Economic Intelligence Group: Opinions-R-Us!

Welcome to TishTrek - THE JOB BLOG!

I answered a couple of interesting questions that my contact Lucas asked on the 'Economics Intelligence Group' Site on LinkedIn today. I love being part of this group because so many members ask inspiring & throught-provoking questions and people really take the time to offer thoughtful, researched responses!


1) AUM - The term means'Assets-Under-Management' (Increase financial value of the happy repeat customers who are already being serviced by your financial institutions). Create new products, services & market offerings so you can manage customer financial transactions areas outside of investment already under your care. Morgan Stanley created a new Private Bank (Charter approved- July 2010) in a race to offer Commercial Banking & Lending services to the clients already being serviced by Morgan Stanley Smith Barney's 18,900 Financial Advisors. New biz model: FA in front seat still driving the car to his/her repeat customer; but now a NEW Private Banker is in the backseat of the same car offering the types of financial solutions that will expand the financial relationship, (i.e. FA has managed a client's investment portfolio for 20 years; Morgan Stanley is betting it has earned the right to now manage the commercial cash management & card services transactions for this client's $500MM commercial business which is currently handled by Bank of America or Wachovia).


2) Why is the wrong talent often left in tact to drive business goals off cliff? Power; politics; corporate relationships; 'clandestine biz agendas' that are in the best interest of a few without regard for the overall mission or goals of a company or the world economy, (i.e. Joseph Cassano the head of AIG Financial Products moved himself & some 'special' employees reporting directly to him out of their offices in Greenwich, CT to the UK so they could more easily execute the iron-clad counterparty contracts (their financial partners get paid 100% on the dollar when the risky bets go south) & employment contracts (each executive is guaranteed millions in bonus payouts even after the deals fail because 'Contract Law' prevails) - all signed BEFORE they started executing their clandestine transactions which contributed to the mortgage/subprime/CDO/Counterparty disaster & ruined AIG (- i.e. I've been recruiting these guys for 24 years: if leaders don't operate with 'leader behaviors,' the risk you CANNOT mitigate is incalculable); finally - myopic thinking often gets in the way of making changes in talent or org structures that would be important for the success of a business.

People want to retain power, status, position as organizations flourish, change, expand, become more profitable, BUT... rapid expansion in corp responsibilities often requires new talent that 'will' scale FAST. Talent that has been there; done it; delivered it; delivered it again in other companies & that owned the accountability for the business benefits realized have the unique perspective to look @ new challenges through the window & paradym of former successes &/or failures.

In my experience, lots of 'competitive advantage' is born when leveraging those kinds of experiences. i.e. Cisco Systems in mid-90's: WHEN an office in a region exceeded $65MM in revenues, the region would be split in half immediately; a new office would open; a new sales manager & sales team would be hired; we'd transfer some # of people in split; & replace the regional mgr who never managed revenues > $65MM. FOCUS on revenue goals drove decisions. If the best sales exec was given too big of a region to manage and it hurt time-to-close stats, revenues would be missed - which was not an option.

Also people who are great operating in a biz silo where they have executed with excellence and with comfort for years do not always have the skills that can scale to 'enterprise-wide' initiatives. That's reality I've lived in every company. People can retain important roles in the org, but they'd be leveraging their skills differently. Internal employees & external candidates shouldn't be elevated to the top job without a thorough and objective assessment that determines they're a 'leader' & that they have the skills to deliver on the mission & goals of the organization.

Best regards,
TishTrek