A must-read for all the survivors.

Global round-up

AN OVERUSED word is globalisation. Here is one more book about this topic, and you sigh, ah. But John Micklethwait and Adrian Wooldridge go about gathering evidence — "from the shantytowns of Sao Paolo to the boardrooms of General Electric, from the troubled Russia-Estonia border to the booming San Fernando Valley sex industry" — to write A Future Perfect and answer questions such as whether globalisation will continue to change our lives or do businesses benefit from going global. A few excerpts:

Many markets for products still stop at national borders. Nearly all of America's light-bulbs are still made in the US, largely because transport costs are too high to justify moving the factories elsewhere. A Canadian province trades 12 times as many goods and 40 times as many services with another Canadian province as it does with an American state of similar size and proximity. In the EU, people are still six times more likely to trade with their countrymen than with people of other European countries.

News programs may still illustrate their reports on the money markets with scenes of hollering traders, but most transactions take place silently, at the touch of a computer key. Indeed, one reason for the wave of mergers and acquisitions that has swept through the banking industry arises from the need to pay for all the high-tech equipment that modern finance demands, as well as for people who can understand it. If you want to find a world-class mathematician nowadays, you might find him at Goldman Sachs sooner than at MIT.

Almost as important as how it has tailored its products is how Nokia has tailored its people by relentlessly preaching the virtues of transparency and humility. Visitors to the firm's modernist headquarters are reminded constantly that "there are no dark corridors in Nokia". To prove the point, the building is transparent to the sky and nearby water and covered with 26,000 panes of glass.

There has always been a delay between the economic changes that usher in a new way of life and the formation of a new economic elite. It took decades for the factory owners who wrought the first industrial revolution in Britain to transform themselves from an economic interest group into a self-conscious class, sending their children to the same schools and making sure they married each other's sisters.

In 1998, the combined income of the 13,000 richest families in the US was almost as big as that of the 20 million poorest families. And many of the rich have done nothing to earn their wealth other than sit on booming assets. An American who owned five hundred thousand dollars' worth of shares and a five hundred thousand dollar New York apartment in 1988 and has done nothing since other than hang on to them is now around five million dollars richer.

A book that you can hang on to.

Be and make

ALL BOSSES want high performance from their teams but how does one build a high-achievement culture. The secret is this: Firms that emphasise the highest standards of employee professionalism are invariably more financially successful than those that don't, says David Maister in his book Practice What you Preach. More:

Yet not only are people a key link in the chain of activities that create profits, but we are also living through a war for talent — a people crisis — where every business is short of people. To be weak in this area is akin to shooting yourself in the foot.

The demand to keep learning new things is made palatable because we actively work at helping people dream, and because it is fun." (A case study)

The amount of time spent thinking about, screening for and appointing the best managers pales in comparison.

To find the courage to keep trying to attain new levels of performance, people must believe in their heart of hearts that the manager actually does believe what he or she says about the firm's standards, mission, vision and strategies.

A book of best practices for the professional service firms.

(Books courtesy: Fountainhead, Chennai. E-mail: fhbooks@satyam.net.in)

Tailpiece

"We have two auditors."

"Internal and external?"

"No, honest and otherwise."

hindubusinessline@hotmail.com

D. Murali

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