Today the ITLG (Irish Technology Leadership Group), a group that aims to bring the experience and expertise of Silicon Valley to Ireland in order to create jobs and bring success to the island of Ireland, announced that the former Intel chief executive and former chairman Dr Craig Barrett has been appointed chairman of ITLG. As a non-profit independent organisation ITLG is able (or claims that it is able) to assist Irish technology fledglings to become global players. The appointment is indeed a significant because one of the espoused ITLG aims is to provide experienced support, access to financing and active market development thereby reducing risk and increasing the chances of success. And we all know how important exporting our way out of the mire is to us all.
Importantly this kind of initiative is significant as it tries to overcome the obvious shortcomings of EI and its legendary bureaucracy. As Irish companies try to sell abroad it becomes more and more important to have access to experienced connected operators. ILTG will in time provide invaluable opportunities and advice to Irish companies to expand and develop in the United States. So much so that the Irish Government is providing financial support to the organisation. I wonder how EI are feeling about this?
Either way the success or otherwise of Ireland depends on our ability to invest in education and research and to promote innovation – thereby winning export income. The ITLG's CEO, John Hartnett, said "When 160 business leaders from the Irish economic Diaspora met at a summit in Ireland in September, Craig Barrett presented a candid analysis and a compelling call to action for investment in Irish innovation. Today, he underscores that with a phenomenal personal commitment to ITLG's mission to forge even deeper links between Silicon Valley and Irish technology in support of the next generation of Irish innovators.”
From Craig Barrets bio on Intel.com: Craig R. Barrett was Chairman of the Board of Intel Corporation from May, 2005-May, 2009. He became Intel’s fourth President in May of 1997 and Chief Executive Officer in 1998. He was elected to Intel’s Board of Directors in 1992 and served as Chief Operating Officer from 1993 to 1997. Barrett began his tenure at Intel as a Technology Development manager in 1974. Prior to joining Intel, Dr. Barrett was an Associate Professor at Stanford University in the Department of Materials Science and Engineering.
Members of ITLG include John Hartnett, chief executive of G24i, Inc. John Gilmore, CEO of Sling Media, Conrad Burke, president and chief executive of Innovalight, Rory McInerney, vice president, Intel and Barry O’Sullivan, senior vice president at Cisco.
I read this paper recently and decided to try to share it - it arises out of an Economist Intelligence Unit survey which polled business decision-makers from North America, Western Europe and Asia-Pacific across a wide range of industries and company sizes.
The main findings were that:
Download the paper free here:
People rightly say that the role of Government is to provide an orderly society and a frame work within which we can live securely, but it also provides an enforceable (through the Gardai & Courts) set of values which control the functioning of our society. Within the laws are embedded (hopefully) our cultural norms and as members of our society we have an obligation to work within these norms and values. If you don't want to conform you can drop out altogether or leave.
The rules should apply to all citizens equally. They don't. Criminals wearing a Dick Turpin mask, a Louis Copeland suit or a priests robe consistently remind us of our diversity and failings. Failings that sap the energy and life from the normal law abiding citizens.
The Garda representatives recently stated that they would break the law in order to defy Government policy and that they are willing to pay the consequences for their illegal actions.
I would remind them that when you have a strong convictions that you are right and they are wrong, i.e. that the laws are in need of change. It may well be that you are willing to pay the consequences for your illegal actions. But what of the consequence for the rest of us in terms of law and order and the respect for the law enforcers?
Unfortunately, in measuring whether people are making decisions that are socially responsible, there is no reason to expect that they might follow a higher standard than that provided by the law, since the law seems to define only the high watermark of our social norms.
If we desire to have a particular moral or ethical view be a value in our society, then we should move to make laws that reflect these values. Not break the laws. The purpose of laws is to have an orderly society that maintains the values of the culture at large - that includes the Gardai.
I was scanning the Sunday papers last night and could not help wondering about the levels of guff churned out these days (including this blog) - so much so that I counted the number of articles I actually fully read. Only five. Every other piece of content was scanned at best. Most of my effort in reading the paper was trying to stay connected to my world. But it only served to disconnect me and in fact made me a little less satisfied.
This morning I listened to the radio as I drove to my meeting - it stimulated me and engaged me - like good media should. Like my favourite magazines and like good TV, it connected. Newspapers on the other hand are battling hard for my readership but with the mess they are in it's hard to see many survive over the next 10 years in their present guise. I guess they are waning in their sphere of influence. They have never really done it for me. Maybe they never will.
I read an interesting article today by Olivier Pujol. Oliver, writing in iCEO, was bemoaning the fact that acquisitions have a terrible habit of going sour. I would tend to agree and am interested to share Oliver's insights and add my own take.
Surveys show that, on average, mergers and acquisitions destroy value. Highly publicised successes are not sufficient to compensate for disastrous ones. Yet, it is relatively easy to set the ground rules for good acquisitions. In my opinion your professional advisor will claim to know or should know the pitfalls, but at the same time they (professionals) keep getting it wrong or allowing us to get it wrong at an alarming rate:
Oliver says that rules broken include:
• Make acquisitions beyond the scope of their strategy (think ebay nd skype)
• Produce unrealistic business projections to accommodate the demands of the deal (timewarner and aol)
• Fail to implement integration plans (Sprint and Nextel Communications)
• Fail to communicate with all the stakeholders (all of the above)
According to the author; the mechanisms leading to these repeated mistakes are too powerful and overcome experience and wisdom; because M and A is a fascinating activity, with stakes far beyond simple efficient business; because closing an acquisition is a short term objective (we all know how powerful they can be), and making it profitable is a long term activity (we all know how difficult that can be).
Pujol claims that surveys consistently illustrate that:
• one fourth of all acquisitions create value far in excess of initial expectations (very positive NPV [net present value], above budget)
• one fourth of all acquisitions perform less than expected, but pay the cost of capital (positive NPV, below budget)
• one fourth of all acquisitions destroy some value (negative NPV) even though cash flows remain positive
• one fourth of all acquisitions end up generating negative cash flows.
In half of the cases, the buyer would have been better off not doing the acquisition. And worse, the aggregated Net Present Value of all M and A activities seems to be significantly negative. In other terms, we would be better off without M and A.
The economic crisis that we are experiencing has demonstrated at length that professionals with excellent technical skills could work their best to create major failures affecting people’s lives. Some of the lessons learnt were:
- short term goals may lead to major wrong decisions
- excessive trust in technicality obscures economic reality
- self interest make people lose all commonsense
- passion for figures and money challenges consideration for other human beings.
Lessons learnt from acquisitions are very similar in many aspects. But money pains are not the most important. There is much more than figures at stake. All acquisitions result in real people losing their jobs.
But bad integration results in unnecessary and often irreversible damage - human and finacial. And managers should never accept that. It’s not an operational mistake anymore, but a human fault. It is high stakes gambling unless the rules are followed religiously.