If I ever rise to become chief executive of anything and I’m looking for yes-men to people my boardroom table, I shall make sure I employ a bunch of merger and acquisition bankers.
At the end of every quarter, to coincide with the publication of M&A rankings that they yearn to top (while professing indifference), these bankers boast about the fullness of their pipelines, the strong prospect for strategic deals, and, implicitly, the promise of more fees. As the illustration below shows, their outlook is at its rosiest-tinted just before a downturn.
In spring 2001, for instance, as deal volume plummeted, the esteemed Simon Robey, then co-head of M&A at Morgan Stanley, pointed out that “the fundamentals of the business have not changed, so when markets stabilise, we should see announcements of deals that are currently in the pipeline”. A truism, of course, but deals did not recover their 2000 peak until 2006. (A partial hall of shame of retrospectively regrettable M&A banker quotes appears at the bottom of this post.)
Most people can identify their top priority at work. Generally, it will be the part of the job that is most productive for their employer: for a merger and acquisitions banker, it could be landing a big deal for a client; for a lorry driver, the punctual delivery of an important consignment; for a hospital doctor or nurse, giving vital treatment to a patient.
Sir Richard Branson’s “non-policy” on holidays is the latest attempt by a company to tackle the “work-life balance” conundrum. The news that he is allowing 170 staff in his head office to take holiday whenever they like, without seeking prior permission, so long as it does not damage the business has been greeted with great enthusiasm by commenters on his blog.
One summed up the Branson cheerleading: “As always, leading the way for Generation Y. I hope someday, before my time is done – that most can enjoy more freedom through work, not enslaved by hours and limits but set free to make a difference whilst living out some dreams. Good start to this movement Richard.” Read more
© Bryce Vickmark
“Professional narcissism” is to be avoided, warned Steven Pinker this week to an audience of business executives. In other words, writing in jargon, brandishing your expertise and thereby making it impenetrable to the general reader. The latest book from the Harvard psychologist and linguist, The Sense of Style is all about language and stylish writing.
Business, he said, is a “target rich area” when it comes to ridiculing the use of language. Although he pointed out that the rarefied world of academia is no better. Read more
Two predictions: How Google Works by Eric Schmidt and Jonathan Rosenberg, out this week, will be a bestseller; How Google Works will be rapidly forgotten. In fact, its publication may turn out to mark the peak of popular excitement about, interest in, and support for, almost everything Google touches.
On Thursday, Scotland may set out on the bumpy path to independence from the rest of the UK. Its banking system is likely to work only if it is braver and more far-sighted than Alex Salmond, the Scottish National party leader, during the campaign.
Open-plan offices are coming under attack. Jeremy Paxman, the British broadcast journalist, let rip last week: “An open-plan office is a way of telling you that you don’t matter. Here you will sit for your allotted hours, at a work station, devoid of any personal touch, while opposite you someone you don’t know shouts into the telephone to a person sitting in an almost identical human warehouse in Bangalore.” Read more
Every time I hear about a company relocating its headquarters I think of the Marvin Gaye song “Wherever I Lay My Hat (That’s My Home)”. A hit for Paul Young in a 1983 cover version, its hummable melody cloaks an unattractive sentiment, voiced by someone with dubious motives.
In the last months of the current European Commission, Google is in deep trouble. Its effort to reach an antitrust deal with Joaquín Almunia, the competition commissioner who is to be succeeded by Margrethe Vestager, is failing amid an outcry from politicians and rivals that it is being let off the hook.
On paper, a good idea: the 50th anniversary edition and its 50-year-old ancestor.
Dominic Barton, McKinsey’s global managing director, says he and his colleagues agreed unanimously that the 50th anniversary edition of the McKinsey Quarterly, just out, should “look forward rather than back”.
But if the consultancy’s claims for the influence of its publication are credible (Mr Barton writes that the Quarterly has helped “set the senior-management agenda” for the past half century), it is worth revisiting that first 1964 edition. It offers a few clues, not only about management trends, but about the future of consulting itself.
The first edition came clearly badged as “a review of top-management problems, published to keep our worldwide consulting staff informed on topics of common professional concern” (my emphasis). In other words, it was at first an internal newsletter. According to McKinsey, an alternative suggested title was the resolutely clunky “Practice Development Quarterly”, but it rapidly became a calling card for “the Firm” and until the 1990s, it was mostly distributed to clients by individual partners along with a personal covering letter. Read more
Dan Doctoroff might have known what was coming when Michael Bloomberg decided on the location for his new desk upon returning “part-time” to his eponymous company after three terms as mayor of New York City.
Mr Doctoroff, the man Mr Bloomberg chose to lead Bloomberg in his political absence, told employees in January that the founder would “most likely spend a few hours a day working from his new desk on the fifth floor,” at Bloomberg’s offices on Lexington Avenue in New York. Read more
Another week, another regulatory battle for Uber, the Silicon Valley private car hire network with a German name. This time it is in Germany, where a Frankfurt court has banned its Uber Pop “ride-sharing” service that introduces passengers to unlicensed drivers through a smartphone app.
The professional services group's logo at the time of its demise in 2002
The half-life of radioactive brands is shorter than you thought. In fact, it is 12 years, according to a bunch of former partners at Arthur Andersen, the professional services group that disintegrated in 2002 after getting far too cosy with Enron, the bankrupt and fraudulent energy company.
They have bravely acquired the rights to “the iconic brand name” for their global tax group – previously and uninspiringly known as WTAS. It is in part a bet on a special type of business amnesia. Read more
Leonardo Del Vecchio: out with the new, in with the old? (Photo: Paolo Bona)
I’m annoyed with Leonardo Del Vecchio, founder of Luxottica, the sunglasses and spectacles-maker. By retaking the executive reins at 79, he has undermined a recent column in which I contrasted his enlightened approach with the benighted version of family ownership and management practised by Rupert Murdoch. Worse, his decision looks like a step back for the company itself.
Mr Del Vecchio apparently has no intention of installing any of his offspring as chief executive, now the well-respected Andrea Guerra has stepped down. That is good. But when you give yourself the title of executive chairman and you own two thirds of the company, it is hard to say that you have kept the operational and shareholder aspects of your business separate, which I still consider to be the best model. As I wrote in March, “maintaining both ownership and management of a large family business more often than not leads downhill into further confusion, uncertainty and internecine conflict”. Read more