Author: gspokes

Introducing: The Green Shack Challenge

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What the heck is this challenge?

It’s the test we all face at some point: to risk getting something wrong, to feel embarrassed. The moment that you could miss out on learning something about yourself and how the world works.

Green Shacks

In 1875 Londoners began to see green shacks appearing in what is now Zone 1. All were positioned conveniently for cabbies to park near. Today there are only 13 left. One of which is a few steps away  from my workplace. The idea was (and still is) to give cabbies somewhere to shelter, get some nosh and a cuppa! An alternative to the pub. Well, during working hours anyway.

Alright history boy, enough context, how do these shacks test us?

OK, OK, I’m getting to the point, a little intellectual foreplay never hurt anyone.

The situation is that we’ve a shack near our workplace, it’s used by cabbies and I’ve heard many colleagues state they’d like to use it: it’s convenient, the bacon baguettes seen in the hands of its patrons look and smell delicious. But they daren’t use it. Why?

  1. “It’s only for cabbies, what if they won’t serve me?”
  2. Er..
  3. That’s it

Well not quite it.

They’re afraid of being refused service, of a public rebuttal and a brief moment of embarrassment.

A classic situation that proves Edward De Bono was right when he said:

“The well-educated terror of being wrong creates the fierce need to be right”

In organisations when you introduce change, remember you’ve also introduced the fear of getting something wrong. Don’t beat your head against a wall if a section of colleagues don’t appear to understand something new – even if it seems so easy to understand. You’re dealing with their aversion to making a mistake (however big or small).

Home turf

It’s funny that the fear doesn’t grip those people when they are in foreign lands. Once the rules aren’t the ones you’re supposed to know, it’s fine to get things wrong. Misunderstandings abroad become anecdotes of how quaint it is to be a stranger in a strange land.

The well-educated terror must take hold again when their return flights touches down on home turf.

Perfection needs imperfection

Perfectionist tendencies are within us all, in varying degrees. Those who have a bad dose tend to be more afraid of getting things wrong. It’s not the mistake they fear, it’s the resulting criticism or being judged inadequate in some way. Having something to complete the “what hasn’t gone so well this year” section of their performance review – will never do.

However, to make the scrawl you leave on history everlasting, requires some cock ups. David Bowie once said:

 “I thrive on mistakes. If I haven’t made three good mistakes in a week, then I’m not worth anything. You only learn from mistakes.”

One thing synonymous with perfection, often described as ‘the finest’ is Champagne. If you concur, you’ll be interested to know what creates the bubbles.

An imperfection in the glass it’s poured into.

Making mistakes does not mean deliberate or offensive actions, it’s about not giving up when you want to achieve your dreams and the right things.

Man, all this writing has made me hungry…………TO THE SHACK

Ivan Fallon, Lloyds Banking Group, The Robson Press

Black Horse Ride – The inside story of Lloyds and the banking crisis

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A Spokesian Review for you

Many of us lived through it. Some of us queued to be part of it.

The Crash

2008 begat a brutal change to the UK economy that adversely affected everyone who relied on it – rich or poor.

Ivan Fallon’s book helps us understand Lloyds Banking Group’s role in it all. He shows how a bank long mocked for its prudence became the victim of the thundering herds. And, highlights the failures of those who were supposed to control them.

His book was long-listed for the FT/McKinsey Business Book of the Year award 2015. In my view rightly so. It contains insights that will stand the test of time. It can help influence those who are charged with preventing future disasters. Remember what Mark Twain said:

“History doesn’t repeat itself but it often rhymes”

Bankers were not popular before the crash, and after it, even estate agents’ popularity rose (although many of them had come a cropper at the expense of the former). But there was and still is a danger in branding all bankers:

Devils or Demons

In his forward Fallon indicates that he will be telling the story from the point of view of the Lloyd’s executives involved. A refreshing approach and one crucial for historians and us to understand how economic adversity can be mitigated in the future.

Every demon is in fact a real person and not everyone in a bank was directly involved in creating the disaster – support functions in particular. That does not negate the Goodwin’s, Stevenson’s and others of their hubris. But analysing the human characteristics of how it happened means we can try and avert it by putting in place approaches that drive ‘good’ behaviours that generate innovative but not overly risky financial activities. Reaching only for the rod of regulation will not work. People are not motivated purely to obey, work must be motivating at some level.

Banking also has an emotional truth to it, one that we too often bury at our own peril. The sums of money involved are huge, rewards are percentages of this – eye watering. But it is not pure greed that bankers or traders are all guilty of. Helen Murlis (renowned reward management author) and I discussed this at the time of the crash. We concluded that recognition was a big factor. If I’m trader x and worth y the why is trader z worth more than me, reward me the same or I’ll walk. The beauty for those who did the latter, taking a stroll wasn’t very far.

I did not feel Fallon’s approach and work was designed to be a pure rebuttal against the banker bashers. It explains more than that, it shows all who were at fault, some were bankers, some were non-bankers in banking roles, others were regulators, politicians or central bankers.

Lloyd’s has been around since 1765 so Fallon wisely narrows the:

Scope

To start in the period of CEO Brian Pittman (1983 – 87) through to the end of CEO Eric Daniels stint (2003 – 11). The latter’s period as CEO was made piquant by the partnership formed with Chairman Victor Blank (2006 -09).  Fallon shows you what motivated them, what they kept private from work and importantly how they never allowed their individual personalities wreck a unified stance when leading the bank.

In tandem Fallon places the mid-day sun on the failings of the regulators, he proved that in this case:

Three isn’t the magic number

Gordon Brown wanted to wrestle regulatory control of the financial services sector from the Bank of England. As Chancellor he failed. Miserably. The result, he created an un-appetising ‘fudge brownie’. Originally he wanted his newly hailed Financial Services Authority (FSA) to oversee everything. The then Governor of the Bank of England (BoE) Eddie George went nuclear – he had more arsenal than Brown. He was seen in the City as the banker’s banker.

The fudge: Now, the FSA would oversee (with pitiful resources) the financial services companies’ operations, the BoE the financial system and the Treasury would oversee the economy and both the FSA and BoE. The diffuse nature of this set up meant no one body was keeping an eye on the overall health of the patient. The herds had no one to stop a stampede into the most short-sighted ways to generate profits.

The Watchmen weren’t asleep though. They didn’t really mind when all the graph arrows pointed north. They went about their business, pulled hideous smiles, played panto in the Commons and told the taxpayer everything was alright.

As well as Fallon’s ability to shed light on these factors he also gives his readers some stark evaluations of the:

Two myths

That the City and press have saddled Lloyd’s with. These are:

  1. Gordon Brown casually gave the green light for Lloyd’s to merge with HBOS at a cocktail party at Spencer House
  2. Lloyds didn’t conduct thorough due diligence on HBOS before recommending the merger to their shareholders

The truth behind these are captured in the book. It’s not for me to say more here, I recommend you read the book (I’m not on any commission by the way, it’s my personal view).

Fallon explicitly looks at these myths, but, what he has wonderfully done for the reader is challenge another. His intimate access and knowledge of the people involved provides the reader with the ability to connect with the:

Human condition

Of the people involved. He removes the salary first, people second approach of many commentators. When reading Fallon’s book I was struck by Victor Blank’s choice of car, his decision of what to wear when the Prime Minister called him, Eric Daniel’s addiction to tobacco, his dedication to seeing his son while being a CEO, Mervyn King’s need to be viewed as an intellectual, Mandy’s ability to get out of hospital even when he didn’t want to and the loss of Terri Dial to cancer. All of these are poignant reminders that not all bankers are demons. Our economy and our own welfare requires a healthy banking system. To achieve this requires professionals and sound individuals to be in place, they might get paid more than we do. But for good reason. Bad bankers do exist though, Fallon points these people out and explains how they caused tangible pain for UK citizens. He also shows how being a true watchman in the ‘good times’ was difficult.

Who would want to entertain icebergs when the gravy was flowing?

If you have an interest in how the world around you works, read this book.

(Note. Photograph for this post © Gary Spokes 2015)

Is Jeremy Corbyn electable?

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Yes

He understands that the world doesn’t have to be the way it is. He believes in a more prosperous and equal society.

The result: Labour Party grandees and others have accusing him of swinging the ‘magic lantern’. They (Peter Mandelson, Tony Blair, Charles Clarke, Gordon Brown and more) have launched highly publicised criticism. Stating his promises cannot be pragmatically implemented and will not universally appeal to the electorate come 2020. Moreover, he won’t hold the Labour Party together in opposition.

Blair was electable and then met George Bush. His post PM ‘peace keeping’ role has rendered his influence sterile. Gordon Brown didn’t face any leadership election within his party. He had to steer the Government through the tumult caused by the crash of 2008. A calamity born in part by his failures as chancellor to wrestle regulatory control form the Bank of England. Letting Mathewson and Goodwin deceive and ruin it for us all. A calamity the electorate could not forgive.

People who live in glass houses seldom throw parties. But Mandy and co seem to like a soirée in the greenhouse.

Ed, well, he couldn’t offer anything appealing to the electorate. Spent some time with Russell Brand and let the SNP walk away with Scotland. He didn’t differentiate from the Tories and ignored the soul of the Labour Party.

Corbyn is not swinging the ‘magic lantern’. He’s pointed a flashlight on valid alternatives that opponents would rather be kept in the dark.

Labour leadership

Jeremy Corbyn is electable as the new Labour leader. Moaning from some (at this late stage) that 35 nominations to stand is too low is a display of arrogance. Blair to Brown was a fatal handover. Now we have rich debate amongst Labour MP’s, Shadow Cabinet, party members and those who will or may vote Labour if Jeremy wins.

He is leading in the polls. Polls that we all know are never100%. However, the surge to register to vote in the contest is real. A deluge undeniably due to Corbyn.

The TV debates irrevocably showed his opponents as cautious, not willing to rule things out. Such lack of underpinning and assurance from Corbyn’s opponents about tackling the immediate future was stark. And highlighted in the polls after debates. He won.

Holding the party together

He’s accused of being uncompromising. That comes from being able to form an opinion, one underpinned by personal experience and research. He gives something clear to agree or disagree with. It is likely that this will provide lines, to tow or cross.

Any political party will have factions.

Rather than pander to them. Generating tepid opposition and policies. Corbyn is willing to let everyone have their say. But ultimately, like any leader he has the conviction to solidify the party line.

Once the result is announced on the 12th September every Labour MP will remember their career. Why they got into politics and the principles that brought them into the Labour Party. Regaining the heart and soul of Labour does not mean exile forever from No. 10.

Bank of England support is not just for banks

It’s been woefully unchallenged by all Governments since the 2008 crash that quantitative easing (QE) and pouring tax-payers money into banks was fine. The story for the electorate, suck it up or face oblivion. QE can be for the people and not just for banks.

Banks used to lend money to businesses to create products, jobs and new inventions. Now we have slipped into a services lead economy with anaemic productivity levels.

Corbyn has got credible economic policy ideas. His opponents attack them as they generate a new narrative for the electorate to consider.

Credibility here needs intellectual underpinning. Economics is a social science after all.

Michael Hudson (Research Professor of Economics at University of Missouri, Kansas City and renowned author) was recently asked what he thought of Corbyn’s idea of a national investment bank and printing money to invest in the public sector. He thinks it:

“Is a wonderful idea. Corbyn wants to actually inject money into the economy, into public spending. It is the opposite of Thatcherism. And that’s the only way to make the real economy grow.”

Martin Wolf wrote an articles during the leadership campaign. Evaluating Corbyn’s proposals and what the Labour party needs to appeal to the electorate.

Wolf believes Corbyn’s economic ideas are ‘muddled’. He said the same about Ed Miliband’s economic proposals before the last election too. Jeremy is not Ed. He’s already (on his own) heeded Wolf’s reminder that Labour must no longer mimic the Tories. Wolf closed his piece forecasting a complacent government and an unelectable opposition are the future. But still cast this appraisal of Corbyn:

“Some proposals – notably higher public investment at a time of low interest rates make sense. Some such as letting the Bank of England inject the money it creates directly into the economy make sense”

Two prominent views and one thread. Investment of public money into the real UK economy makes sense. The electorate will be exposed soon.

A man for today – indeed

Jeremy Corbyn has been dubbed by some as a throwback. The Economist’s Bagehot took a swipe claiming Britain is the most individualistic society in Europe. Pimping the idea that collective endeavours will be unpopular.

He continued by cherry picking one response from a swing voter in Croydon and Nuneaton.

“He’s got all the policies from the sixties” adding “He’s a bit of a hippy”

Bagehot has highlighted a lazy and incorrect example. A cheap shot featured in a publication, hard sold by the homeless in the electronic age. His assertion individualism will make Corbyn unelectable is also misleading. Hundreds of thousands have registered to take part in the campaign. Town Halls and other venues are full of people who have got off their comfy sofas to listen to political discourse. The 2013 protest against bombing Syria and collective efforts today by UK citizens from the same country are an honourable counter to the charge we all are too individualistic.

Not long now

The result of the Labour Party leadership campaign will be announced on the 12th. Corbyn can then lead a strong opposition. The Tories recent un-debated activities in Syria and first defeat in the Commons are but two examples of where Labour should be vehemently holding the government to account. While keeping them pined to positions they find uncomfortable.

2020’s general election is further away. Once it goes the right way on the 12th Labour will be able to stand for equality and prosperity in full view of the electorate.

What was seen at the outset as radical will turn a deeper shade of rational.

© Gary Spokes – 2015

New robots will have the same old masters

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Robot

When the word is mentioned what do you think of?

Were you irresistibly drawn to a fictional character or one that has automated tasks in your workplace?

Fictional robots excite the imagination. They’ve been given human characteristics. Fiction is created by human story tellers. Using story telling abilities gained from generations of humans interacting with other humans.

That’s why we adore fiction. The pace, the surprises, love, sadness, happiness are all borne of us. We’re emotionally intelligent.

Regardless, much of western media is transfixed with the non-fictional robots being created to increase efficiencies. Forecasting indiscriminate loss of jobs and life.

New utopia ahead?

Some are pimping visions of utopia. More robots means more time for us to be human.

In 2014 Martin Wolf, Chief Economics Editor at the Financial Times, outlined how robots can free the poor:

“For a long time the wealthiest lived a life of leisure at the expense of the toiling masses”

“The rise of intelligent machines makes it possible for many more people to live such lives without exploiting others.”

Utopia ahoy

Martin Wolf is not alone. Paul Mason, renowned economics journalist, is one such advocate. His recent book, ‘Post Capitalism: A guide to our future’ was reviewed by a range of prominent thinkers, from Irvine Welsh to Gillian Tett.

For him, Wikipedia symbolises our world on the brink of a revolution. His view:  After two hundred years of capitalism’s domination of the West, it has become flawed. Inequality is rampant, the polar caps are melting and nations are lumbered with debt.

Mason pushes his point:

“The biggest information product in the World – Wikipedia – is made by 27,000 volunteers for free”

“If it were run as a commercial site, Wikipedia’s revenue could be $2.8bn a year. Yet Wikipedia makes no profit. And in doing so it makes it almost impossible for anybody else to make a profit in the same space.”

Gentle Spokesian reminder: The internet was created by the US military. A well funded organisation designed to perfect the arts of war.

Artificial Intelligence

The first word gives the game away. Robots are created by us. They cannot possess epochs of human interaction. Logical and emotional reactions are different. All of us will react differently in a situation depending on our emotions. Daniel Goleman (Author, Lecturer and influencer) is an authority on this, he has a canon of work. If you haven’t read any of his work I’d recommend his book Emotional Intelligence: Why it can matter more than IQ. After reading you will better understand yourself. Daniel explains:

“Emotional intelligence begins to develop in the earliest years. All the small exchanges children have with their parents, teachers, and with each other carry emotional messages.”

Robots will be here for a long time, as mimics. The recent ‘breakthroughs’ in robotics only follow instructions from master chefs, surgeons or other professionals. Undertaking human tasks that are part of human jobs is now a reality. Remember there was a world before vending machines. A person sold you everything previously.  But what if the benefits of robots included conducting more life-saving roles, sometimes in difficult places. Oil rigs, mines, logging sites and more could have ‘medical robots’ permanently on call, in difficult environmental conditions and at lower costs than a human specialist?

Human medical professionals are still needed to progress their art, but, the delivery of it can be carried out on a wider scale. No jobs taken, more lives saved.

Computers have enabled problem solving that has blessed us all. Their codified ability may be planted in a robot. But the ability of a robot to choose the science or profession they are wedded to and motivates them is not here yet.

In 2015 Fei-Fei Li, Stanford University’s Director of their Artificial Intelligence Laboratory poignantly notes:

“Computers are becoming better and better at perception tasks. Algorithms can identify thousands of types of cars while I can only tell three of them.”

“But at the cognitive, empathic and emotional level, machines are not even close to humans.”

Power

During and after the Industrial Revolution the ‘toiling masses’ were the workers who performed tasks an automated machine couldn’t. Before they were slaves carrying out the elite’s wishes. While the ancient 1% blessed themselves with the time to progress humanity.

In fairness the Ancient Greeks and other slave driven societies did come up with some valuables for the human race: The foundations of philosophical thought, developments in mathematics, the initial design of democracy and it educated and entertained us with mythology.

I admire promoters of a more humane world where robots free us to interact with each other more. There is no guarantee that those with the power and money to generate robots will be benevolent. History cannot be ignored.

Will new technology be enslaved to free us or not?

It depends on us. We do have a choice, but we need to act. Remember Einstein’s wise words:

“The world is a dangerous place to live; not because of the people who are evil, but because of the people who don’t do anything about it.”

Note to selves

While Robots can replace humans for repeat tasks, we ask of them. Humans need to remember not to behave like a robot. Charles Handy, in his latest book: The Second Curve reminds us we need to remember the wonder of being us:

“Once you start to calculate the costs and benefits of everything you do you will be no better than a robot. Indeed a robot might well make better calculations than you.”

Mother Nature can’t be ignored in all this

All of this post so far, assumes that humans remain the sole controllers of their own destiny. If the ice caps are melting then we can stop them. If an epidemic breaks out we have or can make the vaccines. Where there’s floods we will build the barriers.

In the background, Mother Nature continues to evolve more than just us. Where dinosaurs once walked so did tiny humans. The tiny took over.

We are at the mercy of Black Swans.

Robots will be a part of our world. At our invitation.

Gary Spokes – 2015

The truth about organisations

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The truth about organisations

Some stress busting revelations

Remember, you are here for you. You are important.

Organisations are created to deliver what they were designed for. They don’t have an obligation to make you a better person. Some obey laws that keep you safe in your workplace but that is to save the ignominy accidents cause.

A common complaint I’ve heard in both public and private sector organisations is that they don’t provide enough development opportunities. Development is yours to own and help you determine the psychological contract you form.

Reflect on your career plan and what development is going to get you there. Then ask for it to happen. You may be able to develop skills and more without any intervention from an organisation. Or is it time to move on? Scary thought?

You’re probably not working for a basket case organisation. I’ve lost count of the times colleagues bemoan why “our organisation is so bad”. Either comparing it to a utopian competitor they’ve not worked for, or a vision of the ideal employer. Don’t fall for this myth – the ire of the day will be present in other organisations.

Relieve your stress, remember:

Working life is never without its challenges.

© Gary Spokes – 2015

Perverse Capitalism

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The race to succeed Obama is on.

Surprisingly a dose of new thinking has been projected from certain podiums.

Hilary Clinton believes short term capitalism has to stop. Quarterly reporting and share buy backs are the bane of a healthy long term economy and should be addressed. America’s publicly listed companies are eating themselves whole.

Is she right?

Yes.

Prominent new thinkers supporting this view are vocal. Short term capitalism: the term fermented by the current MD of McKinsey, Dominic Barton is being supported by words and action. Paul Polman ensured Unilever no longer report on a 90 day basis, in his article for McKinsey.com he stated:

“We don’t operate on a 90 day cycle for advertising, marketing, or investment, why do so for reporting? “

‘Main Street’ US citizens take a collective pasting from short-termism. Stanford University revealed pressure to hit quarterly targets is reducing R&D spending, cutting US growth by 0.1 percentages points annually. Contrast this with private companies, free to take a longer term approach: they invest almost 2.5 times more than their publicly traded organisations in the same industries.

Perverse capitalism is driven by perverse incentives. Bill Lazonick is an economist rallying against his peers. He demonstrates that up until the 80’s executives operated the policy of “retain and reinvest”, with profits planted back into their businesses to bloom for all stakeholders. It was then bloom to doom as how they were paid changed. Incentivised with share options and allocations executives behaved like shareholders. Shareholders only own shares. The age of “downsize and distribute” had begun. A strategy crafted to benefit shareholders (and directors). Re-Investment was now cancelled, new efficiencies hailed and shareholders got the dividends they wanted.

The US isn’t selfish. The ‘treats’ of shareholder value and related bonuses have been exported with piquant effect. I’ll always remember Don Peppers describing to me why Citigroup were stopped from trading from Japan in the early 00’s. US executives were sent to their Japanese business and made their numbers, anyway they could. At one stage they were even passing off sub-standard art as investment grade. Why? The executives knew they were only posted for a set time. And as long as they kept making their numbers: everyone kept getting their bonuses, they got no grief. And they’d be stateside again once the brown stuff hit the oscillating metal. During the proceedings that suspended operations the regulators said Citigroup had a problem, “they lacked a sense of right or wrong”. A serious problem if you need customers in the long term.

I wish Hilary and the new thinkers the very best of luck, severing the thread between share price and perverse incentives needs many knives.

Hilary’s right to challenge a perverse practice that discourages economic growth in the long term. It’s not easy to see yet if this will do the trick for her campaign. But there is no sign that she’s about to give up.