The smartest guys in the room
For a reader familiar with the Enron scandal the title will cause a slight smirk. They were out to get the sharpest minds from the Ivy league and what have you. This was an interpretation of social Darwinism of sorts. And it works as an awkward transition to sports.
While attending a sporty business seminar a while back one presenter was fairly confident about herself. She told, with a loose translation, that
Enron was more HC than Andersen ever was and this is saying a lot. Enron CEO Skilling introduced what came to be called inside the company as "rank and yank". It meant that the bottom 15% was fired annually. Now, let me make a thing crystal clear - in sport we don't do this.
In my experience we fire the top 15%. If any. But this is another story all together.
Sports have evolved, a lot. what used to be a curiosity is now the standard. Full time employees and professional organisations. I will later come to question the professional part but full time never. And will never mention names because calling out is cool in MMA but in professional circles - not yet. I'll be waiting.
And when sports hire they look for the smartest guys in the room.
And this brings as back to Enron.
Mark to market
Enron used mark-to-market-accounting. This allows a company to record potential profits on certain projects immediately after contracts are signed, regardless of the actual profits that the deal will generate. Simple example. You have bought ten shares 4€ per share. Their price go up to 7€ each. Using mark-to-market-accounting you now have a total value of 70€. Whereas the book value might be only 40€. Depending on the principle used.
The trick with mark-to-market in new projects is the fact that it basically allows you to project all the possible outcomes and make your accounting based on the most positive projection. The key is it's not fraud as it could happen. Most likely not but just ignore the small print. But it will make you look pretty good in terms of what's under the line. Not necessary on liquidity issues, though.
It may all seem like a ploy but at the core it's a sound principle. A legit practice. Enron just played it a bit differently but you can never say they were not positive. And it ended to be the biggest corporate fraud in America.
As a bonus it had an effect in no other than 2004 presidential election. Let's put it frankly - Bush played the Enron side and we all know how that election went down.
Recruiting in sports is just this - hope for the best and you get Bush - the most obvious choice.
The smartest guys in the room
Two of my go-to-guys when it comes to ability based views are J. Ridderstråle and K. Nordström. They have co-authored together couple of business best sellers. And they have a belief for people that have the talent that will make the capital dance. Personally I like all things funky. These guys are a pleasure to read.
To be smart and to be a legit smart. There's a difference.
But who is the arbiter of taste in the smart guy area? What is smart? Who is talented?
In sports, the smartest people in the room are hired. This is the fairytale part. I could point out local and national recruiting disasters that have a combined net worth of many hundreds of thousands of euros combined and this does not account for the results accumulated. Just the salaries and the usual expenses you get when recruiting. How you place a price tag for volunteer's good night of sleep or a medal at the international level.
To be blunt, having witnessed many recruiting affairs, I have very little belief in the smart the sport hires nowadays.
Taking nothing from these people, they must be good, at something. Everybody is. Like an awkward relative at the family parties we all know a person that is of most use when standing on a blank A4 to prevent it from flying away in a wind.
Mark-to-market must be in use in recruiting situations. Projecting what could happen. If it just would...
The theory just doesn't always materialise to reality.
Professionalism and Iceland
As promised I'm getting back to this. The fact is, being a professional and a full time are not the same thing.
What the sports recruited was number X of professionals. They got number Y full time employees. As a reference to rank and yank done by Enron, it's fairly hard to measure performance in sports but it's a lot more easier to measure not performing. Which ain't done either.
A professional gets the job done. Period. And gets it done good. Another period.
A full time player is the kind of guy who just idles by. Period. And gets very little done. Another period.
I will not be the cat who gets to go to Iceland but they will not find these full time hangouts there. As long as we recruit bad, the new smart will be just the old average.
Without any knowledge but the one I have acquired I make the bold prediction - Iceland will not be using the mark-to-market when it comes to football.
They cashed in all the chips. Under the line is just that. The profit. All the possible.
Garden Gnomes didn't do the Iceland.
Under the line
Enron had under the line a lot of things. Depends on the accounting. Sports is a way harder to call. This is something that will never be clear. And this is the way we like it. Sports are an enigma. We have either nothing or we have what we came for. What we don't have is answers.
In the end the main players in Enron got their sentences. In sports they are still there. No sentences. They will just travel to Iceland. To find out how it's done.
While attending a sporty business seminar a while back one presenter was fairly confident about herself. She told, with a loose translation, that
"if I'm the best person in the room I change the room."This mentality means surrounding yourself with talent and there's nothing wrong with that. Regardless, the sort of arrogance reminded me of Enron. And Enron story didn't end all that good.
Enron was more HC than Andersen ever was and this is saying a lot. Enron CEO Skilling introduced what came to be called inside the company as "rank and yank". It meant that the bottom 15% was fired annually. Now, let me make a thing crystal clear - in sport we don't do this.
In my experience we fire the top 15%. If any. But this is another story all together.
Sports have evolved, a lot. what used to be a curiosity is now the standard. Full time employees and professional organisations. I will later come to question the professional part but full time never. And will never mention names because calling out is cool in MMA but in professional circles - not yet. I'll be waiting.
And when sports hire they look for the smartest guys in the room.
And this brings as back to Enron.
Mark to market
Enron used mark-to-market-accounting. This allows a company to record potential profits on certain projects immediately after contracts are signed, regardless of the actual profits that the deal will generate. Simple example. You have bought ten shares 4€ per share. Their price go up to 7€ each. Using mark-to-market-accounting you now have a total value of 70€. Whereas the book value might be only 40€. Depending on the principle used.
The trick with mark-to-market in new projects is the fact that it basically allows you to project all the possible outcomes and make your accounting based on the most positive projection. The key is it's not fraud as it could happen. Most likely not but just ignore the small print. But it will make you look pretty good in terms of what's under the line. Not necessary on liquidity issues, though.
It may all seem like a ploy but at the core it's a sound principle. A legit practice. Enron just played it a bit differently but you can never say they were not positive. And it ended to be the biggest corporate fraud in America.
As a bonus it had an effect in no other than 2004 presidential election. Let's put it frankly - Bush played the Enron side and we all know how that election went down.
Recruiting in sports is just this - hope for the best and you get Bush - the most obvious choice.
The smartest guys in the room
Two of my go-to-guys when it comes to ability based views are J. Ridderstråle and K. Nordström. They have co-authored together couple of business best sellers. And they have a belief for people that have the talent that will make the capital dance. Personally I like all things funky. These guys are a pleasure to read.
To be smart and to be a legit smart. There's a difference.
But who is the arbiter of taste in the smart guy area? What is smart? Who is talented?
In sports, the smartest people in the room are hired. This is the fairytale part. I could point out local and national recruiting disasters that have a combined net worth of many hundreds of thousands of euros combined and this does not account for the results accumulated. Just the salaries and the usual expenses you get when recruiting. How you place a price tag for volunteer's good night of sleep or a medal at the international level.
To be blunt, having witnessed many recruiting affairs, I have very little belief in the smart the sport hires nowadays.
Taking nothing from these people, they must be good, at something. Everybody is. Like an awkward relative at the family parties we all know a person that is of most use when standing on a blank A4 to prevent it from flying away in a wind.
Mark-to-market must be in use in recruiting situations. Projecting what could happen. If it just would...
"In theory there is no difference between theory and practice. In practice there is."This is how my mentor Yogi Berra put it. One of my mentors. Let's just say that I have few bright friends and a wife that keep me grounded. But..honestly. Who do you go to if you come face to face with the consequences of these smart guy recruits and they are not all that smart. If the most positive thing you hear about them is a garden gnome.
The theory just doesn't always materialise to reality.
Professionalism and Iceland
As promised I'm getting back to this. The fact is, being a professional and a full time are not the same thing.
What the sports recruited was number X of professionals. They got number Y full time employees. As a reference to rank and yank done by Enron, it's fairly hard to measure performance in sports but it's a lot more easier to measure not performing. Which ain't done either.
A professional gets the job done. Period. And gets it done good. Another period.
A full time player is the kind of guy who just idles by. Period. And gets very little done. Another period.
I will not be the cat who gets to go to Iceland but they will not find these full time hangouts there. As long as we recruit bad, the new smart will be just the old average.
Without any knowledge but the one I have acquired I make the bold prediction - Iceland will not be using the mark-to-market when it comes to football.
They cashed in all the chips. Under the line is just that. The profit. All the possible.
Garden Gnomes didn't do the Iceland.
Under the line
Enron had under the line a lot of things. Depends on the accounting. Sports is a way harder to call. This is something that will never be clear. And this is the way we like it. Sports are an enigma. We have either nothing or we have what we came for. What we don't have is answers.
In the end the main players in Enron got their sentences. In sports they are still there. No sentences. They will just travel to Iceland. To find out how it's done.
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