Monthly Archives: September 2011

//September

It’s almost criminal

When you work for big companies it is very easy to get too familiar with big numbers. I remember a few years ago when I was the COO of a relatively small company and my friend a vice president of a giant multi-national.  I was trying to raise three million Euros and he had just invested nine million on setting up a new trading channel.  However last week, the tables were turned and I was shocked by what I heard. 

I was talking with one of my larger clients about a scheme that could bring about a 40% reduction in year on year costs, simply by switching to a new supplier.  My counterpart explained that he might not want to pursue it because it would most likely cause a certain degree of upset, not only with a colleague in another department, but also with the relationship with his current supplier (with whom he had multiple existing contracts).  But later, when I re-did the sums on the back of an envelope, I calculated that the 40% reduction could amount to a saving as much as five million EUR over three years, and this was without exploring other possible savings that could also be added to the list! 

Not to go after such savings has got to be, by any description, almost criminal.  One owes it to the shareholders, the personnel, the customers and even other suppliers to ensure that your company has an attractively low cost base; especially in areas where there are multiple alternatives of supply.  A company, no matter how profitable, how big and how powerful simply must look at the bottom line in everything they do except when it has a potential safety or environmental impact.  

The irony of the situation was, in that very same week I heard of a brilliant commercial idea that was highly unlikely to get off the ground because of the current reluctance of banks and investors to lend to small businesses. For every Euro wasted there are many more opportunities missed.

It was then I got to thinking – five million EUR over three years, what would be the best possible way of re-investing that money?  Clearly, paying out savings each year in increased dividends is irresponsible if you want to ensure the long-term growth and sustainability of your business. And because right now is as good a time as any to make savings in order to invest into smart schemes, then what?  What would you do with five million EUR over three years?

Any suggestions?

Have a good week,

Harley

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Advice from my father

It must have been the late summer of 1969, I was 12 years old and sitting a restaurant with my father. He was treating me before putting me on the train back to boarding school in the south of England.  A man at the next table was shaking Worcestershire sauce onto his steak.  “If you want to become rich in life, all you need to do is to find something that society needs and supply it at a price it can afford” he said. 

According to my father, the person that invented the top of the Worcestershire sauce bottle had earned as much money as the sauce company itself! Apparently the previous top was made of glass and often became blocked making it impossible to dispense the spicy sauce.

Looking back, it is a nice feeling knowing that I have discovered it, the thing that makes me rich. But perhaps it’s not quite what my father or I had in mind at that dinner table in the Sylvan restaurant, all those years ago.

For a long time after hearing my father’s wisdom, I tried in vain to search for things that society needed; the eureka invention that would change the world.  Over the years I gave up. Mostly because of a lack of original ideas and partly because I had heard so many stories of inventors being ripped off that I allowed them to become excuses for accepting that perhaps the easy money of an inventor’s life was not for me.

Last week however, I discovered an amazing video of a brilliantly simple invention that brings light into poor people’s homes without any running costs at all.  Like all ingenious discoveries there was an underlying need that could be met by simply combining a number of seemingly disconnected and unrelated materials, in this case: A disused Pepsi bottle, mineral water, household bleach, some silicone and a small piece of sheet aluminum. (Watch the video here)

And will the person who invented this great idea ever become rich?

Well it entirely depends on how you measure what rich means. The riches that come from knowing that your invention is transforming the quality of life of a countless number of very poor people must surely be enough in itself?  Just like the richness that comes from realizing that your contribution to the business community and society in general makes a real difference and that you are respected for it.  Can money ever compensate more than that?

Have a good week,

Harley

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An Algorithm for everything

I was at a seminar last week where one of the presenters was covering the subject of diversity.  She didn’t take the usual angle of reducing everything to a question of either gender or race but generally lifted the whole topic to a much higher and all inclusive level.  Just when I was beginning to feel comfortable with her thought provoking approach she flashed up on the giant screen an extremely complex looking algorithm. 

Just in case there might be a reader that does not exactly know what an algorithm is, then I can tell you that it is not the name of a famous American politician’s personal dance band but a mathematical equation that describes the instructions to perform a particular function (or something like that)! 

The speaker was delivering her important message to an audience largely made up of male chemists and engineers and I think her point went down very well judging by the reaction.  Diversity is not solely about a question of exclusion but also a lack of recognition that within any specific gender, race, age, or group of people, there is any number of diversities that we need to recognize.

It was then it got me wondering how much of what we think or do can be expressed in terms of algorithms? Can, for example, a complex business decision (that may include subjective issues) be seriously reduced to a single algorithm? Could deciding on a life partner be better made on the basis of an algorithm rather than sexual drive and instinct? And how long, I wonder, will it be before someone writes an auto-generating algorithm applet for the I-phone?

A few years back I was running the operations of a software company where the daily language was of algorithms and ‘low level programming’ and to be honest when you really get to grips with what is going on, it’s not that complex.  I don’t mean that writing complex algorithms is easy, far from it, but when they are explained by an eloquent software engineer or mathematician they seem very much more accessible.

It never ceases to amaze me how many of us feel comforted by a scientific explanation.  Somehow science makes things true. And yet too often it is seemingly well grounded explanations, given to us from people that sound like they know better, that lead us in completely the wrong direction. 

At the end of the day I believe that it is not so much what is said that matters in life but what happens as a result of it.  And so this week I hope that a whole bunch of people will be starting to explore what diversity means to them and how they will be living it at home and in their working environments, rather than debating if the algorithm could ever be correct or is flawed.

Have a nice week

Harley

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I’m a lumberjack and I’m OK

Over recent years I have progressively done less and less in the garden, handing over responsibility to a firm of landscape gardeners.  However since the storms of a few weeks ago I have had a few fallen trees lying across my lawn, so this weekend I put on my garden clothes and braved the Belgian drizzle to set about dealing with the problem.

I started by taking down my prize chainsaw from its shelf in the shed (mostly to impress visitors) and picked up the brand new axe I purchased in an optimistic moment.  Something stirred me on, perhaps it was the combination of my lumberjack shirt and 501 jeans my trusty working boots with their steel toe caps, or maybe it was because it was my wife’s and my 21st. anniversary and I wanted to impress her with my manly prowess?  Whatever, the result was that I cut up the trees, I split the logs and I stacked them neatly in the wood shed ready for burning in the winter of 2014/15.

The irony of the situation is that I am currently writing a key note speech on ‘Beyond Borders’ for the PMI’s annual Benelux gathering in October and the way I feel right now is that I have this weekend witnessed the buzz of pushing myself beyond my own perceived physical border.

I have challenged my own fear of chainsaws and axes and hard physical work.  I have put aside my reoccurring back problems and told myself “I can do this”.  And what do I have to show for it?  A happy wife, a clear lawn, a nicely piled, sweet smelling, stack of split logs and only a few minor aches in my arms and shoulders and my back is just fine! 

All I have to do now is write an apologetic e-mail to the PMI event organizers asking for a delay in submitting my speech for another seven days.  

Have a good week,

Harley

The lumberjack song :-)

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