It was early morning in late summer. The location was somewhere on what we now know as the Dover coast of England. As the sun came over the eastern horizon, it showed the beach and cliffs behind it in soft light and dark shadows. A stiff breeze kept the temperature brisk and the surf crashing along the flat beach.
Somewhat off the beach, caught in the surf are a number of wooden ships, keels aground but caught in the waves and rocking with them. Behind those ships and further out is what appears to be a large fleet of similar ships. Crowding the decks of the ships are closely packed men dressed in armor and carrying shields, more than a few of them retching from sea sickness.
Spread along the beach facing them is a large mass of men yelling and shaking spears at the ships out in the water. They are a motley crew with a few mounted on horses, most of the rest on foot, but no small number of them riding chariots along the flat beach. Virtually naked, their faces and bodies are painted in a brilliant cobalt blue. Their hair, dressed with a thick mixture of sand and grease, stands straight out or up in what we might think as punk styles.
The year is 55 BC and the ships are carrying Julius Caesar and two of his Gallic Legions, the VIIth and the iconic Xth. This is the largest amphibious opposed landing in Europe before the D-Day landings some 2,000 years later. This Roman army is here to begin the conquest of the land they know as Brittania. We have an eyewitness account of this scene written by Caesar himself. And as he freely admits, there is a problem.
The ships that the Romans, freshly built by Caesar, are in do not have flat bottoms so they can come up on the beach. They have keels and have run aground some distance out from the beach in deep water. To get ashore, the legionnaires have to climb down netting into 6-8 feet of water and move through that water and surf to the beach. The men probably average 5 feet in height and are weighted down with around 60 pounds of armor as well as a bulky shield. As soon as they are in the water, they are at risk of being hit by a storm of arrows and spears from the Celtic tribesmen (ancestors of today’s Irish, Scots and Welshmen) on the beach. Already there drift half submerged bodies, smudging the water a bright red, of the first wave of Romans who have tried to move onto the beach.
On board one of the ships stands Julius Caesar, prominent in the bright red cape of a Roman general. His men have stopped going over the side into the water, despite the sticks of their centurions (Lieutenants). The centurions are not trying to get the men moving all that hard, as many of the bodies in the water are fellow centurions. All have watched with dismay, the death of those few who have already gone before. Those left have lost their courage and will not go forward into what seems certain death. All eyes are now on Caesar, who seems to be fresh out of ideas. It is truly a moment of crisis, with fate in the balance.
At that moment a centurion of the Xth Legion looks over to Caesar, makes eye contact with him and then jumps over the side of the ship carrying the eagle of the legion. Nothing happens for a minute as shock grips the men watching. The eagle of the legion, made of silver and life size, was the totem and spiritual heart of the legion. Always put in the safest place on the field of battle possible, to lose the eagle was to lose honor and live in humiliation. After a moment everyone begins going over the side in a surge of men that carries the day and brings the Romans to victory on the beach.
Julius Caesar was in a position that almost every manager can empathize with. You are in a tight situation with no obvious way to get out of it. Not only that, but it is clearly your screw up that put your people in that position, and everybody knows it. To get out of this mess is going to require that some of your people, but not the manager himself, take the pain of fixing the problem, i.e. lots of OT and weekend work, angry confrontations with customers, months on a bitter construction site, etc. What do you do?
The answer that we all hope for is a volunteer that steps forward, looks around at the others and says, “Follow me”. Julius Caesar got the answer he needed on that summer morning. The Roman Senate had given him the command, but he needed his people to go above and beyond the ordinary to make him the victor on that summer morning so long ago.
As managers in today’s world of business and of projects, how do we get our people to rescue us from our mistakes? We are given our position as managers by the Company. But we will be a success because our people follow us with enthusiasm and willingness to do what it takes, including bailing us out when we get them in a tight spot.
Tuesday, January 20, 2009
Tuesday, January 13, 2009
Did We Make Money Last Year?
The end of the year is past us and a new one dawns before us. If you are in the business world, that particular time of year requires that you find out if the business made money last year. It is something everyone wants to know. Of course the owners are interested. But they come in a poor second to the people that really matter, i.e. the IRS and the banker.
You would think it pretty simple for a business to know such a basic thing. You would think so anyway. While people can usually look at their bank statement, W-2 forms and an investment or two, allowing them to make a fair guess about their own financial situation. Most businesses, including ForeRunner, are on what is known as the “Accrual” system.
Without dipping into the fantasy world of GAAP (Generally Accepted Accounting Principals) and its reversals of common sense, our biggest unknown revolves around whether certain clients will actually pay the invoice we have already counted as revenue. Our costs are real, as the people doing the work get paid every two weeks. But our revenue is only a promise by our clients to pay us. Most clients pay their bills on time, blessed be their name. Others, being held captive to the new CFO’s plan to climb the corporate ladder, practice cash management; essentially meaning that they operate by using their suppliers’ cash. After the required number of calls to Accounts Payable and the client project manager, they will pay.
But this year we have a number of clients who have been negatively impacted by the events of the past year. How is that for a euphemism? Some of our clients are short of cash. I have been there, on a much smaller scale of course, but I have been there and it is hell on earth. My heart goes out to those in that situation. But what do you do when you don't have the money to pay your bills?
Experience suggests that most clients have read Carl von Clausewitz, the great German strategist. Carl, if I may be familiar, said that the best defense is a good offense. You may have come across this insight before and used it yourself. It is a powerful strategy. Rather than a straightforward negotiation over possible discounting on past due invoices, simply declare the service provided to be faulty and/or poorly done. Simply put, the strategy calls for the client to say that "I am not paying you because you did a bad job", rather than "I am not paying you because I am short of money right now."
Of course the strategy works. Carl is still quoted 200 years after his lifetime because he knew how to play the game. The strategy recognizes the reality that an engineers work is not and can not be perfect, but that same engineer is professionally bound to a standard of perfection and is very vulnerable to anyone pointing out the dichotomy . It also provides a justification for acting in a manner that would normally make one feel badly about themselves, i.e. not paying one's bills.
The strategy works, but it has its costs. Both sides know what is really going on, at least once they disentangle themselves from the emotional stew that is created. Trust, that fragile spirit, is lost once again. In the middle of the night, once again we will come face to face with what we do and why we do it.
The next time we work together, and we will for this is a small world saturated with irony, we will bear the scars of previous disappointment. But then that is the world of most projects, hope tempered by experience.
You would think it pretty simple for a business to know such a basic thing. You would think so anyway. While people can usually look at their bank statement, W-2 forms and an investment or two, allowing them to make a fair guess about their own financial situation. Most businesses, including ForeRunner, are on what is known as the “Accrual” system.
Without dipping into the fantasy world of GAAP (Generally Accepted Accounting Principals) and its reversals of common sense, our biggest unknown revolves around whether certain clients will actually pay the invoice we have already counted as revenue. Our costs are real, as the people doing the work get paid every two weeks. But our revenue is only a promise by our clients to pay us. Most clients pay their bills on time, blessed be their name. Others, being held captive to the new CFO’s plan to climb the corporate ladder, practice cash management; essentially meaning that they operate by using their suppliers’ cash. After the required number of calls to Accounts Payable and the client project manager, they will pay.
But this year we have a number of clients who have been negatively impacted by the events of the past year. How is that for a euphemism? Some of our clients are short of cash. I have been there, on a much smaller scale of course, but I have been there and it is hell on earth. My heart goes out to those in that situation. But what do you do when you don't have the money to pay your bills?
Experience suggests that most clients have read Carl von Clausewitz, the great German strategist. Carl, if I may be familiar, said that the best defense is a good offense. You may have come across this insight before and used it yourself. It is a powerful strategy. Rather than a straightforward negotiation over possible discounting on past due invoices, simply declare the service provided to be faulty and/or poorly done. Simply put, the strategy calls for the client to say that "I am not paying you because you did a bad job", rather than "I am not paying you because I am short of money right now."
Of course the strategy works. Carl is still quoted 200 years after his lifetime because he knew how to play the game. The strategy recognizes the reality that an engineers work is not and can not be perfect, but that same engineer is professionally bound to a standard of perfection and is very vulnerable to anyone pointing out the dichotomy . It also provides a justification for acting in a manner that would normally make one feel badly about themselves, i.e. not paying one's bills.
The strategy works, but it has its costs. Both sides know what is really going on, at least once they disentangle themselves from the emotional stew that is created. Trust, that fragile spirit, is lost once again. In the middle of the night, once again we will come face to face with what we do and why we do it.
The next time we work together, and we will for this is a small world saturated with irony, we will bear the scars of previous disappointment. But then that is the world of most projects, hope tempered by experience.
Thursday, January 8, 2009
Natural Gas and Europe
At a chance moment yesterday evening, I caught my favorite newsperson, Katie Couric, pronouncing that President Obama's term in office would be defined by his success in getting the economy back on track. As you might guess, I view the connection between the word, newsperson, and the person, Katie Couric, with a smile. She may well be right however, she has good writers after all. But I remember how George Bush's term in office would be defined by "Compassionate Conservatism".
I think that President Obama might spend much of his time in office dealing with issues outside domestic economy recovery however. The world is becoming a very scary place. Large scale economic upheaval, such as we are experiencing now, always causes political upheaval. Would Barack Obama have been elected if the Dow was still at 14,000? And we are a very stable country. As a case in point, our old friends the Russians have shut off the supply of natural gas to the Ukraine. Imagine if you will, that your supply of natural gas was cut off in the middle of the winter. Europe is a cold place in winter.
The Ukraine, a part of the Soviet Union less than 20 years ago, borders Russia and the European Community. It is trying to become a part of the European Union, with excellent prospects of that happening. That is until this summer and Russia's invasion of Georgia, a sister to the Ukraine. Now Europe, and NATO (the US), are faced with a Russia that is drawing lines in the sand. And Russia is using tanks to draw those lines.
I think that it is a cold winter indeed in Europe's capitals, especially in those rooms in which responsible adults are meeting. They know that Europe has sheltered behind the US military presence in the world while their own forces have become weak to the point of non-existence. They know that the presence of the US military has allowed them to indulge elements of their populations in "feel good" posturing about the realities of power politics. Their populations now believe in peace at any price and view their protector (the US) as the world's villain. Their populations are rapidly aging, their welfare costs rising, their economies weakening and now they are faced with an aggressive resurgent Russia. Their social fabric continues to fray under the burden of large unassimilated Muslim immigrant populations. They have no recourse but to smile and accept Russian extortion.
Yet the political unity of the European Union is weak. Under the strain of Russian aggression, what will happen? Will the French or German public see any necessity to defend Poland? What about the Ukraine? Where is NATO in all this? I don't think the US public wants to be engaged in European confrontations.
The Ukraine is dependent on Russia for energy. But the pipeline that carries Russian gas to the Ukraine also carries natural gas into Europe. It is a fact that pipelines flow in both directions. LNG landed in Europe can flow gas back into the Ukraine. It would only take some money and time to provide the Ukraine and Eastern Europe with alternative gas supplies. But doing so could incur the wrath of Russia. Those tanks again.
It will be interesting to see what happens. In the entire span of recorded history, Europe has not been a peaceful place. There is no reason to think that its future will be any different.
I think that President Obama might spend much of his time in office dealing with issues outside domestic economy recovery however. The world is becoming a very scary place. Large scale economic upheaval, such as we are experiencing now, always causes political upheaval. Would Barack Obama have been elected if the Dow was still at 14,000? And we are a very stable country. As a case in point, our old friends the Russians have shut off the supply of natural gas to the Ukraine. Imagine if you will, that your supply of natural gas was cut off in the middle of the winter. Europe is a cold place in winter.
The Ukraine, a part of the Soviet Union less than 20 years ago, borders Russia and the European Community. It is trying to become a part of the European Union, with excellent prospects of that happening. That is until this summer and Russia's invasion of Georgia, a sister to the Ukraine. Now Europe, and NATO (the US), are faced with a Russia that is drawing lines in the sand. And Russia is using tanks to draw those lines.
I think that it is a cold winter indeed in Europe's capitals, especially in those rooms in which responsible adults are meeting. They know that Europe has sheltered behind the US military presence in the world while their own forces have become weak to the point of non-existence. They know that the presence of the US military has allowed them to indulge elements of their populations in "feel good" posturing about the realities of power politics. Their populations now believe in peace at any price and view their protector (the US) as the world's villain. Their populations are rapidly aging, their welfare costs rising, their economies weakening and now they are faced with an aggressive resurgent Russia. Their social fabric continues to fray under the burden of large unassimilated Muslim immigrant populations. They have no recourse but to smile and accept Russian extortion.
Yet the political unity of the European Union is weak. Under the strain of Russian aggression, what will happen? Will the French or German public see any necessity to defend Poland? What about the Ukraine? Where is NATO in all this? I don't think the US public wants to be engaged in European confrontations.
The Ukraine is dependent on Russia for energy. But the pipeline that carries Russian gas to the Ukraine also carries natural gas into Europe. It is a fact that pipelines flow in both directions. LNG landed in Europe can flow gas back into the Ukraine. It would only take some money and time to provide the Ukraine and Eastern Europe with alternative gas supplies. But doing so could incur the wrath of Russia. Those tanks again.
It will be interesting to see what happens. In the entire span of recorded history, Europe has not been a peaceful place. There is no reason to think that its future will be any different.
Monday, January 5, 2009
Monday Morning Lawyers
I am a creature of habit. There are certain parts of my life that need to be comforted by unchanging ritual. Monday morning is the most important of these. I think of it as the Monday Morning Rite. In my past, I would get very depressed on Sunday night at I contemplated the beginning of a new week of work. To make me feel better, I designed a Monday morning to look forward to; a transition from life unfettered to the discipline of work. The Monday Morning Rite for me is an early morning 7 mile run (slow jog actually), followed by a long shower; and then on to an apple fritter (world class) and coffee at the Donut Hut. For the next hour I drink coffee, nibble on the apple fritter and work on the latest NY Times Sunday Crossword. After that I go to work.
This morning the thermometer showed 9 degrees outside. I can be compulsive, but 9 degrees makes even me bow to reality. So I went to Club USA and did the elliptical machine. I hate treadmills and elliptical machines. All you can do is watch the mindless television news. But trapped in the torture machine that is the elliptical machine, I watch it. It seemed this morning that many of the commercial ads were for personal injury law firms. Everybody in Denver is familiar with the strong arm of Frank Azar, but he is not alone. Not by a long shot.
Time moves very slowly on the elliptical machine. In that interminable wait for the next tick of the clock, I had no choice but to think about lawyers. Most people are of two minds about the legal profession. On the one hand, lawyers are the butt of mean spirited jokes, and as Shakespeare among others reminds us, the source of much (all) trouble in this world. Yet from Perry Mason to LA Law to Boston Legal, lawyers are shown as noble, and even more importantly, sexy. How many times have you heard a proud parent announce their clueless college student to be in pre-law?
It has been my sad fate as a company executive to get to know a number of real lawyers. Hence the importance of the Monday Morning Rite. Despite a strong predisposition to find them as dastards, I have liked most of them. They are just ordinary people, no matter how much I want to throw stones at them. They have a job to do, mortgage payments to make and a conscience to live with. The sad fact of human existence is that underneath it all, we are just people. Hence the need for lawyers.
And that is the source of our schizophrenia. We are human beings. Which means that we screw up on a regular basis. Despite our best intentions, we hurt ourselves and others all the time. We are arrogant, lazy, greedy and envious. To make matters worse, we display a decided tendency to sanctimony. Is this not a fertile ecology for the legal profession? One might imagine the situation as a large warehouse with heaps of spilled corn on the floor, with plenty of dark corners and a warm damp atmosphere. Is it any wonder that there are rats?
And yet we aspire to be better than we are. We are heirs to a tradition that speaks of truth and justice. The Profession of Law is the embodiment of that tradition. Theirs' is the language of justice and the righting of wrongs. While we recognize the failings common to our condition, we also believe in something better. We are all faced with situations or institutions that are powerful, leaving us helpless and vulnerable before them. We need a champion that protects us from the power of the state, from the impersonal procedure bound insurance company or employer, from the implacable results of our own folly.
And so we have the personal injury law firm, the "ambulance chaser" advertising on early morning and afternoon television. My nose curls with the odor of damp moldy corn and the rustle of unseen rodents in dark corners. But I also hear the echos of Marcus Tullius Cicero, of Thomas More, of John Marshall, of Thurgood Marshall. And so while I continue to snort when I think of lawyers, I am also glad that they are there.
This morning the thermometer showed 9 degrees outside. I can be compulsive, but 9 degrees makes even me bow to reality. So I went to Club USA and did the elliptical machine. I hate treadmills and elliptical machines. All you can do is watch the mindless television news. But trapped in the torture machine that is the elliptical machine, I watch it. It seemed this morning that many of the commercial ads were for personal injury law firms. Everybody in Denver is familiar with the strong arm of Frank Azar, but he is not alone. Not by a long shot.
Time moves very slowly on the elliptical machine. In that interminable wait for the next tick of the clock, I had no choice but to think about lawyers. Most people are of two minds about the legal profession. On the one hand, lawyers are the butt of mean spirited jokes, and as Shakespeare among others reminds us, the source of much (all) trouble in this world. Yet from Perry Mason to LA Law to Boston Legal, lawyers are shown as noble, and even more importantly, sexy. How many times have you heard a proud parent announce their clueless college student to be in pre-law?
It has been my sad fate as a company executive to get to know a number of real lawyers. Hence the importance of the Monday Morning Rite. Despite a strong predisposition to find them as dastards, I have liked most of them. They are just ordinary people, no matter how much I want to throw stones at them. They have a job to do, mortgage payments to make and a conscience to live with. The sad fact of human existence is that underneath it all, we are just people. Hence the need for lawyers.
And that is the source of our schizophrenia. We are human beings. Which means that we screw up on a regular basis. Despite our best intentions, we hurt ourselves and others all the time. We are arrogant, lazy, greedy and envious. To make matters worse, we display a decided tendency to sanctimony. Is this not a fertile ecology for the legal profession? One might imagine the situation as a large warehouse with heaps of spilled corn on the floor, with plenty of dark corners and a warm damp atmosphere. Is it any wonder that there are rats?
And yet we aspire to be better than we are. We are heirs to a tradition that speaks of truth and justice. The Profession of Law is the embodiment of that tradition. Theirs' is the language of justice and the righting of wrongs. While we recognize the failings common to our condition, we also believe in something better. We are all faced with situations or institutions that are powerful, leaving us helpless and vulnerable before them. We need a champion that protects us from the power of the state, from the impersonal procedure bound insurance company or employer, from the implacable results of our own folly.
And so we have the personal injury law firm, the "ambulance chaser" advertising on early morning and afternoon television. My nose curls with the odor of damp moldy corn and the rustle of unseen rodents in dark corners. But I also hear the echos of Marcus Tullius Cicero, of Thomas More, of John Marshall, of Thurgood Marshall. And so while I continue to snort when I think of lawyers, I am also glad that they are there.
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