HR Capitalist Believes That Operational Guidelines Are Optional


ScrewballLast week (Wednesday, January 26th, to be exact), my fellow Typepad blogger HR Capitalist (www.hrcapitalist.com) posted a short musing on the subject of what he calls "Rules Orientation." Not a very clear term, it basically attempts to encompass the process of introducing new hires to the way the business is done in the company, i.e. operational guidelines. And the thesis is that it's not always necessary and the choice depends on the propensity of the candidate: if he wants the structure, give it to him; but if he doesn't like to be restrained by the rules, let him figure out his own way. The latter apparently is especially "good" for the companies that operate without rules in the first place – the mayhem kind of businesses.

(Side note: I cannot suppress my high cultural standards and must make a note about the inappropriateness of the "Fight Club" reference. I just cannot stand the pretentiousness of people who don't even understand what they are watching, but try to appear deep. Let me tell you, it took a lot of discipline, military organization, and RULES to properly run Project Mayhem. Remember? "The first rule of Fight Club is…" and so on – rules 1 to 8. Even The Narrator's psyche was protected from Tyler Durden within as long as the rules were followed. Once they were violated, the spell was broken.)

These kind of ideas and recommendations are somewhat surprising, coming from a career HR guru. How narrow is the employment niche of, what he calls, "low rules" candidates? In my opinion, minuscule – maybe some small haphazard consulting company with no supporting staff and a life expectancy of a couple of years, or a startup based on an IPhone App that will be hot for a few months and then lost in the sea of 300,000+ solutions.

In any other type of business, or even in the same kind but with a little bit of structural complexity, project deadlines, customer base, etc., operational guidelines guarantee faster immersion into daily duties. The only employees that should not be bound by protocol are the creative staff (designers, architects, artists, etc.); and even those need to abide by the rules of conduct, employment agreements, client-time billing, etc.

The biggest question is, who the hell can afford nowadays the unstructured learning curves of people not powered by certain procedural standardization? Especially if they are very good – you don't really want them to waste time on "figuring out" their personal ways of going about the job.

Moreover, I guarantee you that no small or midsize business, with its flat organizational structure and intense concentration of responsibilities, can let a no-rules screwball (or rather cannonball) into its already vulnerable system. Just imagine for a second someone like Susan Vance (Katharine Hepburn) running around your workplace, releasing leopards, breaking all conventions, and eventually reducing the result of long-time effort to a pile of disconnected fossils.

But I shouldn't be really surprised that this post was written. This is a typical problem with many narrowly-focused specialists, including HR gurus. They lack the ability for systematic thinking, are not capable of viewing business as an integral organism, where everything contributes to the ultimate success, and, thus, rarely make good executive material.

I am all for matching employees abilities to their appropriately assigned tasks and specifically talk about it in the last section of "CFO Techniques", but I cannot imagine trying to fit into any organization those people who cannot follow any rules.

Strategic Planning vs. Crisis Management


“Harry Potter and the Deathly Hallows: Part II” (written by Steve Kloves, based on a novel by J.K. Rowling’s):

HARRY POTTER

We have to go there, now.

HERMIONE GRANGER

What? We can’t do that! We’ve got to plan! We’ve got to figure out —

HARRY POTTER

Hermione! When have any of our plans ever worked? We plan, we get there, all hell breaks loose!

And that, my dear readers, in a nutshell, is the principal difference between the two action-plan extremists.

In the red corner, equipped by multipage projections with color graphs and tables, are those who believe that strategic planning is the only way of life and one must ponder and weigh every situational possibility before taking any step forward (or backward). In the blue corner, wearing their firefighting suits with confidence and valor, are those who are convinced that when the shit hits the fan they will be able to immediately assess the entire spectrum of life-threatening circumstances and successfully handle the crisis.

Any kind of extremism is bad, kids, m’kay? In religion, politics, personal views, and business management. Different situations require different approaches. Only a balanced combination of executive instruments, including long- and short-term plans as well as emergency-response methodology, can guarantee an enterprise’s ability to efficiently evolve and weather any dangers that constantly arise in the volatile commercial environment.

In my book, “CFO Techniques”, I have devoted an entire section (Part VIII) to strategies and planning as crucial components of CFOs’ and controllers’ functionality – the important responsibilities that change financial managers from bean-counters to CEOs’ executive partners. Participating in analysis of opportunities and construction of well-devised action scenarios offers us a possibility to affect companies in the most significant way. Remember, that those executives who let companies run their course without looking into the future and carefully plotting their steps for further development, leave the businesses vulnerable in the face of the fast-advancing competition.

On the other hand, crisis management efforts applied in situations that present themselves without any warning are of extreme importance as well, particularly in small and midsize businesses, which are highly susceptible to the slightest deviations in market, financial, economic, and political environment. Moreover, these companies frequently have less than sufficient reserves to tide them over tough times. Implementation of a disaster-rescue mission requires high level of composure and rationalization. Those who’ve read my “About” note know that I consider my “fire-fighting” skills to be the most valuable to my employers and clients.

It is a mistake to think, though, that even a very experienced CFO can wing it without contemplating some sort of advance “what-if” scenarios. In fact, a crisis management policy is just another form of a strategic plan. On top of that, proper preparation for emergencies requires broader expertise and deeper knowledge of various commercial, marketing, technological, financial, legal, and organizational matters.

The truth is that a successful executive must be capable of devising a carefully-weighed and calculated strategic development plan with all visual bells and whistles her digital arsenal can afford, but in her special folder she always keeps a set of comprehensive tactical procedures for effective extinguishment of fires and post-disaster survival.

Quote of the Week: US Public Debt


1101640619_400"A billion here, a billion there – pretty soon it adds up to real money."

                              Senator Everett Dirksen

The Frustrated CFO's note:

According to Wikipedia's article on the US Public Debt, as of January 9th, 2012 the gross debt was $15.23 trillion, of which $10.48 trillion was held by the public (i.e. in government issued securities, such as T-bills owned by investors like you) and $4.75 trillion was in intragovernmental holdings, such as, for example, the Social Security Trust Fund (i.e. backed by your money anyway).

I urge you to watch the 1965 video below and pay attention to the numbers that were the subject of Senator Dirksen's concern back then.

 

 

 

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).