This time last year, I wrote a New Year column with seven predictions for events that would occur in business in 2011. It is time for reckoning and I must say that I scored poorly, with only three out of seven correct.
To be fair to me, the predictions were deliberately provocative. As I noted at the time: ”They are intended to be adventurous enough to be interesting – even if I turn out to be wrong, they should at least be things to watch.”
I was at least right about that. With no more excuses, let’s take a look at my predictions and what happened. Read more
Those asking themselves if they can trust Britain’s tabloid newspapers any more won’t have been reassured this week by Piers Morgan, the CNN chat show host, who appeared before an official inquiry into the News of the World phone hacking scandal to cast doubt on both his memory and his memoirs.
Luxury goods companies increasingly seem to inhabit a parallel universe.
Many ordinary shopkeepers – at least in the recession-blighted west – are grappling with slumping sales, falling share prices and the threat of bankruptcy.
In the US, in an effort to offset worse than expected post-Thanksgiving trading, many stores caused confusion, according to the New York Times, by bringing forward “Super Saturday” – a day of pre-Christmas discounting – to December 17. In the UK, the bleak outlook for the likes of HMV, Peacocks and Blacks Leisure, is a symptom of what one analyst forecasts will be the worst Christmas for a decade.
Contrast that gloom with the great expectations of the luxury brands. On Wednesday, Mulberry announced it would appoint Bruno Guillon, a director of Hermès, the high-end French company, as its next CEO. He’ll lead the UK bagmaker’s push into Asia. The group’s shares added another 3 per cent, having risen 60 per cent in the past year. Read more
The corner office has gone open plan, the company jet is passé, and stock options are so last century. What do you give the manager who has everything? Here’s my catalogue of must-have presents to help executives shape strategy into 2012.
AT&T has spent the past few weeks denying that it was about to drop its bid for T-Mobile USA, despite the heavy regulatory opposition. It has now done precisely that.
I was originally against the deal, arguing in March that:
The US performs badly in fixed-line broadband services in terms of price and speed compared with other countries, hurt by Verizon and AT&T having shrugged off the imposition of competition. The last thing the US now needs is AT&T, which already has mobile operating margins of more than 40 per cent, pulling that trick again.
Come on, DoJ. Just say no.
The US Department of Justice subsequently came out against the deal, along with the Federal Communications Commission. AT&T has taken the medicine, paying the proposed deal’s $4bn break-up fee and going back to square one. Read more
The protests in the southern Chinese village of Wukan, which has now established its own administration outside the control of Guangdong province, cap an extraordinary year of street protests from the Middle East to Wall Street.
It is worth watching this FT video filmed inside Wukan by Ben Marino, with commentary by Jamil Anderlini, our Beijing bureau chief. It features villagers speaking openly of their defiance of the local and regional Communist Party structure and calling for Beijing to step in.
It reminds me of my visit to Guangdong this autumn, talking to migrant workers who come to the Pearl River Delta to find relatively high-paying jobs. Although they are far better off than their parents, they also see others profiting – sometimes illicitly – from special treatment. Read more
It’s never a good sign when politicians resort to nationalism, or start to complain about other countries. When a central bank governor does it, things must be bad.
Christian Noyer’s suggestion that ratings agencies should downgrade the UK before they downgrade France would be funny if it wasn’t for the fact that he is the governor of the Bank of France.
I can understand, and even be amused by, the knockabout spectacle of French politicians trying to counterattack against the threat of France losing its triple-A rating by criticising the Brits.
But a central bank governor who is supposed to be above the political fray and to co-operate with other monetary authorities in easing the financial crisis? It isn’t very dignified. Read more
Whoever thought up Amazon’s latest idea for squeezing other retailers – offering money off to people who scanned prices in US stores with its smartphone app and then bought the goods on Amazon – deserves an award for bad timing.
Speculation about António Horta-Osório’s condition will not end now that Lloyds Banking Group has announced the “full recovery” of its ailing chief executive and heralded his return to the job on January 9. Sir Win Bischoff, chairman, told journalists on Wednesday that the cause of the CEO’s sudden enforced departure in November was physical – overwork, sleep deprivation and exhaustion – but “certainly not stress”. Each director has met the chief executive separately and judged him fit to return, as have independent medical experts.
Asked how Mr Horta-Osório seemed to him now, Sir Win replied: “Very well, very well, very well. Bushy tailed. Terrific. Big smile.”
In other words, just as he seemed – to me, to other commentators, and probably to Sir Win - when he was appointed last year. For directors, and shareholders – which include UK taxpayers through holding company UKFI – the important thing is to ensure that Mr Horta-Osório does not suffer any relapse. Sir Win said on Wednesday he was confident his CEO was fit, but if it turned out he wasn’t, he intimated that his own job as chairman would be on the line. Read more
Harvard Business School has launched its big US competitiveness project. It’s a full-bore research-led effort dedicated to improving “the ability of firms operating in the US to compete successfully in the global economy, while supporting high and rising living standards for Americans”. How will non-American alumni feel about that?
Michael Porter, HBS’s competitiveness expert, is in the vanguard. He talked to me about how the US was starting to lag behind when I interviewed him in September, and he and colleague Jan Rivkin reiterate some of these themes in a video interview for the competitiveness project with Justin Fox of Harvard Business Review. As Porter says:
The US’s vitality and dynamism [are] really very fundamentally important to the global economy.
Fair enough. But the project does underline that HBS, for all its aspirations to attract more international students and faculty, is an American business school, with American preoccupations. There is something a little odd about hearing Nitin Nohria – the first HBS dean born outside the US – declare in another video interview that he “can’t think of a problem that affects everybody in the world, not just in the US, more than this question of US competitiveness”. Really? Read more
Old habits die hard in US corporate governance: Pfizer has just announced it will hand chief executive Ian Read the chairmanship. That re-creates the dual chair-CEO role and goes against the slow US trend towards splitting the two top board jobs.
According to Spencer Stuart, the headhunter, 41 per cent of top US companies now separate the roles (though the chairmanship is too often held by the ex-CEO), compared with 26 per cent in 2001. So, as governance expert Lucy Marcus tweeted on Tuesday, Pfizer’s decision is an “astonishing step backward“. Read more
One word describes the attitude of many corporate chairmen towards Sir Tom McKillop, the man who chaired Royal Bank of Scotland to the edge of oblivion between 2006 and 2009: sympathy.
The difficulties of Amazon’s Kindle Fire tablet reminds me of how peculiar it was to hold a launch event at which no-one was allowed to try the device. With hindsight, I and others there should have taken that as a warning.
At the launch in New York in September, Amazon executives showed off the Fire and other Kindle models while journalists and others were kept at a safe distance. Outsiders were not given a chance to see how the devices performed for themselves. Read more
The most breathtaking aspect of Jon Corzine’s prepared testimony to a Congressional committee on the collapse of MF Global is his claim to know little about clearing and settlement.
Mr Corzine’s defence for the missing funds at the commodities broker that he formerly headed is ignorance – that while he knew quite a lot about trading, he left the back office responsibilities to others.
He thus did not know about the missing funds at MF Global until the Sunday night of the weekend when he was trying to strike a deal to rescue the firm. Read more
Despite the criticism that rating agencies have endured in the past three years – much of it justified – someone at Standard & Poor’s retains a sense of humour.