Thursday, January 28, 2010

Another of Steve's money-making toy ??



Those living in the old age, you will be waking up to see the new Apple "toy of century" soon to release in the US market and everywhere perhaps, as everyone in the industry waits to see what Apple's response to netbooks, competitor tablets and E-Book readers will be. The rumour mill has been running and here is some of the news from the grapevine:

- The tablet may or may not be called iPad or iSlate [ To me, the "ipad" does not sound so nice as it sounds like the lady sanitary piece, hope Steve has given some thoughts on this. iSlate also does not sound hi-tech at all ]

- The tablet may basically be a hybrid of between a MacBook and an iPhone. It'll most likely have a metal unibody construction with a glass front that might make it look like a much larger, flatter iPhone.
- The tablet likely has Wi-Fi connectivity, and will be an E-Book reader on steroids (watch out Kindle, Apple's gunning for you). It'll probably be a terrific gaming machine, plus the capabilities for web browsing, e-mail and the ability to multitask.  Hope battery life is not an issue here ! !

The only time in recent history where the hype approached the levels of this announcement was for the introduction of the iPhone 2-3 years ago. The big question on everyone's mind is whether the new tablet will have the same type of response the original iPod and iPhones. I believe personally it will still have some market impact looking at the pricing of this new product, if set at less than S$900 or S$1000.  Manufacturers of E-Book readers are most likely having the feeling of impending doom with their product of limited features and same pricing strategy....
There's also talk of a new, improved contact and calendar synching system for the ipad so it will be similar to that used on the PC tablet.
Another rumour is the possible announcement of a touch-screen version of the iMac. The iMac has become one of the most popular computers in Apple's fleet, and touch screen capability would add tremendously to its appeal with consumers.




Tuesday, January 26, 2010

Leadership by a Leader ?


Leadership is defined as “the influence that particular individuals exert on the goal achievement of others in an organizational context” (Gary Johns et al. 2005, p. 274).  A leader is someone who can influence others and who has managerial authority.” (Robbins, S et al. 2006, p. 568). According to S.A Kirkpartrick and E.A Locke (1991), leaders are intelligent energetic positive thinking people who have alot of initiatives, ambitious and willing to take responsibility and answer for the consequences. A visionary leader is one with a far-sighted vision and has the knowledge and special experience to forsee or forecast what to expect.

Hence, a leader is an individual who leads people towards a certain goal; being a figurehead who rules, guides or inspires others. A leader is one who is in charge or in command of others.

• leader has to be trustworthy and must fulfil promises made. he must also take responsibility for his own actions.
• One who takes his work and role as a leader seriously. He motivates his followers towards a common objective.
• One who is confident and calm in a crisis, a leader must display self-confidence and exude a calm disposition so that people will believe in him. He is able to adapt to situational changes and adjust to his advantage.

To suggest that leaders do not enter the world with extraordinary endowment is to imply that people enter the world with equal abilities, with equal talents.” (Cawthon, D L 1996, p. 2)

By comparing a person who is musically inclined and one who is tone-deaf, the musically inclined individual will progress further than the one who is tone-deaf when they go through the same training. Although the tone-deaf individual may improve slightly, the progress of the talented individual will be much more evident. This is the same case with leadership.

It is true that people can be trained through leadership programs; however these trained personnel will often pale in comparison with those who have in-born characteristics that allow them to excel in leadership roles.

It is not just the amount of training an individual receives that creates a leader; rather it is the traits an individual possesses that play a crucial role. The training just accelerates the development of the in-born abilities.

Leaders rely on self-fulfilling prophecies in achieving some of his main objectives:

Helping people realize their true potential. Life revolves around a few chores, around a handful of activities. We work, we eat, we sleep. Events start defining our lives, instead of our lives defining events. This all too often leads us to lose our perspective, to stop seeing life in its totality. We start going around in circles. It frequently takes a leader to lift us out of this fog, to point us to a true purpose of our lives so that we stretch ourselves to achieve bigger goals in life.

Motivating people to higher levels of performance. Leaders understand that people don't perform at the highest level if they're not fully motivated. Leaders therefore unleash self-fulfilling high expectations for our talents and instill in us the confidence to do more with the tools at hand, or to stretch more to overcome a lack of tools. They inspire in us a desire to perform better in life, both day to day and longer term.

Aligning people with a broader vision. Leaders use self-fulfilling high expectations to rally people behind a higher vision. They convince those people that they're specially endowed with the talents and capabilities they need to surge toward that seemingly unattainable vision.

Monday, January 25, 2010

What really caused Inflation ?


Some believes inflation is a function of too much economic growth. In an increasingly interconnected global economy, shortages of labor and manufacturing capacity in any one country cannot be inflationary. They can't because, as we've regularly seen with U.S. companies, they have always accessed the world's supply of labor and capacity when producing the goods we buy. Even if we assume--as the Fed seemingly does--that the U.S. economy is closed the Fed's definition still wouldn't pass the most basic of scrutiny.


Indeed, labor shortages in any one country are always solved by new labor force entrants seeking to achieve the higher pay created by shortages, by the certain migration of workers from weak to strong labor markets and--most notably--by technological innovations that reduce the need for human labor inputs. High capacity utilization is nothing more than a market signal suggesting more is needed. And because of robotics and other production innovations, capacity is hardly a static concept.

Then there are those who simply use consumer prices as the truest, most market-driven measure of inflation. It's hard at first to argue with this approach since changes in the value of money often show up in prices, but the largely quiescent consumer-price figures during a weak-dollar decade also come up charitably short.

For one, manufacturer can raise prices without actually increasing the nominal prices of the goods they sell. One easy example here would be peanut butter. The marketers for the product decided to indent the condiment's container in order to reduce its content by 9%. Starbucks has held the line on the cost of the pastries it sells by reducing the size of each pastry.

For two, high prices usually mean that they'll soon fall. Flat-screen televisions used to cost more than $10,000 few years back, but today these prices have gone down considerably to less than $2,000. High prices invite more competitors into the market the sale of all sorts of goods, which invariably leads to price reductions regardless of whether the dollar is strengthening.

Finally, rising prices due to a strong demand for one consumer item are not a sign of inflation. If consumer demand for one good is driving its price up, demand for other products must be falling in ways that will drive the prices of other goods down. In short, if there's such a thing as a true price level, it cannot be altered by expensive goods anymore than cheap imports can drive it down.

So what is true inflation? It seems the answer relates to the precious metal call “gold”. Used as a money measure for thousands of years, gold achieved its purely monetary role precisely because its role in the productive economy is so minuscule. As a result, nearly every ounce of gold ever mined is still with us, which means gold's real price is hard to alter thanks to a great deal of gold stock in existence relative to new discoveries.

When the price of gold moves, gold's price isn't moving; rather it is the value of the currencies in which it's priced that is changing. Gold is the objective indicator of inflation: When its price in any currency rises substantially, that means the unit of account is weakening and that we're inflating.

What does this mean for the economy? Broadly it means that when the dollar weakens such that the price of gold spikes, what is limited capital seeks safe-haven in hard, unproductive assets like gold, oil, art and property. Physical assets least vulnerable to monetary debasement win out over less tangible investments of the innovative or knowledge variety. In that sense it's no surprise that technology investments thrived in the '80s and '90s when the dollar was strong.

Getting back to inflation, rather than a measure of prices that change for various reasons that have nothing to do with currency policy, inflation is at its core the painful process by which capital flows to the hard assets of the earth and away from innovative, wage-creating industries. As individuals we don't so much hate inflation for the rising prices as much as we balk at it because our chances to capture good jobs and good wages are compromised for capital essentially hiding.

As the rising price of gold has revealed throughout the decade we've been inflating, no matter what the more quiescent government measures of consumer prices have been telling us. A weak dollar explains our economic unhappiness because a weak dollar is what has made capital disappear.

Is Google going into right direction with Nexus ?


Is Google in the right strategic business path going into the foray of making cell phones?
Google finally completed their product test dubbed the “Nexus” and just recently launch it in the US –the highly anticipated android phone against Apple "Iphone" which Apple has been flourishing in the market for the past 2 years with millions sold. But does Google's move into territory dominated by specialists like Nokia and Motorola and consumer electronics stalwarts like Apple and Samsung make any business sense?  If you ask MBA graduates, nothing is too late as long you have the right strategy and applying all the business theories, marketing tactics, R&D, etc, you will still get a substantial market share which is still a “big pie” in the phone business to be captured by many players. Technology advancement is key to success as long you come with an “extra edge” in the mobile user platform.

Google is an Internet advertising company, after all, trafficking in search terms and text ads, the company has partnered with myriad handset makers and carriers to bring its Android operating system for mobile devices to consumers. Why would it ever want to bypass its partners, putting out its own phone

Here's an interesting peek into the free Web-based mobile phone downloads.
It comes from Myxer, a Florida-based website that claims one of the Internet's largest catalogs of free ringtones, wallpapers, videos, applications and games.

In its inaugural report on the behavior of its 30 million users, Myxer's compares the traffic it's getting from users of Apple's iPhone and Google's Android devices. From 1 billion downloads over the last three months of 2009, Myxer discovered several trends that may be less significant than they appear:

• Visits from users on the Android operating system grew almost 350% from December 2008 to December 2009, compared to iPhone visits which grew 170%

• Roughly 70% of the ringtone downloads made by Android users, and 48% of downloads initiated by iPhone users, came from the Hip-Hop/R&B genre.

• In total, Myxer delivered seven times more downloads to Android devices than iPhone devices in Q4 2009.

No explanation for why Android's traffic is so much higher than the iPhone's but the reasons could probably lie in the fact that creating original wallpaper and ringtones is relatively easy on the iPhone. Besides, the Apple's App Store offers many more games and other diversions than Google's.

Whatever happens, the mobile phone users will expect to see more applications available in both Android and Apple store and it could be an era of “Application-addiction” growing to take over other kind of human interest and whether is going to be bad or good to each individual, time will tell.

Sunday, January 24, 2010

Investing Risk Factors


We all know in finance, higher returns equals higher risk. It's a basic fact of investing, yet working out just how much of a gamble you are willing to take with your hard earned cash is far harder to pin down.

The other side of the story is when individual get so caught up chasing higher returns they ignore the risk factor.
The willingness to take risk is just one facet in managing investment risk. It is even more important to ask yourself this: Do you need to? Are you able to afford to lose?

Here are three factors you should consider before investing:

-Willingness to take risk
Simply put, the willingness to take risk - called risk tolerance - reflects your attitude towards risk. It is the amount of risk you are comfortable taking, or the degree of uncertainty you can handle or if should you lose, are you still liquid in your assets.

For example, if you can sleep soundly even when your investments are experiencing dramatic swings in value, you are considered risk-tolerant. But if they keep you up at night, you are risk-averse.
Risk tolerance often varies with age, income and financial goals. Risk tolerance levels are usually classified as aggressive, balanced or conservative. Each level helps determine the percentage of equities and bonds to hold. Equities are deemed riskier than bonds.

-How much risk you can take
Besides measuring your risk tolerance, you also need to know how much risk you need to take to achieve your financial objectives. It is a useful indicator because you may realise that you do not really need to take the risk of investing in that product after all.
Perhaps your risk profiling score indicates that you are an aggressive investor who can withstand high portfolio volatility.

But there may be no need for you to undertake the new risk because you may be already close to meeting your financial goals.
The need to take risk - called risk capacity - is based on what returns a client needs based on his objectives.

- Ability to take risk
The usual risk profiling exercise carried out at most financial institutions helps determine your willingness to take risk but it does not re-present your ability to take risk.
Let's say the risk profile questionnaire indicates that you are a high-risk investor, but if you look at your financial health and commitments, it may show that you have a lot of debt. This means that you are unable to take high risks even though your risk profile says otherwise.

In some banks, they assesses risk ability and overall pro-duct suitability by collecting information on a customer's investment time horizon, income level, employment/income status, financial health such as cash flow and net worth and age.


Balancing Risk

Providend maintains that using the risk profiling questions alone is insufficient to adequately suss out a client's risk attitude. Besides assessing risk tolerance, it seeks to understand the client's risk capacity and ability to take risk.
It believes that it is able to really understand a client's risk appetite only after these three factors are aligned.
The three factors help determine the amount of risk that should be taken in a portfolio of investments.
The problem many investors face is that their risk tolerance, risk capacity and risk ability are not the same.
This is where the adviser's responsibility comes in. Even if an investor appears to have an appetite for a product with a certain amount of risk, the adviser must steer him away if he feels that the client does not have the capacity and ability to take the risk.  Example, the GP cannot say he prescribed sleeping pills because that was what the patient wanted. In the same way, the adviser or the financial institution cannot say that he or it sold a client a high-risk investment which was not suitable for him because of the client's lack of risk ability, simply because that was what the client wanted.

Professionals owe a duty of care and they should give professional advice including advising an eager customer against investments which are unsuitable for the customer.
In a scenario where making an investment would result in a breach of these thresholds, the bank will either advise the customer to reduce his investment amount to a level within his risk capacity or advise him against making the investment.

As said, be prudent and careful, do not jump into the bandwagon like many who suffered in last year bonds issue.

Leadership Skills




Directing Leaders - define the roles and tasks of the ‘follower’, and supervise them closely. Decisions are made by the leader and announced, so communication is largely one-way. Less autonomous for the follower to make decisions and more dependent on the leader to provide directions.

Coaching Leaders - define roles and tasks, but seeks ideas and suggestions from the follower. Decisions remain the leader’s prerogative, but communication is much more two-way. Follower has some leeway to make some decisions and answerable to mistakes made.

Supporting Leaders  - pass day-to-day decisions, such as task allocation and processes, to the follower. The leader facilitates and takes part in decisions, but control is with the follower.  Follower may feel more confident in making decisions with the support from the leader.

Delegating Leaders - are still involved in decisions and problem-solving, but control is with the follower. The follower decides when and how the leader will be involved.  Follower gets more freedom in making and taking decisions and actions.

Another approach categorizes styles according to emotional intelligence competencies, some of which work better than others in specific situations. These styles have each their pros and cons :

Coercive: The “Do what I tell you to do” style demands compliance by the follower. It is especially useful in turnaround situations, in a crisis, and when you faced with difficult employees where you need to set an authoritative tone and get instruction followed. However, using this style inhibits your organization’s flexibility and can dampen staff morale and motivation. There may be no improvement in work environment and no new ideas being created.

Authoritative: This style mobilizes people toward a vision. Specifically, it provides an overarching goal, but gives others the freedom to choose their own way of reaching it. This approach is most effective when a business is at sea and needs direction, or during an economic or business downturn. This style is less successful when the leader is working with a team of experts who may have more experience—and may disagree with his approach.

Affiliative: This “people-first” style creates emotional bonds and team harmony. It is best used when team coherence is important or in times of low staff morale. But this approach’s focus on praise may permit poor performance among employees to continue unchecked, and employees may lack a sense of overall direction. The downside of this style, however, is that it may result in indecision, and some staff may be confused and leaderless as the directions set could be unclear.

Democratic: This style builds consensus through participation. It is most appropriate when organizational flexibility and a sense of individual responsibility is needed. The downside of this style, however, is that it may result in indecision, and some people may be left feeling confused and leaderless.

Coaching: This style focuses on personal development. Coaching leaders help people identify their strengths and weaknesses, and tie them to their career aspirations. While this style is highly successful with people who wish to improve professionally, it is largely unsuccessful with those who are resistant to learning or changing their ways.

While some styles may be more comfortable for you to adopt than others, the more you stretch yourself to learn a range of styles, the more effective you will be as a leader.