When it comes to looking for partnerships as part of a value chain, one area tends to be neglected. Usually, business people will develop their business plan properly, identify their market and their source of supplies, and make sure that the math is solid. Beyond the numbers, there is always the human factor that will play a role. Every company, therefore every partner in the chain has its own specific culture. This is important to realize, because when cultures, and values, do not match, the relationship will always bring some hardships at some point. This is not a simple problem to solve, and usually, only few potential partners share your values. It is also important to realize that the word “values” does not necessarily imply good ethics and honesty. After all, hyenas move in packs. Sometimes, the partner that can help grow your business the fastest might not be the right one for the long-term, but it might be the best choice for now. Depending on in which region of the world you do business, the sense of time, sometimes even of urgency, can vary a lot. For instance, North Americans tend to want to start business immediately, while the Japanese will take all the time they need to find out whom they do business with, and build enough of confidence in their potential partner before starting business. In the land of the rising sun, it can take several years before the first transaction takes place.
What are the risks of a mismatch of values? It can have serious consequences, depending on how much of your business is engaged with the “wrong” partner. It can range from dissatisfaction about the profitability of your business, constant disagreements and tensions with your business partner, to your being ripped off. One thing is sure: there will never be complete trust and loyalty when values are not aligned. Several years ago, I developed a quantitative system to evaluate the value of a business partnership. It is rather simple in its design and very powerful in its implementation. It helps identify the strengths and the weakness of the business relationship, and it is an amazing to tool to use to address potentially damaging issues over time, and create clarity for future dealings. By realigning values, both business partners can develop a plan of action and look beyond the price negotiations alone.
The importance of values in value chains
October 1, 2010CNN – TED Talk – Big bonuses do not mean big results
March 2, 2010Really interesting presentation that makes you think on HR policies and performance.
http://www.cnn.com/2010/OPINION/03/02/pink.motivation.bonuses/index.html?hpt=C2
Maybe money does not buy happiness after all
January 12, 2010Interesting article and slide show found on CNBC. Here is the text:
As it turns out, some of the highest income states are among the unhappiest, according to a recent study by economists Andrew J. Oswald and Stephen Wu, of the University of Warwick and Hamilton College, respectively.
Taking into account both subjective and objective factors such as sunshine, congestion and pollution in a survey of 1.3 million Americans between 2005 and 2008, the researchers determined which states have the happiest – and unhappiest – residents. Among the happiest are Louisiana, Hawaii and Florida.
“Some might be surprised that states in the south with lower income ranked as high as they did,” said Wu, economist at Hamilton College. “States with high income rate fairly low on the happiness levels. To some it might seem counterintuitive; it’s not just about income levels, but those places might be more crowded, more congested on the roadway, [have] less available land.”
For the slide show click on this link: The Unhappiest States in America
Rent or Buy?
January 2, 2010It can be very tempting to buy a home before you are ready. Why pay rent when you can pay a mortgage instead, and own your home?
When you buy, you have to pay the mortgage, and property taxes, and pay for repairs that become necessary. When you rent, you only have to make the agreed-upon rent payment. Most repairs are not your responsibility. You can move easily when your lease is up if your life changes.
If you borrow $300,000 to buy a home, and the interest rate is 5%, you must make a payment of at least $1250 a month just to cover the interest that is accumulating. If you want to pay down the principal of $300,000, then in the first year, for example, to reduce the principal by $12,000, your mortgage payment would be $2250 per month. If you only pay the interest, you are just renting from the bank, and you are still responsible for repairs and property taxes. If interest rates go up, which will happen eventually, as they have been at or near historic lows for many years, then either your payments must increase, or it will take longer to pay off the mortgage.
There are many mortgage calculators on the internet. The calculator on the Coast Capital website, https://www.coastcapitalsavings.com/Tools_Calculators/RentvsBuy provides a good comparison between renting and buying. Create a few scenarios, and pay close attention to the amount of interest you pay. The numbers may shock you.
Take the time to accumulate a good down payment, and funds for property taxes, closing costs, and unexpected repairs.
Buy when the time is right for you, not because your family or friends or news reports say that now is the time to buy.
In the end, it is all about happiness
November 11, 2009Although we sometimes tend to deny it or to forget about it, but in the end all our actions are about happiness.
At work, people want to have a rewarding job, they want to feel appreciated and make the money they think they deserve, the boss wants to see good results, and the customer wants to get the proper quality. In our personal lives, we look for the right relationships, we have hobbies, and we like spending time with our friends and loved ones.
Why do we wish for all of the above and for more? The answer is simple: when things go our ways, it makes us feel good, it makes us feel happy!
Why do people change jobs? Why do people divorce? For these questions, too, the answer is simple: we change our lives when we are not happy about them. Yet, not everyone makes such changes and some settle with the unsatisfying situation. Does this make sense?
It does if we listen to the theory of Henri Laborit, a French neurobiologist and writer who studied human behaviour when people face adverse situations. According to him, we have three ways to deal with unpleasant situations such as conflicts: running away, fighting back or inhibition. In the French movie Mon Oncle d’Amérique, we can see illustrations of his works thanks to a comparison of life situations with the lab experiments. The research background he shows are experiments with lab rats. In the first experiment, the rat is in a cage with two compartments separated with a wall with an opening allowing the rat to change compartments. Only one compartment has a floor that can be electrified. The rat gets a warning with a buzzer and 4 seconds later the current flows in the floor. Very quickly, the rat realizes that when it goes into the other compartment where the floor is insulated, it escapes the punishment and all physical tests carried out show that the rat is in perfect health. The rat is fine.
Then the operator shuts the opening between the two compartments, the rat cannot escape the punishment. Very quickly, we can see the rat being completely stressed with its hair straight up and breathing quickly. The rat is not doing well at all.
Then, they add a second rat in the cage, and both rats have no other choice than take the electrical current. Instead of getting stressed and ill, the rats fight with each other, and it appears that this helps the dominant one to be perfectly healthy again.
We face this type of situations everyday in our societies. Sometimes, we choose to run away from difficult situations such as quitting a job because of a bad boss, instead of enduring stress every day. We sometimes can fight back, even fight, although our laws do not accept violence as a way of resolving conflicts. When people have no possibility to run away or fight, Henri Laborit’s theory is that they choose inhibition and do nothing at all. They simply take the punishment. Some can compensate this by fighting with their spouses at home, but this usually does not bring much good, either. According to Laborit, inhibition is the stage of angst, and angst is the result of the inability to cope with a situation that seems to have no solution. This usually results in ailment and even diseases, be it physical like ulcers or even cancer, or be it psychological leading to neurosis or depression. Turning against the own body becomes the way of fighting back, and the ultimate act of violence, one can commit against oneself is suicide.
On the other hand, he also noticed that when the rat experiences something that brings satisfaction and pleasure, its natural impulse is to get more of it. If it feels good, then it must be good!
I believe that this illustrate nicely how important it is to always try to look for satisfaction in our lives, at work and at home.
Excerpt from Mon Oncle d’Amerique (In French)
Genchi genbutsu
October 16, 2009This is an interesting article from Economist.com about the Japanese way of getting out of your office and about having a look at what is going on in the plant.
I like the part in which the author tries to compare the Japanese way and the American way. In my opinion, there is not much point in doing that. The best is to review what the strengths of both approaches are and build an even better system from there.
If you want to be an effective manager, you need to have a hands-on approach!
Posted by Christophe Pelletier 






