Responding to change is key to survival, she explains, in a chapter on ‘Craig Effron,’ whose $3.25-billion hedge fund, Scoggin Capital Management, buys and sells the stocks and bonds primarily of companies that are merging, spinning off units, or going through financially tough times.
Effron’s returns are not correlated to the stock market, and 90 per cent of the time, his funds make money in the months the Standard & Poor’s 500 Index is down, the author finds. “I’m a risk manager, which I believe is more important these days than being an analyst,” reads a snatch of Effron-speak, cited in the book.
Playing outside his usual sandbox, Effron searches for gains in ‘Chinese equities, Russian vouchers, commercial real estate, and the government debt of Zaire.’ For instance, in 2003, he purchased ‘the debt of Zaire, now the Democratic Republic of Congo, from the Bank of Brazil, which had lent money to the African nation to build a power plant.’ It was a 20-year loan, and the bank had seen no money from Congo for 19 years and 11 months, so the Brazilians decided to sell the $150-million debt for $0.05 on $1.00, or $7.5 million, just to get it off the books, narrates Burton. Four years and $11 million in legal bills later, Effron collected $70 million from the Congolese government, she continues.
Good read.
Failure is essential in achieving success, though it is of course not sufficient for achieving success, observes Tal Ben-Shahar in The Pursuit of Perfect ( www.tatamcgrawhill.com ).
“Those who understand that failure is inextricably linked with achievement are the ones who learn, grow, and ultimately do well. Learn to fail, or fail to learn.” The author cites a study that found perfectionists to be weaker writers than non-perfectionists because ‘they took pains to avoid allowing other people to view samples of their writing, thereby insulating themselves from feedback that could have improved writing skills.’
A genuine desire to learn – whether from the feedback of other people or from the feedback that failure itself can provide is a prerequisite for success, whether one is in banking, teaching, athletics, engineering, or any other profession, Ben-Shahar reasons.
He cites an instructive quote of Michael Jordan, the legendary sportsman, thus: “I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. 26 times, I’ve been trusted to take the game-winning shot and missed. I’ve failed over and over and over again in my life. And that is why I succeed.”
Helpful study.
Financial indicators are lag indicators, they tell you how you’ve done, says Omar Khan in Liberating Passion: How the World’s Best Global Leaders Produce Winning Results ( www.wiley.com ). You also need measurements that are ‘lead indicators’ and can signpost how you are likely to do, he appeals.
“These include benchmarked quality of key delivery processes, the innovation pipeline, customer engagement, customer satisfaction measures, team satisfaction and competency building measures and other future-creating indicators of this ilk.”
Once you’ve got the visionary purpose and the must-win-battles attitude, with macro metrics for the first and more micro and iterative metrics for the latter, each quarter creates some ‘bold courageous steps’ that would lead to impressive momentum, Khan describes.
Most corporate visions and strategies are either so vague, or stay up on the mountain top, with scant translation down into the valley of daily lives and efforts, the author rues.
“And disconnected from the raison d’être of the business, work gets sapped of vitality and relevance and/of attendant passion.”
Recommended addition to the entrepreneurs’ shelf.
