The Corner Office

It was the end of a long work day, but back then, the days seemed to go a lot quicker than they do now. It was 1998 and the stock market’s unprecedented bull run - fueled by the dot-com boom - seemed like it would never end.

At the tail end of a phone interview with USA Today’s Silicon Valley bureau chief, Julie Schmit asked if I would be a source for another reporter’s story on how unbudgeted tax income from the stock market surge was responsible for the nation’s first budget surplus in almost 30 years.    

For those who were too young or have short memories, at that time, the market had indeed seen an impressive bull run. But as they say, “they ain’t seen nothin’ yet.” Over the next 3 years the NASDAQ would skyrocket 250 percent, only to plummet right back down to where it started. Maybe we’d all just as soon forget that ever happened.

And yet, there was a remarkable benefit that, for the most part, slipped under most of our radar screens. But when you read this excerpt from the USA Today archives, the lesson we, in the deficit and budget-challenged present, can learn from history comes into focus:  (more…)

The other day I was listening to Soul Sacrifice from Santana’s remarkable first album, c. 1969. I’ve probably listened to it a thousand times, but I was still blown away by how tight the band was. All I could think of was what it must feel like when a band jams together for the first time and everyone realizes there’s magic in the room.

But the concept of “Great Groups” - where the whole is infinitely greater than the sum of the parts - goes way beyond Santana, The Allman Brothers, or The Beatles, for that matter. This rare, once-in-a-lifetime phenomenon can occur wherever there’s challenge, opportunity, and creative talent.     

Like its topic, there’s an exceptional, one-of-a-kind book that describes - in dramatic and insightful fashion - the conditions under which great groups occur. It’s called Organizing Genius: The Secrets of Creative Collaboration, by Warren Bennis and Patricia Ward Biederman.

The premise is straightforward enough. “In our society, leadership is too often seen as an inherently individual phenomenon.” We hoist Apple’s Steve Jobs up on a superstar-CEO pedestal, but the book reveals a relatively unexplored talent of Jobs - his ability to inspire groups of developers to great heights. For example, he told the first Macintosh design team that they were there to “make a dent in the universe.” And they did.  (more…)

If you really want to learn how to move up in the business world, you’ve got relatively few sources of expert information. And when you’re done with all the MBA BS, the business self-help books, and God help us - the life coaches - ask somebody who’s done it, and he’ll tell you.

Come to think of it, if you think you can learn what works in the real world from anyone but someone who actually succeeded in the real world, well, let’s just say you might want to rethink your management potential.

In the past we’ve talked about all kinds of management tools and leadership qualities, but this time, we’re going to cut right to the chase. You won’t find these five tips anywhere else, since you’re the first ones to read them. Moreover, these are indeed CEO best practices that I’ve observed in few middle managers - those with CEO potential.   (more…)

If you’ve never won a big contract or huge piece of business, you don’t know what you’re missing. It’s an incredible feeling; like a burst of adrenaline that lasts for as long as the business lasts. But that’s sort of the problem with adrenaline, isn’t it? When it’s gone, you feel like you’re dead inside. And when a company loses that one big deal, that’s exactly what can happen.

At 4:05 pm EST on Monday, solid state drive maker STEC announced its third quarter results. Revenues and earnings were up considerably, beating the company’s previous guidance. All good, right? Not exactly.

Buried way down in the fifth paragraph of the earnings press release, came a whopper:  

“One of our customers entered into a $120 million supply agreement with us for shipments covering the second half of 2009. We recently received preliminary indications that our customer might carry inventory of our ZeusIOPS at the end of 2009 which they will use in 2010.”  

The next day, STEC’s stock was down a whopping 39 percent on volume of 32 million shares. Turns out the customer referenced in the quote, EMC, accounted for 15 percent of STEC’s revenues last year. Sure, STEC had 329 customers in 2008, but just two of them - Smart Modular and EMC - accounted for 50 percent of the company’s total sales. (more…)

Picture this: You are a top executive at one of the biggest technology companies on the planet. You spent 30 years working your tail off, climbing the corporate ladder, building your reputation, and it all paid off. You’re set for life; you can retire tomorrow and never have to worry about money as long as you live.

So what do you do? You leak all kinds of inside information on upcoming earnings releases and a high-profile restructuring and spinoff to a friend at a hedge fund who you know is going to illegally trade a million shares on the information and let another hedge fund manager in on the fun, too.

But you’re caught red-handed on tape by the FBI. Poof, it’s all gone. Just like that.

So, can you picture that happening to you? Of course not; neither can I. But it allegedly happened, and not to just one guy, but two. 

One is former AMD CEO and Motorola president Hector Ruiz, who yesterday agreed to step down as chairman of AMD spinoff Globalfoundries. Ruiz, apparently caught in the FBI snare, cooperated with the investigation and has not been charged.

The other is Bob Moffat, an IBM senior VP who has been mentioned as a possible successor to IBM CEO Sam Palmisano. Moffat, who was arrested by the feds a couple of weeks ago and charged with conspiracy to commit securities fraud, ended his 31-year career at IBM on Friday.  (more…)

When everything’s going well, people manage to find things to whine about. And when there really is something to whine about - like record unemployment, national debt, deficit spending, bonus pools for bank executives - look out below.

Not that there’s anything wrong with that. Complaining does give us all something to do instead of worrying, something to feel in control of even if we’re not. Which I guess is why we do it.  

And while it does afford us some amount of temporary relief, it doesn’t really change a thing except annoy everyone around us. Instead, you might consider actually doing something to help fix the economy and accelerate its return to normal, whatever that means.

No, I’m not talking about spending money or creating jobs. Anybody who tells you to do that is an idiot. You’re going to do that when you feel it’s in the best interest of your company, shareholders, family, whatever.

That said, there are three things each of us - as business leaders and managers - should be doing, actually need to do. Sure, they’re not easy, but none of the most important things in life are. Besides, we didn’t get to this point overnight, and we won’t recover overnight either. Just put one foot in front of the other, starting here: (more…)

On Friday the SEC arrested and charged a billionaire hedge-fund manager and five others - including high ranking executives from IBM, Intel Capital, and Mckinsey & Co. - with insider trading resulting in $25 million in illicit gains.

While it’s tempting to write this off as the work of a few greedy individuals, I don’t believe that’s the case. If the allegations are true, it would appear that the rampant conflicts of interest and insider trading of the tech bubble is still alive and well. The only difference is that, instead of investment banks, the instigators are now hedge funds.

Just look at the breadth and depth of the allegations that the feds used wiretaps and informants to uncover; this was no Mickey Mouse operation:

• It involves Robert Moffat - a senior VP and prime candidate to succeed IBM CEO Sam Palmisano, Rajiv Goel, a managing director at Intel Capital, and Anil Kumar, a director at McKinsey & Co.
• It involves confidential, inside information about earnings and acquisitions involving Google, Intel, Hilton, Clearwire, Sun, and Polycom.
• The linchpin is Raj Rajaratnam - a billionaire hedge-fund manager and former president of investment bank Needham & Co.   

Insider Trading: Past, Present and Future

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A survey of the nation’s top CEOs indicates business conditions are improving. I don’t know about you, but I’m not feeling it. So who, exactly, is benefiting from the bullish outlook?

If you work for Goldman Sachs, which today announced quarterly profits of $3.2 billion while setting aside $5.4 billion for compensation, you’re a happy camper. But if you’re among the 9.8 percent of Americans that are unemployed - a 25-year record - you’re probably not in the mood to celebrate just yet. (more…)

The other day I was watching a debate on CNBC starring a senior labor union official who said - with a straight face - that the UAW (United Auto Workers) had nothing to do with the demise of the U.S. automotive industry. Hard to believe, I know. 

There was a time when America needed labor unions to organize for worker’s rights, but federal and state laws prohibit workplace atrocities of the past. Moreover, the payoff for high-profile class action litigation is such that any large employee groups capable of getting the attention of union lawyers could just as easily get their own attorney to take the case.

I spent decades in the high-tech industry where unions had no traction. Over the years, there were issues involving worker safety in manufacturing facilities, but those were effectively dealt with in the courts. That aside, high-tech employees are typically treated well and if they’re not, there are always state labor boards and lawyers to intervene on employee’s behalf.

So here we are in the 21st century and we still have all these unions for teachers, nurses, truckers, airline employees, construction workers, and yes, automotive workers. But are they really needed? Do they really help employees? Or do they just diminish America’s competitiveness in an increasingly global marketplace? (more…)

On Friday, the Nobel Peace Prize was, for the first time, awarded for words, intentions, and actions that haven’t even begun to deliver results. On the one hand, nobody would question President Obama’s desire for peace and diplomatic intentions toward that end.

But in the real world - diplomatic and business alike - elegant speeches and grand gestures simply do not correlate to desired results. By rewarding intentions instead of waiting for results, the Nobel Committee set an appalling example that takes leadership back to the stone ages.

How many times have leaders and managers captured the imagination of nations and companies but failed to deliver results or, worse still, their good intentions backfired? Carly Fiorina at HP, Jonathan Schwartz at Sun, and Jerry Yang at Yahoo are just a few CEOs who were hired with great fanfare but failed spectacularly to deliver results. (more…)