There’s one aspect that seems overlooked in the whole “multidisciplinary approach” cult: communication. If you don’t have the adequate communication policies/ environment, how does one reap the rewards from all this multidisciplinary goodness? How does a team interact in order to extract value from its members’ diverse interests and skill sets?
Continue reading about Multidisciplinary approach and communication
“If we did not do this already, would we, knowing what we now know, go into it?” Peter Drucker’s question can be applied in both the big picture and small picture – from the broadest strategic moves of your company to its tiniest daily processes. More than that: try substituting “company” in the previous sentence for “department”, “nation”, “regulatory system” and even “life”.
In his latest post, Tom Barrack of Colony Capital writes about some similarities between a big wave surfer and a successful investor. While we would be even more conservative in general, we agree with most the “credos”.
In the 1st Buysiders article inspired by a reader’s suggestion, we’d like to propose “anti-portfolios”. It’s a vital lesson in humility: our activity involves a certain degree of failure, of missed or simply wrong ideas. Recognizing that we are going to make mistakes over time is extremely important in order to mitigate risk as we define it (the permanent loss of capital). The objective here is to insist, once again, that price is the ultimate measure. (…) After you’ve done all the homework, you still have to demand a price that implies a large margin of safety – and keep analyzing the position everyday with the same skepticism you had before you bought it.
The AOL – TimeWarner merger’s 10-year anniversary inspires a feature in the NY Times, and the videos are a must-see for the candid opinions of the top execs involved. One must remember that talented fund managers got burned in 1998-1999 shorting AOL at a P/E of 100, 200, 300… only to see it reach 700. Not a typo, that’s the P/E ratio.
Our thoughts go out to the families affected by floods everywhere, but this picture had us thinking about the book “Too Big To Fail”. Unlike other books about the financial crisis that shook the world recently, Mr. Sorkin’s book deals with the real-time, day-to-day background discussions and decision-making in the eye of the storm. And decisions made in times of turmoil can lead to less-than-ideal outcomes and a false sense of security.
Prof. Joe Stiglitz has been on a tear recently, first describing 5 lessons we should learn from the crisis and later presenting a tough message at the American Economic Association. The bulk of the messages: Wall Street ain’t that smart, and it failed miserably to perform on its purpose. Before the reader thinks “well academe didn’t do much better”, he also blames economists for continuing to rely on “rational player” models.
David Brooks has a nice teaser article on the current and future economic “protocols”. His tip is to not just read the book he’s reviewing but another that complements what he feels are the first book’s weaknesses. Always a nice way to help readers better form opinions of their own, and it’s what we will always try to do here as well. Also includes links to other columns of his.
Continue reading about Christmas bonus, part 2: David Brooks
We have put together a small collection of links regarding competition and corporate strategy as defined by Harvard’s Michael Porter. As this blog will always remind readers, “take it with a grain of salt”! No matter how famous the expert, how “make-sense” his arguments, always check, search for contradictions and weaknesses and then make up your own mind.
Continue reading about Christmas bonus, part 1: Michael Porter
Fred Wilson had an interesting post today on action oriented entrepreneurs/ leaders. While we don’t agree 100%, there are some interesting teasers to think about not only for the companies we study but also for our own. The situation one wants to get to is to have a team composed of people with diverse backgrounds and complementary skills – and personalities – combined with carefully-planned incentives that align individuals and teams with the company’s vision. Easier said than done, but the closer you get to this the better.