Corporate athletics [wk82]

I’ve had an active time this last week: the industry of work, a couple of runs, a weekend of swimming and walks with the family. Now I sit here at the end of working day, conscious I have not written a blog for a while. But this time, it’s intentional. I’ve decided to ‘oscillate’. I will explain…

The blog is a weekly record, but I’ve become concerned that it was at risk of becoming a weekly grind. And there is nothing more damaging to enthusiasm and creative writing than the pressure of a grind. I think of those movies that show an author suffering from writer’s block that is only exacerbated by a deadline, a disregarding publisher, etc.

Prompted by a conversation with my boss and his topical introduction that drew comparisons between an Olympic athlete and a corporate one (corporate athleticism – I know, but please just bear with me for a second), I found myself reading ‘The making of a corporate athlete’ – Loehr and Schwartz’s article for the Harvard Business Review in 2001.

Some executives thrive under pressure. Others do not. Is there a secret? Loehr and Schwartz argue that there is and that a comparison to world-class athleticism is helpful rather than trite. An athlete knows that sustained high achievement demands intensity followed by recovery. They describe this rhythm as ‘oscillation’.

A body builder stresses a muscle to the point where fibres start to tear, but then allows for recovery that results in greater strength. So stress is not the problem in itself; in fact, it can actually be seen as the stimulus for growth. The problem is the lack of disciplined recovery and its absence is the real enemy of high performance.

The most competitive tennis players use disciplined recovery routines in the 15 or 20 seconds between points. They pull their shoulders back, concentrate on their racket, adjust a string by a millimetre, look dispassionate and emotionally detatched. Or from another perspective, one could say that they are assuming a confident winning posture, focusing on the racket to avoid distraction from visualizing the next point, and removing themsleves from the heat of the battle to get their heart rate down. They are oscillating.

This may all seem extreme, but to me a recovery period often has a purpose above and beyond allowing me to peak again. Have you ever had a creative ‘lightbulb moment’ while the mind rests during mindless jogging or gardening? I have. So perhaps the high-performing blog writer is the one that is able to put his journal away for a while, and then comes out fighting/writing with flashes of inspiration. So readers, expect a ultradian sprint of blog publishing in the ensuing days!

And then put this in the context of work. There is an inclination for executives to live in a perpetual state of triage, doing whatever seems most pressing while losing sight of any bigger picture. Blog writing gives me the opportunity to pause and reflect on the bigger picture. So while I reflect on corporate athletics, the more I think that any intention to act like a high performer is unlikely to be a misjudgement.

“Excellence is not a singular act but a habit. You are what you repeatedly do.” Aristotle said that.

Private equity [wk57]

Private-equity (PE) fund managers have had a tough time since the financial crisis hit in 2007. Run-off amongst fund managers has been increasing with a greater number of firms divesting assets and making no new investments – either because they cannot raise a fund and/or find the deals. In the PE world, ‘run-off’ is the equivalent to going out of business.

However, in the medium- to long-term, there would seem to be systemic changes in the global capital markets which should suit an evolved, fit PE industry. Firstly, there is shift of wealth from the West to the East, where private investors put less of their comparative wealth into listed equities. Secondly, demand for listed equities in developed economies is likely to fall due to ageing populations. In retirement, investors will typically lock in their investment returns by converting their assets from equities to cash and equivalents (e.g. fixed-income). These trends will inevitably create an ‘equity gap’, and alternative investments such as investments in PE, property, infrastructure, hedge funds and commodities are well placed to fill that gap left by listed equities to fund growth.

But history shows that there may be some reticence to embrace PE. Despite the fact that upper quartile PE fund managers have historically consistently outperformed public securities, PE has been largely ignored by UK institutional investors. This reticence seems doubly misplaced when you consider modern investment theory. To minimise a portfolio’s riskiness for a level of return, the portfolio should be diverse. For example, funds with significant allocations to a single asset class, such as listed equities, should look to reduce volatility by investing in other assets that behave differently (are lowly correlated) to their primary allocation.  Alternative assets such as PE behave quite differently to equities. So what is going on?

As our lecturer, Guy Fraser-Sampson, so aptly stated, perhaps the answer lies in the view that “the (PE) asset class is broken; it does not seem to plug into our model.” On deeper investigation during our module on PE, it was apparent that all issues with risk, liquidity and predictability of PE earnings are all surmountable if investors are seriously looking to diversify to improve returns and reduce unrewarded risks. The reticence seems to borne out of prejudice and misunderstanding. The systemic changes will no doubt wear down this division.

Two other relevant points that I learned in Guy’s lectures before I sign off:

  • Investors should beware the halfway house of diversifying into a listed PE assets (e.g. 3i), because such listed equities “orbit too close to the sun” (another Guy quote) that one should be diversifying away from.
  • PE firms have their part to play in removing barriers to entry. And their  ‘2 and 20’ charges are a good place to start. General Partners have traditionally charged clients a 2% fee on committed capital and an incentive fee that equals 20% of investment profits. The current run-off trend may well help as PE firms lower fees in response to weak demand.

In the news [wk56]

“For the second time this week, Richard Samuel has not said goodnight to his children. It’s 8.30pm before he gets home …, his wife has fallen asleep reading a book on the sofa and his dinner is cold.


‘An exhausted executive’

“Though his eyes sting from tiredness, he makes a coffee and starts his other job — studying for a part-time executive MBA. His assignment will keep him up until 2am… Samuel is not the only exhausted executive leading a double life for the dream of a brighter future.”                                     The Sunday Times (16 Oct)

So once the excitement of being in a weekly broadsheet had passed (my excited parents loved their son’s exposure to conventional media, whereas my excited wife was less appreciative of the suggestions about our evenings), I took some time to digest the rest of the article.

  • According to the Higher Education Statistics Agency, Britain’s universities enrolled 28,350 students on their MBA courses in 2009
  • Almost 70% of those worked towards the degree while holding down a full-time job, but only 12% of students are funded by an employer
  • Graduate Management Admission Council’s (GMAC) recent findings reveal that 55% of part-time MBA students in Europe received job offers within a few months of finishing their courses, up from only 22% last year
  • Only 14% of the students who sign up for a part-time MBA do so with the intention of finding a new job, according to the GMAC survey. Longer-term career progression is often the aim.

And then I stumbled across this New York magazine article. Published on the same day, its stats had a message of despondency.

  • Nearly 14% of US college graduates from the classes of 2006 through 2010 can’t find full-time work, and overall just 55.3% of people ages 16 to 29 have jobs.
  • Almost a quarter more people ages 25 to 34 are living with their parents than at the beginning of the recession.
  • According to the National Bureau of Economic Research, the average person grabs 70% of their total pay increases during the first 10 years in the workforce. Therefore, having stagnant ­wages during that period means you hit a dampened springboard and are likely to earn a lower average nearly two decades into your careers.

I took away from both articles that realistic expectations, a long game and a portfolio of ambitions should bring about a positive NPV from investing in your own education. Although I do agree with our friends from across the pond, despite the current lust for glory and ideas that matter, “Not everyone’s TED talks will change the world.”

Which reminds me, please have a look at my new, visionary, song-a-day service samuelsounds.com: 1 subscriber today, ubiquity tomorrow.

Networking [wk53]

This week, a Linkedin Today feature caught my eye: ‘Six rules for networking’, published by HBR. I wanted to check if doing an MBA was in there.

  • Rule 1: Build outward, not inward.
  • Rule 2: Go for diversity, not size.
  • Rule 3: Build weak ties, not strong ones.
  • Rule 4: Use hubs, not familiar faces.
  • Rule 5: Swarm the target.
  • Rule 6: If people aren’t pulling together, strengthen ties.

That will be a no then. But doing a course certainly fits the bill: meet new people, make sure they are diverse, leverage other networkers, build teams – I could be reading a Cass prospectus.


When I decided to bite the MBA bullet, I recognised that that my networking activity needed a boost. Earlier in my career, I acted upon the importance of internal and external networks – it was key to my career aspirations. However, as I climbed the corporate ladder, I put diversity and freshness at risk and became a little more isolated. I had realised the advantage of private information from a smaller number of trusted sources. I was more choosy about my contacts. (I should also mention that I had been blessed with more responsibilities at home during this time, which put pay to some of the socialising!)

HBR’s list above seems to duck the issue of trust in business. In another HBR publication, ‘How to build your network’ (Uzzi and Dunlap, 2005), that same oversight is not made. In an Internet-powered world where public information is freely available to all, private information, as verified by a trusted contact, gives an executive a competitive advantage.

Moreover, without working closely with an individual, it is hard to build that trust. This is where an MBA comes into its own. Where work suffers the constraints of politics and prescribed business roles, the MBA offers a shared activity, outside of work, full of enthusiasm, equality, competition, interdependence, highs, lows, commonality, the unexpected, spontaneity – all of which reveals true personality and engenders a greater opportunity to build real trust.

Uzzi and Dunlap’s article also goes onto point out that Bill Gates’s mum knew someone at IBM. So while creativity and entrepreneurial insight are necessary, it is the effective network that sparks the imagination, offers the opportunity to reinvent yourself, or in Bill’s case, allows you declare your sensational news to the world.

So I am working on that bit. And thank goodness for the user-generated content of social media in the meantime.

Voyage of discovery [wk51]

This week, I started my first Year-2 elective – Strategic Fast-track Venturing.

The start of Year 2 is a milestone. Henceforth, courses are determined at my discretion. And so, my expectations are high. I am looking for my chosen electives to draw on the core business modules of Year 1, and solidify them in some sort of practical application. I therefore seek case orientation rather than book reading.

Year 2 is also a milestone for dinner conversations. I am now more regularly asked about where I want to be when I’ve finished the MBA. This is very different question than the one about why I’m doing the MBA. And I struggle with a short response.

Recently, a broadsheet journalist interviewed me about the challenges of a part-time MBA and suggested that I must have clear plans given the great sacrifice. This is a voyage of discovery, I thought. A new voyage is full of uncertainty under any conditions, but especially so when there are few precedents to draw upon. Preordained plans may appear decisive, but seem unrealistic in such a scenario.

Conventional planning operates on the premise that one can extrapolate future results from past experiences. But what if there is not enough known and assumptions are numerous. I would rather adopt some discovery-driven planning in which I set some milestones, where and when I can reflect on what assumptions I can convert into knowledge and part of an evolving strategy.

I think these milestones will become increasingly frequent throughout the year.

It is my very own strategic fast-track (ad)venture. So the next question is, how do I scale up?!

Olympic proportions [wk50]

Last week, I officially finished the first year of the MBA with the submission of a consultancy report for Alcoa. The aim was to assist the aluminium producer manage its capacity response to the FIFA World Cup 2014 in Brazil and Olympic Games in Rio 2016.

Unsurprisingly, much of the demand forecasting revealed great opportunity in the programme of infrastructural investment needed to support these mega-events, with their sporting arenas, global participants, international media and tourists.

The complexity is quite amazing. For instance, between 8 – 24 August 2008, Beijing hosted 10,942 participants, 204 national Olympic committees and all their dignitaries, 24,562 media; they sold 6.5 million tickets and recruited 100,000 volunteers to help run the Games; and last but not least, they picked up a final bill of circa $70bn (Bloomberg).

Cometh the hour, cometh the city…

Around the world, urban areas have been using big events to try to regenerate and promote particular places. Earlier this year (week 28), I had a good look at what the €2.7bn spent on the 32nd America’s Cup had brought to Valencia’s impressive cityscape in 2007.

The Olympics Games is a one-city event. Most cities need to be transformed to house the largest media/communications show on earth. For instance, the demand on energy will be huge as they ‘light up Rio’ for a month in 2016. Brazil currently suffers energy shortages.

In London, the sporting arenas have been built, tickets sold and the country is starting to regain its cyclical interest in athletics. All is in hand for the 2012 Olympics. But hold on a second…. where’s the infrastructural transformation? These may be frugal times, but how on earth are we going to host and then transport 280,000 athletes and staff into position in the heart of the city?

“It would be fairly disastrous if Usain Bolt was stranded on the A40,” said a Transport for London spokesman. So Olympic organisers are coordinating a network of 109 miles of London’s main arteries to operate with Olympic exclusivity.

Personally, I’m glad that we are hosting the Olympics. But, I like congestion as much as the next man. Relinquishing roads? Get out of here! London 2012 takes place between 27 July to 12 August 2012.

Happy holidays and coincidences [wk48]

This week, I have been on holiday with the family in Norfolk in a village called Saxlingham Nethergate. We have been staying with two other families at Hill House, which I cannot recommend highly enough. The facilities, grounds and service provided by the general manager Ben were exemplary.

A holiday is a holiday, so I will keep this brief. However, a couple of coincidences came about while we’ve been away.

The weekend before we left on staycation, I discussed with friends a recent Economist article on why only two British firms are innovative enough to command respect in Silicon Valley. We concluded that the Americans will continue to snap up promising UK tech businesses. By the end of the week, there was only one… Autonomy gets bought by HP.

One morning, I took the kids to the village playground, while my wife prepared a surprise birthday party for our youngest. In the kitchen, she decided to watch the movie Love Actually in the background on one of Hill House’s many screens. That afternoon we went crabbing with the kids in Walberswick. At the end of the day, while leaving the car park of The Anchor, Richard Curtis (Director of Love Actually) walked by the car.

I am told that the most incredible coincidence imaginable would be the complete absence of all coincidence. So I won’t think too much about what this all means, but for as a closing thought, only one of them is a real coincidence. Is there ever such a thing as coincidence in business?

ABCs and educational videos [wk47]

I should have added to my last post that I have learnt that if you want to be successful at (business) school, you’ve got to remember your ABCs. Always Be Cool.

August is meant to be a gap month in our MBA calendar, but it is a busy as ever. Week 47 has already entailed a coursework deadline for a 2,500-word report on ECCO’s global value chain, several meetings on Barclays’ citizenship agenda as part of the CSR module, and the completion of a draft structure for the consultancy report on the work in Sao Paulo. We are meant to be on vacation! ABC.

The holiday period has also brought with it a spate of client conversations about website and blog design. There is a sense of take-stock-and-refresh in the air. I think that I have caught the bug too and plan to make some changes to Cass Reflections. Watch this space. All suggestions greatly received.

I look to keep up-to-date with current thinking in digital design and thought I should share the following guidance from Human Factors: 7 principles that make your website more engaging.

I am a believer in designing marketing messages around a clear, manageable number of vertical markets. It addresses the trade off between effectiveness and efficiency. To me, Principle 1 (‘Too Many Choices’) really helps underpin why we might avoid trying to appeal to too many perceived customer needs, and thereby, how we might spend less to get the results we want. Principle 2 (‘Social Validation’) is something I explored in Week 42’s ‘Earning attention’, but I am yet to test the food, sex and danger of Principle 4. Yes I though that would get your attention.

As an aside, I really like this format of animation and audio. It is great for educational videos. Earlier in the course, Tim, an MBA peer and friend, pointed me in the direction of the RSA Animate video on the truths about what motivates us. For those of you as interested in the potential of the format, it is exemplar.

Doing the right thing [wk43]

Sometimes, timing is everything. This weekend we completed a module in corporate responsibility, which coincided perfectly with the phone-hacking scandal that is taking up every column inch of (nearly all!) the news media. It provided ideal currency.

On Sunday, we were split into teams by our lecturer and ‘corporate philosopher’, Roger Steare, and allocated a blue chip company’s corporate social responsibility (CSR) statement/report. We had been asked to consider how consistent this communication was with the business we understood from its reputation, its treatment by the world of social media, and from its own marketing/investor communications e.g. annual report and accounts. Essentially, this was a deliberation of whether responsibility was part of an organisation’s DNA.

Way back, in week 5, I reflected on whether a business had a soul. At the very least, one can witness a set of decisions. And within these actions, there will be a distinguishable trend in behaviour. Mintzberg defined strategy as a a pattern in a stream of decisions”. Was responsibility part of the company’s strategy?

Key learning points were as follows:

  • responsibility is industry-defined – the industry you are in determines the set of cards you are dealt; the responsibility is in the way that you play them, and thus oil companies can be responsible too
  • transparency versus accessibility – having nothing to hide is a sure sign of responsible leadership, however if you pick up a social report/review of 100+ pages, you start to get a sense that this is equivalent to a defence attorney sending boxes of files to the prosecutors offices; responsibility should be succinct, accessible and evident
  • responsibility is hard to measure – very few firms employ a triple bottom line (profit, people, planet); M&S does and even then, profit performance is inevitably easier to quantify.

In Adrian Henriques article for the Guardian on 12 May, he argued that while CSR reports are not always revealing, because the News of the World had published no social report of any kind and did not discuss such issues in public, it had built no social capital on which it could fall back when times got hard.

On the face of it, I was not convinced by this argument. Having a CSR statement was no guarantee of responsibility. Action is louder than words. However, the more I think about it, Henriques may have a point. A social report is akin to the annual report and accounts. It provides a measure and a communication to stakeholders. If there is a worrying trend in profit performance, investors can build an understanding of where the business is at into their responses.

If we knew in our heart of hearts that the hacking was some misguided attempt by the News of the World to deliver on a communicated and measured aim to uphold the  truth (the means justifies the end, as it were), we, advertisers and politicians may have been little less unified in response. But just as importantly, it would have made the task of rebuilding a reputation much easier.

Reputation is a valuable commodity, hard won and quickly lost through irresponsible behaviour. Managing risk and reputation is vital. A social report is a corporation communicating about doing the right thing. And chewing over what it means to be responsible is not only the right thing to do, but it is also cheaper than having to pay for full page ads in the national press apologising for a the horse that has already bolted.

Interim management [wk41]

Tough week this last week. Exams start today and revision would have normally been all consuming, but I continue to invest time into meeting those in the know about interim management. The MBA is a means to an end. While it is important to get the best out of the MBA journey, it has an unannounced destination, which I intend to influence. And interim management might well fit the bill as a stop or a terminus.

Interim management has been all the rage for the last 4-5 years. And you can understand why. The perpetual change of organisational consolidation, mergers and acquisitions, increased global competition and a growth in small entrepreneurial start-ups have altered job stability and upward mobility. In today’s turbulent business environment, people have careers characterised by flexibility, regular career changes and uncertainty. Essentially, what this has done is to elicit both supply and demand in the market for interim managers. There are more independents (supply) and more situations in which uncertainty has provided a lack of basis for decision-making, but now there is a requirement for an immediate change (demand).

According to the great wiki in the sky, Interim Management is the “temporary provision of management resources and skills”. However, an interim is not a temporary worker. On the demand side, s/he is a professional with a client and an agreed assignment to manage a crisis or a change. On the supply side, it is the lure of a challenging assignment that lasts for 6-12 months and which demands the use of your extensive range of skills and experience.

In this regard, it is like a mutual undertaking. Both parties are taking more control of their near future, and in this ‘interim’ there is clear objective – to inject specialised leadership skills at a time when they are needed most. The interim manager should be able to diagnose the issue and propose a solution (like a consultant) and then implement and handover (like a project manager). The clear accountability of a short-term contract, the consultant/project management offering and immediate availability of a certain skillset makes the interim manager an attractive proposition for all concerned.

One thing that is clear is that the interim market benefits from a more satisfying balance of supply and demand. Last week, I was visiting Odgers Interim at their HQ in W1 and the experience was a good one. My contact was informative and passionate about the interim world. His challenge is that the market is dominated by independent interims, who obtain their work directly from clients.

But with double-digit annual growth, the opportunities in the market are there. In a more mature market, segments will become easier to identify. And there will be segments that are interested in underwriting the inherent risks via having options. Whether this is through the use of an intermediary’s pool of suitable candidates or its own network of interims is no doubt the question that agencies are grappling with.

Nevertheless, if the management consultancy firm has been a traditional target employer for the full-time MBA, perhaps the world of interim management is a good fit for executive MBAs. While becoming a master of your own destiny is an attraction for all, it might be more difficult for someone under 35 to have the experience and maturity and to capture and hold a position successfully.

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