David Jacobson's External Insights

When does a star employee become a high risk?

Most businesses have one: a star employee who has an ego to match. Usually the pros 0f having that person on your staff outweighs the cons but eventually a time will come when that person does something that affects the organisation's reputation or disrupts the other staff's harmony.

How do you handle such a person? In 'One for All' or 'One for One'? The Trade-off between Talent and Disruptive Behavior Knowledge@Wharton discusses the case of a star US footballer who was let go by his team because of repeated eccentric and disruptive behavior that alienated teammates, coaches and fans alike.

Some key quotes:

Terrell Owens is a classic case of a star employee who, because of his immense talent, was given wide latitude even though he engaged in eccentric (at best) and abusive (at worst) behavior. But even Owens' ability to catch passes and score touchdowns could not save his job because his behavior reached the point that it was deemed detrimental to the successful functioning of the organization...

If you have a star sales person who's difficult but works away from the office, you might be willing to tolerate a high level of difficulty with that guy because it doesn't have much effect on the performance of the organization. But where teamwork matters, you want to tolerate less of  that...

The Owens case raises ethical issues because disruptive behavior by high performers, if left unchecked, can run counter to the values of organizations whose codes of conduct require employees to treat one another with respect. "For corporations, it's understood that if you have a double standard and look the other way for your star performers who are behaving poorly, you are corrupting the organization," Dunfee says. "The stars think ethical rules don't apply to them."..

"Some people are great to work with but produce little or no results," she notes. "Both ends of the performance/values spectrum need  to be managed carefully. Smart organizations try to reward employees for a range of behavior that includes producing results and exhibiting the organizational values by which the organization achieves those results. If, after careful goal-setting and coaching, the star can't learn to play well with others and the easy-going person can't learn to produce results, both should be shown the door."

Weasel words and management speak

The success of Don Watson's book Death Sentences about cliches and weasel words has prompted a follow up Dictionary and a website dedicated to deciphering the meaning of words spoken by politicians and businessmen.

If you're not sure what evils I'm referring to, have a look at the wonderful "we do stuff" website. How many cliches did you count?

If you need help with something you're reading then run the text through Bull Fighter. Bullfighter will measure the jargon and verbosity and give the text a Bull Index rating.

The role and responsibilities of CFO's

Recent court proceedings involving executives of GIO, One.Tel and HIH have highlighted the risks of non-director executives particularly the Chief Financial Officer.

Earlier this year CAMAC issued a discussion paper on Corporate duties below board level.

In Down by law in CFO magazine Ann-Maree Moodie discusses the liability of CFO's and how they can manage the risk of penalties, including whether they should become a director to ensure they have access to all relevant company information.

More effective presentation preparation

I recently gave a presentation and decided that as it was a case study I would combine a storytelling approach with Powerpoint and not make it too technical. I have previously used the technical nature of my presentation as an excuse for putting everything into the slides.

My approach to presentations was to use powerpoint as a planning tool. You know the method: leave it till the last minute then bash out a series of slides with dot points then if you have time prepare a full typed speech which roughly matches the slides.

I had already bought Beyond Bullet Points but not got too far with actually using it.   I decided to follow the book's method. Interestingly, Powerpoint comes last after you have worked out what you want to say, how long the presentation will be and ensuring the basic points of the story are covered in a traditional 3 Act format.

Once you get the story right then you transfer your points as slide headings from Word into Powerpoint and decide on a visual theme. You put your narration into Powerpoint notes so that the narration matches the slide.

In fact the process means that as you focus on the story your presentation could be done without Powerpoint if something technical goes wrong. Powerpoint enhances the story rather than acts as a substitute (usually inadequate) for notes .

Presentation Zen makes the same point in Sometimes the best PowerPoint presentation is the one you don't have to give

There were technical questions but I was able to deal with those without needing to list them in the actual slides. My audience was appreciative: perhaps it reflected my preparation as much as the presentation.

See also Scoring Power Points by Jamie McKenzie

Australian Customs Service: IT Governance nightmare

The Minister of Justice and Customs has been playing down for weeks the severity of difficulties with the implementation of Australia's new Cargo Management Re-engineering computer system which tracks all incoming goods on our wharves and at airports. See this transcript of his interview with Alan Jones on 21 October.

The system reportedly ran AU$200 million   over budget, went live despite known problems and without the backup of the previous system.

Amidst escalating costs of fixing the system and threats of a class action by importers, brokers and forwarders and ongoing congestion at ports the Government has announced the appointment of Michael Carmody, currently the head of the Australian Taxation Office, as head of the Australian Customs Service to fix the problem.

National Security Letters

Last week I discussed the effect of notices under Schedule 6 under the Anti-Terrorism Bill (No 2) 2005.

Today's Blawg Review contains links to 3 US posts on their equivalent, the National Security Letter.

Wendy's Blog links to a Washington Post article on the FBI's extensive use of National Security Letters (30,000 last year) and discusses a constitutional challenge to their validity.

In Australia, if the Bill is passed, the notice can be issued without the need for a Federal Magistrate's approval if the AFP  "considers on reasonable grounds that a person has documents (including in  electronic form) that are relevant to, and will assist, the investigation of a serious terrorism offence."

UPDATE: beSpacific points to more US material which makes the observation that the FBI no longer destroys data collected through such sweeps, even if it is irrelevant to the investigation at hand. Instead, the article states, the FBI has been ordered to keep the data, even when it is clear it is on innocent Americans, and "to develop 'data mining' technology "to probe for hidden links among the people in its growing cache of electronic files." What will happen in Australia? Has it been considered?

UPDATE 29 November: The Senate Committee Report

Novogen CEO remuneration resolution

Novogen Limited has agreed to send a letter to shareholders after ASIC queried why the Chairman let the resolution to approve the remuneration report at the AGM pass on a show of hands without calling a poll when it was clear that the majority of proxy votes submitted were against the resolution.

The letter from its Chairman will be sent to all shareholders apologising for not putting to a poll a resolution seeking a non-binding vote on its remuneration report.

The letter, which has been announced to the market, also clarifies:

• that approximately 70 per cent of proxy votes submitted were directed against the approval of the remuneration report; and
• what steps the company proposes to take in response to the vote.

Novogen issued a release to the market that was potentially misleading to shareholders in that it presented the 'no vote' as a proportion of the whole issued share capital, rather than as a proportion of the number of votes reflected in proxy forms lodged prior to the meeting. This had the effect of reducing the apparent 'no vote' from approximately 70 per cent (of directions in proxy forms lodged) to 12.5 per cent, creating an entirely different perception of the level of disapproval of the remuneration report.

Even though a vote to reject a remuneration report is not binding, a company should explain to its shareholders what action, if any, it intends to take in response.

Anti-Terrorism Bill Australia

The Anti-Terrorism Bill (No.2) 2005 was introduced into the House of Representatives on 3 November.

The Law Council has published a summary of its concerns.

As well as provisions relating to terrorism  and sedition, the Bill contains detailed provisions which businesses should know about.

Schedule 6 of the  Bill authorises police access to any documents  (including in electronic form) held by anyone that will assist the investigation of a serious offence if they relate to a person's financial, travel, telephone, gas, water, and electricity records  as well as any other documents if necessary to determine a person's telephone number, where a person lives or who lives at a particular address.

In the case of investigation of a serious terrorism offence, the police can issue a notice without any judicial authority. In the case of a serious non-terrorism related offence, the notice must be issued by a Federal Magistrate.

This would allow access to a person's financial records, medical records, phone and utility records, legal files, library records or any business's customer records (eg car hire, video rental, house rental etc).

There are special provisions relating to operators of aircaft or ships: the police can ask questions relating to the aircraft or ship, or its cargo, crew, passengers, stores or voyage.

It is an offence to fail to comply with a notice, and if the notice specifies that the existence of the notice must not be disclosed, it is an offence to disclose the existence of the notice (unless it is to get the documents or to get legal advice).

However there is no obligation to retain such data outside of your usual legal obligations.

The Bill is expected to be  passed by Christmas.

UPDATE 11 November : Regulatory impact

Westpac embarrassed by electronic document

Westpac asked for its share trading to be suspended temporarily on 2 November after it became aware that on 1 November a template containing adjustments to previous financial results sent to 37 analysts in 16 broking firms could be opened to reveal blacked-out squares that contained a breakdown of the 2004/05 financial year's earnings, and operating margins, before finalisation and lodgement with the Australian Stock Exchange (ASX).

See ASX announcement: Code WBC. News.com.au

2004 yearbook: themes

I have been looking through my archives  and observed that my posts in 2004 had a number of themes.

So I thought I'd re-categorise and list some of the notes that are still current.

Business emotional health

Alternative contracts (State of Grace)
Is your business healthy?
Values and morality in the workplace

Licensing and commercialisation

When to license?
Technology commercialisation
Shared services
Outsourcing

New generations

Mentoring and Generation X
The Gamer Generation

Project management

10 rules for project managers
Multiprojecting

Innovation and entrpreneurship

Learning from failure
What makes an entrepreneur?
Looking for unmet needs
New businesses: success or failure
Tips for business success
The elephant and the flea
Management fads
Product development

Strategic planning

Strategy mapping
Competitive intelligence
What is a good decision?