affect the performance of their organization. As a rule of thumb for example, retail businesses have high turnovers and very low profit margins while service industries like banks make high profit margin with very few assets. Looking at such elements will likely make you understand what you need to improve on or what you need to work on within your organization to do just like or if not better than your competitors.

Assuming your shop does not turn any profit at all. Maybe the problem lies in your sales, although you make good turnover, there is the possibility that you could improve your sales or that your assets are underutilised. Likewise if you are in a sector that need very few assets to turn a profit and assuming you are not getting much return, maybe you need to invest just a little bit more in assets in terms of IT applications or machinery to name just a few. All these appear clearer when you use a Dupont analysis.

Decision making

You only want to invest money where it really matters. Therefore the Dupont analysis is a good starting point when you want to decide as an organization where money should go and why. Also it is a good framework when you have to decide what elements to scrap or maybe those ones which need more attention from your team. Maybe weak sales affect your profitability because of a weak marketing strategy or it is possible your assets are underutilised which explains why you still cannot make the most out of them.

Informed decision making is possibly one of the greatest benefit this model yields to manager when they have to decide where to invest, how and why.

To conclude you always need to understand as a manager why organization makes or does not make profit and the Dupont model is a good framework for that.

References

Bodie, Z., Kane A and Marcus, A.J. (2004) Essentials of Investments, 5^th edition New-York, Mc Graw Hill

Groppello, A.A. and Nikbakjt, E. (2000) Finance, 4^th edition New York, Barron’s Educational Series

Ross, S.A., Westerfield, R. And Jaffe, J. (1999) Corporate Finance, 5^th edition Mc Graw Hill

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A case for more females up the corporate ladder! (part 3)

By Patrick Mayoh

At last! This is the ultimate part of my series on gender diversity in top management positions. There is a strong case to articulate around the need for major corporations to make it much easier for female workers to climb the corporate ladder in major corporations.

The need to increase the workforce in Europe order to maintain or increase current productivity levels, the increasing roles women play in affecting purchasing decisions across households in Europe and the world and improved corporate images are just some of the main reasons that were highlighted in the previous posts about the need for more women to lead.

This last post is going to reveal that companies that are more diverse gender wise have achieve the following:

· Greater operational performance

· Greater financial performance i.e. Greater ROE, Greater EBIT and Greater Stock price growth

Greater Operational performance

MC Kinsey traditionally measures performance in corporations against the following nine criteria:

1. · Direction: vision, mission statement, sense of purpose in general
2. · Accountability: evaluation and proper reporting of results as well as clear guidelines to assess individual responsibilities
3. · External orientation: interactions with customers, suppliers and other external stakeholders
4. · Capabilities: the process of creating and sustaining competitive advantage
5. · Environment and values: organizational cohesion and understanding of shared values by employees
6. · Motivation: Inspired and driven employees
7. · Innovation: thinking ahead of the competition and the industry in general
8. · Coordination and control: evaluating performance
9. · Leadership: how leaders shape and encourage employees to achieve

MC Kinsey posits that organizations that achieve high scores on the following criteria equally achieve greater profitability and market capitalization. But more interestingly was the survey carried out by the organization to assess how much gender diversity affects performance within a specific organization. Out of the 101 companies from America, Asia and Europe and out of the 58,240 respondents it was found that organizations that achieved the highest on each organizational criterion outlined above had three or more females on their corporate boards than those who had fewer females on their corporate teams.

Greater financial performance

In conjunction with Amazone Euro Fund MC Kinsey conducted a study on 89 listed European companies to investigate the effect gender diversity had on the financial performance of companies. The companies were selected on the following criteria:

• · A market capitalization of €150 million
• · The share of women on the executive committee (CEO or CFO)
• · The presence of more than two women on the corporate board

Results indicate that companies that have higher proportions of women on their committee outperform their competitors and have financial performances above the industry’s averages. The Average ROE for the companies selected in the survey was 10, 3% while company with higher proportions of females on their corporate boards achieved an average ROE of 11.4%; this is equally the case with EBIT of 5.8% versus 11.1% and stock price growth of 47% versus 64%.

Conclusively although higher performances in the companies identified in the study cannot be directly attributed to having more females on the executive team, the correlation appears to be quite striking in this case and should therefore be taken into consideration by CEOs and change management professionals within organizations.

Best practices for Gender Diversity

MC Kinsey to conclude the study outlined four best practices that companies could implement to encourage and create gender diversity in their organizations. The case for more corporate female leaders in this series has been made quite clear, and the data as well as the information made available by MC Kinsey are compelling enough. Therefore the following four points are necessary to generate gender diversity:

• · Gender diversity KPIs
• · Measures to facilitate the work-life balance
• · Evaluation of the HR management process
• · Support to leadership

Gender diversity KPIs

This is assessing or investigating the proportion of women within an organization against the following performance indicators:

• · Pay levels
• · Recruitment
• · Turnover
• · Training
• · Satisfaction
• · Promotion

How many women as opposed to men have been promoted in your organization say on a yearly basis? And how does it affect gender diversity in your organization?

Measures to facilitate the work life balance

Measures to facilitate the work life balance should revolve around the following:

• · Work flexibility: how the organization adapt its culture and work environment to be more supportive of females
• · Career Flexibility: the support given to female workers before, during and after their breaks say like Maternity leaves

Those two central elements could be progressively modified to encourage and help women to climb the rungs of the corporate ladder.

Evolution of the HR management process

The HR management process to encourage gender diversity should be articulated around the following:

• · Making sure recruitment sessions both have female candidates and female interviewers
• · Ensuring the neutrality of the appraisal process within HR department
• · Supporting and individualizing career management
• · Making sure women are equally shortlisted for promotion
• · Caring and helping high potential achievers (both males and females)

Support to leadership

This will take place through the following:

• · Mentoring
• · Coaching and training
• · Networking
• · Role modelling

I started this series with the conviction that females were necessary and could be the future of business. I still hold the same belief and I hope more corporations will increasingly see the need to appoint female CFOs or CEOs. Of course this is not to say we don’t need men anymore. I advocate for balance, an equilibrium that could change many organizations across the world.

References

Georges Desvaux, Sandrine Devillard-Hoelinger and Pascal Baumgarter (2007) Women matter: gender diversity, a corporate driver

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A case for more females up the corporate ladder (part 2))

By Patrick Mayoh

Following from last week, this will be the second part of my entreaty to have more women up the corporate ladder

Why women matter

There are three reasons why women do matter in our society. Integrating more women not only into corporate quarters but also within the workforce is likely to deliver the following benefits:

1) Averting the scarcity in the workforce in Europe especially

2) Generating a better understanding of households purchasing decisions in the world

3) Improving the corporate image of an organization

The study from MC Kinsey mentioned in the previous post outlines some interesting statistics about the shortfall likely to affect Europe in the future. If the figure were to remain the same in Europe in terms of labour or the workforce, then the continent risks losing 24 million active workers by 2040. However if the number of women in the workforce could be raised to the same level as for men, the expected shortfall will only amount to 3 million. I have already indicated that European Universities produce more female than male graduates. Assuming more women had access to employment, the potentials for a workforce shortfall will be substantially less than they could be in the future. Such a compelling figure in itself is enough to bolster initiatives regarding gender diversity in corporations across the many businesses in Europe. Keeping the big picture in mind that could mean encouraging gender diversity not only in Europe but across the world. It is not guaranteed that the workforce shortage experience in Europe will not occur in other parts of the world like China whose one child policy might be detrimental to its economy in the future.

Secondly and very interestingly women seem to influence purchasing decisions in many households in fact according to the MC Kinsey study women alone account for 70% of purchasing decisions in Europe. It would be therefore precarious for a Multi National Corporation in Europe not to include a female in its board. More females in corporate quarters would mean a better and more accurate understanding of consumer behaviour and elicit better customer relationship management programmes across organizations. The old cliché holds that men are usually the master, dominating and imposing decisions in all areas of household management. But this figure alone suggest that this old pattern of thought is completely depassé and is clear enough to indicate the fact that with more women at the top corporations could rip more benefits. Understanding customers is definitely central to marketing and branding. More interestingly MC Kinsey went further to reveal that women influence purchasing decisions even in industries that are predominantly dominated by male like the car or computer industry. 60% of car purchases in Japan are influenced by female and 47% of computer users in Europe are women.

Lastly although it might seem obvious to some, increasing access to corporate quarters for women is likely to improve if not change the traditional perceptions external stakeholders have about different organizations. According to a study by the European Commission in 2003 on "cost and;effectiveness of diversity"; companies that have implemented gender diversity across their boards have ripped substantial benefits in such areas as motivation with 58% of organizations acknowledging the fact that gender diversity had generated more motivated employees across the organization. Also 57% thought gender diversity had a direct impact on customer satisfaction while 69% noted a real improvement in their corporate image.

Next week I will be looking at the correlation the MC Kinsey study established between gender diversity and financial performance across different organizations. Also I will be suggesting some thoughts on how to design and implement a gender diversity programme within an organization. CIAO

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A case for more females up the corporate ladder (part 1)

By Patrick Mayoh

This will be a three articles about "why we need more women at the top". It is a case for female empowerment within the business world and especially how this can concretely take place within the business world today.

A research paper by MC Kinsey in 2007 indicates a correlation between financial performance and the presence of more women on corporate boards. In other words, those organizations that champion gender diversity, design and implement policies that make it more possible for female workers to occupy top positions within corporations will likely generate greater financial returns than those who do not.

In “coaching women to lead” by Averill Leimon, Francois Moscovici and Helen Goodier a book released just a few weeks ago, the authors argue that a more male-female balance could make companies 11% better off.

Although women account for a larger portion of university graduates in European Universities, they only make up 21% of the workforce of European companies. In addition women only make 11% of the number of board members of corporate boards of all European corporate listed companies.

Those two pieces of information and research are enough in themselves to make a case for new corporate ladder. One in which women will be able to compete with their male counterparts to grab top positions on corporate boards. With 15 female CEOS on the list of Fortune 500 companies, more could still be done in terms of helping women to have easier access to spots on the corporate boards.

The present situation

Firstly according to the study by MC Kinsey—which will be referred to a lot in this article—the present corporate ladder advocates extreme flexibility and availability. This in a nutshell means those that are likely to be promoted are usually ready to assume virtually all assignments and are able to demonstrate multi-tasking skills while being flexible in terms of work hours and job locations. A prospect that is highly disadvantageous to women who bear the largest share of the burden in terms of domestic duties and activities. Women continue to contribute twice the number of hours men contribute to domestic duties in certain countries like Italy. In France 96% of female graduates from Business School admit childcare and rearing is a major obstacle to career advancement while 62% of US female graduates complain that building a family and other personal duties are hurdles to overcome for promotion. Given those conditions alone, it is easier to understand why the corporate ladder as it is applied in most corporations today seems hostile to women’s progress to top positions on corporate boards.

Secondly and not the least the fact that they are just very few examples of females’ success stories up the corporate ladder convey the feeling especially to women that accessing top positions within their respective corporations is a far-fetched dream. With just 11% of female on corporate boards in European companies and just 15 female Ceos at the helm of fortune 500 companies. The image which easily comes across seems to indicate that women are unlikely to make it to the top or that doing so will usually requires more sacrifices or concessions than male counterparts. This might mean choosing to remain single or childless to name just a few.

Part II next week hopefully will look at some of the benefits attached to women empowerment within the corporate world and provide a roadmap for this to effectively happen.

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Online shopping spree

By Patrick Mayoh

I needed a new pair of trainers a couple of weeks ago and my natural instinct was to log on to Amazon to find the best deal for my product. I do the same when I need a book or another electronic gadget. I do not mean to say Amazon is the only website I research when I need to buy items online, there are a host of other online shopping services like E-bay to name just an example. I cannot just wait for the time where I will be able to order a burger from mc Donald's or Burger king online.
Well according to a recent edition of the Guardian newspaper that will soon be possible. Google recently commissioned the Business Consulting Group to issue a report about the scope and the share of the online shopping industry in the UK. Online shopping and other related transactions account for more 7% of the total GDP. A bigger share than transports, communications, restaurants and hotels to mention just a few sectors; the UK alone is worth £100bn in terms of online related money transactions.
While the rate of UK Internet related transactions is set to grow by 10% a year according to the BCG report it is worth scrutinizing three key points that already underscore or will in a very near future this recent sector of online shopping.
Business and marketing professionals and practitioners will need to be wary of the following factors with regard to online shopping:
• Advertising
• New job opportunities
• Marketing strategy vs. online Marketing strategy
Advertising
Online shopping means advertising practitioners will need to change and definitely improve what is available on their website. Not only do customers try to research products or services before purchasing them, but they also look at the best possible reviews about those items they desire to acquire before making a purchasing decision. Online advertising could take advantage of the online shopping boom by:
Providing customers with the best possible information on the products or services they are looking to buy. This will mean brevity as opposed to redundancy. In that sense online shoppers will have access to the most relevant content on the products or services they are looking to obtain. Less but precise and specific information will only save time to buyers and may mean they will come for even more products and services. Especially for the websites that will save them the greatest amount of time. Have you ever been on a website where you have to browse through many irrelevant categories only to find out the items you are looking for is more expensive than you thought or worse unavailable?
Secondly targeting specific audience will be instrumental for success in the new online shopping spree area. Online advertising planning and designing is and should be done with the targeted audience in mine. Their demographics, interests, age groups, preferences and shopping habits should be systematically monitored in order to determine the best possible formats for adverts.
Thirdly because the number of websites selling the same items grow at an exponential rate, it is quite difficult sometimes for customers to make purchasing decisions. Most of the time convenience and affordability determine where customers buy their products and why they do so on through a particular website rather than another. Therefore credibility should be given priority when advertising products and services online. If online shoppers and that include me have the assurance that they will receive the goods they order on time, at an affordable price, without any extra hidden charges and even get more value as a result of a transaction like vouchers; there is no reason why they would change their shopping habits or online shopping websites. I have been faithful to Amazon ever since for these reasons.
JOBS
The online industry according to the Guardian newspaper employs 250,000 people and is set to create even more jobs as it grows in the future. Online professionals and marketing managers are very much in demand on the job markets and this is only set to continue with time.
Also new fields are likely to emerge from this as well. Specialists in specific aspects of online shopping will emerge with time and dictate as well articulate strategies to reach out specific online customers and shoppers. Online professionals of various markets across the globe will help international organization determine how they reach out to specific clients in different regions of the world. China with more than 420 million users and 6 million adding each month according to a Mc Kinsey is set to be the biggest online market of the future.
Also new business courses focussing on online transactions and advertising will probably be created. There are already web marketing and online marketing subjects in some Master degree curriculum. But what I am envisioning here is a situation where some leading business schools start creating courses revolving around online marketing or online customer relationship management. More organizations will need such professionals to reach an ever growing online public. Facebook alone is a country in itself with more than half a billion users from diverse origins, tastes, interests, age groups and preferences.
Marketing strategy vs. Online Marketing Strategy
I see organizations in the future creating two different departments or sub departments within a marketing one. New resources allocated to online marketing department to focus solely on online operations. I believe soon there will be a great amount on discussions on a new type of marketing mix. Taking into account more than the four traditional elements of the marketing mix and looking at other factors like demographics and habits which really affect how and why customers buy products.
Also different strategies will need to be articulated as different priorities will emerge between traditional marketing divisions and new online marketing divisions within organizations. More traditional marketing department might maybe focus on local customers while online marketing units will look at expansion and foreign markets to take just an example. Or online marketing department could help reach out audiences that traditional marketing department will be unable to appeal to. Teenagers who like Nike products might not read magazines as adult customers but will probably go on YouTube to discover the latest models for new trainers.
Conclusively even though I might not get a burger through online shopping tomorrow, I think this will be the case in a very near future and therefore I believe Internet users will soon dictate the way marketing should be conducted across organizations.

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