Friday, President Bush agreed to "loan" the US Auto Industry $17+Billion to stave off sure bankruptcy. No matter whether you are in favor or not of this use of taxpayer money, I've taken several lessons from this debacle and have a suggestion on how better to spend our money.
Here are the four takeaways I learned from what has gone on between the odd bedfellows in Washington and Detrioit.
1. If your product stinks and no one wants to buy it, there is little recourse from the free market other than to fold one's tent. That is unless the government decides that you deserve a few billion of tax payers' money.
2. Just because you pioneered an industry and once were great, does not mean you still are, unless you happen to important enough to the well being of 1/10 of the whole country's population.
3. Politicians are short sighted. They only look to solve the problems they are currently confronted with and have no vision to what the long run holds. And they certainly can't stand short term suffering for the long term value it may create.
4. But, in the long run, we all are dead anyway. So does any of this matter? What's another $17 Billion anyway?
The government has less business being in the auto business than the incompetent fools who have run the big three into the ground. Ultimately, we are moving all too close to a socialist state, where failure is protected by increased taxes on the successful.
I have a new proposal Mr. Bush. How about we take the $17 billion and create a seed capital fund to breed the next generation of great companies. And the US can be a shareholder! So not only will we all as taxpayers benefit from the hundreds of thousands of new high-paying jobs that will result, but we put ourselves in line for VC like returns on our investment. Can you imagine what value might be bred by that influx of risk capital. This certainly is a less risky bet than investing in the three auto companies!
Showing posts with label CEO Qualfications. Show all posts
Showing posts with label CEO Qualfications. Show all posts
21 December 2008
18 September 2007
Are you really qualified to be the CEO?
There is no degree that you can get to become qualified to become a Chief Executive Officer. Brain surgeons go to medical school and then spend years as a resident, apprenticing for the job. And, after passing the appropriate exams to gain certification, they regularly attend informative and educational sessions to stay current with the latest developments in their fields. Securities lawyers attend law school and then take an intense exam proving their merit before being awarded with their certification. They too have annual continuing education courses to ensure they stay abreast of the latest developments in the law. CPAs undergo a similar rigorous indoctrination and also are required to stay current on changes in laws and regulations.
But what about CEOs? The top office, perhaps the most critical position within entities who themselves control more wealth than some nations, need pass through no such process. There is no continuing requirement for CEOs to stay current on what is going on in business, in their industries, or on how to become better CEOs. Sure, there is business school. But, to our knowledge, there is not even one course given at Harvard Business School that pertains to how to do the job of CEO.
So how do you qualify to become a CEO? Are you just anointed? Is it your family connections? Or did you do it yourself?
Certainly there are many CEOs who become just that by founding the companies that they run. Often, as these companies grow, the founders find that the job has outgrown them. Whether this occurs voluntarily or is forced upon them by their investors, it becomes clear to many of these founders that perhaps they are not the right people for the job.
There are more family run companies than public companies in the United States. So your chances of becoming CEO as a birth right are much higher than climbing the corporate ladder. But here too the CEO job can become a perilous perch.
Other CEOs come from climbing the corporate ladder. They are either good at their prior jobs, show promise in leadership and decision making, or perhaps are just good at the game of office politics. They get appointed by their boards into the job.
But are any of these CEOs really qualified for the job?
What we have found from the years that we have spent working with some of the best (and in some cases some of the not so good) CEOs, is that how they came about capturing the job had little to do with their capabilities. There are some good CEOs who were simply the next generation of their families. There are some that founded companies. And there are some that climbed the corporate ladder. The characteristics of the good ones all seemed to coalesce around a similar set of habits and characteristics.
Our hope is that if you aspire to the role of CEO or already are one today, you probably should consider how you can get good (or better) in that role. The difference between a mediocre CEO and a great one can be the difference between literally tens or hundreds of millions, or even billons of dollars of stakeholder wealth. While we don’t believe that CEOs alone are what causes companies to succeed or fail. It is clear that without a good CEO, a company is clearly hindered in its ability to succeed.
But what about CEOs? The top office, perhaps the most critical position within entities who themselves control more wealth than some nations, need pass through no such process. There is no continuing requirement for CEOs to stay current on what is going on in business, in their industries, or on how to become better CEOs. Sure, there is business school. But, to our knowledge, there is not even one course given at Harvard Business School that pertains to how to do the job of CEO.
So how do you qualify to become a CEO? Are you just anointed? Is it your family connections? Or did you do it yourself?
Certainly there are many CEOs who become just that by founding the companies that they run. Often, as these companies grow, the founders find that the job has outgrown them. Whether this occurs voluntarily or is forced upon them by their investors, it becomes clear to many of these founders that perhaps they are not the right people for the job.
There are more family run companies than public companies in the United States. So your chances of becoming CEO as a birth right are much higher than climbing the corporate ladder. But here too the CEO job can become a perilous perch.
Other CEOs come from climbing the corporate ladder. They are either good at their prior jobs, show promise in leadership and decision making, or perhaps are just good at the game of office politics. They get appointed by their boards into the job.
But are any of these CEOs really qualified for the job?
What we have found from the years that we have spent working with some of the best (and in some cases some of the not so good) CEOs, is that how they came about capturing the job had little to do with their capabilities. There are some good CEOs who were simply the next generation of their families. There are some that founded companies. And there are some that climbed the corporate ladder. The characteristics of the good ones all seemed to coalesce around a similar set of habits and characteristics.
Our hope is that if you aspire to the role of CEO or already are one today, you probably should consider how you can get good (or better) in that role. The difference between a mediocre CEO and a great one can be the difference between literally tens or hundreds of millions, or even billons of dollars of stakeholder wealth. While we don’t believe that CEOs alone are what causes companies to succeed or fail. It is clear that without a good CEO, a company is clearly hindered in its ability to succeed.
Subscribe to:
Posts (Atom)