The End of an Era.......

In February last year, I made a post on here called P45 anyone?  It dealt with the way our company had changed, and expressed concerns about a round of job cuts that at the time was in full flow.  Reading it now, it was a pretty critical piece and in hindsight I stand by every word (if anything I was too lenient).  I ended it by wondering what the future might hold, both for the company and myself – and fairly pessimistic I was too.

 

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With good reason.

From the company perspective, the turbulence has not visibly abated since that time.  Our Charismatic Greek Chairman stepped down.  I think he took his well-earned fortune into a kind of semi-retirement, in that he no longer has any impact (at least as far anyone can see) in the day-to-day operation of the company or its strategic direction, and limits his public appearances to selected events like our annual users conference.  He sends out periodic All Staff e-mails (signed by “The Founder”) – on major religious festivals for instance, like Easter, or the start of Ramadan, or whatever – or when there is a major event in the world that may have an impact on the business.  He also sends out regular congratulatory mails to people celebrating an anniversary – I received one myself the week before last, on the 13^th anniversary of my joining the company.  All very nice I’m sure.

He was replaced as Chairman by our Greek CEO, who had been around for a long time and had been essentially running the company for years anyway.  In the mail he sent out announcing the changes, the New Chairman (let’s call him the Uncharismatic Greek Chairman) made it clear that he, too, intended to take a bit of a back seat and allow his replacement to mould the company and “take it to the next level.”

His replacement came from outside both the company and the IT industry, but with a decent track record of taking companies and building them up into leaner and more profitable entities through a combination of re-organizing them, cutting costs and acquisition (to paraphrase the introduction we were all given), he seemed a good fit for the strategic direction that had already been decided and started.  Let’s call him Le Gaul.

Those of us New Pretenders (and it must be said Old Guard) who had seen it all before (some of us a number of times) viewed all these pronouncements with a large dose of healthy scepticism.  Le Gaul of course brought in his own management team, thus creating a whole new (and expensive) layer to the company organization chart – odd, for someone who preached the Gospel of Lean is Mean.  He also succeeded in pissing off not a few people who suddenly and unexpectedly found themselves lower down the food chain.  God only knows what out Charismatic Greek Chairman Now Known As The Founder thought of it all……he apparently voiced unequivocal support for the changes in his annual conference address, but some people told me his tongue seemed firmly planted in his right cheek as he did so.  In any case, why should he worry?  He’d already taken the money and ran – not his concern any more.

To the rest of us?  Those at the coal face, so to speak?  An expectation that it would all end in tears.

 

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There was a series of roadshows, as managers new and old toured the world, telling us all what a bright future the company had, and how steps would be taken to improve things for all of us, apparently recognizing for the first time in living memory that perhaps things were actually less than perfect.  No excuses were acceptable for not attending one of these performances – I and all my colleagues on the site I was then working had to take a half day off and take a taxi ride 80 miles away to attend our one.  True to my reputation as a devil’s advocate (or, as some would have it, bloody trouble maker) I gave our hosts a bit of a hard time, as did other people at the presentation (possibly following my lead) and to be fair to our hosts, all criticism was well taken and noted for further action – although of course without any promises being made.  But that in itself was a departure from past experience and served to reduce our doubts (a little….).

That was in late summer 2011.  There followed a deafening silence for pretty much the rest of the year.  The odd managerial appointment was advised, Q3 and (eventually) Q4 results published together with the usual pep talk, and a new intranet site opened for business.  The final organization chart that had been promised at the roadshows remained conspicuous by its absence.  And all the while news filtered through of a few more redundancies, and a few more partnership agreements were announced.  It was all very confusing, but management (of course) remained very upbeat.

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Then, to paraphrase P45 anyone?, another volley of shit hit the corporate fan.  This time it came clearly from outside the organisation.   Early in the New Year, our major competitor announced to the world that it was In merger talks with us.  It didn’t go into too much detail, but said it was confident agreement could be reached before long.  It clearly took us by surprise, and as share prices in both companies started jumping up and down all over the place we were forced to rush out an announcement of our own.  We tried to be innocuous, and admitted we were in “preliminary discussions” but that nothing had been decided and we would make further announcements in due course, as and when there was a need……   The negotiations dragged on throughout Q1, while the press (in particular the doom and gloom merchants on the blogs) had a field day.  Throughout this time, business ground to a halt, as prudent customers and prospects decided to wait and see, on the understandable grounds they weren’t sure which product they were going to end up with.   Eventually, as many of us had expected, along came a competing offer, this time from some American venture capitalist I’d never heard of, whose offer of cash was more attractive to the competitor’s shareholders than our stock swap, so of course the deal (if it could be called that) collapsed.

Shortly thereafter, in the wake of appalling Q1 results, Le Gaul resigned to “pursue other business opportunities” (if you say so, monsieur….).  Our number one money man, a long-time employee and (just by way of a change) English, stepped up to CEO, and our Uncharismatic Greek Chairman announced he was going to play a more “hands on role” – although expressing complete support for English (so why are you immediately undermining him then?)

So now, a once lively and wildly entrepreneurial company is now being run by a trio of bean counters whose main priority is maximizing profits, minimizing losses and propping up the stock price to the satisfaction of all our shareholders (including one assumes themselves, with their no doubt substantial blocks).

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Predictably, within a week, the sackings started, for once at a higher level as middle ranking managers (not all of whom had come with Le Gaul) were shown the door marked Exit.   Then it percolated down, if that’s the right expression, and a bunch of people of my level were dumped…..across all business areas.  We in Services were assured (at least I was) that we would be ok since we had already been cut to the bone over the last 18 months or so.  It didn’t convince me at all.

While all this madness was going on, I was trying to keep busy and occupied since in this situation The Bench is not a good place to be.  Regular readers will have seen last years’ epistles from Geneva, Abu Dhabi, Cyprus and Chile and gather I was keeping busy and racking up some decent Airmiles – true enough.  But this year has been very different.  We’re in October and my total time on site has been a measly 10 weeks in total – in Florida, Cairo, London and Malta.  So despite best efforts – mainly e-mails every other day to our resource management team – I’ve been badly exposed.

So of course, push came to shove.  Half way through a bowl of cornflakes last Tuesday morning (late breakfast after two separate school runs for the kids – a great advantage of being at home, spending time with them) the doorbell rang.  DHL. 

True to form, my Termination of Employment Agreement (personally I prefer the phrase “Redundancy Notice”) arrived by courier with absolutely no advanced warning from either my line manager or HR.  It was no real surprise, despite my having spent a half hour on the phone the previous day, discussing how best to get a virus removed from my laptop, with my line manager, during which time the subject of my impending notice was not even hinted at. 

It would be very very easy to be angry and bitter about what has happened and, in particular, the way the deed was done – but I don’t.  There is no one person to feel angry at, of course – it’s not the fault of my various managers over the years, or HR, or even our Uncharismatic Greek Chairman, his predecessor or successors.  Rather, it’s a long line of errors of judgment and half-arsed strategic initiatives that have led to this, an insistence on crisis management and concentration on The Sale to the exclusion of every other facet of the business.  

That has created an imbalance in the way the company operates that someone, a total stranger, actually pointed out to me years ago in a bar in Almaty.   He wasn’t in our business, but knew the company and the way it worked through other people he knew, and his considered opinion was simply explained.  He stated that all companies, and in particular all software vendors, could be imagined as a pendulum, with Sales at one end of the swing and Services at the other (Product Development was somewhere in the middle).  If the pendulum swung too far in either direction, it set up an imbalance that could ultimately lead to disaster if not checked.  In his opinion, our pendulum was too far in the Sales direction – and nothing since then has been done to correct that imbalance – quite the contrary, in fact. 

There is frustration for sure, because I’ve always thoroughly enjoyed the job (I’ve written elsewhere it’s the best I’ve ever had|) and I wanted to continue doing it for the next few years, to my retirement.  I had my conversation with HR and it was all very cordial – in fact I received an apology for the way it has all been handled – and in all honesty, given the parlous state of the company right now I can’t argue with the cost-cutting logic behind it.    If I feel anything at all, it’s a sense of relief that the Sword of Damocles that has been hanging over my head for 18 months or more has finally fallen and done its job.  Since all this started last February, for me it’s always been a case of when I was likely to be dumped and how much of a payment I would get – I’ve never felt confident (hopeful, yes) that I would actually reach retirement age here.

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So now I can get on with the rest of my life.  I’ve started looking around for something new to do and financially I have maybe six or seven months before I need to panic – my notice period runs until February next, and I’m being paid throughout that.   I have a reasonable idea of what projects are coming through over the next few weeks and months, and the people I’ve spoken to are also aware of some if not all of them – since the company has taken the decision to use business partner staff for certain tasks, and it’s a relatively small world I move in professionally, I would have been surprised if that hadn’t been the case – so I’m confident something will come up before Panic Stations arrive.  There are other options as well, so we’ll see.

In the meantime, I have the kids to play with, and read to, and shout at when homework isn’t being done.  I have my books to read (four or five I’ve bought over the past couple of months and not yet started).  I have my music and of course the wonders of Polish daytime tv.  I can spend time finally transferring the handwritten manuscript of the “The Match” - a novel about sex and booze and football that I wrote nearly thirty years ago now but have never had time since to do anything about trying to sell– into a proper format that I might actually be able to do something with. 

And I have this.  The blog will continue, because I enjoy writing it, and I think a few people might even enjoy reading it (sometimes, anyway).  It may change a bit, for a while at least, because Travellin Bob has stopped Travellin.

But not for ever.  It may be the End of an Era, but not the end of all things.

So watch this space……

 

The News - According to Travellin Bob

I’m a bit of a news junkie really.  I can happily spend hours reading the BBC website, mainly the Sport section but also the News, as well as the Guardian and Independent sites, and comparing notes……that way you get a more rounded view of what’s going on, and the various prejudices from the individual hacks writing the pieces tend to cancel each other out.  I watch BBC World News a lot too – in many places I’ve been to it’s been my only English language tv station – and CNN from time to time (although it tends to be a bit too US-slanted for my taste, and in Mark McKay has probably the most irritating sports presenter in television history).    I know, I’m a sad bastard really…..

The other thing I enjoy is the Comments sections that frequently follow news items or blogs, and I’m continuously amazed at what people say.  Yahoo News is the worst offender – their reports tend to be badly written and essentially distilled from other sources like Reuters, AP or other news sites and papers: very little is original content.  But the comments!  Nowhere have I seen such an outpouring of ill-educated, semi-literate and xenophobic nonsense gathered together in one place!  No matter what the story (I use the term in its loosest sense) the Comments are bound to be flooded with anti-government abuse, racist hate-speech and pathetic attempts at humour that fail to crack a smile.  It never ceases to amaze me.

But it’s interesting to see some of the stuff being written.

Over the past couple of days for instance:

 

Another day, another banking scandal.

When all this financial crisis kicked off four years ago with Lehmans collapsing (and it’s incredible that it was that long ago!), a number of other banks, mainly in the US started panicking – as did the US government and regulators.  With good reason – Lehmans nearly brought down the US economy and its aftershocks were felt world-wide (and indeed continue to be so).  Had another bank gone belly up that would have been that, given the size and inextricably linked nature of the global economy nowadays.  All this led to a collapse in confidence in the banking industry, whose participants – and indirectly that includes me – are being portrayed with breathtaking inaccuracy and bile, as Evil Incarnate.  The knock-on effect has been a collapse in confidence in many economies, especially in Europe, where banks have had to be bailed out all over the place – Allied Irish in the Republic of Ireland, RBS and Lloyds in the UK, Dekia in Spain to name just a few.  That in turn has led to Ireland calling for an EU bail-out to avoid a national bankruptcy, Greece struggling for three years to avoid doing likewise, and Spain, Portugal, and Italy all waging their own battles.  Even Germany and France, the powerhouse economies in the EU, are struggling.  It’s a sorry state of affairs, not helped by politicians, of every flavour, whose main commonality is a breathtaking lack of knowledge and experience in a banking industry that they seem hell-bent on destroying, being unable to reach any kind of a consensus on what needs to be done to sort out the mess.

I’ve posted a few columns on here previously, defending bankers, and I make no apology for that now.  I completely agree that there are a great many people employed by banks who are motivated solely by greed, and whose actions have been indefensible, frequently encouraged by a prevailing culture, particularly in investment banking, that profitability is everything and will be hugely rewarded.  But the vast majority of bankers – whether at an executive level or behind the counter of your local branch – are pleasant and honest people, dedicated to providing a good and risk-free service to their customers, and to earn a reasonable wage to keep their families in food, clothes and housing.  So there has been a lot of completely unjust criticism leveled over the past years, and it shows no sign of abating.

Which brings me finally round to the story behind this subtitle.

One of the US banks that needed help when the shit hit the fan was an outfit called Bear Stearns.  They were an old firm, leading players in the major government bond markets in the US and elsewhere, and especially in the mortgage bond markets that were at the root of the Lehmans demise.  They were also criminally negligent, greedy, and liars.  I worked in their London office for a few years, back in the 90s, and I can safely say it was the most unpleasant three years of my working life, so the news that broke this week does not surprise me in the least.  There were people there at that time who would happily screw their own families to make a buck, and it was a culture that came from the Chairman down.  When the regulators and US government realized that the company  was about to do a Lehman, they also realized that following the similar near-demise of Merrill Lynch (another massive bank – and coincidentally former employer of mine) that was averted only by a government sponsored take-over by Bank of America, Bear too had to be saved at all costs to avoid the entire US banking industry (and hence economy) collapsing.  So they persuaded JP Morgan Chase to take over Bear Stearns – which they did, over a weekend.  It was clearly a rushed job, and in hindsight perhaps not done particularly well.

Because it turned out that when JPMC bought Bear, they saddled themselves with billions of dollars’-worth of mortgage backed securities that were, essentially, worthless.  Toxic is probably too kind a word to describe it.  It also became clear that there was a lot more of it around that Bear had managed to sell to its customers and other financial institutions, by misrepresenting the value and quality of the securities in question, and the supporting mortgage assets.  Let’s be honest here – by lying about the things.

And now, years later, it’s all come home to roost as the New York DA has filed a suit against JPMC for in excess of USD20billion in damages.  Now I feel very sorry for JPMC here – the crimes, when proven (as I’m sure they will be, should it actually get to court) were committed by people working for a company that essentially no longer exists as an independent entity, and who quite possibly are no longer employed by JPMC or anyone else in the industry.  And yet the blame, and of course vitriol in the blogs and comment sections, is being heaped squarely upon JPMC’s  corporate shoulders.  In an ideal world, JPMC would not have touched Bear with a barge pole – it’s hard to think of two banking organizations more polar opposite than those two – and would therefore not have become embroiled in this business at all.  The government and authorities who now seem intent on prosecuting them brokered the entire merger, and it seems to me hypocritical in the extreme to pursue this case. 

But pursue it they will, until an out of court settlement is somehow brokered – but whatever happens, JPMC will always be guilty in the Court of Public Opinion.

A Business Bank – just don’t let the Civil Servants run it!

And now today, the Right Honourable Vince Cable, the Business Secretary in the UK Coalition government, announced at his Liberal Democrat Party Conference that the government is to invest a billion pounds into a “business bank” to provide capital for new businesses, and hopes that a similar amount will come from private investment.   He says this is being done because businesses are finding it increasingly difficult to obtain capital from high street banks – which, given the amount of criticism that he and other politicians have been heaping upon them for the last few years is hardly surprising – so they need an additional source of funding.   Now in the old days, this additional source would have been – the investment banks.  Or the stock markets.  Or venture capitalists.  In fact, the very lenders who are now being pilloried and threatened with being regulated out of existence  

You see my point, I hope.  This constant ill-informed criticism of the financial services industry has made all of these traditional “additional sources” highly unpopular and seemingly untrustworthy lenders, even though they generally are not.   It seems that start-ups are now less than willing to go to such sources for their capital requirements, and conversely high street banks are less than willing to risk making an investment in a start-up company. 

It seems to me that we have now reached the point where Cable (and he has been consistently one of the most vociferous complainants in the anti-banker lobby) and other politicians should actually shut up.  Their criticism has made the lending business grind to a halt (the very thing they have been demanding for months should not be allowed to happen), and starting a business bank is an expensive and unnecessary course of action.   The government would be far better employed in helping re-build public confidence in the existing banking industry, and ceasing this constant carping would be a good start.   But I’m not going to hold my breath waiting for that to happen – politicians, generally speaking, seem more concerned with saying the right thing to please their constituents and retain their seat in Parliament than being seen to do the right thing.  The Court of Public Opinion would much rather see and hear criticism, no matter how ridiculous, of banking (or whatever happens to be the current pantomime villain) than see and hear praise or conciliatory actions.  As would news editors – it makes for far better copy.

The other issue with this business bank idea, it seems to me, is that as a government-sponsored bank it would presumably be run by civil servants – or at least civil servants would hold senior positions in it.  If that were not the case, then it would be just another bank, after all – and hence should be subject to all the problems that go with that status.  From a political point of view, God forbid that should be the case!  Frankly, after the third news story, that is the last thing I would want.

Over the past year or so, there have been a number of rail franchises up for renewal in the UK.  The most lucrative is the West Coast Mainline, run for the past several years (with increasing success and profitability) by Virgin Trains.  Recently, the bid process ended and the Department of Transport, in its infinite wisdom, handed the franchise to FirstGroup, a combined road and rail operator, effective December this year.  Virgin immediately lodged a protest and insisted that the numbers in FirstGroup’s bid didn’t add up – there was no way, said Virgin, that FG could spend as much cash on new trains and infrastructure and give as many cheap tickets without losing money hand over fist and compromising passenger satisfaction (and as a worst case go bust and require government rescue).    Sour grapes, yelled the Court of Public Opinion, you’re only saying that because you lost.  Rubbish, said the Minister of Transport (since replaced in a Cabinet re-shuffle), the bidding process was completely fair and above board and we awarded the contract to the company best able to provide value for money and quality service.  Undeterred, Virgin obtained an injunction preventing the handover until the bidding process had been reviewed again. 

Today their action was totally justified, as the new Transport Secretary scrapped the entire bidding process and contract, returning operations of the line to Virgin.  He cited serious errors made by the DoT in coming to their decision in favour of FG, suspended four civil servants directly involved in the process, stated clearly that there was no blame attached to any of the bidders (including Virgin and FG – there were two other losers) and that the cock up was entirely the Department’s fault.  He also stated that a total of GBP40million would be refunded to the bidders to cover the costs of their bid submissions. 

Let’s leave aside the question of how each bidder could spend an average of ten million quid preparing a document stating how they would run a railway line and make money as well as providing a good service (I can only assume that the likes of Deloitte’s and Accenture or other consulting firms were involved, and the bulk of these costs cover their fees).  Let’s also leave out the astonishing appearance of an apparently honest politician (not a hint of cover-up or trying to blame someone else here).   The issue I have is that it seems CIVIL SERVANTS got their sums wrong, and made completely the wrong decisions – and these are the sort of people Mr. Cable is presumably considering should be responsible for running a business bank, lending money.

You couldn’t make it up, could you?

I’ll sue you!  No, I’ll sue you!!

Finally, we have the continuing Phone Wars:  Apple versus Samsung (and anyone else who dares produce a roughly rectangular smart-phone that includes a touchscreen user interface).  This story is truly ridiculous, and again has been running a few years now.

Apple started it with their iPhone.  A game changer if ever there was one, and an idea that has taken the world by storm and changed the way we look at mobile phones for ever.  It was innovative and looked lovely, even if the first model was a bit clunky and unreliable.  The second was better, but initially had signal problems because of the way the aerial was positioned – Apple fixed it quickly, and successive releases have built on that design, adding new bits and pieces, and tweaking things here and there.  Being Apple, they of course charge a ludicrous price for it, and also being Apple (and hence uber-cool) everyone buys the things by the ton.  Incidentally, can someone explain to me how the new iPhone 5 can have an entry level model in the US priced at USD199, whereas in Malta recently I saw an old 4S (the preceding and now outdated and replaced model) was on offer at one store at a “reduced price” of EUR 499 – by my reckonings three times the American price – and you’re not even getting an up-to-date spec!

But since the phone’s introduction, other companies have come up with their own smartphones, and a lot of them are much better than the iPhone.  HTC, Nokia and (especially) Samsung with its Galaxy range have all come up with devices that look better, work better and often have much better functionality than the iPhone, which now looks boring and dated.  The screen is smaller, it looks less attractive and chunky, the picture quality seems less good than the others….the list of differences is long and getting longer by the release.  Apple’s response, rather than working hard to innovate and come up with something new and fresh to blow the opposition away as they did previously, has been to throw millions of bucks at the legal professions and launch lawsuit after lawsuit, alleging theft of intellectual property rights, patent infringements and God knows what else.  Samsung (Apple’s main target) has predictably responded by counter-suing on the same grounds. 

The results are interesting.  Whenever the case is heard in America, and in particular Apple’s own California back yard, they win the case – most recently a billion dollars was awarded against Samsung and a range of Samsung devices (mostly outdated and replaced anyway) banned from sale in the US.  Yet when the case is elsewhere (and they are going on all over the world – Europe, the Far East, Australia to name but three locations) then Apple tend to lose.  No-one seems to be winning outright, and sales seem unaffected.  The new I5 is the fastest selling new phone ever, but Samsung is still selling more phones globally than anyone else – unsurprisingly, because its flagship Galaxy S3 is a bloody fantastic piece of klt.

It all seems ridiculous to me.  How can you accuse someone of copying the shape of your phone and complaining its rounded rectangle breaches copyright?  Sorry, but for the most comfortable and efficient use a rectangle is the best shape to have and there are only so many ways of changing it.   To me, it’s like Adidas suing Umbro because the latter’s new football is round – well, yes, balls generally are.  Other complaints are concerned with way data is transmitted wirelessly – Apple say everyone else is copying them.  Analogy: Adidas complaining that Umbro’s valves (for pumping the ball up) is the same shape as theirs.  Touchscreen interface?  OK, tell me how else you can use of them without using your finger to swipe across the screen and activate something.

Crazy, absolutely crazy.   The only people happy about the situation are the lawyers, who are creaming off huge fees from all the participants – costs that are no doubt being passed along to the consumers, you and I.   And to what end?  Apple fanboys will still stupidly queue round the block for a week to get their grubby little mitts on the latest release, no matter how crappy it is…..because it’s an Apple, dude!  The rest of us  (dare I say the more sensible punters?) will probably look at a number of alternatives and buy the one we think best – be it a Galaxy S3, the HTC One (almost as good), or the Nokia Lumia 900 with its Windows 8 operating system.  Or something else entirely – Blackberry perhaps, or the  new Motorola Razr that looks pretty sexy. 

I’ll be interested to see what happens next after last week’s classic Apple fuck up (undoubtedly their worst ever).  The new iPhone 5 dropped Google Maps entirely from its range of pre-installed apps, and replaced it with its own version, Apple Maps.  The trouble is it doesn’t work.  Users have bombarded the company with complaints because the maps are totally inaccurate and hence useless.  There have been reported errors like the London Eye being relocated to the Welsh coast, and Stonehenge to the centre of Edinburgh.   This all forced Paul Cook, the Blessed Jobs’ replacement as CEO, to issue a statement of apology in which he blamed software glitches (no, really?) and recommended that people use “alternatives like Google and Nokia Maps instead”.  Say what you like about him, but Jobs would never in a million years have allowed something that serious and stupid to have happened.