Monday 23 January 2012

Creativity - Do we dare the impossible?

Today is a confusing period in our history dominated by big business, a stagnated growth, number crunching, profit tomorrow, and regular cost restructuring. I have mentioned before that we tend to lose sight of our long term strategies and goals even our mission statement.  It does appear to be a time that we are void of imagination in business, void of creativity and ideas. So therefore the key question must be - how do we develop them?  Creative people can rightly or wrongly be perceived as a bit whacky, different, idealists, gifted, perhaps psychologically flawed and unconventional.  Sherlock Holmes, for example, or Winston Churchill. They are so full of ideas, that is what makes them creative.

I believe creativity is individual and not communal. In my case, in order to have ideas, I would primarily need to initiate a vision, an interest, inner drive or a passion in what I do. Ideas will help me maintain this and advance forward.  In order to generate my ideas and to be inspired in my business, for example, I need a peace of mind, time to think, read, acquire knowledge and interact with people and things will capture my interest. When it comes to writing an article, an idea of a topic will spring to mind and then I write.  I find that in order to write it requires imagination and thought therefore I need to be disciplined, solidary and peaceful, this allows me to write down my ideas in an orderly fashion.

Ideas and creativity requires knowledge and knowledge is a function of your memory. And your memory needs to be constantly updated, checked, challenged, used and exercised in a meaningful way. In short, to THINK that’s the key, and ideas will catch you by surprise, in your sleep, after an event, going for a walk.

The problem lies herein: yes there are many ideas generated but only a few that get past the first hurdle. We are not confident enough to implement them. It requires a creative visionary with enough foresight to generate the great ones, and it requires a degree of boldness, and an element of fearlessness to implement them. A person who has found his inner belief or passion and is not the least concerned with the effect he or she is creating around them.   It also requires considerable energy, time, and discipline not to mention the cost where risk can come into play if more capital is needed to execute. With all the above – well it takes what some people may call individual genius or a group of them. Perhaps this is why so many potentially great ideas are seldom, and so many of the smaller ones if any are so often just thrown into the in tray and buried beneath the ashes together with everything else.

Let’s try to give an example:

John F, Kennedy in his moon speech in 1961, made a dramatic goal to put a first American on the moon by the end of the decade. Spectacular idea! It drew criticism as unrealistic, mad and a waste of money.  Well with engineering ingenuity together with enough boldness and resources, we know what happened next.

I am no JFK but here is a challenge for the future. Solar impulse makes first International solar powered flight from Switzerland to Brussels.  Wow! The idea is fantastic albeit may have been around for a while but to actually design and implement it!  How about we have our first commercially viable solar powered flight carrying passengers before the end of this decade?  Just think. No more fossil fuels, air and noise pollution, political environmentalists etc. Just to depend on the sun as a sole source of power. With enough ingenuity, talented industry engineers and experts, and financial resources, could we possibly dare the impossible?

Listen – come closer because I am going to say this very quietly. Here is the thing - there are some of us who are out there, more than we know. Those geniuses I am describing, the ones who are half awake… waiting perhaps for a tap on the shoulder… yes. You.  What are you going to do about it?

It is really such a pity in a time where we need them more than ever. Ideas, provided it is a good one, will generate change and bring us forward and I know change can so easily go against current convention but so what.  Am I conventional? I have no idea but I know there are many social norms in society I am not willing to abide by.

Wednesday 18 January 2012

What else can Bankers do?

Having Interviewed and assessed many bankers over the years, I have often been confronted with shall I say a ‘restless’ banker wanting to switch careers and go into for example, Industry, commerce, retail etc. How easy is it once you have gained years of experience in a specialised field? There are certain ways in approaching this question. On paper there are certainly many switches you could make and naturally it depends what you were doing in the bank itself. A functional expert such as HR, IT, Finance and operations, are roles often transferable into many different industry sectors. I am more interested in front office experienced roles in Investment Banking or the business areas, such as Corporate Finance, M&A, Project, leverage, or trade finance as well as equity and debt capital markets and the financial markets. There are many different disciplines such as origination, execution, risk, syndication, sales and trading.  There is also the geographical knowledge and sector expertise of different industries and there is the size of the bank. You could be working in a small bank for example and take on all the front disciplines & sectors! Salaries are also something to take into account as some of the above roles have very high remuneration level of which other industry sectors would not be able to compete. Normally a banker will be aware of this and won’t want to get bogged down on this issue; after all if it was about the money -  just switch banks and find one that pays more!

Taking into account the above factors, it is really a case by case situation but I shall try to summarise and refer to these roles as Investment bankers.  A banker can gain a significant amount of knowledge within a certain sector. Power, renewables, energy, Logistics, aviation, media and telecommunications etc. An easy option is to move to ‘the other side of the fence’ either via one of your clients, your network, or via a third party.  Take on a C level role, Treasury & Finance or a commercial role. A banker can accumulate considerable financial product knowledge and investment expertise, why not transfer this skill set to helping other banks from an advisory or consultative capacity? There is ofcourse Private Equity, after that your options could be limited.

There really has to be strong link from your current skill set to your new position. The recruiters and HR individuals will always try to select those who fit the criteria almost perfectly. They would want to do themselves justice and not shake the cage when it comes to filling a position.  I would differ in my opinion. I believe we can be a little more ‘out of the box’ and not so rigid and too set by ticking the boxes. Hard skill set knowledge is all very well, our softer skill set is equally important. Many experienced and talented individuals will continually want to learn and know more whereby challenging themselves into new areas, in brief they want career progression.

In this difficult and tight market where open positions are less available and career progression more limited, a disguntled’ banker could take this opportunity to really do what he wants to do. In this case little should stop us. Here you need a little bit of ‘character’ the so called extra ‘inner force’ i.e. drive, conviction, desire, passion, inspiration, enterprise.. courage. If I wanted to ‘retire’ early and write a book well you can. If I wanted to leave and open a delicatessen shop or ice cream parlours in a small village in the middle of nowhere. That is ok. Or set up a funeral undertaking business in the basement of my house-  who is stopping you?  If you wanted to give up your banking career to run for Mayor or MP for your local community. Great idea. We need a few more inspirational politicians nowadays. You may need a third party or a partner to help you instill that ‘inner force’ and help bring out your ‘hidden talents’ and true character which we all have but the rest is up to you. Anything can be possible.

The dilemma is as so often the case, we are confronted by a fear. A psychological fear of losing maybe one’s job security, or a level of lifestyle we are accustomed to or feeling chained by the typical trappings of our society and environment. Maybe we have been so busy and engrossed in our work that we simply have not given ourselves time let alone the thought. Not helped by this crisis where every headline appears to be dominated by number crunching and mind boggling figures, we tend to lose sight of our ideas, goals, our strategy, our creativity….even ourselves.  In a nutshell it is that ongoing fear that we have towards change.  It would be a shame really if we went to our graves without having fulfilled one of our lifetime dreams or ambitions.

Thursday 12 January 2012

Should we curb excessive pay?

Remuneration is often a hot topic particularly in a time of economic hardships and tight budgetary controls.  Having gained a detailed insight into the area as we are often aware of people’s salaries and bonuses and what the market pays. Although highly confidential, individuals were always happy to let us know. This is why Time MCG has developed an interest in the topic and can offer advice to firms as part of its services.

It is important primarily that we define remuneration which depends on so many different factors and here is an attempt at a summary. When we look at executives in the banks or large corporations they are generally broken down as follows: Fixed annual salary. Your bonus potential. Share options, pension and health insurance. Potential extra perks such as children’s schooling, phones paid for, laptop, car etc. A reduced mortgage rate if you are working for a bank is a good one. Often at high level employees negotiate a sign on bonus and in some cases at Board level, a clause specifying a payoff package if they were asked to resign. A sign on bonus is negotiated simply because of what the person is negating from his former position. Companies will have strong guidelines on how their offers are made. Share options can often offer a lot of misunderstanding. Companies can award shares at the price of its value of the time that they are awarded to you. Typically you are allowed or have the option to sell them at given dates and price in the future. (e.g. after 3 years a portion, 6 years another portion etc) This is a way of retaining an executive. If you were to leave before you were able to exercise your options, they would become worthless.

Generally speaking if you are looking for more perks, it is possible but it will be offset elsewhere. There is always a limit. What defines your fixed salary is a mixture of company guidelines, market conditions, years of experience and position. Often companies get this right helped by internal expertise, collective labour agreements with other firms in similar sectors and advised by specialised consultancy firms. Bonus’ are part of your secondary benefits. Your bonuses are generally calculated according to the company’s profit and your own performance. Some firms can get very creative how they award their bonuses. E.g. percentage of fees earned or turnover made minus your cost centre etc. At the end of the day it is about profit of the firm. It would be very difficult to argue for example, that an individual had done well in a bank as a front office fee earner for example, but overall the firm made a loss or that you would get a bonus whilst the firm was concentrating on cost cutting. Although firms are quite creative nowadays with their company structures and you could still get paid if for example you were responsible for your own profit centre. The arguments that are in favour of good bonuses. It is an incentive for hard work, it enthuses success. It attracts the best. People in the private sector have money to spend who in turn put it back into the economy in other forms.

We knew often whether people were paid above or below market value and would say ‘You have just got one problem, you are too expensive!’  Individuals never quite liked to hear that it would take them time for this to sink in if they were seeking new position. Pay can be markedly different amongst commercially & specialized orientated roles, according to each sector whether you work for banks, manufacturing, FMCG, retail, IT, or professional services. Amongst functional roles such as HR Director, Finance Director, or IT Director, these were pretty similar across the sectors. It was only in rare cases that pay was excessive and unusually high.

Where the criticism often comes into play is the bonus excesses in the financial sector amongst certain commercial, front office or fee earning individuals in the financial districts of London and New York. Here they are often discretionary. Not to mention sometimes at Board level for large corporations and in certain cases professional services, a more secretive sector, (lawyers, consultants, advisors etc..) Professional services charge (often by the hour) and in certain cases there are cases where fees seem hard to justify. More often than not they can be based on the reputation of a firm and not the individual or some emotional perhaps delusional aspect in saying that ‘we have to charge high as we are good and one of the best.’ It has a tendency of the rich becoming intertwined with the rich. There are many of these individuals who walk home with 7 figure plus annual compensation.

Amongst bankers it is more complex. Generally speaking the Anglo Saxon model is the lower the fixed salary the higher the bonuses. The more traditional continental European model is a higher fixed and lower bonus. In Holland for example, a couple of years back the government decided to cap bank bonuses. This was in order to pre-empt any form of backlash from the general public after the financial crisis and the ABN Amro debacle. The bankers were not too concerned as they were not that high in any case and already they were fairly content with their quality of life.

In conclusion in cases remuneration is correct and spot on although firms need to continually stay abreast. However we are living in a time of serious constraint where many parts of the world and our society are suffering due to inequalities. The wealth gap between the top and the bottom is getting wider. Job losses are increasingly common as are more positions becoming obsolete. There is a real possibility of much resentment and even unrest. We must act responsibly, possess a social conscience and therefore be sensitive to our own pay. It needs to be justified and in some cases transparent as must the profit of the company as the two are clearly linked. Remuneration will need to be more aligned in a case of cost cutting and job losses. No one wants to see bosses lining their pockets as a result of other people’s successes or ostentatious behaviour with regard to wealth. No one wants to see cleverly made large profits as a result of other peoples misfortune (as per the banks with real estate crisis in 2006) or from misguided products. A large pay off of a CEO due to resignation for poor management is wrong. Speculative greed and short termism is not cool. People might say ‘it is survival of the fittest’ I see it as something a little more than that. It just looks like material wealth, money and profit becomes our goal and our only goal which is proven, as in the last ‘lost’ decade and historically, to be superficial and only exasperates our inner craving for more whereby negating our deeper sense of fulfillment and purpose. We will only end up with more problems at a wider level as we are witnessing now.

In an ideal world what we would rather see is a good product or a good service adaptable and changeable to new innovations for the long term, driven and managed by talented inspirational individuals and backed by a strong motivated workforce whereby rewarding ourselves responsibly, fairly and justifiably.

Wednesday 11 January 2012

Redeployment and mobility

A priority for a firm in a time of budgetary constraint due to the growing economic threat is redeployment which is closely connected to the movement of employees or mobility. To avoid redundancy or outplacement situations, a firm will often do its utmost to seek alternative opportunities within the group at large for their employees. This is currently a growing phenomenon in the larger banks. This requires no doubt the flexibility of movement from certain employees. However, if for example there may be more than one person for this position on offer or a shortlist of very good candidates. Who do you choose?

The answer is clearly the best candidate. Nevertheless this is not always the case. Other factors or internal unexplained circumstances could come into play to influence what some may regard an unfair decision and the outcome can be potentially negative for all involved. Time MCG, with its vast experience in interviewing and assessing candidates, will offer external solutions to help resolve such a situation. After reviewing and meeting all candidates, Time MCG will provide the best objective and refreshing advice on who would be the best candidate outlining its reasons behind such a choice without regard of any internal politics or seemingly other factors.

Monday 9 January 2012

The Linkedin Dilemma

I read in the papers just recently that a Company Executive got fired due to ticking off the box specifying he was interested in ‘career opportunities’ on linkedin. In a public website the company in question claimed that they had a policy that specifically prevented its employees from signing up for the network and ticking the “career opportunities” box. It would be seen as a sign of disloyalty to your employer. The employee is bringing a case to court for unfair dismissal’

I found this article intriguing particular as a former Executive Search Headhunter. As far as the recruitment and headhunting industry is concerned, Linkedin was a very powerful tool to use to headhunt experienced hires. (Although not top or C hires, as they are less likely to publically show themselves,) I know some recruiters who purely rely on it. I remember using it back in 2002 when Linkedin was by and large fairly new for a large client and it worked wonders for me. Nowadays thousands of business executives or corporate employees have their profiles on it of which a very high proportion have ticked off the part ‘interested in career opportunities’ Clearly a significant statement for prying eyes, and hungry headhunters. We had therefore no inhibitions when headhunting as we knew that the employee was openly eager to receive our call.

As an employee’ what does that mean to be ‘interested in career opportunities. Effectively what the employee is saying is ‘call me because I am always interested in either hearing what is out there or for a better opportunity. Are you loyal to your firm? Clearly not. This therefore raises all sorts of questions such as. Are you satisfied? Are you not happy? Do you feel unfairly treated? What is the problem then? To always want more is a constant inner struggle in our nature whilst so many of us seem permanently restless and dissatisfied which is more acute in a time of change and uncertainty. The problem therefore lies in the combination on how the employer is treating you and how we feel treated by the company, our attitude and how we behave as an individual.

As far as employers are concerned this is a nightmare. They are regularly infuriated in some of their staff leaving for another opportunity. They have an excellent employee who ‘they believe’ is talking to headhunters simply because he had ticked off the career opportunities box whereby being enticed for a better paid and more responsible position. (this could also be the headhunter/recruiter selling hot air and/or talking them into a move) They are right to be irritated and somewhat infuriated. What do you do? You devise a policy to make it against company policy to fill in your details on linkedin. Good one.

Now that I have left headhunting and run an employment consultancy firm, I will be very frank. I think it is vital to re-instill loyalty back to a firm and work on bringing happiness in a company. It is essential that we look after our employees and do everything to keep them in maximizing their talents and gifts through every available opportunity. It is vital that the right people are working on the right things at the right time. Oh how our productivity could increase ! What we do not want is slave driving talented individuals or that they become codependent or using carrot and stick policy (offering extra financial incentives) If anything will have the opposite effect.

Finally as an individual we must also play our part, to regularly challenge and re-invent ourselves, to give ourselves time to invest in our own training and education in order to stay abreast. Let’s not get so caught up in our sole purpose for growth and profit in this fast changing ‘virtual’ world, this is only running away from own true talents, and let’s be open to change and have a positive attitude.

Ultimately there will simply be no need to tick the box ‘interested in career opportunities’ which is like living in a dream world for that eternal wish for something bigger and greater.