Tom Albanese’s departure looks abrupt, but only in the sense that most outsiders had wearied of hearing calls for the Rio Tinto chief’s head. As Lex has pointed out, his resignation was long overdue.
Since the dire implications of Mr Albanese’s decision to push through the Alcan purchase at the top of the market in 2007 became clear, people had been saying his days were numbered. “I expect him to be out within 12 months,” was the rash prediction of one unnamed investor in 2009. Read more
I predicted that HMV would fail – two years ago. The survival of the venerable British brand, defying doomy analysts’ forecasts, the digital musical revolution and generalised High Street decline, was arguably more surprising than its eventual slide into administration overnight on Monday. It still hurts – even if there is sense in the cold argument that “zombie” companies need to be cleared out before recovery begins. Everyone has shopped at HMV. Its demise has left my son as an unsecured creditor, with £30 of unspent HMV gift vouchers that now have purely souvenir value.
The fact the company lasted this long was partly down to the misfortune of rivals like Virgin Megastore, Woolworths, Game and Zavvi, whose earlier collapse drove CD, DVD and computer game buyers to the few remaining physical outlets. Read more
If you’re still wondering what inflated the dotcom bubble, inflamed the financial crisis and ignited a series of recent corporate disasters, the answer is staring you in the face: it’s the stupidity, stupid. Read more
It’s 25 years, almost to the day, since I started at the Financial Times. “One tip,” confided a more experienced colleague, early on: “Don’t stay more than five years, or you’ll be here for ever.” Read more
Research for the latest Harvard Business Review ranking of the best-performing chief executives since 1995 – topped by Steve Jobs, as it was in 2010 – also yields some interesting new insights about whether to pick insiders or outsiders to run the company.
The study points out that, overall, insider CEOs do better, ranking on average 154 places higher than outsiders on long-term measures of total shareholder return and increase in market capitalisation. But there was little difference between the performance of insiders and outsiders in continental Europe, China and India. Read more
You have two weeks until the end of the quarter – which, for many companies, is also the end of the financial year. Instead of developing strategy, or working on long-term plans – let alone buying gifts or dressing the Christmas tree – you’re locked in a windowless office. Your sole objective: to hit your targets for 2012. Read more
In the list of phrases that should be scratched from the management lexicon, “safe pair of hands” comes pretty high.
The man named to be chief executive of BG, Chris Finlayson, is the latest to be awarded this dubious accolade. He meets two of the requirements for the safe-hands epithet: he’s an insider – though he’s only worked for the UK oil and gas producer since August 2010 – yet he is also “seasoned” (another term that should be banned – executives aren’t sauces, for goodness’ sake).
There are four main reasons why the phrase is more curse than compliment:
1) It has a damned-with-faint-praise tone, sometimes implying that the company couldn’t find a really exciting candidate, so they played safe.
2) It is often an indication that people don’t know as much about the corporate insider as they would know about a high-profile outside candidate.
3) Safety may be a virtue in some cases but an overcautious leader is not always what companies need.
4) “Safe” is often the last thing a safe pair of hands turns out to be. In fact, the record of leaders in the safe-hands hall of fame is as spotty as that of any other executive or politician. Read more
Ian Livingston, chief executive of BT, told me last week more than a third of the telecoms group’s staff are now engineers – a higher proportion than ever. But whereas their expertise once covered mainly the maintenance and repair of an analogue telephone network, he now expects them to do more. Read more