Category: Leadership

Companies Are Recruiting CFOs with Operating Experience to Mitigate COVID Uncertainty

Companies Are Recruiting CFOs with Operating Experience to Mitigate COVID Uncertainty

COVID's negative impact on commerce and the general economy will be felt for some time. 3M (tkr: MMM) is not the only company to hire a new CFO with operating experience in an effort to mitigate the operational uncertainties of COVID. One may believe that all CFOs are operators. Think again. “His (3M's new CFO), … Continue reading Companies Are Recruiting CFOs with Operating Experience to Mitigate COVID Uncertainty

How to Destroy Productivity & Thwart Innovation: A 4-Step Process<span class="badge-status" style="background:red">Premium</span> 

How to Destroy Productivity & Thwart Innovation: A 4-Step ProcessPremium 

Step 1.) Close down a country: What's done is done. However, one of the consequences of shutting down the United States is that the speculative grade default rate is expected to almost triple - 4.7% to 14.4% - within the next year. Not to speak of the millions of non-public businesses that have suffered revenue … Continue reading How to Destroy Productivity & Thwart Innovation: A 4-Step ProcessPremium 

Leaders Create Opportunities

Leaders Create Opportunities

Effective leaders whether they be hired CEOs, entrepreneurs, school teachers or physicians create opportunities through action. Elon Musk did just that this week. We don't often side with Mr. Musk but have been in lockstep with him during this COVID period. Mr. Musk, Tesla (tkr: TSLA), co-founder and CEO recently reopened Tesla's Fremont, CA manufacturing … Continue reading Leaders Create Opportunities

Earnings Summary: A Rational Approach To “Guidance”

Earnings Summary: A Rational Approach To “Guidance”

We were recently critical of companies that decided to completely withdraw their financial outlook given the economic uncertainty that has resulted from the ongoing COVID virus. The good news is that a number of companies are providing financial outlooks, albeit they are taking a conservative approach (which is entirely logical from our perspective). We reviewed … Continue reading Earnings Summary: A Rational Approach To “Guidance”

Earnings Season Thus Far: Lack of Color & Backbone

Earnings Season Thus Far: Lack of Color & Backbone

Earnings calls thus far have struck a similar tone XYZ CEO: "Let me begin by saying our thoughts are with..."XYZ CEO: "We are grateful for the opportunity to delight our customers during this difficult time. We got off to a good start in the months of January and February as we experienced healthy year-over-year growth. … Continue reading Earnings Season Thus Far: Lack of Color & Backbone

CVS Health: An Example of Ineffective Executive Compensation Management

CVS Health: An Example of Ineffective Executive Compensation Management

CVS Health (ticker: CVS) provides an example of ineffective executive compensation management. Compensation should reward past performance and encourage behavior that drives desired future results. CEO total compensation growth should not outpace revenue growth nor operating cash flow growth over time. We prefer operating cash flow as a performance metric over Adjusted EBITDA as some … Continue reading CVS Health: An Example of Ineffective Executive Compensation Management

A Gradual Return To “Normal”

A Gradual Return To “Normal”

People don't like abrupt change. For example, if social distancing rules were lifted tomorrow I doubt that fans would fill Fenway Park. Not out of spite for John Henry (Mr. Henry was forced to trade a prime MVP player because the Red Sox prematurely signed a now injured Chris Sale to a massive contract), but … Continue reading A Gradual Return To “Normal”

A Common Sense Approach to Crisis Management. Leveraging A 6-Step Plan.

A Common Sense Approach to Crisis Management. Leveraging A 6-Step Plan.

During a crisis (bookings down by as much as 80% for some Enterprise Technology companies), leaders act with imperfect information. A reactionary approach is never the optimal approach. We offer a 6-step plan. Vilfredo Pareto was an Italian engineer, sociologist, economist, political scientist, and philosopher. The "Pareto principle" - better known as the 80/20 rule … Continue reading A Common Sense Approach to Crisis Management. Leveraging A 6-Step Plan.