INSEAD – Celebrating the 15 Year Reunion (2008)

15 YEARS LATER : MY 15-YEAR REUNION AT INSEAD

I have just completed my 15-year reunion at INSEAD in Fontainebleau. There were some 59 fellow classmates (out of about 205) who came in from 16 countries (3 came from Australia). It was a lovely way to reconnect – among other things to remind us of the importance of facetime and networking. As big a fan as I may be for virtual worlds and social media networks, the prescient words of John Naisbitt in High Tech/High Touch ring as ever true today.

There were three themes that seemed to keep coming up, no matter the topic at hand:

- The financial crisis
- The work-life balance
- Sustainable development

On the heels of the record-setting one-day stock market swings (the DJIA gyrated from a low of 7773 to a high of 8989 only to finish down 1.5% on October 10th), a devastating eight days of doom and gloom and a drop of -22% on the DJIA, the financial crisis had a bearing on absolutely every activity discussed. How is the financial crisis going to impact sustainable development? Will the financial crisis hurt social media and “metaverses” (with Professor Miklos Sarvary)? There were no contrarians to be heard. The concept of a worldwide recession was widely used. Clearly, we have not seen the end of the bad news as it will now roll out into other fields, including a predictable credit card crunch and down swing in sales of large ticket consumer goods. And, of course, it certainly will have an impact on executive MBAs coming to INSEAD and current MBAs looking for jobs.

The question of work-life balance was systematically raised, and not just by Gen Y MBA students. I think my wife summed it up rather accurately: work-life balance is a myth. There may be moments when when you are able to achieve more family life, but you are inevitably compromising work and vice-versa.

And on sustainable development, much of the conversation seemed to be focused on reinforcing the existence of global warming, and less about the [clear cut] solutions. We heard from Mohan Munasinghe, Vice president of the United Nations Intergovernmental Panel on Climate Change (IPCC) (and Nobel Peace Prize Laureate, 2007 along with Al Gore), who exposed the framework of “sustainomics.” The notion of sustainomics “draws on three basic principles: (1) making development itself more sustainable through immediate actions, (2) balancing the economic, social and environmental dimensions of sustainable development, and (3) transcending traditional boundaries of academic discipline, space, time, and stakeholder actions, to produce the most effective solutions.” Of course, I am not sure of the application in my immediate world. Anyway, good to listen to. {Read more on the subject here}.

Bottom line, attending the reunion was grand. Reunions are about seeing old friends, but I also got a lot out of listening to some good lectures and panels on contemporary topics. One of the recurrent conclusions of reunions, though, it is clearly NOT a French thing. Of the 34 French classmates, a total of 7 came (un grand merci à vous d’être venus), of which 3 live overseas — and only a couple of the French came for the whole weekend–too many other priorities elsewhere! Without talking about their lack of participation in alumni giving, it is a shame that the French culture does not seem to enjoy these types of reunions. I am, nonetheless, hoping that for the 20th year reunion (2013) we will get a fuller turnout — and with a bit of luck will be talking about rosier economic times. Thanks to all of you who did come. We certainly have our work cut out for us to bring some order to the world. In the meantime, all 1993 INSEAD alum are welcome to join the Facebook INSEAD ’93 group (assuming the company Facebook survives the current management exodus).

See you next time.

Microsoft buys Yahoo

Microsoft buys Yahoo?Microsoft to buy Yahoo for real this time? (BBC report) It was announced late yesterday that Microsoft has put in a bid to buy Yahoo for $44.6B, some 62% above where the Yahoo stock price closed on Thursday. Granted Yahoo stock has dropped 46% over the course of the last 3 months (high of $34 in October). Speculation was rife last May that this deal would go down (see SearchEngineJournal post or this Friday Traffic Report blog). There was talk of such a deal in 2006 as well…(see here at Scobleizer).
Google versus Yahoo?  Coming out of the garbage
The Yahoo stock performance and, more importantly, Google‘s continuing dominance obviously have created an environment where this deal would make sense. At 62% above the last close, the premium would look hard to reject from the Yahoo board’s perspective, especially after CEO Jerry Yang had just announced that 1000 people would have to be laid off.

My immediate analysis would be:
- obviously need the anti-competition authority’s approval on this one
- Yahoo’s corporate culture will take it on the chin
- some intelligent cross-fertilization would likely make the combined entity a viable competitor to Google (which would be a good thing), but they will need to find and communicate a real point of difference. How will they manage to compete better in China?

And in case that deal falls through, I invite you (and/or Microsoft) to peruse this site which considers the Top 100 alternative search engines available. What’s interesting is the churn in and out of that top 100 list… And I have been turned on to the KoolTorch search engine which provides a kind of mind-mapping result to your searches. Quite Kool indeed — and a nifty educational aspect (if you enjoy categorization!).

Your thoughts? If you want an interesting thread on the topic and the potential impact to open source work, go visit LinuxJournal. There’s lots of commentary to read through there…

The life cycle of a [successful] company and the importance of the brand

Inspired by this blog on “Pink Slip,” “Business Darwinism and the will to survive“, I ponder how even great companies survive long term. The very concept of lasting [forever] can almost seem counter intuitive (in the world of capital markets). I see the cycle of even those companies “built to last” as destined to un-last or unravel. In the beginning, there is great euphoria. The future is bright, money is raised. As [sales] growth continues, so stock price climbs. Then we track growing market shares. As market share grows ever higher, growth starts to slow. Pricing goes premium and the real game becomes growing the industry. The goodwill of the brand name becomes current currency. Stock dividends come into the picture and the stock stops its ascension upwards in anticipation of further deceleration. Because of the slower growth, there is rotation in the institutions owning the shares. And if market share does continue to grow (depending on how much the industry itself still grows), finally the threat of anti-monopoly or fat cat management inevitably set in. Brand extensions fall flat or dilute the original brand name. Stock price crumbles. Time for reinvention. Merger, takeover, MBO, LBO or other follow to start another cycle. If the company has created a true brand with a real DNA (and a passionate consumer base), then one has to believe the brand may survive, even if the company does not. Whether or not the few companies cited in Jim Collin’s Built to Last continue to survive given the ever changing consumer habits, all the remainder of the “normal” companies are subject to the laws of a true life cycle. Even entirely private fully funded companies that can shun the pressures of their [capital market] stakeholders face the issues of life cycle when it comes to handing over the baton to the next generation of the family — and that could be the subject of another blog altogether. In the meantime, you might enjoy reading this well crafted blog and several comments “Built to Last – Not.

Stock markets : Tokyo vs NYSE

The Figaro newspaper on 20 March published a thorough audit of France. Very interesting if only that it doesn’t seem to scream out what is needed to change around the situation (stagnant growth, etc.). While reading the audit, I came across stats on various stock markets. Two notable facts were illustrated (source FIBV, Euronext): in 2005, the Tokyo stock market overtook the NYSE for number of companies quoted and the gap widened more in 2006. London remains the exchange with the largest number of quoted companies. (The liquidity of the NYSE remains, however, far and away the highest, with three times more transactions than even London, and saw a skyrocketing acceleration in the volume of transactions since 2003). The other fact was that Paris has two times as many quoted companies as Germany… possibly related to the fact that German companies might be more prone to go with the other Anglo exchanges. Then again, it may all be rather moot because of the merger of NYSE with the various stock exchanges in Europe, including Paris, this Spring… at which point NYSE will shoot above the London SE in terms of number of companies listed.