Category: Web/Tech

Economic News Flash: Another Dinosaur Bites the Dust


UntitledIn case you didn't hear, during the past 4-5 days BlackBerry Ltd. (formerly known as Research in Motion, or RIM) has announced that they (1) have generated a $1 billion loss (!) in the last fiscal quarter alone; (2) plan to lay off 4,500 "staffers" (35% of the company's employees); (3) will become private again if the intended $9/share stock buy-out by a Canadian hedge fund Fairfax Financial goes through.

So, after allowing a healthy company (modest $300 million volume in 2002-2003; respectable and still okay $3 billion before the introduction of the iPhone in 2007) to get unmanageably huge ($20 billion in 2011), the mastodon got crushed under its own weight.

Well, first of all: Dah!  I thought it was obvious to everyone that sleek iPhones will keep pushing BlackBerries into the proverbial corner – when you stop being "the cutting edge,"  you can only go this far on the price incentives.  In fact, not only iPhones, but also Google's Androids and Microsoft's Windows Phones surpassed BlackBerry's devices in their service capacities.

I do have some questions, though, regarding the etiology of this grand failure.  

How did the company get so stagnated in less than 30 years since it was formed and mere 14 years since it introduced its first email pager?  Where were all those Ivy-League graduates who were hired to manage innovations, operations, marketing, finance and human resources?  Where were the $700/hour consultants and public accountants?  What did they do with all those expensive Business Analytics and Performance Indicators organized into pretty dashboards?  Why didn't they regroup, contract, reinvent, restructure?

I'll tell you where and why?  The dumb asses, greedily preoccupied with the value of their personal stock options, were staring at the market ticker instead.

When a company grows with an exponentially increasing speed, like cancer, the sensible management by capable people becomes impossible, simply because their supply is too short.  To fill the gaps, a trivial approach is adopted, i.e. hiring according to the laundry list of garden-variety requirements.  Unfortunately, conceptual thinking and understanding of fundamental principles cannot be substituted by expensive diplomas, high test scores, and flowery resumes.  If you go the standard route, all you get is a bunch of highly-presentable empty suits with steely eyes, strong voices, unsubstantiated self-confidence, and not a single original thought in their heads.  Thus, the entrepreneurial brilliance that made the company possible in the first place completely disappears.    

Real business is not a multiple-choice test or a text-book case study.  It's far too dynamic and complicated to be approached with basic school techniques, no matter how ivy the school is.  And the world doesn't slow down for a creature too big to coordinate its own movements.  There are unproven theories that giant dinosaurs, such as Stegosaurus, had a "second brain" - an additional nervous center responsible for the movement of their hind legs and tails.  Makes sense to me, because an ogre with no brain power at all, is not able to coordinate any of his movements; let alone quickly react to changes around it. 

Even more important question for me personally is why wouldn't people let this diseased monster die its very natural, evolutionary death of being stomped out by the stronger competitors?  Why pour almost $5 billion into this carcass?  Has Fairfax Financial been bribed by the Canadian government into preventing even larger job losses?  Did US Treasury, so keen on protecting the stock-market investors, participate in this scheme as well?  Unless the hedge fund is seating on some miraculous technological break-through, politics is the only explanation I can come up with for this waste of money. 

Maybe if BlackBerry were let to die, the other members of the dinosaur herd would've taken notice and treated their gigantism with some surgical partitioning.  Maybe they would've even stopped hiring according to the bullshit diploma-ranking and personal connections and started looking for the real spark of an intellect in their management.  Alas, we probably will never know.    

CFO Folklore: Mortal Kombat – CEO vs. Outlook, FIGHT!


MK 3I am the biggest advocate of an entrepreneurial CEO's freedom from any administrative, technological, and infrastructural minutiae.  They must not busy themselves with making their own reports or calculations in Excel, devising organizational routines, catering to bankers' demands, nurturing relationships with customers, etc.  They have functional executives and senior management for that – CFOs, COOs, CIOs, Controllers, Sales VPs, etc. 

An effectual CEO should be focused almost exclusively on the strategic development of the business and the tactical decisions pertaining to the company's survival and prosperity.  Therefore, he may be, but  doesn't need to be an Excel pro, an IT geek (unless, of course, that's the business), a bullshitting ace, or a financing maverick.  He must be a visionary – that's all.  I stated my position on this issue multiple times and dedicated an entire post to the defense of CEO's limited scope of responsibilities.  I even wrote about it in CFO Techniques.      

I have to say, though, when it comes to technology, for most CEOs outside of the high-tech industry, it's not even the result of division of labor -there's some sort of a pervasive impairment.  Most business owners I know personally or have heard about from other people are not very technologically advanced, to put it mildly. 

There are CEOs who call for help every time they need to insert a column in a table; are incapable of  logging onto a network; and wouldn't touch scanners even if they stand right on their desks.  And that's Ok.  As I said, they don't have to trouble their valuable heads with these things as long as they attend to their primary job and manage to be brilliant at it. 

However, we do live in the second decade of the 21st century and some level of sophistication in the ways of contemporary communication is simply required.  It has nothing to do with being a small business owner, a big-time CEO, or The President.  This is one area of technological advancement, where everyone at a certain point had to overcome their innate resistance to novelties and get on with the program.  Radio, telegraph, telephone, video transmission, cellular connection, etc. – they have simply become mundane tools of every-day existence.   

Nowadays, using electronics as a means of organizing your life and exchanging information is as elementary as turning the pages of an old-fashioned desktop calendar.  And if you don't know how to do it, it makes you look silly and inadequate; it's simply unbecoming for a business leader. 

I currently have a client who comes to the office on Saturdays and Sundays because he cannot follow instructions on how to access his business emails remotely or push them through his iPhone.  His partners, employees, and commercial associates laugh about it behind his back.  It's likely that these inadequacies have an impact on their overall attitudes towards this business owner.

But I am particularly annoyed with those CEOs who are not able to utilize Outlook beyond the most primitive actions of receiving and sending emails.  I mean, for businesses operating in the PC environment, the program has become one of the most vital cross-functional tools since 1997!

I am currently exposed to one of these.  At this point I've already resigned myself to the sad fact that she will never learn how to accept or reject meeting invitations.  I wouldn't even dream of her creating one herself.  She will never get rid of her humongous appointment book, which, due to its instrumental limitations, is incapable of reminding her of important events or tasks at hand.  However, emails are her life, she lives and breathes them.  Wouldn't she treat them with proper care?  Guess again.

The other day she comes over to my office and asks if I still have "that email about…" (the subject matter is irrelevant).  Of course, I do.  She is standing right next to me looking at my screen, prepared to read the email with me when I find it.  I switch to Outlook, which is opened, as always, on the Inbox.  There are maybe 10 emails there, which arrived in the last 30 minutes.  "Where are all the emails?!" she is utterly surprised, "I keep all important emails.  I've got hundreds of them."  "So do I," I reply, "But not in the Inbox, of course."  I slide to my Navigation Pane, go straight to one of my 30 subject folders.

She is not stupid and she is a pretty good CEO.  She understands the importance of time-saving tools.  But she is too proud.  She will not ask me or any of her employees how to do it.  And so, she continues searching through hundreds of messages in her Inbox.             

SOPA, PIPA and “CFO Techniques”


GI_98327_CFO TechniquesThe inner conflict many intelligent people experience over Stop Online Piracy Act (SOPA) and Protect IP Act (PIPA), is an old problem for me. For many years before the pharmaceutical and media lobbies brought the issue of proprietary rights infringement in the Internet age to Washington DC, I've been torn between two firm believes of mine: (1) that content creators (writers, musicians, artists, designers, etc.) are entitled to get paid whenever their creative products are used for commercial purposes (i.e. to make money), and (2) that the information available on the Internet cannot be restricted by any means.

That's why more than 10 years ago, I thought of Napster as a violator of musicians' rights to financially benefit from their products. It was obvious to me that the whole purpose of the "file-sharing service" was Sean Parker's publicity stunt to show off the Fanning brothers' technological platform with a purpose of selling it and profiting from it (which is exactly what happened).

YouTube, whose owners obviously always intended to capitalize on the advertising, is also at fault when it lets the users to upload copyrighted material without paying the content owners royalty out of their revenues. On the other hand, I don't see anything wrong with YouTube being a promotional portal for young artists, musicians, filmmakers, and such (including the crazy exhibitionists catering to voyeurs), who upload their own creations knowingly in hopes of receiving the tangible benefits of being noticed.

Of course, the most conflicting entity is Google. On one hand, we cannot exist without their search engine (I am well aware that there are geeky alternatives out there, but let's face it – Google dominates); on the other hand, when it comes to the Internet advertising they are the closest example of a monopoly we've got in our screwed up economy. Moreover, Google attains its riches by using every single one of us, the information-seeking users. Ultimately, it's in their interests to tag counterfeiters and bootleggers, because users are looking for them. And I guess they know that their hands are not exactly clean. Why else would they settle with the Department of Justice to pay $500 million for allowing Canadian Pharmacies' advertisement?

Presently the issue of the online copyright infringement hits very close to home for me. A bunch of unlicensed eBook-hacking sites are offering "CFO Techniques" downloads for free. Neither me nor my publisher is getting a single penny out of this, while the sites' owners get advertising income, revenues on sales of their users' information, and ability to pollute the hapless freeloaders' computers with the spyware invisibly attached to the plug-ins required for viewing the books. They profit unfairly using MY PRODUCT. And that's not fair.

Still, even this wouldn't force me to support the half-assed anti-constitutional laws like SOPA and PIPA. Why? Because if these laws are passed, I could go to jail for offering my readers a clip from "So, I Married an Axe Murderer" within my post about The Best Boss in Cinematic History , even though I derive no material benefits from this blog (none at all). I'd rather people steal my shit than go along with freedom of speech violations in the name of copyrights protection.

Yet, I am all for fighting piracy in an intelligent way that doesn't take our civil liberties away. And the "financial benefit" criteria seems to my CFO mind like a sensible approach. If a site takes any form of payments or generates advertising revenue through deliberate peddling (not just illustrative usage) of unlicensed and unpaid for content, the enablers of payment processing and advertising portals should stop providing their services to this site. This would be not much different than YouTube's actions under the Digital Millennium Copyright Act (DMCA): they get a notice and remove the violating content.

Money is the key. I always said that the best way to fight terrorism is going after the financial sources. The now supposedly dead Osama Bin Laden without his multimillion wealth would've been just a thug on the street. Facebook without the advertisement revenue would be just a well-designed electronic hangout with no prospects for an IPO (expected in May this year).

Marc Cenedella Freaks Out: “Privacy is for old people says LinkedIn founder”


Linkedin_2-300x206Marc Cenedella is upset! He is so upset he is lashing out at something Reid Hoffman said nearly a year ago at World Economic Forum in December 2010 (the Ladders' researchers must have been working on digging something up on him for months):

Privacy for Old People Says LinkedIn Founder

And I understand – LinkedIn went public and made X amount of millions in cash for Mr. Hoffman (I hope my readers understand that, like the rest of the public-stocks billionaires, he cannot really turn the $1.6 billion of his shares into liquid assets overnight). Mr. Cenedella, who started The Ladders barely two months after LinkedIn was launched in 2003, had wet dreams about being exactly in Mr. Hoffman's position by now.

I have no fucking clue why would he be dreaming those dreams. It's not that he created anything original. There were already other job boards with premium memberships and listing fees before The Ladders. The only differential he had was the $100K+ executive appeal (which, as you know, they just dropped – see my September 24th post). Did he think that those minute bells and whistles would be sufficient to build his value as an attractive investee?

You didn't really think that Marc was upset about your personal privacy, did you? Well, he did at some point – he was a man of ideals. When he started his company he did the right thing – he declared in the Terms & Conditions that he will not share, sell, etc. members' information. And indeed, I don't know anybody who gets spammed because of their usage of The Ladders. It's the other job boards that got their emails too: Monster, CareerBuilder, HotJobs, etc.

But big bucks are big bucks – they manage to bend out of shape the purest of idealists. And now, when Marc is alone in his office or his kitchen writing his blog, he is jealous, devastated, and desperate to kick himself in the nuts for not doing what all other amoral Internet moguls do, namely selling every single shred of your privacy in exchange for a golden bonanza Hoffman experienced on May 19th this year, when LinkedIn's IPO closed at the double of the entering price. (By the way, now it's at four times of the initial offer.)

So, he is upset and the post linked above is his way of letting the buildup of negativity out. Well, Mr. Cenedella's motivations aside, Hoffman's remarks in Davos are wrong on so many levels, it would take me several more posts to break it all down( don't worry, I am not going to). This is exactly what I would expect from someone who "made it" in the way Mr. Hoffman did, though. What's the implication here? Even if you are 18, but is concerned with your constitutional rights for privacy, you are "old" and square? And if you want to be perceived as young and hip, you should disregard all privacy concerns?

Statements like that don't upset me because they are "politically incorrect," as Marc Cenedella claims – I don't care about that shit! They upset me because they are politically dangerous and stupid. How intellectually limited one should be to mix up the teenagers' exhibitionism with privacy issues? Are you that confused? You don't see the difference between people, on their own accord, making decisions to disclose information about themselves and your selling their connectivity and interests profiles to third-party predators for an enormous gain? This proves once again that nowadays success, even in business, has nothing to do with intellect.

Job Search: Altogether Now! Say, “Bye-Bye, Ladders!”


Marc_thumb As some smart people predicted, TheLadders are not for $100K+ job seekers anymore.  In his newsletter last Monday (presented in its entirety at the bottom), Marc Cenedella announced that now his job board "takes all salary levels" (for shame, Marc – subpar writing!)  Well, he definitely can say, "Bye-bye" to many premium members who are paying annual fees on the premise that they belong to an "exclusive club" of six-figure-salaried people (Dear reader, I agree, it's absolutely pathetic, but people are people). 

But I am more interested in the speculative assertions we can deduce from this:

  1. Marc Cendella thought that some investor would come along and he would be bought out by now and retire in the…, where he wanted to retire.  I understand very well the whole thing with the book's publication, etc.  There is no fame or fortune in writing the books (trust me on this one, I should know), because nobody buys or reads them.  You invest your precious time into writing endeavor for other reasons.  In his case – self-marketing.
  2. The job market is so bad that there are not enough 100K+ postings to cover their expenses.
  3. He needs more revenue both to boost the dwindling cash flow, and attract investors.  For that he needs contracts with large employers and recruiting agencies, who don't have too many six-figure positions anymore either.  So, the only way they will deal with him is if he opens the doors to all salary levels.
  4. Now, even the premium members will start receiving laundry lists with salaries all over the place – it's not like there are no $40K a year controller positions out there.  Who wants to pay for that kind of service?
  5. I am not an oracle: it's possible that Cendella is a lucky person and it will all work out his way, but it's my opinion that the near-future probability of TheLadders saying bye-bye altogether is very high.

"Bye-bye!

September 19, 2011

We're expanding, and today we say "bye-bye" to helping only those over $100,000 and "hello" to helping all career-minded professionals. TheLadders now takes all salary levels and shows the right jobs to the right person. So while we're saying goodbye to our narrower segmentation, we are not saying "goodbye" to keeping your job search on TheLadders relevant, focused, and targeted.

So, for example, you won't see jobs that pay half (or double) what you're currently making. You won't see jobs outside of your field — we still won't show sales jobs to finance professionals, or marketing jobs to technologists. And we won't be letting in scammy jobs, work-from-home schemes, or commission-only opportunities — we'll still be vetting every job and every recruiter before we allow them into our community.

So what's the big change for you? Should be not too much… on the surface.

You'll still be seeing great $100K+ jobs, and the recruiters who post them.

Behind the scenes, though, by making it easier for companies and recruiters to fill all of their professional jobs at TheLadders, you'll find that we're getting more, and an even wider variety of, jobs at the right level for you.

We've been out talking to our friends in HR departments and recruiting shops across the country these past few months talking about our expansion and we've found widespread enthusiasm and support. The standard ways of doing things are too expensive, too time-consuming, and too frustrating for them, too.

This expansion has been a long time in the making. From the beginning in 2003, when we set out to become the "Society of the Nation's Top Talent" to our first appearance in the New York Times in 2007, we've talked about preparing for the day when we would expand to cover all professional jobs.

We've worked hard at becoming experts at modern recruiting. We've underwritten research at universities. We've spent over a million dollars re-writing the playbook for job search advice. We published our Amazon Top 100 best-seller: "You're Better Than Your Job Search". And we've studied the history of the job search through the past two centuries.

We also launched Signature, our historically unprecedented program that guarantees you a job offer — or your money back — when you follow our program of weekly or bi-weekly calls over six months.

And based on our expertise in understanding what employers want, we've built the largest resume writing service in the country.

It's that excellence in helping job-seekers like you that has propelled us to become leaders in the business, and it's one of the reasons why we've tripled the number of recruiters and HR professionals in our community this year alone.

And so now that we've grown to almost five million members in the United States and 43% of high-end professionals used TheLadders in their job search last year, we're expanding to serve all career-minded professionals and all professional jobs in the country.

I thank you for your support these last eight years and look forward to eight, or eighteen, or eighty more years helping you succeed in the job hunt!

I'll always be rooting for you,
Marc Cenedella

Marc Cenedella, CEO & Founder"