first time in my life,i ll not be in home on the eve of holi..i hv to celebrate holi ...somewhere away of home...in pondicherry.when i think abt the holi,lot's of sweet memory comes in my mind.i m just gonna miss my favorite festival.singing on road almost naked or dancing on the street like mad or just roaming here and there with friend in evening. i m gonna miss all this thing....going to every home and collecting wood and other thing to burn it in night...stealing wood from the home of the people who don't volunteer to give it...or just eating"gujhia".sometime i think how much sacrifice we hv to make for being a so called successful person..i don't know but m really gonna miss it.don't know ll i be able to celebrate holi in home or not in future also.ok..but no matter perhaps it's called life..
wishing u all a very happy holi............
Sunday, February 28, 2010
Thursday, February 25, 2010
looking back in past..
sometime i look back in past and saw all the happy moment i had in my life...i smile..i get confidence...i just thanks god for all those happy moment he gave to me...but then suddenly i realize that present is completely different from the past..my habit of trusting people..giving them my everything..hurts me a lot..i care a lot for others..i give more weight to their opinion than mine...i just simply think that people who are closer to you always care for u...ya they do..but my higher expectation lead me to disappointment...i don't blame anyone for the sorrow i got in my life...not even my fate..i just blame myself,my attitude towards life..my so called philosophy.i just think that relationship are meant to understand each other but i myself doesn't understand people and expect too much from them...i just pray to god that take my everything away of me but just return all my happy moment again in my life...
Wednesday, February 24, 2010
sachin...u r the genius...champion...
i came from class and suddenly found that sachin is playing on 140.i am a cricket freak but now a days i m not watching cricket.i thought that something is really going to happen..my inner heart says that don't miss this historic moment..and i went...now i don't have to regret that i didn't watch sachin playing such a fine inning...i love sachin....sachin u deserve bharat ratna...no award is needed for u but u deserve this...u made india proud....
Tuesday, February 23, 2010
why are american jobless?
Why Are Americans Jobless ?
John Smith started the day early having set his alarm clock (MADE IN JAPAN) for 6 a.m.
While his coffeepot (MADE IN CHINA) was perking, he shaved with his electric razor (MADE IN PHILIPPINES) .
He put on a dress shirt (MADE IN SRI LANKA), designer jeans (MADE IN SINGAPORE) and tennis shoes (MADE IN
VIETNAM). After cooking his breakfast in his new electric skillet (MADE IN INDIA), then he sat down with his calculator (MADE IN MEXICO) to see how much he could spend today.
After setting his watch (MADE IN TAIWAN) to the radio (MADE IN INDIA), he got in his car (MADE IN GERMANY) filled it with GAS (from Saudi Arabia) and continued his search for a good paying AMERICAN JOB.
At the end of yet another discouraging and fruitless day checking his computer (MADE IN MALAYSIA), John decided to relax for a while. He put on his sandals (MADE IN BRAZIL) poured himself a glass of wine (MADE IN FRANCE) and turned on his TV (MADE IN KOREA), and then wondered why he can't find a good paying job in AMERICA.
AND NOW HE'S HOPING HE CAN GET HELP FROM HIS PRESIDENT (MADE IN KENYA)
John Smith started the day early having set his alarm clock (MADE IN JAPAN) for 6 a.m.
While his coffeepot (MADE IN CHINA) was perking, he shaved with his electric razor (MADE IN PHILIPPINES) .
He put on a dress shirt (MADE IN SRI LANKA), designer jeans (MADE IN SINGAPORE) and tennis shoes (MADE IN
VIETNAM). After cooking his breakfast in his new electric skillet (MADE IN INDIA), then he sat down with his calculator (MADE IN MEXICO) to see how much he could spend today.
After setting his watch (MADE IN TAIWAN) to the radio (MADE IN INDIA), he got in his car (MADE IN GERMANY) filled it with GAS (from Saudi Arabia) and continued his search for a good paying AMERICAN JOB.
At the end of yet another discouraging and fruitless day checking his computer (MADE IN MALAYSIA), John decided to relax for a while. He put on his sandals (MADE IN BRAZIL) poured himself a glass of wine (MADE IN FRANCE) and turned on his TV (MADE IN KOREA), and then wondered why he can't find a good paying job in AMERICA.
AND NOW HE'S HOPING HE CAN GET HELP FROM HIS PRESIDENT (MADE IN KENYA)
All ABOUT SWINE FLU
All About Swine Flu : Symptoms, Precautions, Treatment
Although the name 'swine flu' brings up a lot of extra fear and worry, it is important to note that swine flu is just an influenza A H1N1 virus. The big difference is that the current swine influenza A (H1N1) virus has components of pig and bird influenza viruses in it, so that humans don't have any immunity to it. That is what made it more likely that it would become a pandemic virus (have the ability to cause a global outbreak) because it could easily spread from person-to-person.
The Swine flu has been compared to other similar types of influenza virus in terms of mortality: "in the US it appears that for every 1000 people who get infected, about 40 people need admission to hospital and about one person dies".
Swine Flu Symptoms -
Symptoms of swine flu infections can include:
* cough
* runny nose or stuffy nose
* sore throat
* body aches
* headache
* chills
* fatigue or tiredness, which can be extreme
* diarrhea and vomiting, sometimes, but more commonly seen than with seasonal flu
Signs of a more serious swine flu infection might include pneumonia and respiratory failure.
Swine Flu High Risk Groups -
Swine flu high risk groups, people who are thought to be at risk for serious, life-threatening infections, are a little different and can include:
* pregnant women
* people with chronic medical problems, such as chronic lung disease, like asthma, cardiovascular disease, diabetes, and immunosuppression
* children and adults with obesity
Precautions to keep swine flu at bay -
1. Wash your hands frequently
Use the antibacterial soaps to cleanse your hands. Wash them often, for at least 15 seconds and rinse with running water.
2. Get enough sleep
Try to get 8 hours of good sleep every night to keep your immune system in top flu-fighting shape.
3. Drink sufficient water
Drink 8 to10 glasses of water each day to flush toxins from your system and maintain good moisture and mucous production in your sinuses.
4. Boost your immune system
Keeping your body strong, nourished, and ready to fight infection is important in flu prevention. So stick with whole grains, colorful vegetables, and vitamin-rich fruits.
5. Keep informed
The government is taking necessary steps to prevent the pandemic and periodically release guidelines to keep the pandemic away. Please make sure to keep up to date on the information and act in a calm manner.
Treatment -
If a person becomes sick with swine flu, antiviral drugs can make the illness milder and make the patient feel better quicker. For treatment, antiviral drugs work best if started soon after getting sick (within 2 days of symptoms). The U.S. CDC recommends the use of Tamiflu (oseltamivir) or Relenza (zanamivir) for the treatment and/or prevention of infection with swine influenza viruses; however, the majority of people infected with the virus make a full recovery without requiring medical attention or antiviral drugs.
Vaccination -
WHO does not expect the swine flu vaccine to be widely available until the end of 2009, noting that current production "yield" was only about half as much as expected and would cause timeline delays. There is also concern that countries which produce vaccines, 70 percent of which are in Europe, may delay sending swine flu vaccines to other countries as they may come under "tremendous pressure to protect their own citizens first," note some experts.
Many countries are planning full blown large scale vaccination camps by the end of the year.
Sunday, February 21, 2010
is growth always a good thing?
Rapid growth in revenue and earnings may be top priorities in corporate boardrooms, but these priorities are not always best for shareholders. We are often tempted to invest large amounts in risky or even mature companies that are beating the drum for fast growth, but investors should check that a company's growth ambitions are realistic and sustainable.
Growth's Attraction
Let's face it, it's hard not to be thrilled by the prospect of growth. We invest in growth stocks because we believe that these companies are able to take shareholder money and reinvest it for a return that is higher than what we can get elsewhere.
Besides, in traditional investing wisdom, growth in sales earnings and stock performance are inexorably linked. In his book "One Up on Wall Street", investment guru Peter Lynch preaches that stock prices follow corporate earnings over time. The idea has stuck because many investors look far and wide for the fastest-growing companies that will produce the greatest share-price appreciation.
Is Growth a Sure Thing?
That said, there is room to debate this rule of thumb. In a 2002 study of more than 2,000 public companies, California State University finance professor Cyrus Ramezani analyzed the relationship between growth and shareholder value. His surprising conclusion was that the companies with the fastest revenue growth (average annual sales growth of 167% over a 10-year period) showed, over the period studied, worse share price performance than slower growing firms (average growth of 26%). In other words, the hotshot companies could not maintain their growth rates, and their stocks suffered.
The Risks
Fast growth looks good, but companies can get into trouble when they grow too fast. Are they able to keep pace with their expansion, fill orders, hire and train enough qualified employees? The rush to boost sales can leave growing companies with a deepening difficulty to obtain their cash needs from operations. Risky, fast-growing start-ups can burn money for years before generating a positive cash flow. The higher the rate of spending money for growth, the greater the company's odds of later being forced to seek more capital. When extra capital is not available, big trouble is brewing for these companies and their investors.
Companies often try increasingly big - and risky - deals to push up growth rates. Consider the serial acquirer WorldCom. In the 1990s, the company racked up growth rates of more than 20% by buying up little-known telecom companies. But, it later required larger and larger acquisitions to show impressive revenue percentages and earnings growth. In hopes of sustaining growth momentum, WorldCom CEO Bernie Ebbers agreed to pay a whopping $115 billion for Sprint Corp. But federal regulators blocked the deal on antitrust grounds. WorldCom's prospects for growth collapsed, along with the company's value. The lesson here is that investors need to consider carefully the sustainability of deal-driven growth strategies.
Being Realistic about Growth
Eventually every fast-growth industry becomes a slow-growth industry. Some companies, however, still pursue expansion long after growth opportunities have dried up. When managers ignore the option of offering investors dividends and stubbornly continue to pour earnings into expansion that generates returns lower than those of the market, bad news is on the horizon for investors.
For example, take McDonald's: as it experienced its first-ever losses in 2003, and its share price neared a 10-year low, the company finally began to admit that it was no longer a growth stock. But for several years beforehand, McDonald's had shrugged off shrinking profits and analysts' arguments that the world's biggest fast-food chain had saturated its market. Unwilling to give up on growth, McDonald's accelerated its rate of restaurant openings and advertising spending. Expansion not only eroded profits but ate up a huge chunk of the company's cash flow, which could have gone to investors as large dividends.
CEOs and managers have a duty to put the brakes on growth when it is unsustainable or incapable of creating value. That can be tough since CEOs normally want to build empires rather than maintain them. At the same time, management compensation at many companies is tied to growth in revenue and earnings.
But CEO pride doesn't explain everything: the investing system favors growth. Market analysts rate a stock according to its ability to expand; accelerating growth receives the highest rating. Furthermore, tax rules privilege growth since capital gains are taxed in a lower tax bracket while dividends face higher income-tax rates.
Conclusion
Justifications for fast growth can quickly pile up, even when it isn't the most prudent of priorities. Companies that pursue growth at the cost of sustaining themselves may do more harm than good. When evaluating companies with aggressive growth policies, investors need to determine carefully whether these policies have higher drawbacks than benefits.
Growth's Attraction
Let's face it, it's hard not to be thrilled by the prospect of growth. We invest in growth stocks because we believe that these companies are able to take shareholder money and reinvest it for a return that is higher than what we can get elsewhere.
Besides, in traditional investing wisdom, growth in sales earnings and stock performance are inexorably linked. In his book "One Up on Wall Street", investment guru Peter Lynch preaches that stock prices follow corporate earnings over time. The idea has stuck because many investors look far and wide for the fastest-growing companies that will produce the greatest share-price appreciation.
Is Growth a Sure Thing?
That said, there is room to debate this rule of thumb. In a 2002 study of more than 2,000 public companies, California State University finance professor Cyrus Ramezani analyzed the relationship between growth and shareholder value. His surprising conclusion was that the companies with the fastest revenue growth (average annual sales growth of 167% over a 10-year period) showed, over the period studied, worse share price performance than slower growing firms (average growth of 26%). In other words, the hotshot companies could not maintain their growth rates, and their stocks suffered.
The Risks
Fast growth looks good, but companies can get into trouble when they grow too fast. Are they able to keep pace with their expansion, fill orders, hire and train enough qualified employees? The rush to boost sales can leave growing companies with a deepening difficulty to obtain their cash needs from operations. Risky, fast-growing start-ups can burn money for years before generating a positive cash flow. The higher the rate of spending money for growth, the greater the company's odds of later being forced to seek more capital. When extra capital is not available, big trouble is brewing for these companies and their investors.
Companies often try increasingly big - and risky - deals to push up growth rates. Consider the serial acquirer WorldCom. In the 1990s, the company racked up growth rates of more than 20% by buying up little-known telecom companies. But, it later required larger and larger acquisitions to show impressive revenue percentages and earnings growth. In hopes of sustaining growth momentum, WorldCom CEO Bernie Ebbers agreed to pay a whopping $115 billion for Sprint Corp. But federal regulators blocked the deal on antitrust grounds. WorldCom's prospects for growth collapsed, along with the company's value. The lesson here is that investors need to consider carefully the sustainability of deal-driven growth strategies.
Being Realistic about Growth
Eventually every fast-growth industry becomes a slow-growth industry. Some companies, however, still pursue expansion long after growth opportunities have dried up. When managers ignore the option of offering investors dividends and stubbornly continue to pour earnings into expansion that generates returns lower than those of the market, bad news is on the horizon for investors.
For example, take McDonald's: as it experienced its first-ever losses in 2003, and its share price neared a 10-year low, the company finally began to admit that it was no longer a growth stock. But for several years beforehand, McDonald's had shrugged off shrinking profits and analysts' arguments that the world's biggest fast-food chain had saturated its market. Unwilling to give up on growth, McDonald's accelerated its rate of restaurant openings and advertising spending. Expansion not only eroded profits but ate up a huge chunk of the company's cash flow, which could have gone to investors as large dividends.
CEOs and managers have a duty to put the brakes on growth when it is unsustainable or incapable of creating value. That can be tough since CEOs normally want to build empires rather than maintain them. At the same time, management compensation at many companies is tied to growth in revenue and earnings.
But CEO pride doesn't explain everything: the investing system favors growth. Market analysts rate a stock according to its ability to expand; accelerating growth receives the highest rating. Furthermore, tax rules privilege growth since capital gains are taxed in a lower tax bracket while dividends face higher income-tax rates.
Conclusion
Justifications for fast growth can quickly pile up, even when it isn't the most prudent of priorities. Companies that pursue growth at the cost of sustaining themselves may do more harm than good. When evaluating companies with aggressive growth policies, investors need to determine carefully whether these policies have higher drawbacks than benefits.
INDIA-GOD'S VIEW
God was in the process of creating the universe. And he was explaining his subordinates...
"Look everything should be in balance. For example, after every 10 deers there should be a lion. Look here my fellow angels, here is the country of the United States I have blessed them with prosperity and money. But at the same time I have given them insecurity and tension...
And here is Africa. I have given them beautiful nature. But at the same time, I have given them climatic extremes...
And here is South America. I have given them lots of forests. But at the same time, I have given them lesser land so that they would have to cut off the forests... So you see fellows, everything should be in balance.
One of the angels asked... "God, what is this extremely beautiful country here?" God said....... "Ahah...that is the crown piece of all. "INDIA", my most precious creation. It has understanding and friendly people. Sparkling streams, serene mountains. A culture which speaks of the great tradition that they live. Technologically brilliant and with a heart of gold...
The angel was quite surprised "But god you said everything should be in balance."
God replied - "Look at the neighbours, I gave them
"Look everything should be in balance. For example, after every 10 deers there should be a lion. Look here my fellow angels, here is the country of the United States I have blessed them with prosperity and money. But at the same time I have given them insecurity and tension...
And here is Africa. I have given them beautiful nature. But at the same time, I have given them climatic extremes...
And here is South America. I have given them lots of forests. But at the same time, I have given them lesser land so that they would have to cut off the forests... So you see fellows, everything should be in balance.
One of the angels asked... "God, what is this extremely beautiful country here?" God said....... "Ahah...that is the crown piece of all. "INDIA", my most precious creation. It has understanding and friendly people. Sparkling streams, serene mountains. A culture which speaks of the great tradition that they live. Technologically brilliant and with a heart of gold...
The angel was quite surprised "But god you said everything should be in balance."
God replied - "Look at the neighbours, I gave them
WINNER Vs LOSER
The winner is always part of Anwers;
The losers is always part of problem:
The winner has a programm;
The loser has a excuse:
The winner says, "let me do it for you";
The loser says, "that is not my job":
The winner sees an answer for every problem;
The loser sees a problem for every answer:
When a winner says, "It may be difficult but it is
possible";
When a loser says, "It may be possible but it is too
difficult":
When a winner makes a mistake, he says 'I was wrong';
When a loser makes a mistake, he says, 'It wasn't my
faut':
A winner makes Commitments;
A loser makes Promises:
Winner have dreams;
Loser have schemes:
Winner says, 'I must do something';
Loser says, 'something must be done':
Winner are a part of the team;
Losers are apart from the team:
Winner see the gain;
Loser see the pain:
Winners see possibilities;
Losers see problems:
Winners believe in win/win;
Losers believe for them to win someone has to lose:
Winners see the potential;
Losers see the past:
Winners are like a thermostat;
Losers are like a thermometer:
Winners choose wat they say;
Losers say what they choose:
Winners use hard argument but softwords;
Losers uses soft argument but hard words:
winner stand firm on values but compromise on petty
things;
Loser stand firm on petty things but compromise on
value:
Winners follow the philosophy of empathi; " dont do to
others wat do you would not want them to do to you";
Losers follows the philosophy of empathi; ' do it to
others before they do it to you":
Winner make it happen;
Loser let it happen:
Winners plan and prepare to win;
Loser plans to win:
The keyword is preparation
The losers is always part of problem:
The winner has a programm;
The loser has a excuse:
The winner says, "let me do it for you";
The loser says, "that is not my job":
The winner sees an answer for every problem;
The loser sees a problem for every answer:
When a winner says, "It may be difficult but it is
possible";
When a loser says, "It may be possible but it is too
difficult":
When a winner makes a mistake, he says 'I was wrong';
When a loser makes a mistake, he says, 'It wasn't my
faut':
A winner makes Commitments;
A loser makes Promises:
Winner have dreams;
Loser have schemes:
Winner says, 'I must do something';
Loser says, 'something must be done':
Winner are a part of the team;
Losers are apart from the team:
Winner see the gain;
Loser see the pain:
Winners see possibilities;
Losers see problems:
Winners believe in win/win;
Losers believe for them to win someone has to lose:
Winners see the potential;
Losers see the past:
Winners are like a thermostat;
Losers are like a thermometer:
Winners choose wat they say;
Losers say what they choose:
Winners use hard argument but softwords;
Losers uses soft argument but hard words:
winner stand firm on values but compromise on petty
things;
Loser stand firm on petty things but compromise on
value:
Winners follow the philosophy of empathi; " dont do to
others wat do you would not want them to do to you";
Losers follows the philosophy of empathi; ' do it to
others before they do it to you":
Winner make it happen;
Loser let it happen:
Winners plan and prepare to win;
Loser plans to win:
The keyword is preparation
Modern portfolio theory-MPT
According to the theory, it's possible to construct an "efficient frontier" of optimal portfolios offering the maximum possible expected return for a given level of risk. This theory was pioneered by Harry Markowitz in his paper "Portfolio Selection," published in 1952 by the Journal of Finance.
There are four basic steps involved in portfolio construction:
-Security valuation
-Asset allocation
-Portfolio optimization
-Performance measurement
There are four basic steps involved in portfolio construction:
-Security valuation
-Asset allocation
-Portfolio optimization
-Performance measurement
Friday, February 19, 2010
Best moment's in life
1. Falling in love.
2. Laughing till your stomach hurts.
3. Enjoying a ride down the Country side.
4. Listening to your favorite song on the radio.
5. Going to sleep listening to the rain pouring outside.
6. Getting out of the shower and wrapping yourself with a warm, fuzzy
towel.
7. Passing your final exams with good grades.
8. Being part of an interesting conversation.
9. Finding some money in some old pants.
10. Laughing at yourself.
11. Sharing a wonderful dinner with all your friends.
12. Laughing without a reason.
13. "Accidentally" hearing someone say something good about you.
14. Watching the sunset.
15. Listening to a song that reminds you of an important person in
your
life.
16. Receiving or giving your first kiss.
17. Feeling this movement in your body when seeing this "special"
someone.
18. Having a great time with your friends.
19. Seeing the one you love happy.
20. Wearing the shirt of a person you love and smelling his/her
perfume.
21. Visiting an old friend of yours and remembering great memories.
22. Hearing some telling you "I LOVE YOU"
True friends come in the good times when we tell them to, and come in
the bad times.....without calling."
2. Laughing till your stomach hurts.
3. Enjoying a ride down the Country side.
4. Listening to your favorite song on the radio.
5. Going to sleep listening to the rain pouring outside.
6. Getting out of the shower and wrapping yourself with a warm, fuzzy
towel.
7. Passing your final exams with good grades.
8. Being part of an interesting conversation.
9. Finding some money in some old pants.
10. Laughing at yourself.
11. Sharing a wonderful dinner with all your friends.
12. Laughing without a reason.
13. "Accidentally" hearing someone say something good about you.
14. Watching the sunset.
15. Listening to a song that reminds you of an important person in
your
life.
16. Receiving or giving your first kiss.
17. Feeling this movement in your body when seeing this "special"
someone.
18. Having a great time with your friends.
19. Seeing the one you love happy.
20. Wearing the shirt of a person you love and smelling his/her
perfume.
21. Visiting an old friend of yours and remembering great memories.
22. Hearing some telling you "I LOVE YOU"
True friends come in the good times when we tell them to, and come in
the bad times.....without calling."
peter drucker's famous quotes
"Almost everybody today believes that nothing in economic history has ever moved as fast as, or had a greater impact than, the Information Revolution. But the Industrial Revolution moved at least as fast in the same time span, and had probably an equal impact if not a greater one."
"In all recorded history there has not been one economist who has had to worry about where the next meal would come from."
"Management by objectives works if you first think through your objectives. Ninety percent of the time you haven't.'
"Management is doing things right; leadership is doing the right things."
"Plans are only good intentions unless they immediately degenerate into hard work."
"Quality in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for. A product is not quality because it is hard to make and costs a lot of money, as manufacturers typically believe. This is incompetence. Customers pay only for what is of use to them and gives them value. Nothing else constitutes quality."
"So much of what we call management consists in making it difficult for people to work."
'The computer is a moron."
"The most important thing in communication is to hear what isn't being said."
"There is nothing so useless as doing efficiently that which should not be done at all."
"We now accept the fact that learning is a lifelong process of keeping abreast of change. And the most pressing task is to teach people how to learn."
"Innovation is the specific instrument of entrepreneurship... the act that endows resources with a new capacity to create wealth."
"Management" means, in the last analysis, the substitution of thought for brawn and muscle, of knowledge for folklore and superstition, and of cooperation for force. . .
"In all recorded history there has not been one economist who has had to worry about where the next meal would come from."
"Management by objectives works if you first think through your objectives. Ninety percent of the time you haven't.'
"Management is doing things right; leadership is doing the right things."
"Plans are only good intentions unless they immediately degenerate into hard work."
"Quality in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for. A product is not quality because it is hard to make and costs a lot of money, as manufacturers typically believe. This is incompetence. Customers pay only for what is of use to them and gives them value. Nothing else constitutes quality."
"So much of what we call management consists in making it difficult for people to work."
'The computer is a moron."
"The most important thing in communication is to hear what isn't being said."
"There is nothing so useless as doing efficiently that which should not be done at all."
"We now accept the fact that learning is a lifelong process of keeping abreast of change. And the most pressing task is to teach people how to learn."
"Innovation is the specific instrument of entrepreneurship... the act that endows resources with a new capacity to create wealth."
"Management" means, in the last analysis, the substitution of thought for brawn and muscle, of knowledge for folklore and superstition, and of cooperation for force. . .
Managing Oneself by Peter R Drucker
HARVARD BUSINESS REVIEW, JANUARY 2005, pág 100-109
History's great achievers - a Napoleon, a da Vinci, a Mozart - have always managed themselves. That, in large measure, is what makes them great achievers. But they are rare exceptions, so un-usual both in their talents and their accomplishments as to be considered outside the boundaries of ordinary human existence. Now, most of us, even those of us with modest endowments, will have to learn to manage ourselves. We will have to learn to develop ourselves. We will have to place our-selves where we can make the greatest contribution. And we will have to stay mentally alert and engaged during a 50-year working life, which means knowing how and when to change the work we do.
What Are My Strengths?
Most people think they know what they are good at. They are usually wrong. More often, people know what they are not good at - and even then more people are wrong than right. And yet, a per-son can perform only from strength. One cannot build performance on weaknesses, let alone on something one cannot do at all.
Throughout history, people had little need to know their strengths. A person was born into a position and a line of work: The peasant's son would also be a peasant; the artisan's daughter, an artisan's wife; and so on. But now people have choices. We need to know our strengths in order to know where we belong.
The only way to discover your strengths is through feedback analysis.
Whenever you make a key decision or take a key action, write down what you expect will happen. Nine or 12 months later, compare the actual results with your expectations. I have been practicing this method for 15 to 20 years now, and every time I do it, I am surprised.
The feedback analysis showed me, for instance-and to my great surprise-that I have an intuitive understanding of technical people, whether they are engineers or accountants or market research-ers.
It also showed me that I don't really resonate with generalists.
Feedback analysis is by no means new. It was invented sometime in the fourteenth century by an otherwise totally obscure German theologian and picked up quite independently, some 150 years later, by John Calvin and Ignatius of Loyola, each of whom incorporated it into the practice of his followers.
1 Peter F. Drucker is the Marie Rankin Clarke Professor of Social Science and Management (Emeritus) at Claremont Graduate University in Claremont, California. This article is an excerpt from his book Management Challenges for the 21st Century (HarperCollins, 1999)-
In fact, the steadfast focus on performance and results that this habit produces explains why the institutions these two men founded, the Calvinist church and the Jesuit order, came to dominate Europe within 30 years.
Practiced consistently, this simple method will show you within a fairly short period of time, maybe two or three years, where your strengths lie - and this is the most important thing to know. The method will show you what you are doing or failing to do that deprives you of the full benefits of your strengths. It will show you where you are not particularly competent. And finally, it will show you where you have no strengths and cannot perform.
Several implications for action follow from feedback analysis. First and foremost, concentrate on your strengths. Put yourself where your strengths can produce results.
Second, work on improving your strengths. Analysis will rapidly show where you need to improve skills or acquire new ones. It will also show the gaps in your knowledge -and those can usually be filled. Mathematicians are born, but everyone can learn trigonometry.
Third, discover where your intellectual arrogance is causing disabling ignorance and overcome it. Far too many people - especially people with great expertise in one area-are contemptuous of knowledge in other areas or believe that being bright is a substitute for knowledge. First-rate engi-neers, for instance, tend to take pride in not knowing anything about people. Human beings, they believe, are much too disorderly for the good engineering mind.
Human resources professionals, by contrast, often pride themselves on their ignorance of elemen-tary accounting or of quantitative methods altogether. But taking pride in such ignorance is self de-feating.
Go to work on acquiring the skills and knowledge you need to fully realize your strengths.
It is equally essential to remedy your bad habits-the things you do or fail to do that inhibit your effec-tiveness and performance. Such habits will quickly show up in the feedback. For example, a plan-ner may find that his beautiful plans fail because he does not follow through on them. Like so many brilliant people, he believes that ideas move mountains. But bulldozers move mountains; ideas show where the bulldozers should go to work. This planner will have to learn that the work does not stop when the plan is completed. He must find people to carry out the plan and explain it to them. He must adapt and change it as he puts it into action. And finally, he must decide when to stop pushing the plan.
At the same time, feedback will also reveal when the problem is a lack of manners. Manners are the lubricating oil of an organization. It is a law of nature that two moving bodies in contact with each other create friction. This is as true for human beings as it is for inanimate objects. Manners- simple things like saying "please" and "thank you" and knowing a person's name or asking after her family-enable two people to work together whether they like each other or not. Bright people, especially bright young people, often do not understand this. If analysis shows that someone's brilliant work fails again and again as soon as cooperation from others is required, it probably indicates a lack of courtesy - that is, a lack of manners.
Comparing your expectations with your results also indicates what not to do. We all have a vast number of areas in which we have no talent or skill and little chance of becoming even mediocre.
In those areas a person - and especially a knowledge worker-should not take on work, jobs, and assignments.
One should waste as little effort as possible on improving areas of low competence.
It takes far more energy and work to improve from incompetence to mediocrity than it takes to im-prove from first-rate performance to excellence.
And yet most people-especially most teachers and most organizations concentrate on making in-competent performers into mediocre ones. Energy, resources, and time should go instead to mak-ing a competent person into a star performer.
How Do I Perform?
Amazingly few people know how they get things done. Indeed, most of us do not even know that different people work and perform differently. Too many people work in ways that are not their ways, and that almost guarantees non-performance.
For knowledge workers, How do I perform? may be an even more important question than What are my strengths? Like one's strengths, how one performs is unique. It is a matter of personality.
Whether personality be a matter of nature or nurture, it surely is formed long before a person goes to work. And how a person performs is a given, just as what a person is good at or not good at is a given. A person's way of performing can be slightly modified, but it is unlikely to be completely changed-and certainly not easily. Just as people achieve results by doing what they are good at, they also achieve results by working in ways that they best perform. A few common personality traits usually determine how a person performs.
Am I a reader or a listener? The first thing to know is whether you are a reader or a listener. Far too few people even know that there are readers and listeners and that people are rarely both. Even fewer know which of the two they themselves are. But some examples will show how damaging such ignorance can be.
When Dwight Eisenhower was Supreme Commander of the Allied forces in Europe, he was the darling of the press. His press conferences were famous for their style - General Eisenhower showed total command of whatever question he was asked, and he was able to describe a situation and explain a policy in two or three beautifully polished and elegant sentences. Ten years later, the same journalists who had been his admirers held President Eisenhower in open contempt. He never addressed the questions, they complained, but rambled on endlessly about something else.
And they constantly ridiculed him for butchering the King's English in incoherent and ungrammatical answers.
Eisenhower apparently did not know that he was a reader, not a listener.
When he was Supreme Commander in Europe, his aides made sure that every question from the press was presented in writing at least half an hour before a conference was to begin. And then Eisenhower was in total command. When he became president, he succeeded two listeners, Frank-lin D. Roosevelt and Harry Truman. Both men knew themselves to be listeners and both enjoyed free-for-all press conferences. Eisenhower may have felt that he had to do what his two predeces-sors had done. As a result, he never even heard the questions journalists asked. And Eisenhower is not even an extreme case of a non-listener.
A few years later, Lyndon Johnson destroyed his presidency, in large measure, by not knowing that he was a listener.
His predecessor, John Kennedy, was a reader who had assembled a brilliant group of writers as his assistants, making sure that they wrote to him before discussing their memos in person. Johnson kept these people on his staff-and they kept on writing. He never, apparently, understood one word of what they wrote. Yet as a senator, Johnson had been superb; for parliamentarians have to be, above all, listeners.
Few listeners can be made, or can make themselves, into competent readers - and vice versa. The listener who tries to be a reader will, therefore, suffer the fate of Lyndon Johnson, whereas the reader who tries to be a listener will suffer the fate of Dwight Eisenhower. They will not perform or achieve.
How do I learn? The second thing to know about how one performs is to know how one learns. Many first-class writers - Winston Churchill is but one example -do poorly in school. They tend to remember their schooling as pure torture. Yet few of their classmates remember it the same way. They may not have enjoyed the school very much, but the worst they suffered was boredom.
The explanation is that writers do not, as a rule, learn by listening and reading. They learn by writ-ing. Because schools do not allow them to learn this way, they get poor grades.
Schools everywhere are organized on the assumption that there is only one right way to learn and that it is the same way for everybody. But to be forced to learn the way a school teaches is sheer hell for students who learn differently.
Indeed, there are probably half a dozen different ways to learn.
There are people, like Churchill, who learn by writing. Some people learn by taking copious notes. Beethoven, for example, left behind an enormous number of sketchbooks, yet he said he never actually looked at them when he composed.
Asked why he kept them, he is reported to have replied, "If I don't write it down immediately, I forget it right away. If I put it into a sketchbook, I never forget it and I never have to look it up again." Some people learn by doing. Others learn by hearing themselves talk.
A chief executive I know who converted a small and mediocre family business into the leading com-pany in its industry was one of those people who learn by talking. He was in the habit of calling his entire senior staff into his office once a week and then talking at them for two or three hours. He would raise policy issues and argue three different positions on each one. He rarely asked his as-sociates for comments or questions; he simply needed an audience to hear himself talk. That's how he learned. And although he is a fairly extreme case, learning through talking is by no means an unusual method. Successful trial lawyers learn the same way, as do many medical diagnosticians (and so do I).
Of all the important pieces of self knowledge, understanding how you learn is the easiest to acquire. When I ask people, "How do you learn?" most of them know the answer. But when I ask, "Do you act on this knowledge?" few answer yes. And yet, acting on this knowledge is the key to perform-ance; or rather, not acting on this knowledge condemns one to non performance.
Am I a reader or a listener? and How do I learn? are the first questions to ask.
But they are by no means the only ones.
To manage yourself effectively, you also have to ask. Do I work well with people or am I a loner? And if you do work well with people, you then must ask. In what relationship? Some people work best as subordinates.
General George Patton, the great American military hero of World War II, is a prime example. Pat-ton was America's top troop commander. Yet when he was proposed for an independent command. General George Marshall, the U.S. chief of staff-and probably the most successful picker of men in U.S. history - said, "Patton is the best subordinate the American army has ever produced, but he would be the worst commander." Some people work best as team members.
Others work best alone. Some are exceptionally talented as coaches and mentors; others are sim-ply incompetent as mentors.
Another crucial question is: Do I produce results as a decision maker or as an adviser? A great many people perform best as advisers but cannot take the burden and pressure of making the deci-sion. A good many other people, by contrast, need an adviser to force themselves to think; then they can make decisions and act on them with speed, self confidence, and courage.
This is a reason, by the way, that the number two person in an organization often fails when pro-moted to the number one position. The top spot requires a decision maker. Strong decision makers often put somebody they trust into the number two spot as their adviser and in that position the person is outstanding.
But in the number one spot, the same person fails. He or she knows what the decision should be but cannot accept the responsibility of actually making it.
Other important questions to ask include.
Do I perform well under stress, or do I need a highly structured and predictable environment? Do I work best in a big organization or a small one? Few people work well in all kinds of environments.
Again and again, I have seen people who were very successful in large organizations flounder mis-erably when they moved into smaller ones. And the reverse is equally true.
The conclusion bears repeating: Do not try to change yourself-you are unlikely to succeed. But work hard to improve the way you perform. And try not to take on work you cannot perform or will only perform poorly.
What Are My Values?
To be able to manage yourself, you finally have to ask. What are my values? This is not a question of ethics. With respect to ethics, the rules are the same for everybody, and the test is a simple one.
I call it the "mirror test." In the early years of this century, the most highly respected diplomat of all the great powers was the German ambassador in London. He was clearly destined for great things - to become his country's foreign minister, at least, if not its federal chancellor. Yet in 1906 he abruptly resigned rather than preside over a dinner given by the diplomatic corps for Edward VII. The king was a notorious womanizer and made it clear what kind of dinner he wanted. The ambas-sador is reported to have said, "I refuse to see a pimp in the mirror in the morning when I shave." That is the mirror test. Ethics requires that you ask yourself. What kind of person do I want to see in the mirror in the morning? What is ethical behaviour in one kind of organization or situation is ethical behaviour in another.
But ethics is only part of a value system - especially of an organization's value system.
To work in an organization whose value system is unacceptable or incompatible with one's own condemns a person both to frustration and to non performance.
Consider the experience of a highly successful human resources executive whose company was acquired by a bigger organization. After the acquisition, she was promoted to do the kind of work she did best, which included selecting people for important positions.
The executive deeply believed that a company should hire people for such positions from the out-side only after exhausting all the inside possibilities. But her new company believed in first looking outside "to bring in fresh blood." There is something to be said for both approaches - in my experi-ence, the proper one is to do some of both. They are, however, fundamentally incompatible- not as
policies but as values. They bespeak different views of the relationship between organizations and people; different views of the responsibility of an organization to its people and their development; and different views of a person's most important contribution to an enterprise. After several years of frustration, the executive quit - at considerable financial loss. Her values and the values of the or-ganization simply were not compatible.
Similarly, whether a pharmaceutical company tries to obtain results by making constant, small im-provements or by achieving occasional, highly expensive, and risky "breakthroughs" is not primarily an economic question. The results of either strategy may be pretty much the same. At bottom, there is a conflict between a value system that sees the company's contribution in terms of helping physi-cians do better what they already do and a value system that is oriented toward making scientific discoveries.
Whether a business should be run for short-term results or with a focus on the long term is likewise a question of values. Financial analysts believe that businesses can be run for both simultaneously.
Successful businesspeople know better. To be sure, every company has to produce short-term results.
But in any conflict between short-term results and long-term growth, each company will determine Its own priority.
This is not primarily a disagreement about economics. It is fundamentally a value conflict regarding the function of a business and the responsibility of management.
Value conflicts are not limited to business organizations. One of the fastest growing pastoral churches in the United States measures success by the number of new parishioners. Its leadership believes that what matters is how many newcomers join the congregation. The Good Lord will then minister to their spiritual needs or at least to the needs of a sufficient percentage. Another pastoral, evangelical church believes that what matters is people's spiritual growth. The church eases out newcomers who join but do not enter into its spiritual life.
Again, this is not a matter of numbers.
At first glance, it appears that the second church grows more slowly. But it retains a far larger pro-portion of newcomers than the first one does. Its growth, in other words, is more solid.
This is also not a theological problem, or only secondarily so. It is a problem about values. In a pub-lic debate, one pastor argued, "Unless you first come to church, you will never find the gate to the Kingdom of Heaven." "No," answered the other. "Until you first look for the gate to the Kingdom of Heaven, you don't belong in church." Organizations, like people, have values.
To be effective in an organization, a person's values must be compatible with the organization's values. They do not need to be the same, but they must be close enough to coexist. Otherwise, the person will not only be frustrated but also will not produce results.
A person's strengths and the way that person performs rarely conflict; the two are complementary. But there is sometimes a conflict between a person's values and his or her strengths.
What one does well-even very well and successfully - may not fit with one's value system. In that case, the work may not appear to be worth devoting one's life to (or even a substantial portion thereof).
If I may, allow me to interject a personal note. Many years ago, I too had to decide between my values and what I was doing successfully. I was doing very well as a young investment banker in London in the mid-1930´s, and the work clearly fit my strengths. Yet I did not see myself making a
contribution as an asset manager. People, I realized, were what I valued, and I saw no point in be-ing the richest man in the cemetery.
I had no money and no other job prospects.
Despite the continuing Depression, I quit-and it was the right thing to do. Values, in other words, are and should be the ultimate test.
Where Do I Belong?
A small number of people know very early where they belong. Mathematicians, musicians, and cooks, for instance, are usually mathematicians, musicians, and cooks by the time they are four or five years old. Physicians usually decide on their careers in their teens, if not earlier.
But most people, especially highly gifted people, do not really know where they belong until they are well past their mid-twenties. By that time, however, they should know the answers to the three questions: What are my strengths? How do I perform? and. What are my values? And then they can and should decide where they belong.
Or rather, they should be able to decide where they do not belong. The person who has learned that he or she does not perform well in a big organization should have learned to say no to a posi-tion in one. The person who has learned that he or she is not a decision maker should have learned to say no to a decision-making assignment. A General Patton (who probably never learned this himself) should have learned to say no to an independent command.
Equally important, knowing the answer to these questions enables a person to say to an opportu-nity, an offer, or an assignment, "Yes, I will do that. But this is the way I should be doing it. This is the way it should be structured. This is the way the relationships should be.
These are the kind of results you should expect from me, and in this time frame, because this is who I am." Successful careers are not planned.
They develop when people are prepared for opportunities because they know their strengths, their method of work, and their values. Knowing where one belongs can transform an ordinary person - hardworking and competent but otherwise mediocre-into an outstanding performer.
What Should I Contribute?
Throughout history, the great majority of people never had to ask the question.
What should I contribute? They were told what to contribute, and their tasks were dictated either by the work itself as it was for the peasant or artisan - or by a master or a mistress - as it was for do-mestic servants. And until very recently, it was taken for granted that most people were subordi-nates who did as they were told. Even in the 1950s and 1960s, the new knowledge workers (the so-called organization men) looked to their company's personnel department to plan their careers.
Then in the late 1960s, no one wanted to be told what to do any longer. Young men and women began to ask. What do / want to do? And what they heard was that the way to contribute was to "do your own thing." But this solution was as wrong as the organization men's had been. Very few of the people who believed that doing one's own thing would lead to contribution, self-fulfilment, and suc-cess achieved any of the three.
But still, there is no return to the old answer of doing what you are told or assigned to do. Knowl-edge workers in particular have to learn to ask a question that has not been asked before: What should my contribution be? To answer it, they must address three distinct elements: What does the situation require? Given my strengths, my way of performing, and my values, how can I make the
greatest contribution to what needs to be done? And finally, What results have to be achieved to make a difference? Consider the experience of a newly appointed hospital administrator. The hospi-tal was big and prestigious, but it had been coasting on its reputation for 30 years. The new admin-istrator decided that his contribution should be to establish a standard of excellence in one impor-tant area within two years. He chose to focus on the emergency room, which was big, visible, and sloppy. He decided that every patient who came into the ER had to be seen by a qualified nurse within 60 seconds. Within 12 months, the hospital's emergency room had become a model for all hospitals in the United States, and within another two years, the whole hospital had been trans-formed.
As this example suggests, it is rarely possible -or even particularly fruitful - to look too far ahead. A plan can usually cover no more than 18 months and still be reasonably clear and specific. So the question in most cases should be. Where and how can I achieve results that will make a difference within the next year and a half? The answer must balance several things. First, the results should be hard to achieve-they should require "stretching," to use the current buzzword.
But also, they should be within reach. To aim at results that cannot be achieved-or that can be only under the most unlikely circumstances - is not being ambitious; it is being foolish. Second, the re-sults should be meaningful.
They should make a difference. Finally, results should be visible and, if at all possible, measurable. From this will come a course of action: what to do, where and how to start, and what goals and deadlines to set.
Responsibility for Relationships
Very few people work by themselves and achieve results by themselves - a few great artists, a few great scientists, a few great athletes. Most people work with others and are effective with other people. That is true whether they are members of an organization or independently employed. Managing yourself requires taking responsibility for relationships. This has two parts.
The first is to accept the fact that other people are as much individuals as you yourself are. They perversely insist on behaving like human beings.
This means that they too have their strengths; they too have their ways of getting things done; they too have their values. To be effective, therefore, you have to know the strengths, the performance modes, and the values of your co-workers.
That sounds obvious, but few people pay attention to it. Typical is the person who was trained to write reports in his or her first assignment because that boss was a reader. Even if the next boss is a listener, the person goes on writing reports that, invariably, produce no results.
Invariably the boss will think the employee is stupid, incompetent, and lazy, and he or she will fail. But that could have been avoided if the employee had only looked at the new boss and analyzed how this boss performs.
Bosses are neither a title on the organization chart nor a "function.”They are individuals and are entitled to do their work in the way they do it best, it is incumbent on the people who work with them to observe them, to find out how they work, and to adapt themselves to what makes their bosses most effective.
This, in fact, is the secret of "managing" the boss.
The same holds true for all your co-workers. Each works his or her way, not your way. And each is entitled to work in his or her way. What matters is whether they perform and what their values are. As for how they perform - each is likely to do it differently. The first secret of effectiveness is to un-
derstand the people you work with and depend on so that you can make use of their strengths, their ways of working, and their values. Working relationships are as much based on the people as they are on the work.
The second part of relationship responsibility is taking responsibility for communication. Whenever I, or any other consultant, start to work with an organization, the first thing I hear about are all the personality conflicts. Most of these arise from the fact that people do not know what other people are doing and how they do their work, or what contribution the other people are concentrating on and what results they expect.
And the reason they do not know is that they have not asked and therefore have not been told.
This failure to ask reflects human stupidity less than it reflects human history.
Until recently, it was unnecessary to tell any of these things to anybody. In the medieval city, every-one in a district plied the same trade. In the countryside, everyone in a valley planted the same crop as soon as the frost was out of the ground. Even those few people who did things that were not "common" worked alone, so they did not have to tell anyone what they were doing.
Today the great majority of people work with others who have different tasks and responsibilities. The marketing vice president may have come out of sales and know everything about sales, but she knows nothing about the things she has never done-pricing, advertising, packaging, and the like. So the people who do these things must make sure that the marketing vice president under-stands what they are trying to do, why they are trying to do it, how they are going to do it, and what results to expect.
If the marketing vice president does not understand what these high-grade knowledge specialists are doing, it is primarily their fault, not hers. They have not educated her. Conversely, it is the mar-keting vice president's responsibility to make sure that all of her co-workers understand how she looks at marketing: what her goals are, how she works, and what she expects of herself and of each one of them.
Even people who understand the importance of taking responsibility for relationships often do not communicate sufficiently with their associates. They are afraid of being thought presumptuous or inquisitive or stupid. They are wrong. Whenever someone goes to his or her associates and says, "This is what I am good at. This is how I work. These are my values. This is the contribution I plan to concentrate on and the results I should be expected to deliver," the response is always, "This is most helpful.
But why didn't you tell me earlier?" And one gets the same reaction - without exception, in my ex-perience-if one continues by asking, "And what do I need to know about your strengths, how you perform, your values, and your proposed contribution?" In fact, knowledge workers should request this of everyone with whom they work, whether as subordinate, superior, colleague, or team mem-ber. And again, whenever this is done, the reaction is always, "Thanks for asking me. But why didn't you ask me earlier?" Organizations are no longer built on force but on trust. The existence of trust between people does not necessarily mean that they like one another. It means that they under-stand one another.
Taking responsibility for relationships is therefore an absolute necessity.
It is a duty. Whether one is a member of the organization, a consultant to it, a supplier, or a distribu-tor, one owes that responsibility to all one's co-workers: those whose work one depends on as well as those who depend on one's own work.
The Second Half of Your Life
When work for most people meant manual labor, there was no need to worry about the second half of your life.
You simply kept on doing what you had always done. And if you were lucky enough to survive 40 years of hard work in the mill or on the railroad, you were quite happy to spend the rest of your life doing nothing. Today, however, most work is knowledge work, and knowledge workers are not "fin-ished" after 40 years on the job, they are merely bored.
We hear a great deal of talk about the midlife crisis of the executive. It is mostly boredom. At 45, most executives have reached the peak of their business careers, and they know it. After 20 years of doing very much the same kind of work, they are very good at their jobs.
But they are not learning or contributing or deriving challenge and satisfaction from the job. And yet they are still likely to face another 20 if not 25 years of work. That is why managing oneself increas-ingly leads one to begin a second career.
There are three ways to develop a second career. The first is actually to start one. Often this takes nothing more than moving from one kind of organization to another: the divisional controller in a large corporation, for instance, becomes the controller of a medium-sized hospital.
But there are also growing numbers of people who move into different lines of work altogether: the business executive or government official who enters the ministry at 45, for instance; or the midlevel manager who leaves corporate life after 20 years to attend law school and become a small-town attorney.
We will see many more second careers undertaken by people who have achieved modest success in their first jobs. Such people have substantial skills, and they know how to work. They need a community-the house is empty with the children gone - and they need income as well. But above all, they need challenge.
The second way to prepare for the second half of your life is to develop a parallel career. Many people who are very successful in their first careers stay in the work they have been doing, either on a full-time or part-time or consulting basis. But in addition, they create a parallel job, usually in a non profit organization, that takes another ten hours of work a week. They might take over the ad-ministration of their church, for instance, or the presidency of the local Girl Scouts council. They might run the battered women's shelter, work as a children's librarian for the local public library, sit on the school board, and so on.
Finally, there are the social entrepreneurs.
These are usually people who have been very successful in their first careers. They love their work, but it no longer challenges them. In many cases they keep on doing what they have been doing all along but spend less and less of their time on it. They also start another activity, usually a non-profit. My friend Bob Buford, for example, built a very successful television company that he still runs. But he has also founded and built a successful non-profit organization that works with Protes-tant churches, and he is building another to teach social entrepreneurs how to manage their own non-profit ventures while still running their original businesses.
People who manage the second half of their lives may always be a minority.
The majority may "retire on the job" and count the years until their actual retirement. But it is this minority, the men and women who see a long working- life expectancy as an opportunity both for themselves and for society, who will become leaders and models.
There is one prerequisite for managing the second half of your life: You must begin long before you enter it.
When it first became clear 30 years ago that working-life expectancies were lengthening very fast, many observers (including myself) believed that retired people would increasingly become volun-teers for non-profit institutions. That has not happened. If one does not begin to volunteer before one is 40 or so, one will not volunteer once past 60.
Similarly, ail the social entrepreneurs I know began to work in their chosen second enterprise long before they reached their peak in their original business.
Consider the example of a successful lawyer, the legal counsel to a large corporation, who has started a venture to establish model schools in his state.
He began to do volunteer legal work for the schools when he was around 35. He was elected to the school board at age 40. At age 50, when he had amassed a fortune, he started his own enterprise to build and to run model schools. He is, however, still working nearly full-time as the lead counsel in the company he helped found as a young lawyer.
There is another reason to develop a second major interest, and to develop it early. No one can expect to live very long without experiencing a serious setback in his or her life or work. There is the competent engineer who is passed over for promotion at age 45- There is the competent college professor who realizes at age 42 that she will never get a professorship at a big university, even though she may be fully qualified for it.
There are tragedies in one's family life: the break-up of one's marriage or the loss of a child. At such times, a second major interest-not just a hobby-may make all the difference. The engineer, for ex-ample, now knows that he has not been very successful in his job. But in his outside activity-as church treasurer, for example - he is a success. One's family may break up, but in that outside ac-tivity there is still a community.
In a society in which success has become so terribly important, having options will become increas-ingly vital. Historically, there was no such thing as "success." The overwhelming majority of people did not expect anything but to stay in their "proper station," as an old English prayer has it. The only mobility was downward mobility.
In a knowledge society, however, we expect everyone to be a success. This is clearly an impossibil-ity. For a great many people, there is at best an absence of failure. Wherever there is success, there has to be failure. And then it is vitally important for the individual, and equally for the individ-ual's family, to have an area in which he or she can contribute, make a difference, and be some-body That means finding a second area-whether in a second career, a parallel career, or a social venture-that offers an opportunity for being a leader, for being respected, for being a success.
The challenges of managing oneself may seem obvious, if not elementary.
And the answers may seem self-evident to the point of appearing naive. But managing oneself re-quires new and unprecedented things from the individual, and especially from the knowledge worker. In effect, managing oneself demands that each knowledge worker think and behave like a chief executive officer. Further, the shift from manual workers who do as they are told to knowledge workers who have to manage themselves profoundly challenges social structure. Every existing society, even the most individualistic one, takes two things for granted, if only subconsciously: that organizations outlive workers, and that most people stay put.
But today the opposite is true. Knowledge workers outlive organizations, and they are mobile. The need to manage oneself is therefore creating a revolution in human affairs.
History's great achievers - a Napoleon, a da Vinci, a Mozart - have always managed themselves. That, in large measure, is what makes them great achievers. But they are rare exceptions, so un-usual both in their talents and their accomplishments as to be considered outside the boundaries of ordinary human existence. Now, most of us, even those of us with modest endowments, will have to learn to manage ourselves. We will have to learn to develop ourselves. We will have to place our-selves where we can make the greatest contribution. And we will have to stay mentally alert and engaged during a 50-year working life, which means knowing how and when to change the work we do.
What Are My Strengths?
Most people think they know what they are good at. They are usually wrong. More often, people know what they are not good at - and even then more people are wrong than right. And yet, a per-son can perform only from strength. One cannot build performance on weaknesses, let alone on something one cannot do at all.
Throughout history, people had little need to know their strengths. A person was born into a position and a line of work: The peasant's son would also be a peasant; the artisan's daughter, an artisan's wife; and so on. But now people have choices. We need to know our strengths in order to know where we belong.
The only way to discover your strengths is through feedback analysis.
Whenever you make a key decision or take a key action, write down what you expect will happen. Nine or 12 months later, compare the actual results with your expectations. I have been practicing this method for 15 to 20 years now, and every time I do it, I am surprised.
The feedback analysis showed me, for instance-and to my great surprise-that I have an intuitive understanding of technical people, whether they are engineers or accountants or market research-ers.
It also showed me that I don't really resonate with generalists.
Feedback analysis is by no means new. It was invented sometime in the fourteenth century by an otherwise totally obscure German theologian and picked up quite independently, some 150 years later, by John Calvin and Ignatius of Loyola, each of whom incorporated it into the practice of his followers.
1 Peter F. Drucker is the Marie Rankin Clarke Professor of Social Science and Management (Emeritus) at Claremont Graduate University in Claremont, California. This article is an excerpt from his book Management Challenges for the 21st Century (HarperCollins, 1999)-
In fact, the steadfast focus on performance and results that this habit produces explains why the institutions these two men founded, the Calvinist church and the Jesuit order, came to dominate Europe within 30 years.
Practiced consistently, this simple method will show you within a fairly short period of time, maybe two or three years, where your strengths lie - and this is the most important thing to know. The method will show you what you are doing or failing to do that deprives you of the full benefits of your strengths. It will show you where you are not particularly competent. And finally, it will show you where you have no strengths and cannot perform.
Several implications for action follow from feedback analysis. First and foremost, concentrate on your strengths. Put yourself where your strengths can produce results.
Second, work on improving your strengths. Analysis will rapidly show where you need to improve skills or acquire new ones. It will also show the gaps in your knowledge -and those can usually be filled. Mathematicians are born, but everyone can learn trigonometry.
Third, discover where your intellectual arrogance is causing disabling ignorance and overcome it. Far too many people - especially people with great expertise in one area-are contemptuous of knowledge in other areas or believe that being bright is a substitute for knowledge. First-rate engi-neers, for instance, tend to take pride in not knowing anything about people. Human beings, they believe, are much too disorderly for the good engineering mind.
Human resources professionals, by contrast, often pride themselves on their ignorance of elemen-tary accounting or of quantitative methods altogether. But taking pride in such ignorance is self de-feating.
Go to work on acquiring the skills and knowledge you need to fully realize your strengths.
It is equally essential to remedy your bad habits-the things you do or fail to do that inhibit your effec-tiveness and performance. Such habits will quickly show up in the feedback. For example, a plan-ner may find that his beautiful plans fail because he does not follow through on them. Like so many brilliant people, he believes that ideas move mountains. But bulldozers move mountains; ideas show where the bulldozers should go to work. This planner will have to learn that the work does not stop when the plan is completed. He must find people to carry out the plan and explain it to them. He must adapt and change it as he puts it into action. And finally, he must decide when to stop pushing the plan.
At the same time, feedback will also reveal when the problem is a lack of manners. Manners are the lubricating oil of an organization. It is a law of nature that two moving bodies in contact with each other create friction. This is as true for human beings as it is for inanimate objects. Manners- simple things like saying "please" and "thank you" and knowing a person's name or asking after her family-enable two people to work together whether they like each other or not. Bright people, especially bright young people, often do not understand this. If analysis shows that someone's brilliant work fails again and again as soon as cooperation from others is required, it probably indicates a lack of courtesy - that is, a lack of manners.
Comparing your expectations with your results also indicates what not to do. We all have a vast number of areas in which we have no talent or skill and little chance of becoming even mediocre.
In those areas a person - and especially a knowledge worker-should not take on work, jobs, and assignments.
One should waste as little effort as possible on improving areas of low competence.
It takes far more energy and work to improve from incompetence to mediocrity than it takes to im-prove from first-rate performance to excellence.
And yet most people-especially most teachers and most organizations concentrate on making in-competent performers into mediocre ones. Energy, resources, and time should go instead to mak-ing a competent person into a star performer.
How Do I Perform?
Amazingly few people know how they get things done. Indeed, most of us do not even know that different people work and perform differently. Too many people work in ways that are not their ways, and that almost guarantees non-performance.
For knowledge workers, How do I perform? may be an even more important question than What are my strengths? Like one's strengths, how one performs is unique. It is a matter of personality.
Whether personality be a matter of nature or nurture, it surely is formed long before a person goes to work. And how a person performs is a given, just as what a person is good at or not good at is a given. A person's way of performing can be slightly modified, but it is unlikely to be completely changed-and certainly not easily. Just as people achieve results by doing what they are good at, they also achieve results by working in ways that they best perform. A few common personality traits usually determine how a person performs.
Am I a reader or a listener? The first thing to know is whether you are a reader or a listener. Far too few people even know that there are readers and listeners and that people are rarely both. Even fewer know which of the two they themselves are. But some examples will show how damaging such ignorance can be.
When Dwight Eisenhower was Supreme Commander of the Allied forces in Europe, he was the darling of the press. His press conferences were famous for their style - General Eisenhower showed total command of whatever question he was asked, and he was able to describe a situation and explain a policy in two or three beautifully polished and elegant sentences. Ten years later, the same journalists who had been his admirers held President Eisenhower in open contempt. He never addressed the questions, they complained, but rambled on endlessly about something else.
And they constantly ridiculed him for butchering the King's English in incoherent and ungrammatical answers.
Eisenhower apparently did not know that he was a reader, not a listener.
When he was Supreme Commander in Europe, his aides made sure that every question from the press was presented in writing at least half an hour before a conference was to begin. And then Eisenhower was in total command. When he became president, he succeeded two listeners, Frank-lin D. Roosevelt and Harry Truman. Both men knew themselves to be listeners and both enjoyed free-for-all press conferences. Eisenhower may have felt that he had to do what his two predeces-sors had done. As a result, he never even heard the questions journalists asked. And Eisenhower is not even an extreme case of a non-listener.
A few years later, Lyndon Johnson destroyed his presidency, in large measure, by not knowing that he was a listener.
His predecessor, John Kennedy, was a reader who had assembled a brilliant group of writers as his assistants, making sure that they wrote to him before discussing their memos in person. Johnson kept these people on his staff-and they kept on writing. He never, apparently, understood one word of what they wrote. Yet as a senator, Johnson had been superb; for parliamentarians have to be, above all, listeners.
Few listeners can be made, or can make themselves, into competent readers - and vice versa. The listener who tries to be a reader will, therefore, suffer the fate of Lyndon Johnson, whereas the reader who tries to be a listener will suffer the fate of Dwight Eisenhower. They will not perform or achieve.
How do I learn? The second thing to know about how one performs is to know how one learns. Many first-class writers - Winston Churchill is but one example -do poorly in school. They tend to remember their schooling as pure torture. Yet few of their classmates remember it the same way. They may not have enjoyed the school very much, but the worst they suffered was boredom.
The explanation is that writers do not, as a rule, learn by listening and reading. They learn by writ-ing. Because schools do not allow them to learn this way, they get poor grades.
Schools everywhere are organized on the assumption that there is only one right way to learn and that it is the same way for everybody. But to be forced to learn the way a school teaches is sheer hell for students who learn differently.
Indeed, there are probably half a dozen different ways to learn.
There are people, like Churchill, who learn by writing. Some people learn by taking copious notes. Beethoven, for example, left behind an enormous number of sketchbooks, yet he said he never actually looked at them when he composed.
Asked why he kept them, he is reported to have replied, "If I don't write it down immediately, I forget it right away. If I put it into a sketchbook, I never forget it and I never have to look it up again." Some people learn by doing. Others learn by hearing themselves talk.
A chief executive I know who converted a small and mediocre family business into the leading com-pany in its industry was one of those people who learn by talking. He was in the habit of calling his entire senior staff into his office once a week and then talking at them for two or three hours. He would raise policy issues and argue three different positions on each one. He rarely asked his as-sociates for comments or questions; he simply needed an audience to hear himself talk. That's how he learned. And although he is a fairly extreme case, learning through talking is by no means an unusual method. Successful trial lawyers learn the same way, as do many medical diagnosticians (and so do I).
Of all the important pieces of self knowledge, understanding how you learn is the easiest to acquire. When I ask people, "How do you learn?" most of them know the answer. But when I ask, "Do you act on this knowledge?" few answer yes. And yet, acting on this knowledge is the key to perform-ance; or rather, not acting on this knowledge condemns one to non performance.
Am I a reader or a listener? and How do I learn? are the first questions to ask.
But they are by no means the only ones.
To manage yourself effectively, you also have to ask. Do I work well with people or am I a loner? And if you do work well with people, you then must ask. In what relationship? Some people work best as subordinates.
General George Patton, the great American military hero of World War II, is a prime example. Pat-ton was America's top troop commander. Yet when he was proposed for an independent command. General George Marshall, the U.S. chief of staff-and probably the most successful picker of men in U.S. history - said, "Patton is the best subordinate the American army has ever produced, but he would be the worst commander." Some people work best as team members.
Others work best alone. Some are exceptionally talented as coaches and mentors; others are sim-ply incompetent as mentors.
Another crucial question is: Do I produce results as a decision maker or as an adviser? A great many people perform best as advisers but cannot take the burden and pressure of making the deci-sion. A good many other people, by contrast, need an adviser to force themselves to think; then they can make decisions and act on them with speed, self confidence, and courage.
This is a reason, by the way, that the number two person in an organization often fails when pro-moted to the number one position. The top spot requires a decision maker. Strong decision makers often put somebody they trust into the number two spot as their adviser and in that position the person is outstanding.
But in the number one spot, the same person fails. He or she knows what the decision should be but cannot accept the responsibility of actually making it.
Other important questions to ask include.
Do I perform well under stress, or do I need a highly structured and predictable environment? Do I work best in a big organization or a small one? Few people work well in all kinds of environments.
Again and again, I have seen people who were very successful in large organizations flounder mis-erably when they moved into smaller ones. And the reverse is equally true.
The conclusion bears repeating: Do not try to change yourself-you are unlikely to succeed. But work hard to improve the way you perform. And try not to take on work you cannot perform or will only perform poorly.
What Are My Values?
To be able to manage yourself, you finally have to ask. What are my values? This is not a question of ethics. With respect to ethics, the rules are the same for everybody, and the test is a simple one.
I call it the "mirror test." In the early years of this century, the most highly respected diplomat of all the great powers was the German ambassador in London. He was clearly destined for great things - to become his country's foreign minister, at least, if not its federal chancellor. Yet in 1906 he abruptly resigned rather than preside over a dinner given by the diplomatic corps for Edward VII. The king was a notorious womanizer and made it clear what kind of dinner he wanted. The ambas-sador is reported to have said, "I refuse to see a pimp in the mirror in the morning when I shave." That is the mirror test. Ethics requires that you ask yourself. What kind of person do I want to see in the mirror in the morning? What is ethical behaviour in one kind of organization or situation is ethical behaviour in another.
But ethics is only part of a value system - especially of an organization's value system.
To work in an organization whose value system is unacceptable or incompatible with one's own condemns a person both to frustration and to non performance.
Consider the experience of a highly successful human resources executive whose company was acquired by a bigger organization. After the acquisition, she was promoted to do the kind of work she did best, which included selecting people for important positions.
The executive deeply believed that a company should hire people for such positions from the out-side only after exhausting all the inside possibilities. But her new company believed in first looking outside "to bring in fresh blood." There is something to be said for both approaches - in my experi-ence, the proper one is to do some of both. They are, however, fundamentally incompatible- not as
policies but as values. They bespeak different views of the relationship between organizations and people; different views of the responsibility of an organization to its people and their development; and different views of a person's most important contribution to an enterprise. After several years of frustration, the executive quit - at considerable financial loss. Her values and the values of the or-ganization simply were not compatible.
Similarly, whether a pharmaceutical company tries to obtain results by making constant, small im-provements or by achieving occasional, highly expensive, and risky "breakthroughs" is not primarily an economic question. The results of either strategy may be pretty much the same. At bottom, there is a conflict between a value system that sees the company's contribution in terms of helping physi-cians do better what they already do and a value system that is oriented toward making scientific discoveries.
Whether a business should be run for short-term results or with a focus on the long term is likewise a question of values. Financial analysts believe that businesses can be run for both simultaneously.
Successful businesspeople know better. To be sure, every company has to produce short-term results.
But in any conflict between short-term results and long-term growth, each company will determine Its own priority.
This is not primarily a disagreement about economics. It is fundamentally a value conflict regarding the function of a business and the responsibility of management.
Value conflicts are not limited to business organizations. One of the fastest growing pastoral churches in the United States measures success by the number of new parishioners. Its leadership believes that what matters is how many newcomers join the congregation. The Good Lord will then minister to their spiritual needs or at least to the needs of a sufficient percentage. Another pastoral, evangelical church believes that what matters is people's spiritual growth. The church eases out newcomers who join but do not enter into its spiritual life.
Again, this is not a matter of numbers.
At first glance, it appears that the second church grows more slowly. But it retains a far larger pro-portion of newcomers than the first one does. Its growth, in other words, is more solid.
This is also not a theological problem, or only secondarily so. It is a problem about values. In a pub-lic debate, one pastor argued, "Unless you first come to church, you will never find the gate to the Kingdom of Heaven." "No," answered the other. "Until you first look for the gate to the Kingdom of Heaven, you don't belong in church." Organizations, like people, have values.
To be effective in an organization, a person's values must be compatible with the organization's values. They do not need to be the same, but they must be close enough to coexist. Otherwise, the person will not only be frustrated but also will not produce results.
A person's strengths and the way that person performs rarely conflict; the two are complementary. But there is sometimes a conflict between a person's values and his or her strengths.
What one does well-even very well and successfully - may not fit with one's value system. In that case, the work may not appear to be worth devoting one's life to (or even a substantial portion thereof).
If I may, allow me to interject a personal note. Many years ago, I too had to decide between my values and what I was doing successfully. I was doing very well as a young investment banker in London in the mid-1930´s, and the work clearly fit my strengths. Yet I did not see myself making a
contribution as an asset manager. People, I realized, were what I valued, and I saw no point in be-ing the richest man in the cemetery.
I had no money and no other job prospects.
Despite the continuing Depression, I quit-and it was the right thing to do. Values, in other words, are and should be the ultimate test.
Where Do I Belong?
A small number of people know very early where they belong. Mathematicians, musicians, and cooks, for instance, are usually mathematicians, musicians, and cooks by the time they are four or five years old. Physicians usually decide on their careers in their teens, if not earlier.
But most people, especially highly gifted people, do not really know where they belong until they are well past their mid-twenties. By that time, however, they should know the answers to the three questions: What are my strengths? How do I perform? and. What are my values? And then they can and should decide where they belong.
Or rather, they should be able to decide where they do not belong. The person who has learned that he or she does not perform well in a big organization should have learned to say no to a posi-tion in one. The person who has learned that he or she is not a decision maker should have learned to say no to a decision-making assignment. A General Patton (who probably never learned this himself) should have learned to say no to an independent command.
Equally important, knowing the answer to these questions enables a person to say to an opportu-nity, an offer, or an assignment, "Yes, I will do that. But this is the way I should be doing it. This is the way it should be structured. This is the way the relationships should be.
These are the kind of results you should expect from me, and in this time frame, because this is who I am." Successful careers are not planned.
They develop when people are prepared for opportunities because they know their strengths, their method of work, and their values. Knowing where one belongs can transform an ordinary person - hardworking and competent but otherwise mediocre-into an outstanding performer.
What Should I Contribute?
Throughout history, the great majority of people never had to ask the question.
What should I contribute? They were told what to contribute, and their tasks were dictated either by the work itself as it was for the peasant or artisan - or by a master or a mistress - as it was for do-mestic servants. And until very recently, it was taken for granted that most people were subordi-nates who did as they were told. Even in the 1950s and 1960s, the new knowledge workers (the so-called organization men) looked to their company's personnel department to plan their careers.
Then in the late 1960s, no one wanted to be told what to do any longer. Young men and women began to ask. What do / want to do? And what they heard was that the way to contribute was to "do your own thing." But this solution was as wrong as the organization men's had been. Very few of the people who believed that doing one's own thing would lead to contribution, self-fulfilment, and suc-cess achieved any of the three.
But still, there is no return to the old answer of doing what you are told or assigned to do. Knowl-edge workers in particular have to learn to ask a question that has not been asked before: What should my contribution be? To answer it, they must address three distinct elements: What does the situation require? Given my strengths, my way of performing, and my values, how can I make the
greatest contribution to what needs to be done? And finally, What results have to be achieved to make a difference? Consider the experience of a newly appointed hospital administrator. The hospi-tal was big and prestigious, but it had been coasting on its reputation for 30 years. The new admin-istrator decided that his contribution should be to establish a standard of excellence in one impor-tant area within two years. He chose to focus on the emergency room, which was big, visible, and sloppy. He decided that every patient who came into the ER had to be seen by a qualified nurse within 60 seconds. Within 12 months, the hospital's emergency room had become a model for all hospitals in the United States, and within another two years, the whole hospital had been trans-formed.
As this example suggests, it is rarely possible -or even particularly fruitful - to look too far ahead. A plan can usually cover no more than 18 months and still be reasonably clear and specific. So the question in most cases should be. Where and how can I achieve results that will make a difference within the next year and a half? The answer must balance several things. First, the results should be hard to achieve-they should require "stretching," to use the current buzzword.
But also, they should be within reach. To aim at results that cannot be achieved-or that can be only under the most unlikely circumstances - is not being ambitious; it is being foolish. Second, the re-sults should be meaningful.
They should make a difference. Finally, results should be visible and, if at all possible, measurable. From this will come a course of action: what to do, where and how to start, and what goals and deadlines to set.
Responsibility for Relationships
Very few people work by themselves and achieve results by themselves - a few great artists, a few great scientists, a few great athletes. Most people work with others and are effective with other people. That is true whether they are members of an organization or independently employed. Managing yourself requires taking responsibility for relationships. This has two parts.
The first is to accept the fact that other people are as much individuals as you yourself are. They perversely insist on behaving like human beings.
This means that they too have their strengths; they too have their ways of getting things done; they too have their values. To be effective, therefore, you have to know the strengths, the performance modes, and the values of your co-workers.
That sounds obvious, but few people pay attention to it. Typical is the person who was trained to write reports in his or her first assignment because that boss was a reader. Even if the next boss is a listener, the person goes on writing reports that, invariably, produce no results.
Invariably the boss will think the employee is stupid, incompetent, and lazy, and he or she will fail. But that could have been avoided if the employee had only looked at the new boss and analyzed how this boss performs.
Bosses are neither a title on the organization chart nor a "function.”They are individuals and are entitled to do their work in the way they do it best, it is incumbent on the people who work with them to observe them, to find out how they work, and to adapt themselves to what makes their bosses most effective.
This, in fact, is the secret of "managing" the boss.
The same holds true for all your co-workers. Each works his or her way, not your way. And each is entitled to work in his or her way. What matters is whether they perform and what their values are. As for how they perform - each is likely to do it differently. The first secret of effectiveness is to un-
derstand the people you work with and depend on so that you can make use of their strengths, their ways of working, and their values. Working relationships are as much based on the people as they are on the work.
The second part of relationship responsibility is taking responsibility for communication. Whenever I, or any other consultant, start to work with an organization, the first thing I hear about are all the personality conflicts. Most of these arise from the fact that people do not know what other people are doing and how they do their work, or what contribution the other people are concentrating on and what results they expect.
And the reason they do not know is that they have not asked and therefore have not been told.
This failure to ask reflects human stupidity less than it reflects human history.
Until recently, it was unnecessary to tell any of these things to anybody. In the medieval city, every-one in a district plied the same trade. In the countryside, everyone in a valley planted the same crop as soon as the frost was out of the ground. Even those few people who did things that were not "common" worked alone, so they did not have to tell anyone what they were doing.
Today the great majority of people work with others who have different tasks and responsibilities. The marketing vice president may have come out of sales and know everything about sales, but she knows nothing about the things she has never done-pricing, advertising, packaging, and the like. So the people who do these things must make sure that the marketing vice president under-stands what they are trying to do, why they are trying to do it, how they are going to do it, and what results to expect.
If the marketing vice president does not understand what these high-grade knowledge specialists are doing, it is primarily their fault, not hers. They have not educated her. Conversely, it is the mar-keting vice president's responsibility to make sure that all of her co-workers understand how she looks at marketing: what her goals are, how she works, and what she expects of herself and of each one of them.
Even people who understand the importance of taking responsibility for relationships often do not communicate sufficiently with their associates. They are afraid of being thought presumptuous or inquisitive or stupid. They are wrong. Whenever someone goes to his or her associates and says, "This is what I am good at. This is how I work. These are my values. This is the contribution I plan to concentrate on and the results I should be expected to deliver," the response is always, "This is most helpful.
But why didn't you tell me earlier?" And one gets the same reaction - without exception, in my ex-perience-if one continues by asking, "And what do I need to know about your strengths, how you perform, your values, and your proposed contribution?" In fact, knowledge workers should request this of everyone with whom they work, whether as subordinate, superior, colleague, or team mem-ber. And again, whenever this is done, the reaction is always, "Thanks for asking me. But why didn't you ask me earlier?" Organizations are no longer built on force but on trust. The existence of trust between people does not necessarily mean that they like one another. It means that they under-stand one another.
Taking responsibility for relationships is therefore an absolute necessity.
It is a duty. Whether one is a member of the organization, a consultant to it, a supplier, or a distribu-tor, one owes that responsibility to all one's co-workers: those whose work one depends on as well as those who depend on one's own work.
The Second Half of Your Life
When work for most people meant manual labor, there was no need to worry about the second half of your life.
You simply kept on doing what you had always done. And if you were lucky enough to survive 40 years of hard work in the mill or on the railroad, you were quite happy to spend the rest of your life doing nothing. Today, however, most work is knowledge work, and knowledge workers are not "fin-ished" after 40 years on the job, they are merely bored.
We hear a great deal of talk about the midlife crisis of the executive. It is mostly boredom. At 45, most executives have reached the peak of their business careers, and they know it. After 20 years of doing very much the same kind of work, they are very good at their jobs.
But they are not learning or contributing or deriving challenge and satisfaction from the job. And yet they are still likely to face another 20 if not 25 years of work. That is why managing oneself increas-ingly leads one to begin a second career.
There are three ways to develop a second career. The first is actually to start one. Often this takes nothing more than moving from one kind of organization to another: the divisional controller in a large corporation, for instance, becomes the controller of a medium-sized hospital.
But there are also growing numbers of people who move into different lines of work altogether: the business executive or government official who enters the ministry at 45, for instance; or the midlevel manager who leaves corporate life after 20 years to attend law school and become a small-town attorney.
We will see many more second careers undertaken by people who have achieved modest success in their first jobs. Such people have substantial skills, and they know how to work. They need a community-the house is empty with the children gone - and they need income as well. But above all, they need challenge.
The second way to prepare for the second half of your life is to develop a parallel career. Many people who are very successful in their first careers stay in the work they have been doing, either on a full-time or part-time or consulting basis. But in addition, they create a parallel job, usually in a non profit organization, that takes another ten hours of work a week. They might take over the ad-ministration of their church, for instance, or the presidency of the local Girl Scouts council. They might run the battered women's shelter, work as a children's librarian for the local public library, sit on the school board, and so on.
Finally, there are the social entrepreneurs.
These are usually people who have been very successful in their first careers. They love their work, but it no longer challenges them. In many cases they keep on doing what they have been doing all along but spend less and less of their time on it. They also start another activity, usually a non-profit. My friend Bob Buford, for example, built a very successful television company that he still runs. But he has also founded and built a successful non-profit organization that works with Protes-tant churches, and he is building another to teach social entrepreneurs how to manage their own non-profit ventures while still running their original businesses.
People who manage the second half of their lives may always be a minority.
The majority may "retire on the job" and count the years until their actual retirement. But it is this minority, the men and women who see a long working- life expectancy as an opportunity both for themselves and for society, who will become leaders and models.
There is one prerequisite for managing the second half of your life: You must begin long before you enter it.
When it first became clear 30 years ago that working-life expectancies were lengthening very fast, many observers (including myself) believed that retired people would increasingly become volun-teers for non-profit institutions. That has not happened. If one does not begin to volunteer before one is 40 or so, one will not volunteer once past 60.
Similarly, ail the social entrepreneurs I know began to work in their chosen second enterprise long before they reached their peak in their original business.
Consider the example of a successful lawyer, the legal counsel to a large corporation, who has started a venture to establish model schools in his state.
He began to do volunteer legal work for the schools when he was around 35. He was elected to the school board at age 40. At age 50, when he had amassed a fortune, he started his own enterprise to build and to run model schools. He is, however, still working nearly full-time as the lead counsel in the company he helped found as a young lawyer.
There is another reason to develop a second major interest, and to develop it early. No one can expect to live very long without experiencing a serious setback in his or her life or work. There is the competent engineer who is passed over for promotion at age 45- There is the competent college professor who realizes at age 42 that she will never get a professorship at a big university, even though she may be fully qualified for it.
There are tragedies in one's family life: the break-up of one's marriage or the loss of a child. At such times, a second major interest-not just a hobby-may make all the difference. The engineer, for ex-ample, now knows that he has not been very successful in his job. But in his outside activity-as church treasurer, for example - he is a success. One's family may break up, but in that outside ac-tivity there is still a community.
In a society in which success has become so terribly important, having options will become increas-ingly vital. Historically, there was no such thing as "success." The overwhelming majority of people did not expect anything but to stay in their "proper station," as an old English prayer has it. The only mobility was downward mobility.
In a knowledge society, however, we expect everyone to be a success. This is clearly an impossibil-ity. For a great many people, there is at best an absence of failure. Wherever there is success, there has to be failure. And then it is vitally important for the individual, and equally for the individ-ual's family, to have an area in which he or she can contribute, make a difference, and be some-body That means finding a second area-whether in a second career, a parallel career, or a social venture-that offers an opportunity for being a leader, for being respected, for being a success.
The challenges of managing oneself may seem obvious, if not elementary.
And the answers may seem self-evident to the point of appearing naive. But managing oneself re-quires new and unprecedented things from the individual, and especially from the knowledge worker. In effect, managing oneself demands that each knowledge worker think and behave like a chief executive officer. Further, the shift from manual workers who do as they are told to knowledge workers who have to manage themselves profoundly challenges social structure. Every existing society, even the most individualistic one, takes two things for granted, if only subconsciously: that organizations outlive workers, and that most people stay put.
But today the opposite is true. Knowledge workers outlive organizations, and they are mobile. The need to manage oneself is therefore creating a revolution in human affairs.
viral marketing
An example of viral marketing is Hotmail, which offers free web-based email. Each time a user emails someone, there is an embedded advertisement to the recipient to sign up for a Hotmail account. While the practice was much more widely used in the early to mid-2000s as new internet businesses were being created in extreme numbers, it is still common among internet based business-to-consumer (B to C) companies.
Marketing-funny definition
You see a gorgeous girl at a party. You go up to her
and say, "I am very rich.Marry me!"
That's Direct Marketing.
You're at a party with a bunch of friends and see a
gorgeous girl. One of your friends goes up to her and
pointing at you says, "He's very rich.Marry him."
That's Advertising.
You see a gorgeous girl at a party. You go up to her
and get her telephone number. The next day you call
and say, "Hi,I'm very rich.Marry me."
That's Telemarketing.
You're at a party and see a gorgeous girl. You get up
and straighten your tie, you walk up to her and pour
her a drink. You open the door for her, pick up her
bag after she drops it, offer her aride, and then say,
"By the way, I'm very rich.Will you marry me?"
That's Public Relations.
You're at a party and see a gorgeous girl. She walks
up to you and says, "You are very rich.."
That's Brand Recognition.
You see a gorgeous girl at a party. You go up to her
and say, "I'm rich.Marry me" She gives you a nice hard
slap on your face.
That's Customer Feedback !!!!!
You see a gorgeous girl at a party. You go up to her
and say, "I am very rich.Marry me!" And she introduces
you to her husband
That's Demand and supply gap.
You see a gorgeous girl at a party. You go up to her
and before you say, "I am very rich.Marry me!" she
turns her face towards you ------------ she is your
wife !
That's competition eating into your market share
Impact of ....woman
Do you know the relation between two eyes?
They never see each other....... ... BUT
They blink together
They move together
They cry together
They see things together
They sleep together
They share a very deep bonded relationship
However, when they see a woman, one will blink and another will not.
Moral of the story:
Woman can break any kind of relationship!!!
They never see each other....... ... BUT
They blink together
They move together
They cry together
They see things together
They sleep together
They share a very deep bonded relationship
However, when they see a woman, one will blink and another will not.
Moral of the story:
Woman can break any kind of relationship!!!
Thursday, February 18, 2010
FAMILY PROBLEM
Two men, one American and an Indian were sitting in a bar drinking shot after shot.
The Indian man said to the American, 'You know my parents are forcing me to get married to this so called homely girl from a village whom I haven't even met once.' We call this arranged marriage. I don't want to marry a woman whom I don't love... I told them that openly and now have a hell lot of family problems.'
The American said, talking about love marriages... I'll tell you my story.
I married a widow whom I deeply loved and dated for 3 years. 'After a couple of years, my father fell in love with my step-daughter and married her, so my father became my son-in-law and I became my father's father-in-law.
Legally now my daughter is my mother and my wife’s my grandmother.
More problems occurred when I had a son. My son is my father's brother and so he is my uncle. Situations turned worse when my father had a son. Now my father's son, my brother is my grandson. Ultimately, I have become my own grand father and I am my own grandson..
And you say you have family problems...
The Indian fainted…
The Indian man said to the American, 'You know my parents are forcing me to get married to this so called homely girl from a village whom I haven't even met once.' We call this arranged marriage. I don't want to marry a woman whom I don't love... I told them that openly and now have a hell lot of family problems.'
The American said, talking about love marriages... I'll tell you my story.
I married a widow whom I deeply loved and dated for 3 years. 'After a couple of years, my father fell in love with my step-daughter and married her, so my father became my son-in-law and I became my father's father-in-law.
Legally now my daughter is my mother and my wife’s my grandmother.
More problems occurred when I had a son. My son is my father's brother and so he is my uncle. Situations turned worse when my father had a son. Now my father's son, my brother is my grandson. Ultimately, I have become my own grand father and I am my own grandson..
And you say you have family problems...
The Indian fainted…
Do you know how great people would catch lion with their skills rather then using their strength. Here are some funny examples.
Newton ’s Method:
Let, the lion catch you.
For every action there is an equal and opposite reaction.
Implies you caught lion.
Einstein Method:
Run in the direction opposite to that of the lion.
Due to higher relative velocity, the lion will also run faster and will get tired soon.
Now you can trap it easily.
Indian Police Method:
Catch any animal and interrogate it & torture it to accept that its a lion.
Rajnikanth Method :
Keep warning the lion that u may come and attack anytime.
The lion will live in fear and die soon in fear itself.
Jayalalitha Method:
Send Police commissioner Muthukaruppan around 2AM and kill it, while it’s sleeping !
Manirathnam Method (director):
Make sure the lion does not get sun light and put the lion in a dark
room with a single candle lighted.
Keep murmuring something in its ears.
The lion will be highly irritated and commit suicide.
Karan Johar Method (director):
Send a lioness into the forest.
Our lion and lioness fall in love with each other.
Send another lioness in to the forest, followed by another lion.
First lion loves the first lioness and the second lion loves the 2nd lioness.
But 2nd lioness loves both lions.
Now send another lioness (third) into the forest.
You don’t understand right… ok….read it after 15 yrs, then also u wont!
Yash Chopra method (director):
Take the lion to Australia or US.. and kill it in a good scenic location.
Govinda method:
Continuously dance before the lion for 5 or 6 days.
Menaka Gandhi method:
Save the lion from a danger and feed him with some vegetables continuously.
George bush method:
Link the lion with Osama bin laden and shoot him!!!
Rahul Dravid s method:
Ask the lion to bowl at u.
U bat for 200 balls and score 1 run
Lion tired and surrenders
Software Engineer Method:
Catch a cat and claim that your testing has proven that its a Lion.
If anyone comes back with issues tell that you will upgrade it to Lion.
Newton ’s Method:
Let, the lion catch you.
For every action there is an equal and opposite reaction.
Implies you caught lion.
Einstein Method:
Run in the direction opposite to that of the lion.
Due to higher relative velocity, the lion will also run faster and will get tired soon.
Now you can trap it easily.
Indian Police Method:
Catch any animal and interrogate it & torture it to accept that its a lion.
Rajnikanth Method :
Keep warning the lion that u may come and attack anytime.
The lion will live in fear and die soon in fear itself.
Jayalalitha Method:
Send Police commissioner Muthukaruppan around 2AM and kill it, while it’s sleeping !
Manirathnam Method (director):
Make sure the lion does not get sun light and put the lion in a dark
room with a single candle lighted.
Keep murmuring something in its ears.
The lion will be highly irritated and commit suicide.
Karan Johar Method (director):
Send a lioness into the forest.
Our lion and lioness fall in love with each other.
Send another lioness in to the forest, followed by another lion.
First lion loves the first lioness and the second lion loves the 2nd lioness.
But 2nd lioness loves both lions.
Now send another lioness (third) into the forest.
You don’t understand right… ok….read it after 15 yrs, then also u wont!
Yash Chopra method (director):
Take the lion to Australia or US.. and kill it in a good scenic location.
Govinda method:
Continuously dance before the lion for 5 or 6 days.
Menaka Gandhi method:
Save the lion from a danger and feed him with some vegetables continuously.
George bush method:
Link the lion with Osama bin laden and shoot him!!!
Rahul Dravid s method:
Ask the lion to bowl at u.
U bat for 200 balls and score 1 run
Lion tired and surrenders
Software Engineer Method:
Catch a cat and claim that your testing has proven that its a Lion.
If anyone comes back with issues tell that you will upgrade it to Lion.
LEE...BRUCE....LEE...ILEE.....
♪♪....Lee Lee...Bruce....Lee Lee...♪♪
1. Favorite vegetable
* Mu Lee
2. Favourite Lunch
* Tha Lee
3. What happens to the theatre once
a Bruce Lee movie is over?
* Kha Lee
4. Bruce Lee“s sister-in-law“s name?
* Saa Lee
5. Favorite Breakfast
* Id Lee
6. Favourite festival
* Diwa Lee
7. Favorite Actress
* Sona Lee
8. Favorite Music
* Qawa Lee
9. Most interesting job?
* Coo Lee
10. When did Bruce Lee die?
* Fina Lee
11. How did Bruce Lee die?
* With a Go Lee
12. Favorite hill station
* Kulu Mana Lee
13. Nick name?
* Mawa Lee
14. Favori te Hindi movie?
* Gharwa Lee Baharwa Lee
15. Favourite cricketer?
* Saurav Gangu Lee
16. Favourite Pet
* Bil Lee
17. Favourite Passtime
* Khuj Lee
18. Bathing Place
* Na Lee
.
.
.
.
.
.
Maaro
* Taa LEE
urs...
Lee..ttle Hearts...
1. Favorite vegetable
* Mu Lee
2. Favourite Lunch
* Tha Lee
3. What happens to the theatre once
a Bruce Lee movie is over?
* Kha Lee
4. Bruce Lee“s sister-in-law“s name?
* Saa Lee
5. Favorite Breakfast
* Id Lee
6. Favourite festival
* Diwa Lee
7. Favorite Actress
* Sona Lee
8. Favorite Music
* Qawa Lee
9. Most interesting job?
* Coo Lee
10. When did Bruce Lee die?
* Fina Lee
11. How did Bruce Lee die?
* With a Go Lee
12. Favorite hill station
* Kulu Mana Lee
13. Nick name?
* Mawa Lee
14. Favori te Hindi movie?
* Gharwa Lee Baharwa Lee
15. Favourite cricketer?
* Saurav Gangu Lee
16. Favourite Pet
* Bil Lee
17. Favourite Passtime
* Khuj Lee
18. Bathing Place
* Na Lee
.
.
.
.
.
.
Maaro
* Taa LEE
urs...
Lee..ttle Hearts...
TIPS to improve self confidence
Here are some quick tips to improve your Self Confidence. If we are committed to have a healthy self confidence there are many things you can do every day to boost your self confidence, each small steps that will help you to reach your goal. The good news is that self-esteem is not fixed and can be improved, try some of the steps below to boost your confidence and self-esteem.
1) Identify your successes. Everyone is good at something, so discover the things at which you excel, then focus on your talents. Give yourself permission to take pride in them. Give yourself credit for your successes. Inferiority is a state of mind in which you've declared yourself a victim. Do not allow yourself to be victimized.
2) Look in the mirror and smile. Studies surrounding what's called the "facial feedback theory" suggest that the expressions on your face can actually encourage your brain to register certain emotions. So by looking in the mirror and smiling every day, you might feel happier with yourself and more confident in the long run.
3) Exercise and eat healthy. Exercise raises adrenaline and makes one feel happier and healthier. It is certainly an easy and effective way to boost your self-confidence.
4) Turn feelings of envy or jealousy into a desire to achieve. Stop wanting what others have just because they have it; seek things simply because you want them, whether anybody else has them or not.
5) When you're feeling superbly insecure, write down a list of things that are good about you. Then read the list back. You'd be surprised at what you can come up with.
6) Don't be afraid to push yourself a bit - a little bit of pressure can actually show just how good you are!
7) You can try taking a martial arts or fitness class/course (or both). This will help build confidence and strength.
8) Invest in some new clothing and donate some of your old clothing to send a message to yourself that you both look sharp and feel sharp.
9) Try to make yourself talk positively at all times. When you hear yourself saying you can't do something, stop and say you can. Unless you try, you will never know whether you are able to or not.
10) Don't get wrapped up in your mistakes and dwell on bad points; they can contrast your good points or even give you something to improve. There's no feeling like being good at something you were really bad at.
11) Don't confuse what you have with who you are. People degrade their self worth when comparing possessions.
12) Surround yourself with nurturing friends, not overly critical individuals who make you feel inadequate or insecure. This could do great harm and damage to your self CONFIDENCE
1) Identify your successes. Everyone is good at something, so discover the things at which you excel, then focus on your talents. Give yourself permission to take pride in them. Give yourself credit for your successes. Inferiority is a state of mind in which you've declared yourself a victim. Do not allow yourself to be victimized.
2) Look in the mirror and smile. Studies surrounding what's called the "facial feedback theory" suggest that the expressions on your face can actually encourage your brain to register certain emotions. So by looking in the mirror and smiling every day, you might feel happier with yourself and more confident in the long run.
3) Exercise and eat healthy. Exercise raises adrenaline and makes one feel happier and healthier. It is certainly an easy and effective way to boost your self-confidence.
4) Turn feelings of envy or jealousy into a desire to achieve. Stop wanting what others have just because they have it; seek things simply because you want them, whether anybody else has them or not.
5) When you're feeling superbly insecure, write down a list of things that are good about you. Then read the list back. You'd be surprised at what you can come up with.
6) Don't be afraid to push yourself a bit - a little bit of pressure can actually show just how good you are!
7) You can try taking a martial arts or fitness class/course (or both). This will help build confidence and strength.
8) Invest in some new clothing and donate some of your old clothing to send a message to yourself that you both look sharp and feel sharp.
9) Try to make yourself talk positively at all times. When you hear yourself saying you can't do something, stop and say you can. Unless you try, you will never know whether you are able to or not.
10) Don't get wrapped up in your mistakes and dwell on bad points; they can contrast your good points or even give you something to improve. There's no feeling like being good at something you were really bad at.
11) Don't confuse what you have with who you are. People degrade their self worth when comparing possessions.
12) Surround yourself with nurturing friends, not overly critical individuals who make you feel inadequate or insecure. This could do great harm and damage to your self CONFIDENCE
cowboy marketing...
This situation occurs when the marketer values its own interest over those of its client. Smart investors should not pay attention to spam emails and/or the stocks they promote. Buying these stocks will more often than not result in losing money because once the stock's price rises, the unscrupulous parties involved will cash out, causing it to plummet and leaving legitimate investors with losses.
game theory..
Game theory attempts to look at the relationships between participants in a particular model and predict their optimal decisions. One frequently cited example of game theory is the prisoner's dilemma.
Suppose there are two brokers accused of fraudulent trading activities: Dave and Henry. Both Dave and Henry are being interrogated separately and do not know what the other is saying. Both brokers want to minimize the amount of time spent in jail and here lies the dilemma. The sentences vary as follows:
1) If Dave pleads not guilty and Henry confesses, Henry will receive the minimum sentence of one year, and Dave will have to stay in jail for the maximum sentence of five years.
2) If nobody makes any implications they will both receive a sentence of two years.
3) If both decide to plead guilty and implicate their partner, they will both receive a sentence of three years.
4) If Henry pleads not guilty and Dave confesses, Dave will receive the minimum sentence of one year, and Henry will have to stay in jail for the maximum five years.
Obviously, pleading guilty is the most attractive should the other plead not guilty since the sentence is only one year. However, if the other party also chooses to plead guilty, both will have to serve three years. On the other hand, if both parties plead not guilty, they'd have to serve two years in jail. Consequently, the risk of pleading not guilty is a five-year sentence, should the other choose to confess.
Suppose there are two brokers accused of fraudulent trading activities: Dave and Henry. Both Dave and Henry are being interrogated separately and do not know what the other is saying. Both brokers want to minimize the amount of time spent in jail and here lies the dilemma. The sentences vary as follows:
1) If Dave pleads not guilty and Henry confesses, Henry will receive the minimum sentence of one year, and Dave will have to stay in jail for the maximum sentence of five years.
2) If nobody makes any implications they will both receive a sentence of two years.
3) If both decide to plead guilty and implicate their partner, they will both receive a sentence of three years.
4) If Henry pleads not guilty and Dave confesses, Dave will receive the minimum sentence of one year, and Henry will have to stay in jail for the maximum five years.
Obviously, pleading guilty is the most attractive should the other plead not guilty since the sentence is only one year. However, if the other party also chooses to plead guilty, both will have to serve three years. On the other hand, if both parties plead not guilty, they'd have to serve two years in jail. Consequently, the risk of pleading not guilty is a five-year sentence, should the other choose to confess.
Market Segmentation Theory
Also called the "Segmented Markets Theory", this idea states that most investors have set preferences regarding the length of maturities that they will invest in. Market segmentation theory maintains that the buyers and sellers in each of the different maturity lengths cannot be easily substituted for each other. An offshoot to this theory is that if an investor chooses to invest outside their term of preference, they must be compensated for taking on that additional risk. This is known as the Preferred Habitat Theory.
What is market cannibalization?
Market cannibalism is defined as the negative impact a company's new product has on the sales performance of existing products. This is best illustrated by the "Cola Wars" - the marketing fight between Pepsi (NYSE:PEP) and Coca-Cola (NYSE:COKE), which lasted most of the 1970s and 1980s. The soft drink rivalry pushed Coca-Cola Co. to make one of the most famous marketing blunders in financial history. In the process of creating Diet Coke, the company's chemists discovered a new formulation for Coke. The new concoction was sweeter and smoother than the century-old formula upon which Coke had been built. In fact, it was similar to Pepsi - the drink that was eating away at Coke's domestic market share.
On April 23, 1985, Coca-Cola Co. announced that New Coke was on its way. Because of a strong preference for New Coke in consumer taste tests, Coca-Cola decided to pull the old Coke formula from the shelves. Essentially, the company was throwing away a century of branding by favoring the new, relatively unknown formula over the one that consumers had grown up with. For Coca-Cola executives, this made sense. Much like with software companies that pull old versions from the shelf when a new one is released, they didn't want their old product line to keep consumers from buying their new one. Unfortunately, this bold move backfired horribly.
Consumers rebelled and flooded Coca-Cola with angry letters and phone calls. Coke's stock and market share took multiple hits and Pepsi even proclaimed victory in the Cola Wars now that Coca-Cola had copied its taste. The influx of complaints led to a "We've heard you" marketing reverse. On July 11, 1985, mere months after its sudden exit, the old formula was re-introduced with "Classic" added to the title - probably better than "Old Coke". Coca-Cola Classic quickly ate up the sales of New Coke in a textbook case of market cannibalization, but the company's stock did recover for the most part. The marketing blunder may not have been as much of a disaster as it appears. The controversy and media attention attracted some fence-sitting consumers back to the Coca-Cola brand.
Nevertheless, the saga of New Coke turned off many investors and resulted in Coca-Cola becoming an undervalued wallflower that nobody wanted to touch. Due to the strong international presence of Coke, however, investing sage Warren Buffet started buying significant amounts of Coca-Cola stock in the late '80s, which proved to be one of his most profitable buys. Despite its flirtation with a branding disaster and market cannibalization, Coke remains one of the world's strongest brands and a stalwart company to boot.
On April 23, 1985, Coca-Cola Co. announced that New Coke was on its way. Because of a strong preference for New Coke in consumer taste tests, Coca-Cola decided to pull the old Coke formula from the shelves. Essentially, the company was throwing away a century of branding by favoring the new, relatively unknown formula over the one that consumers had grown up with. For Coca-Cola executives, this made sense. Much like with software companies that pull old versions from the shelf when a new one is released, they didn't want their old product line to keep consumers from buying their new one. Unfortunately, this bold move backfired horribly.
Consumers rebelled and flooded Coca-Cola with angry letters and phone calls. Coke's stock and market share took multiple hits and Pepsi even proclaimed victory in the Cola Wars now that Coca-Cola had copied its taste. The influx of complaints led to a "We've heard you" marketing reverse. On July 11, 1985, mere months after its sudden exit, the old formula was re-introduced with "Classic" added to the title - probably better than "Old Coke". Coca-Cola Classic quickly ate up the sales of New Coke in a textbook case of market cannibalization, but the company's stock did recover for the most part. The marketing blunder may not have been as much of a disaster as it appears. The controversy and media attention attracted some fence-sitting consumers back to the Coca-Cola brand.
Nevertheless, the saga of New Coke turned off many investors and resulted in Coca-Cola becoming an undervalued wallflower that nobody wanted to touch. Due to the strong international presence of Coke, however, investing sage Warren Buffet started buying significant amounts of Coca-Cola stock in the late '80s, which proved to be one of his most profitable buys. Despite its flirtation with a branding disaster and market cannibalization, Coke remains one of the world's strongest brands and a stalwart company to boot.
What is market cannibalization?
Market cannibalism is defined as the negative impact a company's new product has on the sales performance of existing products. This is best illustrated by the "Cola Wars" - the marketing fight between Pepsi (NYSE:PEP) and Coca-Cola (NYSE:COKE), which lasted most of the 1970s and 1980s. The soft drink rivalry pushed Coca-Cola Co. to make one of the most famous marketing blunders in financial history. In the process of creating Diet Coke, the company's chemists discovered a new formulation for Coke. The new concoction was sweeter and smoother than the century-old formula upon which Coke had been built. In fact, it was similar to Pepsi - the drink that was eating away at Coke's domestic market share.
On April 23, 1985, Coca-Cola Co. announced that New Coke was on its way. Because of a strong preference for New Coke in consumer taste tests, Coca-Cola decided to pull the old Coke formula from the shelves. Essentially, the company was throwing away a century of branding by favoring the new, relatively unknown formula over the one that consumers had grown up with. For Coca-Cola executives, this made sense. Much like with software companies that pull old versions from the shelf when a new one is released, they didn't want their old product line to keep consumers from buying their new one. Unfortunately, this bold move backfired horribly.
Consumers rebelled and flooded Coca-Cola with angry letters and phone calls. Coke's stock and market share took multiple hits and Pepsi even proclaimed victory in the Cola Wars now that Coca-Cola had copied its taste. The influx of complaints led to a "We've heard you" marketing reverse. On July 11, 1985, mere months after its sudden exit, the old formula was re-introduced with "Classic" added to the title - probably better than "Old Coke". Coca-Cola Classic quickly ate up the sales of New Coke in a textbook case of market cannibalization, but the company's stock did recover for the most part. The marketing blunder may not have been as much of a disaster as it appears. The controversy and media attention attracted some fence-sitting consumers back to the Coca-Cola brand.
Nevertheless, the saga of New Coke turned off many investors and resulted in Coca-Cola becoming an undervalued wallflower that nobody wanted to touch. Due to the strong international presence of Coke, however, investing sage Warren Buffet started buying significant amounts of Coca-Cola stock in the late '80s, which proved to be one of his most profitable buys. Despite its flirtation with a branding disaster and market cannibalization, Coke remains one of the world's strongest brands and a stalwart company to boot.
On April 23, 1985, Coca-Cola Co. announced that New Coke was on its way. Because of a strong preference for New Coke in consumer taste tests, Coca-Cola decided to pull the old Coke formula from the shelves. Essentially, the company was throwing away a century of branding by favoring the new, relatively unknown formula over the one that consumers had grown up with. For Coca-Cola executives, this made sense. Much like with software companies that pull old versions from the shelf when a new one is released, they didn't want their old product line to keep consumers from buying their new one. Unfortunately, this bold move backfired horribly.
Consumers rebelled and flooded Coca-Cola with angry letters and phone calls. Coke's stock and market share took multiple hits and Pepsi even proclaimed victory in the Cola Wars now that Coca-Cola had copied its taste. The influx of complaints led to a "We've heard you" marketing reverse. On July 11, 1985, mere months after its sudden exit, the old formula was re-introduced with "Classic" added to the title - probably better than "Old Coke". Coca-Cola Classic quickly ate up the sales of New Coke in a textbook case of market cannibalization, but the company's stock did recover for the most part. The marketing blunder may not have been as much of a disaster as it appears. The controversy and media attention attracted some fence-sitting consumers back to the Coca-Cola brand.
Nevertheless, the saga of New Coke turned off many investors and resulted in Coca-Cola becoming an undervalued wallflower that nobody wanted to touch. Due to the strong international presence of Coke, however, investing sage Warren Buffet started buying significant amounts of Coca-Cola stock in the late '80s, which proved to be one of his most profitable buys. Despite its flirtation with a branding disaster and market cannibalization, Coke remains one of the world's strongest brands and a stalwart company to boot.
Wednesday, February 17, 2010
indian intelligency
After digging to a depth of 100 metres last year,
Russian scientists found
traces of copper wire dating back 1000 years, and
came to the conclusion
that their ancestors already had a telephone
network one thousand years
ago.
So, not to be outdone, in the weeks that followed,
American scientists dug
200 metres and headlines in the US papers read:
"US scientists have found traces of 2000 year old
optical fibres, and have
concluded that their ancestors already had
advanced high-tech digital
telephone 1000 years earlier than the Russians."
One week later, the Indian newspapers reported the
following:
"After digging as deep as 500 metres, Indian
scientists have found
absolutely nothing. They have concluded that 5000
years ago, their
ancestors were already using wireless technology .
Russian scientists found
traces of copper wire dating back 1000 years, and
came to the conclusion
that their ancestors already had a telephone
network one thousand years
ago.
So, not to be outdone, in the weeks that followed,
American scientists dug
200 metres and headlines in the US papers read:
"US scientists have found traces of 2000 year old
optical fibres, and have
concluded that their ancestors already had
advanced high-tech digital
telephone 1000 years earlier than the Russians."
One week later, the Indian newspapers reported the
following:
"After digging as deep as 500 metres, Indian
scientists have found
absolutely nothing. They have concluded that 5000
years ago, their
ancestors were already using wireless technology .
indian intelligency
After digging to a depth of 100 metres last year,
Russian scientists found
traces of copper wire dating back 1000 years, and
came to the conclusion
that their ancestors already had a telephone
network one thousand years
ago.
So, not to be outdone, in the weeks that followed,
American scientists dug
200 metres and headlines in the US papers read:
"US scientists have found traces of 2000 year old
optical fibres, and have
concluded that their ancestors already had
advanced high-tech digital
telephone 1000 years earlier than the Russians."
One week later, the Indian newspapers reported the
following:
"After digging as deep as 500 metres, Indian
scientists have found
absolutely nothing. They have concluded that 5000
years ago, their
ancestors were already using wireless technology .
Russian scientists found
traces of copper wire dating back 1000 years, and
came to the conclusion
that their ancestors already had a telephone
network one thousand years
ago.
So, not to be outdone, in the weeks that followed,
American scientists dug
200 metres and headlines in the US papers read:
"US scientists have found traces of 2000 year old
optical fibres, and have
concluded that their ancestors already had
advanced high-tech digital
telephone 1000 years earlier than the Russians."
One week later, the Indian newspapers reported the
following:
"After digging as deep as 500 metres, Indian
scientists have found
absolutely nothing. They have concluded that 5000
years ago, their
ancestors were already using wireless technology .
rock star of economics-keynes
If ever there was a rock star of economics, it would be John Maynard Keynes. Keynes shares his birthday, June 5th, with Adam Smith and he was born in 1883, the year communist founder Karl Marx died. With these auspicious signs, Keynes seemed to be destined to become a powerful free market force when the world was facing a serious choice between communism or capitalism. Instead, he offered a third way, which turned the world of economics upside down. In this article, we'll examine Keynes' doctrine and its impact. (To read about Adam Smith, be sure to check out Adam Smith: The Father Of Economics.)
The Cambridge Seer
Keynes grew up in a privileged home in England. He was the son of a Cambridge economics professor and studied math at university. After two years in the civil service, Keynes joined the staff at Cambridge in 1909. He was never formally trained in economics, but over the following decades he quickly became a central figure. His fame initially grew from accurately predicting the effects of political and economic events.
His first prediction was a critique of the reparation payments that were levied against the defeated Germany after WWI. Keynes rightly pointed out that having to pay out the cost of the entire war would force Germany into hyperinflation and have negative consequences all over Europe. He followed this up by predicting that a return to the prewar fixed exchange rate sought by the chancellor of the exchequer, Winston Churchill, would choke off economic growth and reduce real wages. The prewar exchange rate was overvalued in the postwar damage of 1925, and the attempt to lock it in did more damage than good. On both counts, Keynes was proved right. (For related reading, see War's Influence On Wall Street.)
A Big Miss, But a Great Rebound
Keynes was not a theoretical economist: he was an active trader in stocks and futures. He benefited hugely from the Roaring '20s and was well on his way to becoming the richest economist in history when the crash of 1929 wiped out three-quarters of his wealth. Keynes hadn't predicted this crash, and was among those who believed a negative economic event was impossible with the Federal Reserve watching over the U.S. economy. Although blindsided by the crash, the adaptable Keynes did manage to rebuild his fortune by buying up stocks in the fire sale following the crash. His contrarian investing left him with a fortune of around $30 million at his death, making him the second richest economist in history. (For more on this period in economic history, check out What Caused The Great Depression? and Crashes: The Great Depression.)
The General Theory
Many others fared far worse in the crash and the resulting depression, however, and this is where Keynes' economic contributions began. Keynes believed that free market capitalism was inherently unstable and that it needed to be reformulated both to fight off Marxism and the Great Depression. His ideas were summed up in his 1936 book, "The General Theory of Employment, Interest and Money". Among other things, Keynes claimed that classical economics - the invisible hand of Adam Smith - only applied in cases of full employment. In all other cases, his "General Theory" held sway. (Read Can Keynesian Economics Reduce Boom-Bust Cycles? to learn more.)
Inside the General Theory
Keynes' "General Theory" will forever be remembered for giving governments a central role in economics. Although ostensibly written to save capitalism from sliding into the central planning of Marxism, Keynes opened the door for government to become the principal agent in the economy. Simply put, Keynes saw deficit financing, public expenditures, taxation and consumption as more important than saving, private investment, balanced government budgets and low taxes (classical economic virtues). Keynes believed that an interventionist government could fix a depression by spending its way out and forcing its citizens to do the same, while smoothing futures cycles with various macroeconomic techniques.
Holes in the Ground
Keynes backed up his theory by adding government expenditures to the overall national output. This was controversial from the start because the government doesn't actually save or invest as business and private business do, but raises money through mandatory taxes or debt issues (that are paid back by tax revenues). Still, by adding government to the equation, Keynes showed that government spending - even digging holes and filling them in - would stimulate the economy when businesses and individual were tightening budgets. His ideas heavily influenced the New Deal and the welfare state that grew up in the postwar era. (To learn the differences between supply-side and Keynesian economics, read Understanding Supply-Side Economics.)
The War on Saving and Private Investing
Keynes believed that consumption was the key to recovery and savings were the chains holding the economy down. In his models, private savings are subtracted from the private investment part of the national output equation, making government investment appear to be the better solution. Only a big government that was spending on behalf of the people would be able to guarantee full employment and economic prosperity. Even when forced to rework his model to allow for some private investment, he argued that it wasn't as efficient as government spending because private investors would be less likely to undertake/overpay for unnecessary works in hard economic times.
Macroeconomics: Magnifying and Simplifying
It is easy to see why governments were so quick to adopt Keynesian thinking. It gave politicians unlimited funds for pet projects and deficit spending that was very useful in buying votes. Government contracts quickly became synonymous with free money for any company that landed it, regardless of whether the project was brought in on time and on budget. The problem was that Keynesian thinking made huge assumptions that weren't backed by any real world evidence.
For example, Keynes assumed interest rates would be constant no matter how much or how little capital was available for private lending. This allowed him to show that savings hurt economic growth - even though empirical evidence pointed to the opposite effect. To make this more obvious, he applied a multiplier to government spending but neglected to add a similar one to private savings. Oversimplification can be a useful tool in economics, but the more simplifying assumptions are used, the less real-world application a theory will have.
The Theory Hits a Rut
Keynes died in 1946. In addition to "The General Theory", he was part of a panel that worked on the Bretton Woods Agreement and the International Monetary Fund (IMF). His theory continued to grow in popularity and caught on with the public. After his death, however, critics began attacking both the macroeconomic view and the short-term aims of Keynesian thinking. Forcing spending, they argued, might keep a worker employed for another week, but what happens after that? Eventually the money runs out and the government must print more, leading to inflation.
This is exactly what happened in the stagflation of the 1970s. Stagflation was impossible within Keynes' theory, but it happened nonetheless. With government spending crowding out private investment and inflation reducing real wages, Keynes' critics gained more ears. It ultimately fell upon Milton Friedman to reverse the Keynesian formulation of capitalism and reestablish free market principles in the U.S. (Find out what factors contribute to a slowing economy, in Examining Stagflation and Stagflation, 1970s Style.)
Keynes for the Ages
Although no longer held in the esteem that it once was, Keynesian economics is far from dead. When you see consumer spending or confidence figures, you are seeing an outgrowth of Keynesian economics. The stimulus checks the U.S. government handed out to citizens in 2008 also represent the idea that consumers can buy flat-screen TVs or otherwise spend the economy out of trouble. Keynesian thinking will never completely leave the media or the government. For the media, many of the simplifications are easy to grasp and work into a short segment. For the government, the Keynesian assertion that it knows how to spend taxpayer money better than the taxpayers is a bonus. (To learn more about the stimulus checks, read How do government issued stimulus checks improve the economy?)
Conclusion
Despite these undesirable consequences, Keynes' work is useful. It helps strengthen the free market theory by opposition, as we can see in the work of Milton Friedman and the Chicago School economists that followed Keynes. Blind adherence to the gospel of Adam Smith is dangerous in its own way. The Keynesian formulation forced free market economics to become a more comprehensive theory, and the persistent and popular echoes of Keynesian thinking in every economic crisis caused free market economics to develop in response.
Friedman once said, "We are all Keynesians now." But the full quote was, "In one sense we are all Keynesians now; in another, no one is a Keynesian any longer. We all use the Keynesian language and apparatus; none of us any longer accepts the initial Keynesian conclusions."
The Cambridge Seer
Keynes grew up in a privileged home in England. He was the son of a Cambridge economics professor and studied math at university. After two years in the civil service, Keynes joined the staff at Cambridge in 1909. He was never formally trained in economics, but over the following decades he quickly became a central figure. His fame initially grew from accurately predicting the effects of political and economic events.
His first prediction was a critique of the reparation payments that were levied against the defeated Germany after WWI. Keynes rightly pointed out that having to pay out the cost of the entire war would force Germany into hyperinflation and have negative consequences all over Europe. He followed this up by predicting that a return to the prewar fixed exchange rate sought by the chancellor of the exchequer, Winston Churchill, would choke off economic growth and reduce real wages. The prewar exchange rate was overvalued in the postwar damage of 1925, and the attempt to lock it in did more damage than good. On both counts, Keynes was proved right. (For related reading, see War's Influence On Wall Street.)
A Big Miss, But a Great Rebound
Keynes was not a theoretical economist: he was an active trader in stocks and futures. He benefited hugely from the Roaring '20s and was well on his way to becoming the richest economist in history when the crash of 1929 wiped out three-quarters of his wealth. Keynes hadn't predicted this crash, and was among those who believed a negative economic event was impossible with the Federal Reserve watching over the U.S. economy. Although blindsided by the crash, the adaptable Keynes did manage to rebuild his fortune by buying up stocks in the fire sale following the crash. His contrarian investing left him with a fortune of around $30 million at his death, making him the second richest economist in history. (For more on this period in economic history, check out What Caused The Great Depression? and Crashes: The Great Depression.)
The General Theory
Many others fared far worse in the crash and the resulting depression, however, and this is where Keynes' economic contributions began. Keynes believed that free market capitalism was inherently unstable and that it needed to be reformulated both to fight off Marxism and the Great Depression. His ideas were summed up in his 1936 book, "The General Theory of Employment, Interest and Money". Among other things, Keynes claimed that classical economics - the invisible hand of Adam Smith - only applied in cases of full employment. In all other cases, his "General Theory" held sway. (Read Can Keynesian Economics Reduce Boom-Bust Cycles? to learn more.)
Inside the General Theory
Keynes' "General Theory" will forever be remembered for giving governments a central role in economics. Although ostensibly written to save capitalism from sliding into the central planning of Marxism, Keynes opened the door for government to become the principal agent in the economy. Simply put, Keynes saw deficit financing, public expenditures, taxation and consumption as more important than saving, private investment, balanced government budgets and low taxes (classical economic virtues). Keynes believed that an interventionist government could fix a depression by spending its way out and forcing its citizens to do the same, while smoothing futures cycles with various macroeconomic techniques.
Holes in the Ground
Keynes backed up his theory by adding government expenditures to the overall national output. This was controversial from the start because the government doesn't actually save or invest as business and private business do, but raises money through mandatory taxes or debt issues (that are paid back by tax revenues). Still, by adding government to the equation, Keynes showed that government spending - even digging holes and filling them in - would stimulate the economy when businesses and individual were tightening budgets. His ideas heavily influenced the New Deal and the welfare state that grew up in the postwar era. (To learn the differences between supply-side and Keynesian economics, read Understanding Supply-Side Economics.)
The War on Saving and Private Investing
Keynes believed that consumption was the key to recovery and savings were the chains holding the economy down. In his models, private savings are subtracted from the private investment part of the national output equation, making government investment appear to be the better solution. Only a big government that was spending on behalf of the people would be able to guarantee full employment and economic prosperity. Even when forced to rework his model to allow for some private investment, he argued that it wasn't as efficient as government spending because private investors would be less likely to undertake/overpay for unnecessary works in hard economic times.
Macroeconomics: Magnifying and Simplifying
It is easy to see why governments were so quick to adopt Keynesian thinking. It gave politicians unlimited funds for pet projects and deficit spending that was very useful in buying votes. Government contracts quickly became synonymous with free money for any company that landed it, regardless of whether the project was brought in on time and on budget. The problem was that Keynesian thinking made huge assumptions that weren't backed by any real world evidence.
For example, Keynes assumed interest rates would be constant no matter how much or how little capital was available for private lending. This allowed him to show that savings hurt economic growth - even though empirical evidence pointed to the opposite effect. To make this more obvious, he applied a multiplier to government spending but neglected to add a similar one to private savings. Oversimplification can be a useful tool in economics, but the more simplifying assumptions are used, the less real-world application a theory will have.
The Theory Hits a Rut
Keynes died in 1946. In addition to "The General Theory", he was part of a panel that worked on the Bretton Woods Agreement and the International Monetary Fund (IMF). His theory continued to grow in popularity and caught on with the public. After his death, however, critics began attacking both the macroeconomic view and the short-term aims of Keynesian thinking. Forcing spending, they argued, might keep a worker employed for another week, but what happens after that? Eventually the money runs out and the government must print more, leading to inflation.
This is exactly what happened in the stagflation of the 1970s. Stagflation was impossible within Keynes' theory, but it happened nonetheless. With government spending crowding out private investment and inflation reducing real wages, Keynes' critics gained more ears. It ultimately fell upon Milton Friedman to reverse the Keynesian formulation of capitalism and reestablish free market principles in the U.S. (Find out what factors contribute to a slowing economy, in Examining Stagflation and Stagflation, 1970s Style.)
Keynes for the Ages
Although no longer held in the esteem that it once was, Keynesian economics is far from dead. When you see consumer spending or confidence figures, you are seeing an outgrowth of Keynesian economics. The stimulus checks the U.S. government handed out to citizens in 2008 also represent the idea that consumers can buy flat-screen TVs or otherwise spend the economy out of trouble. Keynesian thinking will never completely leave the media or the government. For the media, many of the simplifications are easy to grasp and work into a short segment. For the government, the Keynesian assertion that it knows how to spend taxpayer money better than the taxpayers is a bonus. (To learn more about the stimulus checks, read How do government issued stimulus checks improve the economy?)
Conclusion
Despite these undesirable consequences, Keynes' work is useful. It helps strengthen the free market theory by opposition, as we can see in the work of Milton Friedman and the Chicago School economists that followed Keynes. Blind adherence to the gospel of Adam Smith is dangerous in its own way. The Keynesian formulation forced free market economics to become a more comprehensive theory, and the persistent and popular echoes of Keynesian thinking in every economic crisis caused free market economics to develop in response.
Friedman once said, "We are all Keynesians now." But the full quote was, "In one sense we are all Keynesians now; in another, no one is a Keynesian any longer. We all use the Keynesian language and apparatus; none of us any longer accepts the initial Keynesian conclusions."
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