First Order Blog

Intellectual Property

Google spent $12B last year for Motorola’s mobile-patents. Facebook paid Microsoft $550 million for some of the patents that Microsoft bought from AOL.

The question is… for business or lawsuits?

Yahoo filed a lawsuit against Facebook over alleged patent infringement. Facebook countersued. Apple sued Samsung, which they won in America but now there are trials in other countries. British Telecom and Oracle sued Google.

Changing of the Guard

The co-CEO's of Research in Motion (makers of Blackberry) resigned this time last year, due to sliding market share (3/4 of value in 2 years). Investors were frustrated that the new CEO was not from the outside, but instead joined RIM in 2007. Yahoo's once-new CEO, Scott Thompson, was their 5th leader in 5 years...

...and now Marissa Mayer from Google is #6.

CEO tenure decreased from an average of 8 years to 6 in the last decade (Booz & Co.).

Some of the causes include:
- Lack board alignment
- Ignore critical feedback and do not tolerate dissenting opinions

2013

As we look forward to a New Year, it is necessary to assess your corporate strategy. During this analysis, you must consider 2012’s internal performance and strategy execution, as well as external market landscape factors. Then, you either stay aligned to your stated strategy or you adjust and change your strategy.

Three questions to ask:

  1. Where will we play this year?
  2. How do we win there?
  3. Are our best people working on these opportunities?

What is your 2013 strategy?

Merry Christmas!

Some companies throw holiday parties and give presents. One present that all companies should give is affirmation to employees: celebrating their individual contribution to the company’s success the previous year (i.e. how they are a "cog in the wheel").

Transformation for Survival

The list of once-prominent companies that are failing now is growing from the ice-boxes and typewriters: Borders, Blockbuster, Tribune…..

  • Eastman Kodak, founded in 1888, which filed for bankruptcy in January 2012, was slow to move toward digital photography. Fujifilm has thrived due to its imagination for reinvention.
  • 2011 advertising revenue for all US newspapers was $23.9 Billion. Google advertising revenue was $36.4 Billion.
  • In 2010, Netflix had less than 1% marketshare of the US online movie business. It has now overtaken Apple as the top earner and has 44% marketshare.

Search for Information

In 1979, workers received 2.5 weeks of annual training. In 2011, only 21% of the workforce received any training at all. Fewer companies invest in developing new skills, which makes this the “Era for Personal Learning,” as individuals need to take control of their own learning experience and drive a personalized “curriculum.” This will assist in addressing skill and competency gaps for an ever-changing job market.

Consensus

Diversity of perspective and opinion provide legitimate discussions. A strong leader does not rebuff disagreement, but encourages it to find the better solution. One must challenge their self-assumptions, yet not be a part of consensus group think. The goal is a group’s aligned action, and the by-product result of this is a leader gaining influence.

However, many struggle with this due to:

  • Straight talk does not include generous listening
  • Issue disagreements lead to personal conflicts and questioning of capability

Listening

I asked a tech executive who had been working with a high priced coach what he had learned after a year, and he said, “to be a better listener.” At a financial firm’s CEO off-site meeting--where 2 years ago no one spoke (and was thus considered a waste of time)--a highly planned and structured culture change to encourage collaboration and listening made this year’s off-site highly anticipated by participants. Employees of both organizations probably felt like they were delivering that famous telecom company tagline from a few years ago.

Succession Planning

Recently, there have been some CEO transitions at large companies: Tim Cook (joined Apple in ’98) from Steve Jobs, Virginia Rometty (joined IBM in ’81) from Sam Palmisano. These two new leaders should beware of their peers: HP’s had 3 CEO’s in 13 months, and Yahoo’s had 5 in 5 years.

CHRO Metrics

According to a 2011 Cornell study, the HR metrics used to study effectiveness include:

  • 58% internal customer surveys
  • 34% HR costs/cost ratio
  • 29% Turnover/retention
  • 21% Performance against Key Performance Indicators (KPI’s)
  • 20% Recruiting efficiency
  • 18% Employee engagement
  • 12% People costs
  • 5% HR process completion