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Archive for May, 2012

Is Your Network Just Another Statistic?

May 28th, 2012 Comments off

     During the course of my career I’ve been fortunate enough to assemble what I believe is a pretty fantastic network. I’m also thankful that I can call a significant number of these folks good friends and have the fortune to see them outside of the office. Recently, it seems I’ve been receiving more frequent introductions to recent college graduates who are looking to establish their own networks and kick start their career paths. Some have been working on this effort during their college stint while others are just beginning. You have to start somewhere…

     As I looked at my own network it begged the question of how I can leverage it in some way to help them, as well as provide some of my colleagues with a bit of recognition for what they have accomplished in their own career. With this thought in mind I’ve decided to start a new series I’m tagging as “CorpFin 10Q’s”. Essentially a brief 10-question format for those in my network. With a network that spans the areas of Finance, Investor Relations, R&D, Manufacturing, Sales, Consulting, and other areas, I’m hoping it provides an interesting perspective. 

     Hopefully your own network isn’t just a statistic, but more an asset that can help in broadening your knowledge base and assist others in the building of their own career.

Thanks for reading…

Jeffrey Ishmael

Book Review: Great By Choice by Jim Collins

May 20th, 2012 Comments off

            Of the many aspects I enjoy about this blog is the opportunity to pass along recommendations about books or magazine articles that I come across. One of the books that I recently finished is Great By Choice by Jim Collins. This book comes on the heels of two other highly recognized books by Jim Collins, Good To Great and Built To Last. In his latest release, Collins extols the merits of proper planning and takes the position that with the proper amount of planning, companies can indeed map the proper path to greatness and achieve shareholder returns that are far above both market returns and/or segment returns.

            However, let’s be careful not to interpret that this book simply implies that any company, through some rudimentary planning, can become the master of their own destiny. The messages in this book are much more definitive and also take the time to dissect a number of industries, particularly the airline industry.  The time frame that the book also takes in analyzing its selection of companies and industries also spans a 3-decade window. A time frame in which there is plenty of time to witness consolidations, mishaps, bankruptcies, as well as opportunistic changes in long-term trends.

            With respect to the airline industry, there are few industries that have been subjected to the number of disruptions that this industry has. Overall, this industry has been subjected to some of the harshest disruptors any industry can experience;

-Repeated fuel shocks, Deregulation, Labor Strikes, Air Traffic Controller Strikes, Fare Wars, Massive CapEx investment, Sept-11 attacks, and recessions.

In consideration to these elements, Collins takes a very methodical walk through the elements that allow companies to move beyond average or subpar performance to greatness. In an overview of his concepts, he discusses;

-Thriving in uncertainty

-10xers

-20-Mile March

-Bullets vs Cannonballs

-Return on Luck

There are certainly more, but Collins takes a deep dive into the planning process undertaken by companies and that the preparation undertaken is to not only capitalize on new opportunities, but to mitigate the risk of “bad luck events”.  Collins emphasizes the point that there is no company that is immune to a bad luck event, but it’s the planning that minimizes the impact of the event. Conversely, it’s the quality of planning that allows a company to fully capitalize on a good luck event. There is also extensive discussion regarding the view that planning is not an overnight concept, but a more enduring “20-mile march”.  A planning process that is more longer term in nature.

            It’s difficult to give this book the credit it deserves in a short overview, but it’s certainly a worthwhile read. As I’ve often gone back and reviewed some of Collins’ previous books, I suspect that this one will also stand the necessary scrutiny years from now.

Thanks for reading…

Jeffrey Ishmael

What Was He Thinking…or Was He?

May 16th, 2012 Comments off

            I didn’t realize that when I posted my last blog entry “Have You Defined Your Blog Rules of Engagement”, that I would so quickly see a press release outlining the termination of the CFO of publicly held Francesca’s. As the article highlighted, the CFO of the company had been very active in his usage of LinkedIn and Twitter. However, that was not where he ran afoul. As later press releases started bringing more details to the table, it was rather shocking some of the postings that he had actually made on Twitter.

            As it was outlined in the WSJ article, choice postings include;

–          “Board Meeting. Good numbers=Happy Board”

–         “Draft S-1, pages of risks (sigh). I tell lawyers to add the risk that a meteor strikes earth, killing all life causing investors to lose”

–         “getting ready for a big SEC filing”

     Needless to say, there were more postings that carried this same type of theme, as well as the highly “articulated” points of view carried in his previous posts. It really is disheartening to think that an individual with this level of “discretion” would be considered a peer.

     These postings are not in error because the company was a publicly held entity. These would have been serious transgressions even in a private company. If you have been entrusted with the CFO post, public or private, there is an inherent level of trust with your Board, fellow Executive team members, and investors that needs to be maintained. There’s also a level of communication that needs to be maintained from an internal perspective as well and these postings were certainly not done in the spirit of maintaining professionalism.

     Although I’m sure it won’t be the last, I would hope that we don’t see these situations with any degree of regularity as C-level executives continue to expand their use of social media.

Thanks for reading…

Jeffrey Ishmael