Another great Ryder Cup?

The 2012 Ryder Cup starts just outside Chicago today. It is an event that has brought some great moments on the past and usually brought out the best in both players and spectators. I hope we see more this weekend and I sense the signs are good.

For those that don't know, this is an event in which some of the highest paid sportsmen in the world who spend most if the time competing as individuals, come together to play for each other as a team (USA or Europe) for nothing other than pride and comradery.

Of course there have been some questionable moments including Corey Pavin's camouflage cap and aggressive antics winding up a partisan US crowd at the "war on the shore" at Kiawah Island in 1991. While is was reportedly intended to demonstrate support for US troops in the first Gulf War, it did not come across that way.

So I find reports of this year's opening statements by the respective team captains encouraging.

Olazabal, the European Captain, remembered the contribution and spirit of Seve Ballasteros, his long term friend and golf partner, who died last year. The 2012 Ryder Cup is the first without Seve's touch for a long, long while. Even though too sick to travel in 2010 he was contact with the team and served as inspiration.

Jose-Maria said that his friend had demonstrated the core Ryder Cup values of never quitting and being prepared to chase any adversity. Not a bad motto in the world we occupy today.


Davis Love III said something even more valuable in my mind and that was to remind everyone that the Ryder Cup is not a matter of life or death, not a battle, but an athletic competition between sportsmen. Keeping a proper perspective is so important these days.

So as the first fourballs set off my hopes for a great weekend are high. I want to seen keen competition, fine sportsmanship and real friendship. Fingers crossed.

The Baby Bulldozer

I have just traversed the consourse of Liverpool Street Station in London at rush hour. This is a major commuter terminus and is very busy in rush hour, with some dominant streams of people; streams that seem almost solid should you try and cross them.

At a macro level it looks like fluid moving, but on closer inspect there is a perpetual Brownian-like motion of individuals side-steppin this way and that and occassionally colliding. It is not "Brownian-like" as there is a purposeful direction for each person, not a random walk.

Across the main flow was a young woman navigating with a baby in a buggy. From a distance the waves of humanity just broke around her as she relentlessly moved across. Normally in the UK people are well mannered and do make allowances for mothers with young children. With a little patience the masses do the right thing.

This was different. The buggy was being used like a bulldozer or maybe an ice-breaker (as in the ships that navigate around the frozen poles of this planet). There was no eye contact, attempted or actual made by the mother, no implicit, unspoken "please" or "thank you" just a determination to traverse the shortest route to her destination no matter how it inconvenienced anyone else and put the young child in the collision zone as she followed on behind.

There were a few sharp glances and muttered curses, but life passed her by and continued on its way.

I am not quite sure why I blogged this, but it caught my attention and seemed worthy. While I can admire her foucs and determination I think society would be less if we all adopted that approach.

I will still dance around others as our paths cross, avoiding collision and smiling "sorry" or "thank you". I will give up my seat for those in greater need. I have have to remember that I am rapidly part of the older generation, but still feel 25 at heart and enjoy good health so giving up my seat to a young pregnant woman causes me no problem. I will still look to impart good manners to my daughter. That is what I can and will do; I hope others will do the same and not just live in their own small bubble and b*gger the rest.

Who would be an American abroad with 27.5% of your net worth at risk?

No, I don't mean that nastily, but I have just read how penal the US Internal Revenue Serive (the IRS) is.

I am looking at FATCA, the legislation aimed at tackling the pereceived tax evasion by US citizens abroad. The intention is to get the world's financial institutions to identify US persons and start reporting details on balances over $50,000 initially to the IRS. There is not benefit to the institution, but there is a threat that if they do not comply then US paying agents will be required to deduct 30% withholding tax on payments to them, including (re)payment of principle amounts.

While this withholding tax may be reclaimed if the circumstances are right, just the disruption of cash flow has been enough to herd most of the world into expected compliance.

There is plenty of comment on the rights and wrongs about this so I won't be addressing that.

What I did want to comment on was some things I learnt from an article in the Financial Times today.

It laid out some of the penalties that the IRS can levy on non-compliant US Persons. It seems that there is a voluntary scheme running at the moment to let US Persons come clean and get their tax affairs in order under a "voluntary disclosure programme". Under this scheme there are penalties up to 27.5% of the person' net worth! Just think about that.

The type of person at risk is most likely wealthy and 27.5% of a large number is still a large number. This can affect people with what was described as "derivative US citizenship" but living abroad who might not have though they were caught within the IRS ambit of operation.

There is also something called Foreign Bank Account Reports (FBAR) and if an idividual is deemed to have wilfully failed to report the the penalty can be half the account balance. Again considering the targets of this those could be hefty numbers.

Now it maybe that HMRC in the UK can be heavy handed, but these US penalties just look excessive and truly intended to scare people into compliance. I wonder if they will have the desired effect or just set the thought of "bully" in more people's minds.

There was a time when it seemed that gaining US citizenship was a desirable and much sought result by many outside the continental US, but is that still so if this is representative of how you will be treated/threatened?

Just my opinion.

The Change Delivery KPI

I was reminded recently of a piece of work I did a couple of years back. It still stands up to inspection......so I thought I would share it here.

The challenge that was originally posed and is still relevant was to develop a key performance indicator, a single figure, for a mixed portfolio of change, that could go on an executive dashboard and mean something!

After a little thought I created just such a KPI and ran it successfully for over three years.

The organisation already had the foundations for a KPI, but struggled to distil the essence into a number that, if monitored, would aid management's decision making.

The Foundations

The foundations were a project dashboard and an existing BRAG rating system.

The dashboard was a summarised report of the most important active change projects for the organisation. While most important often correlated with largest, this was not always the case. A regulatory "must do" project would make it to the dashboard, while the refurbishment of the in-house cafe and showers would not, rebranding would, but the replacement of printers and scanners may well not. The list was agreed with stakeholders up front and was adjusted over time as priorities changed and some projects were delivered and new (unplanned) ones arose.

This dashboard was no more than two sides of A4 and contained around 10-15 and no more than 20 projects or change initiatives. If the number was greater it diffused management attention and did not aid decision making in terms of resource allocation, etc.

Every project/change initiative was already RAG rated each month. The B in BRAG related to blue and was used to indicate "closed". A project was reported as Blue in the month it was formally closed, and then removed from future dashboards.

Broadly speaking the BRAG ratings meant:

B = blue signified complete/closed.
R = red meant the project was not likely to deliver as expected and there were issues that needed urgent attention
A = amber meant project delivery was at risk, but issues were being managed
G = green meant the project is on target to deliver as expected

These are a synthesis of the key considerations time/cost/quality as applied to each project and in a reasonably mature environment contain a lot of implicit information.

Creating A Number

The first question was to consider if all projects on the Dashboard were equal? I decided that this was not the case and needed some simple weighting to emphasise the critical items. In general I assigned a weight of 10 to dashboard projects, but used a lesser weighting of 3 where it felt more appropriate.

For the purposes of the KPI any project not on the dashboard was disregarded, or given a weight of zero.

The next thing was to the score BRAG. I used B=5, G=5, A=3 and R=-1.

Please note the negative score for Red. The idea being that a project in trouble normally distracts attention from other efforts, and thus has a wider, detrimental impact on the change portfolio.

So, for each dashboard project I could create a performance number that was (project weight x score) and I could sum those up each month. This provided a single number, ie sum of (project weight x score), but its absolute value was subject to the changing consitution of the project dashboard.

The way over this was to initially express actual score as a fraction of the total possible score that month ie if every project was on track or completed (Blue or Green).

This produced a new number that was

sum of (project weight x score)
sum of (project weight x 5)

The temptation was to express this as a percentage, but when one uses percentages psychology kicks in an readers assume that 100% is the target. This did not feel right in a world where we are looking at actively managing risk and trying to do more with less.

This said please bear with me as I use percentages for a little longer.

If every project was Amber, ie delivery had some risk, but issues were being managed then the indicator would come out at 60% ie 3/5. This felt like the lowest boundary of acceptable performance.

While we thought it unlikely that we would ever score 100% we also recognised that such a score would probably indicate that we were not pushing our change capability hard enough, over-staffed, under ambitious, too cautious, etc. I ran the numbers for the previous year and equated the number produced with how the world of change had felt at the time, as best we could recall.

We finally settled on 80% as the upper boundary of our target performance, agreeing that should we breach that we would want to look at the book of work / capacity with a view to stretching ourselves.

Of course you may choose other boundaries, depending on your risk appetite, but the point is that there is a target band and it is unlikely to be at 100%.

With this in mind we can create a number in a range. I would suggest that the range be 0-5, but you can choose one that suits.

Thus the monthly performance number is

sum of (project weight x score) x 5
sum of (project weight x 5)

with the target  performance band between 3 and 4.

Another advantage is that "happy reporting" ie the eternally optimistic (or political?) reporting of projects at Green will tend to push the KPI into the upper band and thus attract scrutiny and discussion - no bad thing.

Using the Number

There is one final tweak and that is to not use the monthly figure, but rather a three month moving average. The reason being that the health of projects do fluctuate and can change quickly. Effective change management is able to properly address these fluctuations and take remedial/mitigating action. If, however, the situation is not addressed over a period, say three months, then we want the indicator to flag this.

So the final KPI is

   3-month moving average of      sum of (project weight x score) x 5
                                                        sum of (project weight x 5)

This was then graphed and reported on monthly with trends monitored.



Graphing the KPI

A few tips in the graphing.

• Limit the scale so that space is not wasted. I set lower limit of the y-scale to 2 as if we ever got below that we would have more serious trouble than scoring a KPI!!
• Smooth the graphline - it looks better, guards against "knee jerk" reactions and fits better with the trend value of this indicator.
• Set the target performance band as green, the upper (too comfortable?) band as amber, ie worthy of attention and the lower band as red, ie needing attention.

Conclusion

Of course it contains a lot of detail within a single number, and real understanding of issues around the delivery performance of a change portfolio needs deeper examination, but as a single repeatable, credible number that can be used on a high-level KPI dashboard and provide useful insight, I have found no better!

Slow Progress

Well, I said I would be honest and I did set this blog up to aid self-governance, so I gave to confess to slow progress. I have been writing the first part, true to the outline, but ave not completed it.

A large part is down to a lack of application in that I have found it hard to find time for it I the last week or so. That is slightly circumstantial, but I do need to think hard about how and when to devote attention.

The other part is that even when I apply myself, I don't produce as much as I expected. Now this may be because I am an inexperienced writer, but also shows an optimistic outlook when I set out.

The reality check is that this will take more time than originally estimated making a year end production unlikely. As I compose this blog, the idea of creating a serial set of pieces (as opposed to a magnum opus) crosses my mind and merits further thought. The outline would still work and I probably could compile a complete book at the end. On the plus side it would build momentum and garner early feedback.

I do need to think about that further.

Something of an internet blindspot?? What is a Toshin Fund?

In my current role I became aware that our Japanese operation was involved with something called "toshin" funds, but there seemed to be little clarity about what they are. In particular I wanted to relate their structure to things I knew, eg SICAVS, Investment Trusts, OEIC's, etc and in doing so understand the parties involved and their responsibilities.

Now whether this counts as complacency or experience (or indeed both), but I started out confident that I could educate myself via the internet with a few google searches and, maybe, the use of my Linkedin network which is reported to number between 9 and 12 million depending on when you look at it.

Well I have to report that I have struggled and wonder if this is a blindspot for the internet.

When I look in wikipedia "toshin fund" returns nothing and "toshin" redirects me to Tekken characters.

So you might wonder if toshin funds exist?

I then looked at the website of the Japanese financial regulator, the Financial Services Agency. If I put the word "toshin" in their search engine returns a couple of documents in Japanese that appear to be data sheets and a reference to "head of Toshin branch of Chuo Securities". That is all!

So next to Google and a search for "toshin". This comes up with a number of references, but only a few are relevant

• In an FT article I find reference to "buyers of publicly offered investment trusts, or “Toshin” "
• On a site for foreign exchange jargon  in find "Toshin: Japanese investment trusts which invest in non-JPY denominated assets."
• A Forbes article reports "Japanese individuals invest in foreign government bonds and currencies in investment trust units known as Toshin funds."

So they exist and indeed the monies invested appear substantial, yet I find little reference material on the web - strange! I am not clear as I am hearing "investment trust" that I think I know, tending to be a closed ended, often quoted limited company, but then I see "units" which sounds more like mutual funds of maybe OIECS or SICAV.

So now I try my Linkedin network. I post a question under my status asking others to post it on and I put a question up in the "Answers" section.

I have now received two contacts; one from an indian describing himslef as a "human search engine" who found reference to a brokers report refering to Toshin Funds and most recently a guy in Scotland who advises me that "although termed investment trusts they are the equivelant of our open-ended mutual funds". Interestingly this reply, the only really useful one via Linkedin comes from a past employee of the company I am now working at!

So I am a little wiser, but not much. If I do get this all clear in my head then I suspect I will feel an obligation to write a wiki - my first.

I consider myself quite adept at internet searches and following breadcrumb trails, but I am surprised how barren this trail has been in a world where data (and information) is accumulating at an exponential rate.

I have one or two breadcrumbs to follow still, so my curiousity and tenacious nature are not sated yet.

The $104m Whistleblower - Something feels so very wrong with this!!!

In my current role I am looking at the implications of FATCA -Foreign Account Tax Compliance Act - which is the IRS (Internal Revenue Service)  move to prevent US citizens evading their US tax liabilities.

I am told that the US is one of only two countries (Somalio being the other) that looks to tax its citizens wherever they reside in the world; other countries look to tax those resident in the country. While US financial institutions report to the IRS, it has been down to the individual to declare any assets and income held outside the US, and of course not all do.

In fact UBS has in the past marketed tax evasion products to US citizens and it was the exposure of this that drove the creation of FATCA. This will requires foreign (ie non-US) financial institutions to identify any accounts held by actual or potential (ie it cannot be proved that they are not) US citizens and report the accounts and information on balances to the IRS.

The "incentive" is actually a big stick and that is where a financial instution does not play ball with the IRS, it will be subjected to 30% withholding tax on US payments made to it. This is on both principle and income payments so would be at least very disruptive to cash flow and potentially very penal.

Compliance with FATCA is expected to be costly.

So it was with some bemusement that I saw this news article in The Telegraph today

UBS whistleblower Bradley Birkenfeld paid $104m

Mr Birkenfeld, a former UBS banker who was released from prison last month after serving 30 months, was awarded the sum under legislation that encourages people to expose tax evasion. It is believed to be the largest-ever whistleblower payout to an individual.

 

The 47 year–old's disclosures to the Internal Revenue Service (IRS) and other US authorities helped force a $780m settlement between UBS and the US in early 2009. At the time, Peter Kurer, then chairman of UBS, said the bank accepted "full responsibility for these improper activities".

 

As part of the settlement, UBS handed over the details of 250 accounts Americans had – a figure that later climbed close to 5,000.

 

US authorities' insistence that account details be disclosed, alongside the hefty fine, was taken as evidence of a renewed determination from the government to target tax evasion.

 

Although Mr Birkenfeld acted as a whistleblower, he was also sent to prison for his own role in helping UBS clients evade tax after he pleaded guilty in 2008.

 

Now I am all for protecting "innocent" whistleblowers ie those who have done no wrong and have the courage to expose wrong doing around them, but for a man who was convicted and has served 2 1/2 years to then be set up for life - I expect $104m would do that - seems wrong. I am pretty sure that the sentence was substantially reduced as a result of his "co-operation" and frankly I think that should have been enough.

 

I am left wondering if he pays taxes on that $104m? I suspect not and that just compounds my feeling of ill-ease.

 

This seems to be blind bureaucracy without any exercising of judgement by the US authorities and as I said in the title it feels so very, very wrong.

 

 

 

Lest we forget - I am embarrassed to admit.....

.....that I have only just realised that this is 9/11! Actually it is the 11th anniversary and I wonder if ten years was a watershed.

How time moves on. In this case it cannot heal, such was the devastation, but maybe we are learning to live with it better? Of course during the Paralympics we heard a lot about out our 7/7, but actually in quite a positive way as victims and other disabled people celebrated what was possible more than recounting what was lost.

The World Trade Centre Tragedy was on another scale entirely and many families will be scarred for generations. We must not forget, but maybe we can move on better now; maybe my late realisation of the significance of this day shows that indeed we are?

Lest we forget!

Yes.......I have started, but.....

I am not as far as I thought I would be. Of course I have reasons in that my wife was away all week and we have house guests ie the in-laws. I have had to work, keep house and look after daughter and dog.

That said I have started. I reviewed the outline and decided it was good enough for now (no needless tweaking in search of perfection) and then faced with question where to start? Parts of me still wante do take what I already have and start fitting it in - the low hanging fruit, if you like. That said I quickly saw the risk of slipping back to old habits.

Instead I decided that having used the "question" approach to outlining ie each chapter heading is a question that needs answering for the reader and then structuring them in a way that made sense, I actually had my answer already. As Maria would say on The Sound of Music, let's start at the very beginning!

That is what I did and started helping the reader understand what they have got themselves into by agreeing (or by being appointed) to be sponsor. That is helping the reader understand how reading to book will help them.

I have made a good (my assessment) start to this and will continue with it. My plan would like to think I would be further ahead, but this feels like the right way. Estimates are just that and as I do more I will get better at my planning. For now the main things is that I feel I am on he right path and keeping this blog is keeping me honest.

I am thinking that I will post the first chapter here when finished and see what feedback it might receive.

Ah well, back to the real work now.

Who wants a "Solutioneer"?

There was a question on LinkedIn that built upon an article about crazy job titles. Examples given included Red Cliff Defender (no, I have no idea what that is), Jedi technologist and Queen of Quantum Possibilities.

I offered up Corridor Warrior, which was my play on road warrior, except I was perpetually mobile in one building.

More seriously this resonated as in my recent search for work I realised that unless you offered the recruiter or agency a standard job title, they found it easier to pass you over for someone who did.

At the same time, with the growing importance of self-branding and networking, one needs a quick way to convey what you do in a memorable way.

I can and do call myself a programme manager on my CV, but that is only part of what I do. When I look at my skills and strengths I tend to see the bigger picture, solve problems and shape change, especially more complex change. While these are true, they are not interesting or easy to deliver.

I currently work in change management, but actually prefer the name of a previous group I belonged to called Business Solutions.

This brought me to the term "Solutioneer" and is a combination of, at least in my mind that I tend to pioneer new solutions. I guess I could have gone with "piolution" instead but that seemed to close to pollution!

I am now letting the idea settle, but I can see a new business card.

- Posted using BlogPress from my iPad

A great reminder for fathers

The Sunday Times today ran extracts from Victoria Pendleton's new book. For readers who don't know of Victoria she was a gold medal cyclist in both the Beijing and London Olympics along with nine world titles.

In her book she talks of her relationship with her father who seems to have pushed her hard if selfishly. More surprising are her candid admission about the self harming she started when in intense training in Switzerland as a way to "feel different" about herself, when she was wracked with self-doubt.

She even cut herself after her first gold in Beijing at the time of her greatest achievement.

As a father of a 17 year old girl who I try my best to encourage and support in the face of mixed reactions, this article reminded me that relations with our hidden can be complex and their reactions unexpected. It is a time for me, the parent, to be more vigilant and remember that she will always be my little girl no matter how old she is.

I have no idea how I would feel should self-harming be an issue, other than huge guilt and failure on my part. I don't want that to happen.

- Posted using BlogPress from my iPad

Outlining progress

I am not sure this counts a break through, but last week I took up the offer of a free ebook on how to create an ebook. This was given away by an American who makes money selling information products ........ like ebooks. It reminds me of the joke that the best of building a small business was to set up a business selling products aimed at people seeking to build a small business.

Anyway this ebook offered to show how to outline a book over the weekend and showed how it thought it could be done. I decided to give it a go.

The suggestion was to use post cards and sticky notes. I decided to use mind mapping software on my iPad, but the process was the same. In working my way through I realised why I had been struggling previously. The advocated approach is largely  one of "top down and eliminate". With an amount of material already written I had been attempting to see how I could assemble that material, sort of more "bottom up and enhance".

Now I have a good outline. I suspect I will review and refine it over the next week or so, but this is a real step forward.

One of the tips was to phrase your chapter headings as questions. This remind me of an old boss' advice to always ask "so what?" This made me think about titles for the book. There is no pressure to finalise this but I am keeping ideas.

I have three so far.

• The "ronseal" option ie The (Change) Sponsors' Handboo
• My earlier thought of "To Delivery And Beyond" 
• New idea of "So What?" or something using this.

All in all I do feel I am making progress and writing this blog is a good support to that effort.