Lead, follow or get out of the way!

On the tenth anniversary of the launch of Google, the company has been awarded a US patent for the ‘self driving car’.  The intellectual property rights relate to a method to switch a vehicle from a human-controlled mode into the state where it takes charge of the wheel.  It explains how the car would know when to take control, where it is located and which direction to drive in.

The application for Transitioning a Mixed-mode Vehicle to Autonomous Mode was applied for in May, but had been hidden from public view until this week.  Patent experts note that Google’s patent will not prevent others developing rival self-drive vehicles.

“This patent, which is effective in the US only, would only be enforceable to prevent other companies from using the same specific method and not to prevent other companies also providing autonomous vehicles in general,” said Andrew Alton, a patent attorney at Urquhart-Dykes & Lord.

Apparently Google has been testing a fleet of driverless cars for several years.  The test cars have travelled along Highway 1 between Los Angeles and San Francisco, over the Golden Gate Bridge and elsewhere. Two humans were on board at the time – one to oversee the driving and intervene if necessary, the other to monitor the equipment from the passenger seat.

On hearing this, we here at Zeitgeist got to thinking about the ‘self driving organization’ – a Nirvana state where everyone understands where to focus and leadership to drive the organization becomes just an outdated business practice.  Then we remembered that unlike a technical object with no feelings, conscience and will, human beings are significantly complex beings that require leadership to maximize their potential.

While the concept of organizational self-governance has been studied for years, perhaps the Brazilian firm Semco SA is the only organization to have successfully managed industrial democracy with any degree of success.  Ricardo Semlar’s organization has been visited by many major companies and yet the move to copy the model has been non-existent despite the growth and financial rewards achieved by Semco through their model.

To this end then, it seems like we are destined to continue down the investment in leadership path as we deal with complex adaptive systems more commonly labeled as humans.  The move away from command and control to more of a self governing culture is certainly more appropriate for the latest generation of employees but for us at least, leadership and good governance is here to stay.

Experts say driverless cars could become a commercial prospect sooner than most people believe.  For leaderless organizations the prognosis is not so good…

Europe’s bad haircut

This week, Europe’s leaders are holding an emergency summit in Brussels aimed at tackling the eurozone debt crisis.  The meeting will try to agree a plan that was thrashed out at the most recent in a series of summits convened to address the eurozone’s problems.

In the past year, problems have spread from Greece to the Irish Republic and Portugal, to Spain, and to Italy. Now, even France is beginning to look vulnerable.  As a result, many commentators are of the view that the outcome of this meeting will determine the future of the single currency in Europe.

Once again the situation is described as ‘being on a knife edge’, with the potential economic ramifications, both for the EU and the rest of the world, profound.  And yet there still appears to be a basic lack of consensus amongst Europe’s leadership over the true situation and how best to address it.

At this stage many areas of disagreement remain and many issues still need to be ‘fixed’, including; how best to expand the European Financial Stability Facility (better known as the bailout fund for debt-ridden countries), how to reduce Greece’s debt mountain before it is forced to default and how to protect those banks that are vulnerable as a result of lending to highly-indebted countries.

Of course, the situation is further complicated by political self-interest.  A sub-plot to all the discussions is the realization that a ‘bad deal’ for their own country would dramatically shorten the career of the leader in question.  This is at the heart of the row between France and Germany over Greece’s “haircut”.  In essence, Greece will simply be allowed to pay back less than it actually borrowed. This means those institutions that lent money to Athens will have to write off some of the money they are owed.  France is concerned because its banks have lent more heavily to Greece, and are therefore more exposed, than those in Germany.

So, here we are: a continuing lack of consensus regarding the ‘true’ underlying situation; no agreed plan to address the root causes of the issues; disagreement over priorities and urgency; stakeholders still promoting their own interests ahead of the greater good; systemic slow decision-making and, most worrying, no respected, unifying leadership.

If the EU was a business, its days would be numbered.

Recruitment not working?

Recent research indicates that even the very best employment advertising is viewed by less than ten percent of suitably qualified candidates. Furthermore, the response rate of these suitable applicants is a damning 1%.   When hiring for senior positions, the statistics are even worse.

Clearly these figures are representative of a systemic failure of ‘the standard’ approach to recruitment, but how can this actually happen?  By way of illustration, we conducted a straw poll of 100 senior leaders in a variety of industry sectors and asked them a simple question… “How up to date is your resume?”

In reality, we expected the majority to say that their resume was at least moderately out of date but we were surprised to hear that over 70% of the senior leaders questioned don’t even have a resume and, in fact, they don’t recall the last time they responded to a career advertisement. 

Ask those same individuals if they were seeking to attract another senior leader to their organization what might a benchmark profile look like, and they will usually refer to one of the existing leadership group.

So what? Well, this means that in reality the person you really want to hire is not actually seeking a new role and is almost certainly not looking at your ad online or in the newspaper, no matter how nice, big, or expensive it is.

Let’s assume that you’ve reached the point where you have decided to hire a recruitment firm.  Your research into the many companies available should result in a fairly rapid realization that the majority of firms base their business models on an extension of the advertising model, supported by an extensive database of applicant resumes.

However, we’ve already established that virtually none of the leadership team has a resume registered with anyone and, if they did, they are not at this point interested in “other opportunities”.  Many of the larger retained firms do work hard to maintain an extensive network of contacts but, if that was exhaustive, we would never see recruitment firms advertising.

The approach to recruitment projects has evolved over the years but the majority of projects are still defined by senior management before being delegated, usually to an internally focused human resources department.

The problem here is that the human resource profession has been the primary contributor to the development of data management systems which are designed to generate, sort and screen resumes; a system which is shared by the majority of recruitment firms.  While these systems have proven effective in surplus markets, they have no place where critical, qualified, resources are known to be in deficit.  The caliber and quantity of options are negatively impacted and business objectives compromised.

The thing is that critical and strategic recruitment initiatives need to be just that – critical and strategic.

A recruitment project needs to be managed in similar fashion to a major business development initiative.  The target market needs to be exhaustively researched to identify information that can be utilized in the development of an acquisition plan.  The recruitment ROI (the fiscal return that should be achieved as a direct result of recruiting the ‘ideal’ individual) also needs to be determined.  Once all the viable targets have been assessed, the “ideal” options can be professionally introduced to a market aligned business plan with clearly defined contribution and benefit points that represent a logical career transition and professional acceleration opportunity.

We must acknowledge that no one voluntarily changes employment without significant expectation of improvement.  Those performing at a high level are typically receiving the professional and financial recognition to keep them engaged and unlikely to seriously consider casually presented options.  While there are definitely exceptions, they are just that, exceptions, and most business leaders would not want to base their business’s future on that.

This commentary is certainly based on current market conditions but, based on the demographics alone, available and accessible talent is expected to decrease for the foreseeable future.  Those organizations which are first to recognize that they are not the “buyer” in this market and who develop programs to define, pursue and acquire the caliber of talent essential to long term business growth, will be the ones to prosper.

This week’s guest blogger is leading human capital strategist, Mike Palmer.

Mike is a partner with Chapman & Associates, a human capital consultancy which supports clients with business intelligence, counter measure strategies and aligned advisory services to establish the ‘acquisition of expertise’ as their competitive advantage.  Mike can be reached at m.palmer@chapmanassociates.ca

 

Busted

A couple of weeks after the news that Blockbuster Canada’s remaining stores are set to close, the media story is moving on to the inevitable loss of jobs and the imminent availability of large amounts of commercial retail and office space.

It seems that each Blockbuster store employs an average of 10 people, meaning about 2,500 people could be out of work in addition to the 1,400 people who lost their jobs during the first round of store closures earlier this summer.

So what happened to this once dominant global player?  According to the Receiver last week “As a result of the significant changes in Blockbuster Canada Co.’s competitive landscape, the company’s ‘bricks and mortar’ business model has experienced significant challenges over the last few years, largely due to the proliferation of various alternatives available to media consumers in Canada.”

By way of background, in May this year Blockbuster Canada was placed into receivership by an Ontario court as a result of a combined US$70 million claim made by a number of movie distributors, including the Hollywood studios that provide its DVDs.

Previously the Canadian operations had acted as a guarantor for Blockbuster’s U.S. business, which filed for Chapter 11 bankruptcy protection in September 2010, while it attempted to restructure its debt.  This seemingly last-gasp action was aimed at reducing the company’s debt from circa $1bn to around $100 million, with the hope that it would enable the company to compete with rivals; something that it had not been able to do in recent years.  Blockbuster U.S. was later sold to American satellite TV provider Dish Network Corp, who declined to buy the Canadian operation but left it to pay the bills.  Dish Network also pushed to prevent Blockbuster Canada from using the highly recognized brand name going forward.

It’s all a bit of a mess… but the reality is that Blockbuster had been struggling to stay relevant in a time of increasing digital movie downloads facilitated by the dramatic increase in internet accessibility together with an associated increase in data transfer speeds opened new channels to market.

It’s clear that the Internet and accelerated digital streaming are here to stay and, with ever faster download speeds, the user experience is set to improve even further.  At the same time there has been a fundamental shift in consumer preferences and expectations.

Rivals to Blockbuster, such as Netflix, quickly took advantage of these changes and stormed ahead as they harnessed the opportunities presented.  Blockbuster, on the other hand, struggled to service its debts and the resultant lack of liquidity led them to become increasingly inwardly focused as they fought to stay afloat. As a result, Blockbuster was forced into a turnaround position, reworking its strategy and attempting to differentiate itself from rivals as the only company to provide products across multiple delivery channels.

Our recent blog ‘Navigating Choppy Waters’ spoke about the increasing challenge of staying competitive in increasingly uncertain and rapidly changing economic conditions and detailed the ‘Top 5’ steps every company must take.  The Blockbuster example further demonstrates that in order to compete over the long term, companies must focus externally and on the surrounding business realities and not just internally.

Perestroika, Pigs and Lipstick

In an interview in The Guardian this week the former Soviet leader Mikhail Gorbachev makes some interesting comments about his time in office and, more specifically, some of the errors that he made.

One of those key errors was trying to continue reforms within the Communist Party which he now feels he should have abandoned earlier and established a new democratic party.

As the interviewer suggests, Gorbachev was always in a different class in terms of world leaders and therefore his objective assessment of his key mistakes during his six tumultuous years at the helm should not be a surprise.  Asked to name the things he most regretted, he replied without hesitation: “The fact that I went on too long in trying to reform the Communist party.” He should have resigned in April 1991, he said, and formed a democratic party of reform since the Communists were putting the brakes on all the necessary changes.

He goes on to say that the Communist Party “had become a brake on reforms even though it had launched them. But they all thought the reforms only needed to be cosmetic. They thought that painting the facade was enough, when actually there was still the same old mess inside the building.”

Mikhail Gorbachev - World class leadership

 

The popular saying “if you put lipstick on a pig, it’s still a pig” sums up this issue nicely and in business it can be used to describe those situations where companies communicate reform and change but in reality stifle that change  – either intentionally or unintentionally.

Talking change and reform at the boardroom table means nothing if that change is not facilitated widely throughout the organization via a meaningful, structured plan and with the requirements being supported and understood by all.  It is critical that the change and the reasons for the change is believed in by the leadership team.

Strong ideas, weakly held will not bring meaningful and sustainable success.  Worse still is having a view that talking change is sufficient and that normal service will be resumed shortly.

Equally expecting instant results; not taking the time to engage with stakeholders, doing it on the cheap; expecting everything to go smoothly and a host of other “easy solutions” simply aren’t realistic.

Gorbachev listed several achievements he was most proud of, starting with one word: “Perestroika.”

Meaning restructuring, Perestroika was the program of reforming the Soviet Union’s political and economic system that Gorbachev set in motion soon after he came to power in March 1985.  If you are considering Perestroika in your own organization ensure that you have patience and take a long term perspective.  Devote appropriate resources to the effort, and have a robust plan.

The Past has Passed

An enormous jawbone found in Kazakhstan is further evidence that giant birds roamed – or flew above – the Earth at the same time as the dinosaurs.  If flightless, the bird would have been 2-3m tall; if it flew, it may have had a wingspan of 4m.  The find is only the second bird of such a size in the Cretaceous geologic period, and the first in Asia.

The only other evidence of a bird of such a size during the period was a fossilised spinal bone found in France in 1995.  Dr Darren Naish of the University of Portsmouth says “This fossil is only known from its lower jaw, so unfortunately we can’t say anything at all with certainty about the shape and form of the whole animal.  If it was flightless and sort of ostrich-shaped, it would have been maybe 2-3m tall and somewhere over 50kg,”

For 150 years, a species called Archaeopteryx has been regarded as the first true bird, representing a major evolutionary step away from dinosaurs. Archaeopteryx has a hallowed place in science, long hailed as not just the first bird but as one of the clearest examples of evolution in action.

Discovered in Bavaria in 1861 just two years after the publication of Darwin’s Origin of Species, the fossil seemed to blend attributes of both reptiles and birds and was quickly accepted as the “original bird”.  However all this leads to that fact that there is a great deal of confusion in the field says Prof Lawrence Witmer from Ohio University, as scientists try to understand where dinosaurs end and where birds begin.

Having given this ongoing debate some thought we got to thinking about how much time is spent looking to the past in business and wondering if our allocation of time appropriate.  A typical business we work with might spend 70% of it’s time reviewing the past, 20% considering the present and perhaps 10% focused on the future – not unlike out scientist friends trying to prove the origin and evolution of birds.

Much time and effort is spent on what happened last week, last month, or last year. This is not to say that looking at the past is not important to create the future, but we must look to the past to learn, not to re-live.

Similarly, time allocated to the present is often spent on telling stories and justifying current results. It is important to understand the present and we must do so by sticking to facts to better enable us to move forward. If we continuously justify our current results, we will never improve.

Finally, time allocated to the future is spent on describing the way things should be.  Although it is obviously important to create a clear picture of how things could be, we must also spend time determining what needs to be done to create the desired future.  So, we suggest that the allocation of time should look like this:

• Past – 10%
• Present – 20%
• Future – 70%

Importantly, not only does the allocation change, but the content of each does as well.

• Past – Spend time looking at ‘the past’  to learn from it.  This information will be used to create strategies for a better future.
• Present – Time spent on the present must be focused on facts and data to help us better understand where we are today
• Future – Time spent on the future should be to determine exactly what we want the future to be like and what we must do to make it that way.

So unless you are a palaeontologist, don’t spend the majority of your time looking at the past and perhaps even becoming victim to it.  Reassess the allocation of your time and become more future orientated.

The past is passed – the future is where the profit lies…

Navigating Choppy Waters

Here at Zeitgeist we’re big fans of the ‘great outdoors’ and particularly appreciate the beautiful and rugged scenery in Canada.

One of the best things about living in Canada is the opportunity to participate in a wide array of activities in stunning surroundings. One ‘activity of choice’ for many is kayaking.  Kayaking is a wonderful sport which can be as demanding or as gentle as the participant requires and, provided that basic physical requirements are met, all that is really necessary is the ability to both paddle and keep an eye out for other boats and obstacles.

However, for some, this seemingly straightforward combination of physical and visual skills can actually be quite the challenge.  During a recent floating expedition this became particularly evident when, having completely failed to notice the waves created by a large boat just ahead of the group of paddlers, a member of the Zeitgeist team paid the inevitable consequence – much to the amusement of the rest of the group.

This (soggy) occurrence reminded us of a recent conversation with a prospective client about the importance of keeping an eye on the wider environment, no matter how challenging things are closer at hand. His company had recently been focusing all their attention on addressing a range of internal issues, following the acquisition and integration of a competitor. As a result they had been paying scant attention to the vagaries of their market.

Vancouver Kayaking

 

The (perhaps) inevitable result was the loss of one of their largest accounts to a competitor who had introduced an innovative payment cycle for those global clients who would commit to longer term contracts in return for budget certainty, while exchange rate markets remained volatile. The prospective client’s ‘growth by acquisition’ strategy remains valid but they had temporarily overlooked the importance of ‘looking out of the windows’ of their business for the waves created by events that are outside of their control.

As the US faces the very real prospect of a double-dip recession, the money markets slump once more amid US uncertainty and Eurozone debt fears and the majority of Western economies race to devalue their currencies, what can you do to stay afloat in these choppy waters? Here are our top tips:

- Regardless of whatever internal challenges are demanding attention, make it a priority to ‘look outside of the company windows’ for those unexpected waves.

- Undertake regular environmental scans and answer the following questions:

o What are the top 5 Macro (Global) and Micro (Industry) drivers that are affecting us right now?
o What were the Top 5 Macro and Micro drivers 5 and 10 years ago?
o What do you think the Top 5 will be in 5 years?  Think about trends, customer expectations, technology, geo-demographics and political/legislative changes.
o What is most likely to change (be specific!)
o What is unlikely to change / what will be stable

- ‘Stress Test’ your existing strategy: Map it against the above environmental factors and look for gaps, risks and opportunities that you have previously overlooked.

- Prioritize all activity and monitor your progress towards your goals.

- Be flexible and adjust your strategy, filling in gaps and refining it to mitigate risks and exploit new opportunities as they arise.

The future can never be certain and change is inevitable.  In order to stay afloat, businesses need to have a robust strategy planning process which delivers a strategy that is reflective of the aims and drivers of the organization and the current internal and external situation.  At the same time it must be flexible enough to adapt as the future unfolds…

Prime Time

Prime numbers are found hidden in nature. Buzzing quietly beneath the planet we inhabit is an unseen world of numbers, patterns and geometry. Mathematics is the code that makes sense of our universe.

In the forests of Tennessee this summer, part of this code will literally emerge from the ground… Every 13 years, the normal country music sounds of Nashville get drowned out for six weeks by the chorus of an insect – the mysterious Cicada. Only found in the eastern areas of North America, this Cicada’s survival depends on exploiting the strange properties of some of the most fundamental numbers in mathematics – the primes, numbers that are only divisible by themselves and one.

The Tennessee Cicada:

A bug in the system…entirely different!

The Cicadas appear periodically but only emerge after a prime number of years. In the case of the Nashville species that number is 13. The forests have been quiet for 12 years since the last invasion of these mathematical bugs in 1998 and the locals won’t be disturbed by them again until 2024.

This choice of a 13-year cycle doesn’t seem too arbitrary. There are another two groups across North America that also have this 13-year life cycle, appearing in different regions and different years. In addition there are another 12 groups that appear every 17 years.

Sure, you could just dismiss these numbers as random. But it’s very curious that there are no Cicadas with 12, 14, 15, 16 or 18-year life cycles…

Because 13 is indivisible it gives the Cicadas an evolutionary advantage as primes are helpful in avoiding other animals with periodic behaviour. Suppose, for example, that a predator appears every four years in the forest. Then a Cicada with an 8 or 9 year life-cycle will coincide with the predator much more often than a Cicada with a 7 year or 13 year prime life cycle. These insects are tapping into the code of mathematics for their survival.

In a bizarre leap of intuition, this got us thinking about the relationships among industry life cycles, technological change, and firms’ strategic choices – relationships that are central to the fields of strategy, economics, and organization theory. The field of Strategic Management has recently explored a range of new questions regarding innovation, technological change, organization capabilities, and leadership decision-making. This exploration has produced many insights regarding how firms develop and how competition unfolds over time.

At Zeitgeist we use the Industry Lifecycle model in helping our clients develop strategy. Here is the model in a nutshell. Industries typically start off with a period of fragmentation, as companies experiment with different approaches. With time, a scalable approach emerges as a dominant model, often because it yields greater efficiencies than available alternatives. The dominance of the model also depends on the abilities of those invested in it to disseminate the model among key customers, suppliers, and other vital constituents. As the dominant model develops, an industry goes through a shakeout as unaligned firms are forced to exit. Eventually, firms find it difficult to improve their productivity on the dominant model at high rates, volume growth hits a point of diminishing returns, and the industry enters maturity. Ultimately, as volumes drop because of saturated demand or exhausted supply, the industry moves into decline.

In practice and in theory, many strategists have shown that the specific choice of business strategy by an organization – whether to pursue a low-cost approach or to differentiate on quality, for example – should depend on the phase of the industry life cycle. And yet we still know relatively little about how the industry life cycle influences firms’ strategy development.

So perhaps, like the mysterious Cicada, understanding the competitive advantage a lifecycle insight might provide is key to organizational survival..?

Who Knew?

Yet more companies have withdrawn their advertizing support in the wake of the News of the World phone ‘hacking’ scandal.

It is alleged that the News of the World has been illicitly hacking into the voicemail messages of prominent people to find stories. The tabloid, a sister paper to The Times and The Sunday Times, admitted intercepting voicemails in April after years of rumours that the practice was widespread. It is not yet known how exactly many phones have been hacked but police are investigating and estimate the numbers to be in excess of 4,000. Those targeted are said to include celebrities, sport stars, politicians, victims of crime and even dead British soldiers’ relatives.

After a disappointingly long delay, the British government has promised a public enquiry… many commentators are pointing to the personal friendship between British Prime Minister David Cameron and the current Chief Exec of News International, Rebekah Brooks, as a possible factor in this delay. Claiming to have ‘been on holiday’ at the time of some of the worst hacking episodes, Brooks seems to be laying the blame at the feet of her one-time deputy and previous editor of The News of The World, Andy Coulson. Just to add a little further opacity to how this might be perceived, Coulson moved on to become Director of Communications for David Cameron’s Conservative Party.

The claims appear to lend credibility to claims that Rupert Murdoch, owner of News Corporation which ultimately owns the News of the World, is thought to retain his loss making newspaper businesses because of the political influence that they can collectively bring to bear.

The scandal does not end there and the British Police are also facing questions over the relationship between its officers and the papers. News International uncovered e-mails indicating tens of thousands of pounds were paid over the years to police officers.

Although there will be advertizing revenue losses, so far the main harm has been to the company’s reputation and the company’s shares dropped 3.6 percent on Wednesday to $17.47, after rising for most of the year. The episode could also threaten the biggest deal on the News Corporation’s plate as it awaits UK government approval of its complete takeover of BSkyB, the satellite television company in which it already holds a 39% stake.

So what can we learn from all this, apart from the obvious? Well, if the owners at News Corporation were not aware of the phone hacking, as they have claimed, then the issue of governance needs to be considered.

Governance is a much misunderstood discipline at the leadership level from the perspective that the scope of the term is often limited. The point being that Governance is not just about control. Ensuring that processes are efficient as well as effective allows business units to respond more quickly and also by reducing waste, errors and re-work there can be real, tangible cost savings.

Good governance allows the leader to manage with confidence in the knowledge that, if adhered to, the relevant processes provide an outcome that is predictable and consistent and provides the best opportunity for success. In dynamic, complex and resource constrained organizations, the requirement for leaders to stay ‘in control’ of their environment is critical. Appropriate governance frameworks allow the leader to efficiently manage the way business is executed.

As Mr. Murdoch is hopefully realizing, good governance is essential. As a leader, it is imperative to make sure that you have the right level of governance to enable you to be effective in your role… but don’t confuse it with micro-management though. Implement standards, good practice and be clear with your expectations and then make sure that they are being followed.

For a business to succeed in the increasingly complex, uncertain and volatile business world it is essential that core processes have critical governance frameworks to ensure that the leader can effectively remain accountable for the performance of the business unit. Adherence to processes that work will provide confidence to the leader that the team are behaving as required and to standards that have been thought through and are fit for purpose.

***** UPDATE: Rupert Murdoch announces that The News of The World is to cease publication by the weekend *****

I Go or MeeGo

Well, Nokia has lost another technology chief – their fourth in five years. Nokia says that he left for personal reasons but the Finnish press are saying that he left due to differing views on strategy. Mr Green was known to champion the MeeGo mobile operating system which Nokia recently sidelined.

That decision was brought about by Nokia boss Stephen Elop’s decision to adopt Microsoft’s Windows Phone software for its Smartphones. Unnamed Nokia sources are said to be backing up the claim that the abandonment of the MeeGo operating system decision was the core issue for Mr Green. Rich Green joined Nokia in early 2010 following a 19 year stint at Sun Microsystems.

We have referred to Nokia’s problems in the past in this blog, when we discussed the strategy lessons to be learned from the erosion of their formerly substantial market share. At the moment, there is no doubt that the transformation Nokia is currently going through needs to be rapid and far reaching. Clearly, Nokia’s senior management have had to make some very hard decisions regarding its older projects and products but the strategic decision to switch to Windows is one that Mr Green was not prepared to support.

From our perspective there are a number of positive lessons coming out of this.

Firstly, Mr Green’s decision to leave rather than to deliver a strategy that he was not engaged with… The issue of who is right is not important here. If indeed he left by choice and as a matter of principle, then good for him for accepting that he could not deliver on something he did not believe in and recognizing that it could cause internal conflict which would create drag on the Nokia organization.

Conversely, if he was forced out then good for Nokia for taking a tough decision and realizing that if a key executive cannot be persuaded to be on-side with the strategy then such a scenario would be unlikely to end well. As we say consistently, strategy is all about making tough choices and trade-offs.

The credit ratings agency Fitch has cut the status of Nokia’s bonds to just above junk… with their rating dropping from BBB+ to BBB-. Last week Nokia warned that its sales for the second quarter of this year would be well below previous forecasts and also abandoned its outlook for the full year, knocking 12% off the company’s share price in Frankfurt. In executing Nokia’s strategy, they have further tough choices to make.

Critically, whatever they do, the pace of change needs to be appropriate and reflective of the pace of change being experienced in the Smartphone marketplace. Accommodating dissenting voices at the leadership table is a luxury the company simply cannot afford.