Month: September 2015

Will my job survive till next Recession?

1

If you are the breadwinner of your family this should be the question surfacing on top of your mind all the time.

Why do we fear for recession?

For that we should know when the next recession will tentatively start. As per the economist, first the Federal Reserve correction/ action should happen and then the tentative timeline for the next recession will be 12-15 months from that date.

The best one to predict with the nearest possible accuracy on the occurrence of Recession is the Stock Market. So far the stock market has predicted almost 5 recessions accurately from March 1961.

The recovery period or the average growth period of economy between two recessions is around 5-6 years taking the past records from WWII era. But if we consider the last recovery of the earlier recession which happened in 2009 with the 6 years average growth period, we are almost exactly on the 6th year. So on this calculation the recession is some there in the corner for sure.

What is the first sign?

As I said earlier stock markets only can predict the scenario in a more accurate way than others. If we take the stock market data points, the first sign of recession has already happened on August 24, 2015 with the big crash by the Chinese Stock Market mounting to a loss of nearly 40%.

The second sign is, during 2007 the Federal Reserve was only 500 Billion whereas today it is 1.6 Trillion. The 1.1 trillion dollar is now idling with just 0.25% interest in the Fed reserve. Can fed reserve let it go for long time?

Banks are not ready to lend this money to others as it didn’t see any credit-worthy borrowers. When we take the above two data points alone, we can predict that the recession is almost there in the corner. Markets were able to recover from August 24 crash. But it is still 12% below than average till date.

So we can conclude that the next recession will not delay beyond 12-15 months from December 2015 – February 2016. The peak period will be between mid 2016 to early 2018. If this didn’t happen then don’t worry till 2020.

Now let us come to the original question. Will my job survive till next recession?

It all depends on which path your current or new company is going to take.

Companies will first focus on Profitability. They will do all possible to increase the Gross Margin. The simultaneous step any company will do is to Cut the Costs even if they don’t see any reduction in the inflow of money. This will help the company to Preserve the Cash

Cockroaches thrive more during disaster period not just in Personal life but also in Profession life too.

If the company is going to increase the Gross Margin, they will automatically stop recruiting high paid profiles. If required, they will let go the non performers on the same high paid profiles. Since the company itself
is going to apply all the possible strategy to escape from the recession, it is implicit that every employee should go all possible extra miles to increase their performance in the current company and secure their job.

If we join a new company now it will take nothing less than 6 – 12 months to prove our efficiency beyond the luck aspect. By then it will be the actual starting point of the peak recession. If we fail, then we will be the first one the company will let go.

So apply your common sense and take a decision to secure your job wherever you are.

Advertisement

I am worried – I didn’t quit my job yet!

sheepBlind Sheep Syndrome

I am worried, I didn’t quit my job yet but my fellow team members already quit. If you can understand the above sentence, this is the exact meaning of “Blind Sheep Syndrome”

People without any self determination or people who think they are always perfect in taking decisions are the victims of the above syndrome. This can be seen much in professional life. If a horror movie becomes successful, all of a sudden you can see there will be 4 to 10 horror movies going to come out one after the other.

This same blindness is always followed in career too. The moment your close colleague quits his job you will become restless and very detached from your job. You will start worrying that you didn’t quit your job yet Or at least you will start analysing whether you are correct on continuing with the current job.

Other way of people getting affected by this syndrome is by the people who got the quality of influencing others. The moment these guys drop their paper they will somehow make others to think twice in continuing with their current company.

Can we avoid this?

The answer is NO. But we can control the situation.

Believe there is always an antidote available for any epidemic. The Managers are the role players for this and if they have the complete hold of the team then this situation can always be kept under control.

Flat or Hierarchical Organisation Structure

What if the Manager quits?

The classic case of requirement of the combination of flat and hierarchical organisation will arise if your Manager controls the entire team. Gone are the days to have either Flat or Hierarchical Organisation Structure. Today the need is always a blend of both of these structures.

If you think people are your core asset then you should avoid going to Hierarchical organisation. Hierarchical Organisation will always create a professional gap between different layers of people which will eventually end up with atttrition. Same way, Flat Organisation will result into tough situation of satisfying your people on their growth roadmap.

The Blind Sheep Syndrome will always affect the Hierarchical Organisation more than the Flat Organisation.

If we have a combined structure of Flat & Hierarchical Organisation then we can avoid the wild situation arising out of Blind Sheep Syndrome.

After all, job is the need of any individual. But company as a whole is the need of any Management.

Sustainable Growth – A Real Challenge For any Entrepreneur

growth1Like I said in my earlier blog, ” Copycat or Lack of Innovation”, any entrepreneur should have a strong concept before he starts his venture. New ideas and brand new concepts are very important to maintain the growth of any business.

A business could be product based or service based. This article was written on the service based perspective.

Initial Period

A software service company can be started based on two scenarios. There is a strong financial back up to build step by step and reach a sustainable stage, OR we already have a client who is ready to give projects  so that we can grow the company on back of that project.

On both the above two scenarios the initial growth is very steep. Risk level is low and building the team is not a big task or deal.

There is another scenario which is very rare. Business getting started by SME – Subject Matter Experts. Initial period of this scenario will be very tough and also the risk level is very high. But this will be a real Unique achievement.

Team Size Vs Revenue Ratio

On both the scenarios, one thing can be a common factor. We will never start a business as a 100 member initial team. It will be from 1-10 and then it will grow to 11-50, 51-200, 201-500, etc.

Initial strength up to 200 members is what we normally see from any start up company in the first 3 – 5 years.

Alternatively on the revenue side it is easy to reach to .75 to 1 Million dollar revenue in the first 3 -5 years along with 51-200 member company.

But there will be a stagnation stage at this level for every business. Either we will see the revenue remains the same for years along with the number of team members or the revenue will not change but the team size will come down to 120 – 160 level.

Both the above scenarios will require a total new business and operational change  with new set of clients and deal sizes. If a company is able to cross this chasm with in a period of 12  – 18 months then their growth will accelerate to the next stop gap at 1001 – 5000 member company and 12 – 60 million growth.

This science is a cycle and it will happen at each level of the growth.

What will make you cross that chasm?

It can happen only if we have a strong vision and all new Next Level Growth Plan with real leaders with you to implement it. It will be a real litmus test for any Entrepreneur at this stage and those who have the following commitment only can survive that and cross the chasm.

What are those Commitments?

“Dominate or Dissolve. No more Compete” 

Yes, we can take a tough stand to Dominate the market with our New Strategy or all new Next Level Growth plan or to Dissolve or windup the show forever. Because we cannot call ourself as an Entrepreneur if we Compete with others with a stagnated Revenue or Head Count or Same level of  Clients for a long period.

So remember the phrase “Dominate or Dissolve. No more Compete”, if you really want to get called or call yourself as an Entrepreneur!!!

Copycat or Lack of Innovation

copycatInnovation to Product

“Innovation” is one of the most coined word by many companies added with “acceleration” during the growth stage. But does that really suits them? Answer is almost No in many scenarios.

Innovation in a service company carries different meaning than the product company. Service innovation is mostly on process side and Product innovation is  on usability and functionality side.

If we take any new product on the market they will not be mostly their own brain child. They normally bridge the gap of the available product and brand as their new innovative one. Or at least their core or base concept of the product will be mostly from any of the other products available in the market.

One thing we cannot deny. After a point of time these products will totally change their identity from the base and  will become the so called innovative product by itself

But I am not earmarking every product that way. Because there needs to be some real innovative products to get as the base for the other new brands for sure.

Product to Innovation

On other scenario, the core or the base product needs to bring in more and more new features to handle the market sustainability. They are in more compulsion than others to bring in more changes to their product for their mere existence in the market.

What if they get in to lack of new innovation?

They will also start thinking or doing what the other product companies do. Just Copycat!!!

Example: iPhone. Apple released their first iPhone with their new innovation in the smartphone arena when Smartphone was not a must that time. But today the situation is different. To explain it more clearly I could say “Vitamin pills to Pain killer” difference.

iPhone was a vitamin pill when it was released. But since smartphone is a must now, iPhone is a pain killer now.

But today the new iPhone 6s got many new features which they claim as their new innovation. Innovation should be newly invented one and cannot be an inherited one. 

I have the following doubts about their new features.

1. 3D touch – Already available in Blackberry Storm2

2. Live Photo – Already available in HTC Zeo

3. 4K video – Already available in Sony Experia Z2 and LG G3

4. Flashback zoom – Already available in Samsung Galaxy

5. Hey Siri – Already available in Google Now and MS Lumia

6. Aluminium parts – Already used by Samsung Galaxy S6 and S6 Edge

so on an so forth.

So can we conclude that Apple didn’t innovate anything new of their own and they just consolidated the features available on several devices into one device?

This proves that the so called Father of Innovations also has to copycat the features or at least take the clue of new idea from others and make it as new feature in their upcoming products.

This is happening for the survival in the competitive market. Coming to the Top is harder. Being in the top is the hardest. So to be on the top we are even ready to Copycat which is exactly what was not our claim when we were struggling to come to the top.

Professional Loyalty a Myth

loyaltyWhat is Loyalty?

Have we ever thought of this word before. The answer would be yes. But the truth is “for others” and not when it comes to us.

If we take the direct meaning of the word loyalty there are different ways to use it. First, in Confucianism, it is meant as “do the best you can do for others”. Second, in Christianity, “if loyalty to man conflicts with loyalty to God, the latter takes precedence”.

But what it actually means?

We almost correlate it with “slavery”.

How?

If my employee quit, its against loyalty.

If my friend speaks to my enemy, its against loyalty.

If I discuss into healthy debate with anyone of other company in my line of business its against loyalty to the company, so on and so forth.

But, hang on. Did we ever do a self analysis about us on this so called myth “loyalty”. No we won’t. Because whatever we do, it is all because of a cause and if the same is done by others then we immediately weigh it in Loyalty scale. This is not for you or for me. This is happening in most of the People I am able to acquaint with.

We forget that we were also working with someone else yesterday and will be working with someone else tomorrow. If we had worked with others and come to our present company then are we “not loyal?” . We won’t accept. Why accepting? We won’t even analyse us in that angle.

When we recruit people from other company we won’t question them for “loyalty”. We even go extra mile asking them to bring other people from their earlier company to our company. Some may even do that.

But when they quit, we first give lecture to them on so called “loyalty” and particularly we will advise them in a commanding tone about loyalty.

Is quitting a job means not being loyal?

First please understand. QUITTING is not anything against LOYALTY. When we feel something is not going to our comfortness or if we want  advancement in our carrier, we have to quit and move on. Else both our company as well as us are not going to advance, why advance, we won’t even feel comfortable in the profession.

What is loyalty then?

Loyalty is a virtue or we can say it is the top of all virtues. So it is not something going to do with Profession at all.

Just be “true” that is what required in profession. True to your profession and true to your work ethic. Non solicitation is the ethic of any job. Just don’t solicit anything which rightfully belongs to others.

According to me, Loyalty is a very bad quality against Professional and Personal Enhancement.

If you Boss or your company speaks about Loyalty rather than trueness then you are at the wrong place in your carrier.

Loyalty will bring in a slavery mentality within you which will stop you in coming out of the cocoon even though you may feel or want to.

If Loyalty defines to be “not quitting job” even if I am sure that I won’t advance myself in the current position, then I prefer to be Not Loyal.

If professional loyalty means “being true” to the position I am holding and held, then I prefer to be Loyal.

%d bloggers like this: