Change, blunders and blockchain

Appearing in In The Black, March 2021

Reimagine Change
By Ciara Lancaster
Grammar Factory, $33, 234 pages

Dealing with transformation and managing crises is the new paradigm for work but most of us have not yet adapted, according to change capability consultant Lancaster. We are trying to impose stability on an increasingly dynamic system, and the common result is mental exhaustion. Lancaster, a former executive at Deloittes, came close to burnout so she knows the signs of change fatigue, and she sets out a framework for personal reconstruction and growth. The first steps are understanding the warning signals and overcoming the defensive instincts hard-wired into the brain. She draws on behavioural science research and the views of thought leaders to illustrate her points.

In the second half of the book she examines the processes of mental change, with advice on how to slow down, develop resilience, and “re-code” thinking. Allow yourself to be creative at work and home, she says. Re-connect with loved ones and with enjoyable experiences, and make time to improve fitness (which includes getting enough sleep). At the end of the road is a sense of flow and the true humility that good leadership requires. The journey is not always easy and takes time but it is essential for survival in the modern world.

Who Blunders and How: the Dumb Side of the Corporate World
By Robin Banerjee
Sage Publications, $33, 312 pages

What were they thinking? It is a recurring question in this book, which focuses on the reasons for decisions which were undeniably foolish. Banerjee, a senior executive, casts a wide net, looking at American, European, Indian and Japanese cases. A root cause is what might be called the victory disease, when companies that experienced early success with a product line became arrogant and complacent. Kodak failed to recognise the emergence of digital technology, Nokia missed the importance of software innovation, Blackberry did not realise how fast the telco business was changing.

In other cases companies that had generated a lot of cash went on an M&A binge without examining the value propositions. Others put incompetent people into key positions because they were related to the founder.

Several, when faced with a serious public relations problem, did the worst possible thing: they denied it, and then lied. This underlines a point that Banerjee emphasises. When you make a blunder, admit it, seek ways to remedy it, and devise a system to prevent a recurrence. Everyone makes mistakes, and the real point is what you learn from them. What worked yesterday might not work today, and it will certainly not work tomorrow.

The Definitive Guide to Blockchain for Accounting and Business
By Saurav Dutta (editor)
Emerald Publishing, $72, 320 pages

Professor Dutta currently heads the School of Accounting at Curtin University in Western Australia but he also has an broad background in financial research. For this guide he has put together a strong team combining practical experience and academic knowledge. The aim is to provide both a primer for people with little understanding of blockchain technology as well as a guide to new challenges for those with more experience.

As a starting point the chapter on terminology is useful, as are the sections dealing with tokenisation and internal controls. Several contributors discuss the transparency that underpins blockchain and examine the role that cryptocurrencies play. A number of security problems connected to blockchain have recently emerged; they are serious but there are solutions available, and much depends on the robustness of the initial design.

In his concluding chapter Professor Dutta looks at future opportunities. He sees that finance professionals can make important contributions on the tax and regulatory issues around blockchain. He also identifies the health, energy and maritime sectors as areas where blockchain systems can be effectively developed. It adds up to a comprehensive package in a field which is likely to become a key element of the financial landscape.

Downloadable resources

Crisis management
Guiding an organisation through a crisis involves a number of counter-intuitive steps, according to leadership expert Amy Edmonson. In this TED talk she argues that leaders should not pretend to have all the answers but should focus on transparent and ongoing communication. In a crisis leaders must be willing to act even though they have limited and conflicting information. Edmonson believes that honesty is more likely to engender trust than a show of strength, and leaders should be able to adjust their moves as circumstances change. She points to New Zealand PM Jacinta Ardern as a good example of crisis leadership.

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Showing skills
After a difficult year companies have begun to hire professionals again but landing the right job has become more difficult. This blog post from recruitment firm Michael Page shows that while elements such as an impressive CV, a compelling cover letter and strong interview skills are still crucial, employers are also asking candidates how they can contribute to business recovery and continuity. Ways to respond to this include showing customer skills, an understanding of digital trends, and a capacity for critical thinking.

The post includes links to other articles dealing with common interview questions, salary negotiation and building a personal brand.

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Successful start
A McKinsey survey shows that only 20 percent of start-ups launch successfully and scale up, and only 24 percent of incumbents’ new ventures become viable companies. This article suggests ways to overcome the most common pitfalls, including understanding the customer base before launching, observing market preferences, and using a beta program or wait list to drive early interest.

The article also notes that successful ventures plan around weekly rather than quarterly cycles and utilise social media as well as paid advertising. These strategies can not only underpin a successful launch but also form the basis of a durable operating model.

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Tax law
Once upon a time the Australian Tax Office was a somewhat secretive organisation but that has changed radically. Its website has a great deal of information for finance professionals, and in particular the legal section provides a valuable database. It has a number of search options to find legislation, cases, interpretations and policies that the ATO uses when making decisions. There is a list of fact sheets for employers, and guidance on policy issues that are currently being developed. The ATO also offers a subscription service that allows clients to see when the database information has been updated or revised.

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Sustainable finance
The Sustainable Financing and Investing Survey 2020 conducted by global bank HSBC has found that capital market participants are attaching greater importance to sustainable finance than a year ago, even as they have had to navigate unprecedented challenges due to the COVID-19 crisis. In fact, more than half of investors and three-quarters of issuers say the pandemic has made them realise they had paid insufficient attention to social issues.

The bank has also released research showing that stocks of large companies with strong environmental, social and governance ratings have outperformed the global average by 4.7 per cent since mid-December 2019.

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