Category Archives: Future threats and opportunities

Here you find our thoughts on the state of play in our society: the macro issues that are affecting your personal risk and security.

Three articles, our children, and food for thought

 

A recent Bloomberg Businessweek article entitled, Is Your Job About To Disappear?: Quick Take, said this:

“Throughout much of the developed world, gainful employment is seen as almost a fundamental right. But what if, in the not-too-distant future, there won’t be enough jobs to go around? That’s what some economists think will happen as robots and artificial intelligence increasingly become capable of performing human tasks. Of course, past technological upheavals created more jobs than they destroyed. But some labor experts argue that this time could be different: Technology is replacing human brains as well as brawn.”

In his review of “The Golden Passport” in the April 10th New York Times, Andrew Ross Sorkin wrote, “The book is a richly reported indictment of the [Harvard Business School] as a leading reason that corporate America is disdained by much of the country … Citing a report from the Aspen Institute, [the book’s author Duff] McDonald explains that “when students enter business school, they believe that the purpose of a corporation is to produce goods and services for the benefit of society. When they graduate,” he continued, “they believe that it is to maximize shareholder value.”

The Real Threat of Artificial Intelligence appeared on the Opinion page of the New York Times Sunday Review dated June 24, 2017. It was written by Kai-Fu Lee, chairman and chief executive of Sinovation Ventures, a venture capital firm, and the president of its Artificial Intelligence Institute.

Clearly the debate is heating up. At some point, someone or a group of someones will decide the winner, if there is a winner. Others will hand down a verdict on whether or not the Harvard Business School should take the credit or the blame for how enthusiastically business has embraced technology.

Families about to engage with their children in discussions about post-secondary education might want to answer these questions: Will there be 40-hour-a-week jobs with benefits and retirement pensions? Where? What kinds of jobs will they be? What education will it take to qualify for them? It’s a start.

Riding madly off in all directions

If there are days when it feels like the world is riding madly off in all directions, it probably is. Change is the culprit and it’s never happened this fast or in so many places at the same time. Nothing in our experience has equipped us to deal with it.

Parents who are sending their children to university in the current economic and technological climate expect that when their children graduate, the jobs they’ll be applying for will be as traditional and as plentiful as they were in their parents’ day. They may be in for a surprise.

Employment relationships aren’t what they used to be. Corporate tastes in university degrees have changed. We have to factor that into how we think about the role higher education is going to play in the life of our children and what their options are going to be. Change is a fact of life for real companies and organizations with real names. Our kids need to know which companies and organizations they are or are likely to be.

We also have to bear in mind that the cost of tuition has risen 40% in the last 10 years. That will continue. Over 50% of all jobs are now precarious. Over half of those jobs will be automated in the next 10 years. That, too, will continue.

The links in what follows will take you to articles and reports about the current environment and how it will impact on your young people and those of people you know. They feature GE’s Jeff Immelt (#4), MIT’s Erik Brynjolfsson (#12), McGill’s Suzanne Fortier (#12) and Google’s Sergey Brin (#16), among others.

  1. September 1969 — The first node of ARPANET installed at UCLA
  2. August 12, 1981 — IBM introduces its first personal computer
  3. July 15, 2014 — Apple and IBM Forge Global Partnership to Transform Enterprise Mobility
  4. August 4, 2016 — LinkedIn interview with GE CEO Jeff Immelt: “Culture is not just apps. It’s a combination of people and technology. If you are joining the company in your 20s, unlike when I joined, you’re going to learn to code. It doesn’t matter whether you are in sales, finance or operations. You may not end up being a programmer, but you will know how to code. We are also changing the plumbing inside the company to connect everyone and make the culture change possible. This is existential and we’re committed to this.”
  5. September 2016 Deloitte survey “Transitioning to the Future of Work and the Workplace, Embracing Digital Culture, Tools, and Approaches”
  6. October 22, 2016 — Finance Minister Bill Morneau offered this advice at a Liberal Party gathering in Niagara-On-The-Lake: “Get used to the ‘job churn’ of short-term employment and career changes.”
  7. December 17, 2016 — Morneau’s advisory council on economic growth predicts that: Fully half of all jobs will be automated during the next decade, making massive retraining a social and economic necessity.”
  8. January 14, 2017 — “Innovation key to achieving Trudeau’s resourcefulness.’” In order to move Canada’s reputation away from resources to resourcefulness, PM must break the mould of linear thinking.
  9. January 12, 2017 — World Economic Forum report: “The jobless world and its discontents, How can we prepare for a future where drones, 3D printing and automation replace jobs?”
  10. January 14, 2017 — The Economist: “Lifelong learning, How to survive in the age of automation” (Cover story and Special Report)”
  11. January 16, 2017 —As Robots Take Jobs, Europeans Mull Free Money for Al
  12. January 19, 2017 — Davos 2017 – Issue Briefing: Jobs and the Fourth Industrial Revolution
  13. February 2017 — Maclean’s print edition: “When robots steal your job”, The real driver behind re-shoring is automation. Robotic jobs, not human ones, are coming back.
  14. February 2017 — Automa-nation: Will robots take your job? A new report suggests 42% of the Canadian job market is at risk.
  15. January 17, 2017 — IBM THINK Blog, IBM Cognitive Principles
  16. January 19, 2017 — World Economic Forum, Davos 2017: Google’s Sergey Brin on AI

We’re told that we’re in the midst of the Fourth Industrial Revolution. We may not know how the story ends, be we do know that it will probably involve some form of advanced education. Our children have to be prepared.

 

 

“Control over change would seem to consist in moving not with it but ahead of it. Anticipation gives the power to deflect and control force.” Marshall McLuhan

Due diligence is behaviour designed to ensure before we put our money down that what we intend to buy and what the seller ultimately delivers are one and the same. Some would call that protecting an investment. Others would call it common sense. Personal Due Diligence calls it both.

Decisions about post-secondary education have consequences that involve life, career, family and financial stability. Too many parents believe that graduating from any institution of higher learning, university in particular, is a guarantee of well-paid, secure, predictable work. There are no such guarantees: only enhanced likelihoods. What we do know for sure is that we’re living in a post-industrial economy: yesterday’s manufacturing jobs and the ones that supported them are gone. What happened to blue-collar workers is now happening to white-collar workers. As Wikipedia puts it, “Information, knowledge, and creativity are the new raw materials of such an economy.”

According to the Conference Board of Canada: “The distinction between college and university is less important than the relevance of the discipline to the workplace, since it is relevance—along with supply and demand—that sets the market price for skilled talent.” Degrees in some disciplines are more likely to lead to work than others.

Research done in Alberta in 2005 showed that young people consult their parents in these matters more often than any other group and by a wide margin. But outdated ways of thinking, like old habits, die hard. Decisions based on wishful thinking rather than fact-based understanding of labour market and technological trends are some of the greatest risks our children face. The evidence has been accumulating since 2012 and the trend shows no sign of abating.

For now, the best defense against unemployment, underemployment and precarious employment for our children is due diligence. To quote The Economist, “[the] rise of the on-demand economy poses difficult questions for workers, companies and politicians,” and it comes with a considerable risk of displacement to which very few of us are immune. Due diligence is about minimizing the negative consequences of that risk. Or at the very least, knowing what the risks are and factoring them into the final decision to proceed with a university education. We should be making these decisions more with our eyes wide open and less with our fingers crossed.

In What is the Meaning of The Medium is the Message? Mark Federman, Chief Strategist, McLuhan Program in Culture and Technology wrote:

“Marshall McLuhan was concerned with the observation that we tend to focus on the obvious. In doing so, we largely miss the structural changes in our affairs that are introduced subtly, or over long periods of time. Whenever we create a new innovation—be it an invention or a new idea—many of its properties are fairly obvious to us. We generally know what it will nominally do, or at least what it is intended to do, and what it might replace. We often know what its advantages and disadvantages might be. But it is also often the case that, after a long period of time and experience with the new innovation, we look backward and realize that there were some effects of which we were entirely unaware at the outset. We sometimes call these effects “unintended consequences,” although “unanticipated consequences” might be a more accurate description.

“Many of the unanticipated consequences stem from the fact that there are conditions in our society and culture that we just don’t take into consideration in our planning. These range from cultural or religious issues and historical precedents, through interplay with existing conditions, to the secondary or tertiary effects in a cascade of interactions. All of these dynamic processes that are entirely non-obvious comprise our ground or context. They all work silently to influence the way in which we interact with one another, and with our society at large. In a word (or four), ground comprises everything we don’t notice.

“If one thinks about it, there are far more dynamic processes occurring in the ground than comprise the actions of the figures, or things that we do notice. But when something changes, it often becomes noticeable. And noticing change is the key.

“As McLuhan reminds us, ‘Control over change would seem to consist in moving not with it but ahead of it. Anticipation gives the power to deflect and control force.’”

It’s not how much you spend on university. It’s how wisely

between friends


Rise of the ‘precariat
,’
the global scourge of precarious jobs

Barely one in four of the global workforce has a stable job, UN reports
– CBC News, World, June 1, 2015

Contract work is here to stay, says Bank of England governor
UK job market has changed permanently due to financial crisis, Mark Carney tells Treasury select committee
– The Guardian, November 25, 2014


In his Nov. 1, 2015, editorial ‘The 21st-Century Club’, Fortune editor Alan Murray said of the 13th Fortune Global Forum:

“We are now in the early stages of the third Industrial Revolution. New corporate behemoths like Google, Facebook and Uber are reaching Fortune 500 size at unprecedented speed. The century will belong to those who master this new model. Economic dynamism will matter more than sheer scale. The invitation-only CEO gathering (Nov. 2-4) will include leaders of many of the largest companies in the world and focus on the challenge of ‘Winning in the Disruptive Century'”. (You can view the agenda of the recently concluded event by clicking here.)

One of the advantages of living in the early 21st century is that all it takes to see how some of the most powerful corporations in the world are going to change the way we live and work is a few keystrokes. What the Forum attendees heard and discussed wasn’t ‘if’: it was when—and when is now.

Those companies will need the help of well-educated young minds and they’re not alone. They’ve declared their intentions publicly which means that the word is out on what kinds of schooling they’ll be looking for. Parents and children who plan to attend university have to read that word, understand it and act on it. We know the names of the people who are shaping the future and the names of the companies they head. The information they’re making available about what they’re thinking is free.

It’s not how much parents are spending on higher education that matters; it’s how wisely they’re spending it. It’s a lot cheaper to avoid making a mistake than it is to correct it. The two articles at the top of this page speak to the consequences. So does this story about the precariat by Joe Fiorito in today’s Toronto Star. How is someone who is just starting out supposed to repay student loans on irregular or inconsistent income? At what point will the rising cost of tuition put post-secondary education out of reach? What will the impact be on the universities themselves?

There’s a glut of degrees on the street. Jobs that used to call for a high school diploma now call for a degree but pay high school wages. Graduates are accepting them even though they aren’t full-time and employers don’t look gift horses in the mouth. Had graduates taken the time to scrutinize the labour market before they put their money down, they might not have run out of options.

We can’t blame all of this on graduates any more than we can blame all of it on universities or governments. But we can blame it on a changing employer-employee social contract that has already cost many parents their job. Why weren’t they and others paying attention?

The environment in which today’s jobs exist is as important as the jobs themselves. Free trade agreements are part of that environment. Compromises were built into every one of them. To get, we gave. And what we gave was often measured in jobs lost. Canada has entered into 44 of those agreements so far and concerns are being expressed about the Trans-Pacific Partnership, which has yet to be ratified. Politicians and businesspeople love to boast about how many new jobs the agreements they ink will create. What kind of jobs are they? Will they be permanent or precarious? What qualifications will they call for? How much will they pay?

In its Oct. 24th – 30th issue, The Economist published ‘Reinventing the company’. In its Nov. 1st issue, FORTUNE published ‘The 21st Century Corporation: Every aspect of your business is about to change’. This is what Geoff Colvin said in his lead-in:

“Imagine an economy without friction—a new world in which labor, information, and money move easily, cheaply, and almost instantly. Psst—it’s here. Is your company ready?”

Please be sure to read FORTUNE editor Alan Murray’s editorial ‘The 21st-Century Club’. It’s what the C-Suite is reading and it’s already here.

By no means does this apply to all lines of work or to all degrees or all post-secondary diplomas and certificates. But where it does, and if precarious employment is the outcome, how do we calculate the value of higher education? Or the cost? Is it the education, the way it’s chosen, or both?

Even if parents are prepared to borrow money to put their kids through college, someone is going to have to pay it back. In the States, 7 million have defaulted on their loans. The US$1.2 trillion owing isn’t the figment of someone’s imagination: it’s real. In Canada, the number is between C$25 billion and C$50 billion, and one family in 8 is shouldering the burden.

To see the numbers for yourself, go to Google Alerts and set it to deliver links to articles with the words “student debt” in them to your e-mail inbox once a day. You’ll average 10 per day, 7 days a week, 52 weeks a year. I have been since October 2012, and the problem isn’t confined to North America. To see what universities are doing to cope, research the Millennium Project at the University of Michigan.

The world isn’t going through a phase: it’s evolving. We’re experiencing an economic tectonic shift, a “third Industrial Revolution” as FORTUNE puts it. If you want to see what the World Economic Forum’s Global Competitiveness Report 2014 – 2015 says about how Canada is faring, click here.

The United Negro College Fund has been reminding us for years that: “A mind is a terrible thing to waste”. So is a university. If we continue to waste either or both, we’ll have no one to blame for the consequences but ourselves.

Customers First, Investors Last: What were they thinking?

For years now, my colleagues and I here at BoardBench, have been saying that Wall Street has it backwards.  In the boardroom, directors have been fed, with a very large spoon, the mantra that they are beholden to the shareholder, that their purpose is to “maximize shareholder value.”  If you asked a large group of directors if this is true, you’d see a lot of bobbleheads in the room.  Many believe this is a legal requirement and in line with good business sense and good corporate governance.  Unfortunately, the concept of “shareholder primacy” is a relatively recent phenomenon.  It is also simplistic (shareholders’ wants are not homogeneous), has no legal basis anywhere (go ahead, try to prove me wrong), and, as many are now pointing out, usually damaging to companies, and the economy as a whole.

What we believe is real, and will eventually be proven again as real to the Street, is that customers, and employees are the two key drivers of corporate success.  When I say “again” I’m referring to Peter Drucker’s famous quote from decades ago: “the purpose of a business is to create and keep customers.”  So many seem to have forgotten this, or have never even heard of it.

But the basic premise is this: if you take care of your customers, and have great employees who are well supported and appreciated for being curious and excited about what they do such that they will ensure that customers love the products and services that the company offers, the company and shareholders will reap the rewards, too.  Of course other things come into play, like managing R&D investments (with the customer in mind), operations, and supporting a corporate culture that has strong values and morals.  The basic premise may be slightly oversimplified, but it applies, and should resonate with the board.

It appears that I’m finally not standing alone on this either.  In a recent interview, Jack Ma, the world’s newest CEO darling, made two bold public statements.  He basically shunned the current thinking of the Street by stating, on national TV, that “our customers come first, ouJack.jpgr employees second, and our shareholders third.”   He continued: “We aim to be larger than Wal-Mart by 2016, or sooner.”  If – no, when – Jack succeeds, and executes flawlessly on his statement, that customers and employees take a front seat over shareholders/investors, then he’s got an excellent chance of passing Wal-Mart as the world’s largest retailer.  Note, Wal-Mart just slapped some of its employees, who have the most direct relationship with their customers, by cutting their insurance benefits. This was probably done to cut costs, but it will probably also have a long-term impact on their customer relationships, too. But, I digress.

It seems that too many directors, CEOs, and business leaders, have become obsessed with what Wall Street, its analysts, and shareholders think.  Many have learned to play these groups exceptionally well, too. Countless analysts and shareholders have been taken in by companies’ projections, quarterly earnings estimates, and highly creative financial management and reporting.  Don’t get me wrong, the importance of the exchanges and the markets cannot be downplayed, but a balance is needed.  Focusing on Main Street is just as important, if not more so.

If you follow Main Street, you know about big box discount stores. Costco Wholesale Club, founded by Jim Sinegal and Jeffrey Brotman, believe in serving the customer first, and that if employees are treated properly, they will work with, and treat the customer well too.  Jim, the public face, is a “hands on guy” who is known for visiting each individual Costco store.  Jim is also outspoken about his views on Wall Street.  He’s been known to say that he puts his customers and employee needs above “pleasing shareholders.”  This philosophy must be working: Costco’s five year return is +116.73%.  If you bought the stock earlier, your return would be closer to 354%.

American Express is another company known for taking good care of its customer/members.  Personally I’ve been a fan of the company’s customer service representatives over the years, and tell them that every time I’ve called for help.  Don’t get me wrong, working at this company must be tough: when I was younger, AmEx employees were nicknamed The Dragons.  Perhaps because they were seehat2.jpgn as willing to fight for the company and their customers nearly to the end.  By the way, if you invested in American Express five years ago, your return on investment would be up 149.46%.

If you’ve worked with the general retail public, as I did during my college years, then you know just how tough this can be.  Sadly, not everyone who enters a store, calls a helpline, or dines in a restaurant is a kind and thoughtful customer.  Amazon deals with all sorts of customers from nearly every continent in the world, and I’m sure they have some interesting stories to share.  However, the company is noted for being one of the best customer service organizations in the world.  Amazon has more than one customer base, as many do: retail members, and consumers.  Jeff Bezos clearly divided the customer’s connection to Amazon into two categories: the experience and the service.  At this level, he notes that customer service is part of the full customer experience.  If it’s unpleasant, it’s a negative customer experience.  He supports the idea that a positive customer experience creates greater loyalty with Amazon.  If you’ve ever dealt with an Amazon Customer Service rep, you know that they work quickly to resolve your issue, they get the job done for you, and you are nearly always satisfied and left feeling good about your relationship with Amazon.  And, if you invested in Amazon five year ago, your return on investment is now up 236.64%.

While it’s much more pleasant to focus on the “good guys,” there are dark clouds.  Some companies are noted for their poor customer service.  Some survive because there are few alternatives: think of phone companies and cable providers, and some you can name on your own (take a look at their five-year ROIs).  However, when it comes to poor customer experience these days, I think sadly of that American icon Sears.  Whenever I bring them up these days, all I hear is: “Oh my gosh, I could tell you about the time when…”  Sears is a sad story101.jpg about the decline of a once great and loved retail giant.  Many years ago, the Sears catalog used to be called a “wish book.”  Families would anxiously wait for it to arrive in the mail.  It was nearly 5 inches thick. Moms, dads, sisters, and brothers would argue over whose turn it was to browse through and select from among the items they wanted for birthdays, holidays, special occasions and more.  Some people even bought their homes out of the Sears catalog.  But, it has lost its way, and it’s touch with its customers and has already begun its drop down that magical slide once pictured in its own catalog.  The entire company and its hopes for the future look pretty dismal: sell off of units and real estate, store closings, etc.  Sadly, if you invested in Sear’s five years ago, your return on investment would be -58.50% and it’s still falling today.

To sum up and put things into even sharper perspective, I recently spoke with the General Counsel of one of the largest, most recognized corporations in the world.  He told me, succinctly, that the biggest problem with their board is that not one director had any understanding of who their customers were and are or what they want.  I can also assume that they don’t understand their employees either.  So I will watch how this company slides in the next few years (Note: their record has been negative for some time), and report back with an update, unless, that is, they somehow figure it out and turn it around.

Do you need to focus on board improvement: composition, strategy, direction, execution, oversight?  Boards are our specialty. Give us a call.

Nancy May

Corporate Advisory Boards: “Show Me the Money”

Tell me, simply: What’s the purpose of being in business? We shopped this question around to board members and executives, and heard many different (sometimes long-winded) answers. “Maximize value for stakeholders ― Have a flexible business strategy/model to stay relevant ― Make and sell goods or services ― Get and keep customers ― Derive monetary and psychic satisfaction, and a host of other interesting opinions. However, if you put all their responses into a big pot, lit a fire under it (one I like to call scrutiny), skimmed off all the fat, political correctness, esoteric ideals, and highfalutin’ thinking, you could boil it down to one simple, honest truth: “To make money!”

So what type of board can most directly make you more money? Traditional (governing) boards can, although not always directly, since their activities focus on many other things including compliance, fiduciary duties, long-term protection of stakeholder interests, etc. What about advisory boards? Companies have formed these kinds of board for lots of reasons. Often they do so to deal with  temporary issues like legal/compliance, getting closer to customers, bolstering management, etc.: issues that probably could be more efficiently addressed through consultants. But, for the most part, companies build and keep advisory boards with the long view in advisors.jpgmind, and to make even more money.

It’s common to see start-ups and high-growth firms use advisory boards to get them over the hurdles, so that they can start or continue to generate more revenues than expenses. But, what’s more intriguing is the number of large, global, and/or well-established corporations that are quietly trying to think like entrepreneurs so that they can “get their groove back.” In response to this challenge, they are building and using advisory boards to reinvigorate their processes, products, sources of capital, and new business opportunities, among other things. Ultimately, of course, to make even more money. But are advisory boards really worth it? After all, for young and well-established companies, it takes thoughtful planning, time, and considerable resources to build, maintain, exploit, and execute on what they can give you. Apparently, some are convinced.

Recently, International Flavors and Fragrances, a global corporation, built a Scientific Advisory Board. The reason: to enhance their research team’s abilities and expand their innovation pipeline. The Advisory Board’s internal leader, Senior Vice President of Research and Development, Ahmet Baydar, had the support and backing of the company’s CEO and the entire board. Focus, time, and the right resources, have delivered results. Ahmet shared: “This effort has significantly increased our innovation development thresholds. Our Advisory Board members have given us sound guidance, introduced issues, partners, and opportunities that have all brought relevant value to our business.

Mid-cap private companies use such boards to give them extra muscle, or in some cases, to tap the brakes a bit, when needed. Jim Taylor, CEO of Abarta Oil & Gas and Chairman of Abarta, Inc., a diversified family-owned holding company, told of his experience. Having built a board of independent advisors, Jim shared that these folks have “challenged us, made us accountable for our decisions and actions, and pushed us to articulate our objectives and vision more clearly. In addition, the board has helped us identify new lines of business, which equate to new revenues.” He added that “without our board I would move more quickly, but probably recklessly, with less measured perspective.” The board helped them divest itself of a business it had owned for 63 years (originally bought by Jim’s grandfather). “They helped us realize a better value on the business than we could have expected.”

Then there’s Deutsche Bank Americas: different scale, different industry. A few years back, they correctly decided that their senior team could benefit from having, on tap, a broad and diverse group of globally-renowned advisers. They took the time to focus, find the talent, and commit to building an impressive group. They also made sure that the respect and support went both ways — as it should with a good advisory board. Bill Woodley, Deputy CEO, who oversees the Advisory Board shared: “We’ve assembled a world-class group of independent advisers who offer a diverse and rich perspective to our senior management. The Advisory Board has helped us look at our current and prospective clients differently, resulting in more sustainable and balanced business prospects.”

Although many companies keep information about their advisory boards’ ROI private, our discussions with both large and smaller companies point to real and considerable financial returns. Larger corporations, with mature advisory groups, tell us that returns in the early stages range from $100 million to over $500 million.  For some smaller companies, advisory boards have accounted for higher valuations for spinoffs, avoiding poor decisions (unlike one company we know, without a board of advisers, that paid 60% more than it should have for an acquisition), and yes, many new clients, too.  Either way, when you add it all up, well-constituted and managed advisory boards can create significant returns.

Now, let’s say you wanted to acquire such a board.  How would you approach it? The process may seem simple, yet it’s anything but. As with any good business, clearly defined objectives are the keys to a successful advisory board and solid ROI. This includes identifying gaps in expertise, among many other things. Also, be bold: understand that those who you think are beyond your reach may be the best suited to test your capabilities and push you beyond your corporate comfort zone. You’ve also got to realize that greed is NOT good and that thinking only about your own bottom-line with your advisory board may make you very lonely and deeper in debt.fin.jpg

Recognizing what’s in it for your adviser prospects will be one of the golden keys to soliciting their help. Done properly, your newfound advisers can open a five-lane freeway of relationships, insights, resources, and client opportunities. However, remember that you get what you pay for. You have to carefully sort out how your advisers will perceive your valuation of their time and efforts. Some companies have been lucky enough to find highly experienced and skilled advisors who are no longer financially motivated. For the most part, I believe this species has been over-hunted to the brink of extinction. Other “free” advisers may be secretly hoping to gain some other advantage from you down the line. I believe that appealing to someone’s self-interest is a safer bet than relying on their generous nature. Either way, to align their interests more securely with your company’s, your advisers should be compensated for their efforts through annual retainers, meeting fees, marketable equity, bonuses, commissions, in-kind services, or other creative incentives. Your recruitment process should include compensation negotiations, to increase your odds of success. Otherwise, your interests will most likely take a backseat to those of others who, they believe, value them more.

Once built, understand that constructive tension can be your best friend. You stand to gain a lot of good advice from each director one-on-one. However, getting them together periodically, accelerates the brainstorming and one-upping process among them, boosting your take-away potential. Being open to a push or a hard kick in the seat (no, I’m not into pain) from your advisers should enable you, and your management team, to drive business beyond where it’s been. That’s held true for small, mid-cap, and large global companies. The tough part is learning how to let go. Listen and debate the issues with an open mind, but once consensus is achieved, act on what your advisors recommend. If you don’t, you’ll lose their trust and interest, and your investment will likely go south. This is just the tip of the iceberg when it comes to building, running, and extracting value from a well oiled advisory board.

So what are you going to ask of your hard-won and newly-acquired set of (what you hope will be), precious expert advisers, the moni.jpgfirst time you sit down with them? That will depend on how you’ve assessed their personalities and egos, and on your own comfort and ability to balance subtlety with candor in what you say and do. But, even if you don’t straight-out say it to them, then you should be thinking it – all the time: “show me the money!” A little jump up and down for emphasis (behind closed doors) won’t hurt, either.

Now, once more, from the top: What’s the purpose of a business and an advisory board?

Nancy May

Is this why we’re spending money on higher education for our children?

Q: What do you want to be when you grow up?
A: Employed!

How are you going to explain that this isn’t your grandfather’s economy?

If deciding what university or community college or trade school your child is going to attend is starting to keep you up nights, you’ve probably visited more than a few of their websites. You’ve looked at the pictures of smiling faces, viewed the videos and read the inspirational language intended to convince you to spend your money, and, possibly, your child’s future, with the people on whose behalf those websites were created.

By now you’ve noticed that (a) you’ll have to do some digging to find any mention of tuition, fees and expenses because it would be in poor taste to publicize them on the home page; and (b) every one of those institutions is looking for a donation.

There are some who consider it gauche to have the words “money” and “university” in the same sentence. They would argue that higher education isn’t about money: it’s about introducing young minds to new ideas and new ways of looking at the world and themselves. It builds networks that include students who sit next to one another in lecture halls but live half a world away. Then there’s the benefit that comes from learning to fend for oneself away from home. This is the point where laundry and groceries enter into the discussion.

Those people would be right—to a point. But when the last glittering speck of that pixie dust that university websites magically create settles gently to the floor and the cool breeze of reality wafts through the room, the fact of the matter will be that nothing about attending an institution of higher learning is free. Once a child reaches the end of the taxpayer-funded, kindergarten/primary school/high school conveyor belt, decisions have to be made about the need for post-secondary education altogether. (P.S.: Taxpayer dollars pay for that, too.)

Even if his or her degree were paid for in full before the first day of lectures, the newly minted undergraduate or postgraduate is going to have to earn a living, especially if he or she is among the 40 million students south of the border who have US$1.2 trillion in student loans to repay, or the Canadians who owe between C$25 billion and C$50 billion. That money is going to have to come from somewhere. What about the cost of living? Will there be a new home or car to finance? Will there be enough money to pay the rent or buy food?

Finding work to pay for those things is the elephant in the room. Regardless of how many organizations the new graduate may have joined or voyages of self-discovery he or she may have gone on, if the résumé intended to support his or her application for that first full-time job is rejected by applicant tracking software for lack of key words and phrases, we have a problem. If the problem can be traced to a poorly executed résumé, the oversights can be corrected. But if the academic qualifications are wrong and creativity falls short of compensating for it, the only cure may be to spend 4 more years earning an education that will sell, but only after an in-depth reassessment of personal goals and what the economy needs.

As a country, we can’t afford scenarios like that because a mind is a terrible thing to waste (©UNCF). If you read or listen to nothing else today, please click on and ponder Robots Vs. The Middle Class (Bloomberg Businessweek, May 25 – May 31, 2015) and listen to Terry O’Reilly’s The Internet of (Marketing) Things (Under the Influence, CBC Radio One, Saturday, May 30, 2015). You’ll want to pay particular attention to O’Reilly’s thoughts about the Apple Watch.

How different is today’s economy from your grandfather’s economy? Well, did you ever doubt for a moment that your first job would be full-time with benefits? Are you doing now what you were planning to do then? Are you employed full-time? Have you been unemployed as a result of downsizing or outsourcing? Knowing what you know now, what would you do differently?

Would your grandfather recognize a world in which China is the world’s manufacturer, where 50% of working Canadians of all ages are not employed full-time, and where the price of post-secondary education is higher now than at any other time in history? What about a Canada where manufacturing has been decimated while employers continue to complain that they’re hard-pressed to find certain kinds of workers yet most of them refuse to train? What would he say about a Canada where $500 billion is sitting idle while vote getting corporate tax breaks underwritten by your tax dollars and mine go unused?

The North American work force is resolving itself into two camps: the one that recognizes that this isn’t your grandfather’s economy and is adjusting its expectations accordingly, and the one that doesn’t. One refuses to take career and labour market information at face value until they’ve confirmed it independently with multiple sources with their own eyes, not once but several times. The other doesn’t. One studies industries, market trends, the impact of technology and the performance of employers because they recognize that large numbers of dollars are at stake, not only the ones they’ll spend acquiring the necessary education, but the also the ones they risk not earning by failing to do their personal due diligence. The other doesn’t.

The economy is the financial air we breathe. We ignore it at our peril. Since 2001, I’ve met face-to-face with 2130 working people who, five minutes before I walked into the room, lost a job they thought wasn’t at risk. Most of them believed that where the world is going didn’t apply to them. They were mistaken.

F. Neil Morris
President & Founder
Personal Due Diligence
+1 (905) 273 9880