Category: Business

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Business

Disrupting the Credit Bureaus

Yesterday, literally while shaving, I was thinking about credit bureaus – how they gather all of this information about us from third party sources (with varying degrees of accuracy) and then sell it back to credit grantors seeking to find some assurance of our credit worthiness.

What if, I wondered, we had our own place to provide that information – our own “credit profile” as it were. For honest folks, it would be much more accurate than what the bureaus provide.

This morning, I came across this blog post by Jeremy Liew, a partner at Lightspeed Venture Partners. Turns out he’s been thinking along similar lines – “idea of using publicly available data to make better underwriting decisions”. His post is titled “Data exhaust moves beyond targeted marketing and into financial services decision making“. Love that term – data exhaust! Fascinating stuff – and worthy of more work.

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Business Work

The End of Management

Alan Murray writing in the Wall St. Journal:

“The big companies Mr. Christensen studied failed, not necessarily because they didn’t see the coming innovations, but because they failed to adequately invest in those innovations. To avoid this problem, the people who control large pools of capital need to act more like venture capitalists, and less like corporate finance departments. They need to make lots of bets, not just a few big ones, and they need to be willing to cut their losses.”

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Books Business

The Quants

I just finished Scott Peterson’s The Quants: How a New Breed of Math Whizzes Conquered Wall Street and Nearly Destroyed It, a great read!

Peterson chronicles the evolution of the quants – tracing the evolution from Ed Thorp and his Beat the Dealer book about blackjack. Like many other readers, Thorp’s book had a big impact on me when I first read it. It definitely improved my blackjack playing – even if I never was good enough to get kicked out of a casino!

The meltdown of the quant funds in August 2007 is the conclusion of Peterson’s book – an engrossing read!

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Business

Some Stunning Numbers!

Watching the financial reports of various companies over the past few days has brought to my attention some startling numbers – to wit:

  • Amazon.com reported quarterly revenues up 14%
  • Apple reporting quarterly revenues UP 12% – amazingly good!
  • PayPal reported 11% revenue growth on a 12% increase in payment volume
  • The New York Times Company reporting advertising revenues OFF 32% – a very big, ugly number!
  • Microsoft reporting its first ever annual DECLINE in revenue – capped by a 17% decline in quarterly revenues year over year – UGLY indeed.

Our economic struggles continue – a quick look at the monthly charts of National Economic Indicators prepared by the Federal Reserve Bank of Richmond confirms. Recommendation: Best viewed with a strong drink in hand!

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Business Living

Servant Leadership

I was going through a pile of old files last night – sorting out stuff that still needed to be shredded from stuff that was just trash. Boxes that had built up over the years. When you have space, these boxes just seem to collect. For whatever reason, last night I dealt with a few of them!

Along the way I came across a very nice congratulatory letter written to me in the early 1990’s by Jim Blanchard, then CEO of Synovus. I was working for Visa in those years and had just been promoted to EVP.

It was a simple letter that Jim sent – passing along his congratulations and cheering me on to bigger and better things! But, remember how those kinds of letters and thank you’s made all the difference in the world in terms of just feeling good?

Jim was a great member of the board of Visa for many years – and a real example of servant leadership in action. It was great fun to find his letter almost twenty years later. Reminds me again just how important random (and not so random!) acts of kindness are to others in this crazy world of ours!

Continue reading “Servant Leadership”
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Business

Failure’s Not That Expensive!

Over on O’Reilly Radar, Tim blogged about Jeff Bezos at the Wired Disruptive by Design conference.

In particular, these words from Bezos caught my eye:

“People over-focus on errors of commission. Companies over-emphasize how expensive failure’s going to be. Failure’s not that expensive….The big cost that most companies incur are much harder to notice, and those are errors of Omission.”

Incumbents, stand up and pay attention!

Categories
Business Living

Leadership is Situational

Here’s a great quote from Steve Ballmer in today’s Corner Office column in the New York Times:

“I’ve come to believe that to be a great leader, you have to combine thought leadership, business leadership and great people management. I think most people tend to focus more on one of those three.

I used to think it was all about thought leadership. Some people think it’s all about your ability to manage people. But the truth is, great leaders have to have a mix of those things.”

A mix of those things indeed – applied uniquely (situationally) to the individual and the situation!

Years ago, in one of my earliest IBM management classes, we had an amazing teacher (who’s name I’m embarrassed that I can’t recall) who shared a very basic notion that has stuck with me ever since: successful leadership is very, very situational – one size definitely does not fit all!

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Business Current Affairs Payments

Credit Cards

What a week for credit card issuers! The word “retribution” comes to mind.

Today’s meeting with Obama at the White House, Dodd and Schumer today asking Bernanke et all to use the Fed’s powers to block issuer interest rate increases, yesterday’s passage of the Credit Cardholders Bill of Rights out of the House Financial Services Committee, etc. Just a few of this week’s highlights…

Way back in early February, I wrote a blog post about “The Pressures on US Consumers from their Credit Card Debt” – primarily noting how the credit card issuers were actually digging their own grave with their upward interest rate adjustments. A natural (if silo’ed) response by issuers to the need to protect/improve the P&L of the credit card businesses inside major financial institutions.

In spite of this week’s angst, we’re still a ways away from any legislative response actually passing (in the Senate, in particular). The financial services lobby is certainly fully engaged on the issues. It will be fascinating to see who prevails.

What’s the lesson the credit card industry should learn from all this? Anything?

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Books Business Living

What’s Your Book?

From The House of Dimon: How JPMorgan’s Jamie Dimon Rose to the Top of the Financial World by Patricia Crisafulli:

I tell people there is a book on every single one of you.

If I want to know you, all I have to do is talk to people who work with you and for you, clients, counterparts at other firms, friends, and relatives. . . . I will know you . . . much better than you think; in fact, maybe even better than if I spent an hour with you or two….

There is a book on everybody, and part of it is to try to make sure you figure out that book.

— JAMIE DIMON, OCTOBER 2002 SPEECH, NORTHWESTERN UNIVERSITY, KELLOGG SCHOOL OF MANAGEMENT, EXECUTIVE MASTER’S PROGRAM

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Business Current Affairs Frustrations

The Hard Part

So, now the hard part comes re: AIG.

Not the bonuses to the AIG FP folks – but, rather, AIG’s passthrough of billions of dollars of emergency federal funding to “the coffers of several dozen big banks, shielding them from losses.”

And AIG didn’t just pass the billions through to American banks – but “Société Générale of France and Deutsche Bank of Germany, each of which received nearly $12 billion, Barclays of Britain, which received $8.5 billion, and UBS of Switzerland, which received $5 billion.”

The magic phrase: 100 percent on the dollar. Why? Who’s in charge of this debacle, anyway?