Enron: We ask why.

Enron was an American energy and service company, and for many years held the position of  the world's leading electricity, natural gas, and communication company. Fortune magazine named Enron "America's Most Innovative Company" for six consecutive years, and in 2000 the company claimed revenues of nearly $101 billion. However, people soon learned of the very complex and creatively planned accounting fraud this company was pulling of for many years. Known as the "Enron scandal", it made the company a symbol of corporate fraud and corruption. Important characters in the Enron crisis were its CEOs - the main players in the game.
Ken Lay was on the highest position when the company went down, he stated that nothing wrong was done. For him, profit was more important then ethics or morals. Jeff Skilling was the visionary of the company, a man with big ideas.  He re-created the industry by creating a new accounting procedure for Enron, which allowed them to speculate on the new deals of the company. They created the image and growth of the company of their deal's worth in the future - the value of greatness over actual value. Andy Fastow was a master at covering up truth for the company. He created fake companies to help hide the downfall of their rule. His work was in structured finance, and played up on people's greed to get money. Cliff Baxter had such trauma from hurting millions of people, that he committed suicide.

The suicide note, found in the car of Cliff Baxter.

The company treated their stakeholders poorly, especially their employees. They motivated them through fear of loosing their job, and worked on the basic instincts of the "survival of the fittest." Even the successful people in the business would not make it, if they were not the top. They encouraged workers to gamble more, and risk. Their main goal was to get the government out of the energy market, although free market is expensive for customers, and would not necessarily benefit anybody but them. Such company held no value for people, relations or the real world... everything was money, and importance was measured by the greatness of the price tag.
The company and its leaders were sure good at acting, as they had America convinced that they were smarter then anybody else. They thought they were changing the world, but reflected greed. They wanted to believe their perception was reality, although deep down it was obvious that everything was going horribly wrong on all levels.
In the end, nobody understood how the company made money, and it became clear that it was "all just games". People questioned their accounting methods. Nothing seemed to fit, and everyone on top was acting suspicious. The truth came out, when it was too late to do anything about the inevitable end. The company hit bankruptcy within weeks, and let over 22,000 people that were depending on them down. They could not out-think the system like they wanted to, so the men in charge scrambled to make as much money last minute as they could. They sold billions in stock before the company lost value, and transferred company profits to personal accounts. It was the biggest business scandal of the century. This economic fraud destroyed the market. The innocent employees and shareholders lost everything. Nobody could ever dreame in their worst nightmares that Enron would go down, let alone that fast. They were left without any value or money.  Life savings of their shareholders, and retirement founds of their employees (saved in company stock or control) were forever gone. Main men in the game faced serious accusations, and those who did not commit suicide, are bound to spend their days in jail. They lost their dignity, value, respect, and now the whole world looks at them for the example of bad business ethics. Business owners should learn from Enron's downfall as ethics and success should always work hand in hand. They owned the world, but lost their soul in the process. Lost their sense of morality. Their life and great work became the land of illusion. Nobody should ever be such victim to arrogance, intolerance and greed.

It all just leaves you thinking with one; Is it ethical to drain out all money, to exploit people. Is it okay to do something, JUST because you can? I hope that this lesson thought us all that the answer is NO.

Marketing works of Emotions

Is there math behind emotion? Can you measure a kiss? Did you ever wonder how many kisses lead to a marriage? Is there a metric for those magical moments, for human emotion, the very substance for all things great? Those irreplaceable moments where an authentic connection occurs, the one that grows an already deepening relationship.
These are the moments people most covet and equally fear, but this is the exact metric for greatness, brands and people alike. This type of marketing was once thought to not exist in the digital space, but it does. It exists in a big way.

An online store-builder company Shopify approached  new project. Their  benevolent and innovative goal was to create a safe and inspirational digital space for budding entrepreneurs. There wasn't the question of, "For every dollar we spend for a copy of a product, how many new acquisitions will be made?" There wasn't complication behind it, their goal was simple: to build a relationship and to do so through unmatched generosity and education.
The new wave of marketing, with all the talk of likes and tweets, really whittles down to one thing: basic, human connection. It comes down to trust, guidance, and authenticity. "No longer are click-throughs as an isolated metric relevant. The better and perhaps more difficult question to ask is, why would anyone want to talk about you? I'll give you a hint: It isn't because of your latest banner ad." This new method asks people to step out of the box, and make people talk by actions. But is this new approach raising the bar to better standards, or is it on the border line with ethics when it fails?

The GOOD, the BAD, & the UGLY.

Corporate Social Responsibility -CSR-  is a new trend among businesses. Large companies now commonly claim that CSR is one of their objectives, and that they aren’t in business just for the profits, that they’re also intent on serving some larger social purpose - but we have to wonder; How much of that is actually true? The GOOD, the BAD, and the UGLY, stands for various companies and their level of social responsibility.

The GOOD are the companies that truthfully state, and actually follow CSR. They contribute to their communities, and help make difference in the world. An example of the GOOD would be the famous ice-cream company Ben & Jerry's. Ben & Jerry's is a company that is huge on activism. They help save the environment, and are big on holding up true values. Some of the examples of them actually having corporate social responsibility are the ways they gain ingredients to make their ice-cream. Their milk is bought off of small dairy farms in Vermont, which helps the local farming community of their base town. As well, Ben and Jerry's buys only fair trade products, like coffee, vanilla and cocoa. This way they make sure that the products they use, did not limit someone's rights. As well, they gotten pretty creative over the years, with how they handle their waste. In the beginning, the waste went to a manure pit, then it went to a composting facility , and now they send it to a Methane Bio-digester. This miracle of modern science puts the waste through a biological process that actually creates methane energy for the farmers. And the “cake” solids left over from the digested are then turned into comfy bedding for the cows. Isn't that so much better then piling waste up?

The BAD are the companies that treat their employees or their communities in a wrong manner, and practice bad business ethics. An example of a BAD company would be Walmart. The company claims that they "Always [have] low prices - Always." But how do you think they can achieve that?? Walmart does not help communities, instead it "helps" destroy them. When Walmart comes into a new town, it ruins all small businesses. People shop there because of their lower prices, but the truth is they achieve those prices by ignoring ethics, and treating people in a unjust way. For example, most of their employees have only a part time job status, as then no health care has to be paid by the company. Walmart uses the system, and tells it's employees to get food stamps, use government aid plans, and basically go on walfare. The employees have no choice then to actually do that, as they do not have any money, because Walmart barely pays them at all ... even if they work more then 40 hours a week. The UGLY are companies that "greenwash" the public. Greenwashing is when a company states that they are practicing CSR techniques, helping the community, and trying to save the environment - but in fact - all the statements are false. They state so only because they feel that it will help them increase their business chances, and earn more profit. A good example of the UGLY would be Kraft Foods. This top producer of foods and beverages in America, has dug itself a hole when their statements about being "all natural" have been proven to be false. Kraft's Cereals have been falsely been promoted for having natural ingredients, when they in fact use genetically engineered corn. The corn that is used in their cereals is made in a lab, and not by nature. The cereal maker's efforts to create a healthy image can have an horrible impact on children, and our health. When Kraft promotes its Natural Advantage cereals as chock full of “antioxidants” and “natural fiber" it seems as a great and healthy choice. However, the cereals also may contain pesticide residue, and modified milk products from cows treated with the rBGH growth hormone. 
Next time, do not be fooled by a companies big talk. Help eliminate those BAD and UGLY competitors off the market, and research the brands that you trusted until now. We live in days when we have to rely on our selves for almost anything.

How business can bloom even now...

New York City is a place that never sleeps - could it be because of all the coffee shops lurking around?



Most of the recent growth in the New York high-end coffee market can be traced back to Starbucks. New Yorkers were getting used to the idea of sophisticated coffee before the company opened, wanting to offer more then just regular watery "diner" coffee, and a "regular" cup from the street carts, who's taste is blocked out by sugar and milk. Starbucks saturated the market with its opening in 1994, planning to have 100 stores in Manhattan within four years. Today, there are nearly 200 Starbucks shops on that little "island". It  created a huge market of consumers who no longer tolerated "bad coffee" - but it also drove many smaller chains out of business. However, that is quickly changing in today's economy.  Today, Small coffee chains, benefit from lower retail rents and the created bottomless thirst for high-end coffee even in weaker economy, and are taking the opportunity to expand in New York City. The higher rates of unemployment, that came out of this weak market, forced many people to find their entrepreneurial spirit and start something on their own. 

The lower rents that came out of it, made a lot of the shop owners feel like they needed to open up. As well, landlords became more flexible about considering food service businesses and new businesses as tenants — In a softer economy, landlords have a little bit less say in that area. 

One interesting company that comes out of this whole mess is Pudge Knucles, a start-up roasting facility in Red Hook. They plant to become a chain, and even aspire for a dozen shops. This company takes pride in its NYC herritage, and names their coffees names like "East Coast Thriller" and "Five Borough Blend". Their aim is to provide an unpretentious alternative to overly "sophisticated" coffee chains. And even though more creative and determined coffee shops seems to be filling the market, there is plenty of room for competition.

“I would say there’s really no place in Manhattan where you’re not going to find a competitor,” said Shelton Franklin, a senior managing director at S. Blair Partners, a real estate services company “There’s always somebody a block away, but there still seems to be room for more.”  - Now that's an interesting idea, a city RUN by coffee.("Fuel for the City That Never Sleeps", by Alison Gregor.)

An angle of Business

Business is part of our everyday life, but often we do not see that we can easily become enslaved in its demands. It is hard to get money, not meaning earning enough for living, but earning enough for luxury, and find the time to enjoy things outside of the business area. As technology and innovations advance in products and care, so do new trends begin in the business sector. Multilevel Marketing is one of these new ideas that we see spreading out all over the globe.

Although not necessarily owning her own business, Jana Lackovicova is her own boss. Her business activity belongs in the tertiary sector, and this new way to make business and money suits her need of time, as well as cash flow. She began this type of business to get out of the role of an Employee, who doesn't make much money, but has enough free time, to get to the role of an "Investor", who has plenty of time and money. Wouldn't you think that this would be the ideal position for everyone? Jana wanted to be independent, and followed the theory of the world famous Robert Kiyosaki, and made a change in her life.  Classical business that you run on your is a lot of stress, and you exchange your time, for money, which you invest back into your business. This type of business requires capital, investments, responsibility, taxes, usually spaces you need to continue on with your business,as well as staff, and repeated buying of goods and "ingredients" that you need to make your business run, and be a "business". Multilevel Marketing, which is the type of business activity Jana is involved in, requires no spaces, no staff, no stock, no responsibility, and ultimately - no risk.On the other hand, she needs to keep educating herslef in the area of business, and about the company she "embodies". This type of a "job" requires a great skill in communication, as well as have people skills. To start up, Jana only had to pay 100 Euros, so raising a capital was not a burden, as it usually is with other businesses. Her work is linked with the multinational company Nu Skin, and Jana's business activity is categorized into Wellness - beauty, and anti-aging systems. She learned about Nu Skin in the U.S., as her friend introduced her to this idea. The company has 7S7 learning educating system - which means that she goes to learn about new trends, ideas, and ways, and then educates the people under her.
She says "The hardest part of all this was the decision to leave my previous position as an employee, where I didn't make much money but at least had time, and decided to do something independent."
Her biggest challenge in business is to gain people for it. People who would be interested, who she could present to. She aims to gain and convince the biggest number of people possible, that what she does is right and that they should do it also. Her aim is for them to be happy with it. "My goal is to duplicated my business." she says, "How I was tough by my sponsor, and teach it to the people I am involved with."
Although every business has a lot of competition on the rise, she argues "We are original, and not imitations" and that's what puts them aside and makes them shine. In the firm, there is an ethical code, that guides them on how they should act towards their partners, and clients, how to present themselves, and states what isn't allowed. "For example, we never ask each other how much we gain." Other then being on the good side of the ethics, the company has also a lot of social programs set up. Jana's favorite program helps kids in Malawa, by supporting and  giving their parents work in factories, and the kids food when they receive education. With so many innovations and social responsibility the company has on hand, it is no wonder that many people choose to work for with them and become their investors. Over all, it is all about good moves in people's lives that we are hearing about here.



Want to learn more? Visit www.nuskin.com

Greece faces a referendum

As the government was on the verge of collapse, the Greek cabinet offered to fully support Prime Minister George Papandreou, and his surprise plan to call a referendum on the Greek Financial crisis.  Papandreou’s plan is to seek the support of the Greek people, a majority of whom dislike the bailout terms, is the latest challenge to Europe’s crisis-fighting strategy. This proposal threatens Greece's loyalty to the terms of a new deal with it's lenders. The referendum shows that the positive regard of last week’s European Union summit will fade quickly. This situation increases the risks of a bigger default on Greek debt and,as well as Greece ultimately leaving the euro zone. Never the less, this whole situation cannot end well, as in the end Europe will suffer either from the betrayal of Greece, or from the dept the zone has gotten it self into from borrowing money to pay for Greece's dept.

Source: New York Times

How does a country in dept, that gets more in dept, help another country rise from the dept?

Slovakia and the Euro

Bratislava is struggling. On Monday, Slovakia's governing coalition failed make a deal to prevent a collapse of the continent-wide plan to help indebted European nations.Prime Minister Iveta Radicova said her four-party coalition was unable to compromise a deal. The Slovak government sat down for three hours, and the only thing they agreed on is that the coalition will talk further on Tuesday, when the Slovak Parlament is scheduled to vote on the EU bailout found. Up until now, only Slovakia and an even smaller partner Malta, have not backed up the plan. However, Malta is expected to approve the plan later on Monday, making Slovakia the only undecided member of the Euro-zone. All 17 nations that use the euro must approve expanding the bailout fund, which is designed to strengthen Europe's defenses against the debt crisis, that is growing fast.

Slovakia, a nation with 5.5 million people, would contribute about 1 percent of the money needed or 7.7 billion euros. The outcome of the Slovak parliamentary vote is uncertain because of a member of the coalition, that  is strictly opposed to increasing the fund. Sulik, the chairman of the opposing party,  said that they are trying to find a compromise deal that would prevent Slovak taxpayers from "paying a cent", however his proposal was rejected by the other parties. The proposal called for the creation of a parliamentary committee that would review any future loans from the fund with a right to veto it. Analysts have warned that a Slovak vote against boosting the fund would send a bad signal to already nervous financial markets about the inability of euro-zone countries to unite to tackle the debt crisis. Slovakia is too small of a country to face the euro-zone's debt crisis and its consequences alone.With the help of EU funds and foreign investments, Slovakia has benefited significantly from its membership in the euro-zone and the EU, and is quickly becoming a leading European car exporter. This is a important and scary situation for Slovakia, because nobody wants to back down. Slovakia needs the EU even more then any other members, and cannot afford to turn their back to them in their time of need, despite the fact that the country it self has nothing left to give or lend, especially to stronger countries. With such chaos and changes in views, Slovakia is threatened to not stay a member, which would result in a tragic blow for the economy. Car companies, such as Kia or Volkswagen would move their factories to other countries, and Slovakia would be left in ruins.

"It might have started from Greece because of the very high debt and excessive deficit, but the crisis has spread all over Europe, so there must be an action, a unanimous action, a unanimous decision from all members to protect the European Union at this point." said Stratis Polychroneas, head of fixed income at Solidus Securities in Athens.

The Mission Statement

A mission statement is a statement that expresses a businesses core aims. It is to be simple enough for public to understand, and written in a way that stimulates interest of outside groups and motivates the workers. A good mission statement should include the following:

·        What the company does.

·        Whom do they do it for.

·        What is the benefit.

A good mission statement should not be too vague and broad to apply to any company, but it should also not be too complicated, making it hard to form an opinion about the company.

Below are three examples of a companies’ mission statements.

The Walt Disney Company

Walt Disney is a company that controls the global entertainment and Media Networks, Parks and Resorts and Consumer Products. They dominate the field with a wide range of business activities including theme parks, television broadcasts or internet businesses.

Mission Statement
"The mission of The Walt Disney Company is to be one of the world's leading producers and providers of entertainment and information. Using our portfolio of brands to differentiate our content, services and consumer products, we seek to develop the most creative, innovative and profitable entertainment experiences and related products in the world."

This mission statement of this company is very specific with their mission statement. It tells you that Walt Disney is a company in the field of entertainment and wants to be the most innovative and creative in presenting you with information and products. This mission statement gives you many points which you can analyze, as we can see if their company is on the right track. It provides specific details that apply to the company, but still makes the public "feel good" about the organization from what they read. It provides with little hints of its vision statement, or plans for the future, but then again we cannot accept a big corporation to lay all of its cards on the table.  

Microsoft

Microsoft is an software company that provides a wide range of technology services and products. It is one of the leading "computer" companies, well-know for the operating system of Windows and The Microsoft Office. 

Mission Statement
"At Microsoft, we work to help people and businesses throughout the world realize their full potential. This is our mission. Everything we do reflects this mission and the values that make it possible."

This mission statement, compared to the one of Walt Disney, is a little bit more vague. It fails to inform us what the company does. Although we all probably know what type of business Microsoft is and what it contributes to, the company's mission statement is less specific, and it we would not know it had anything to do with software or computers, without our previous knowledge.  However, we can analyze this statement on the company's efficiency to help other companies work to the fullest potential, and reflect good values to make their mission possible. Never the less, this statement would be categorized amongst the weaker ones, as it does not provide the reader with much specific detail, nor an aim of what the company wants to be in the future. 

MetLife Inc 

MetLife is an insurance institution that  offers retirement products and prepaid legal plans for individuals, or groups, offering international insurance, and serving countries in Latin America and Asia as well as the US.

Mission Statement
"The capable team of MetLife's Customer Response Center (CRC) shares a common mission - that all customers are "Met for Life." By balancing the efficiencies of new technologies with the personal touch of highly trained and motivated professionals, we are able to deliver solutions and services that exceed our customers' expectations. We thereby earn their loyalty."

This mission statement is by far the most direct, well explained and persuasive above all mentioned. When you give people details, and not just vague information, they end up more convinced and with stronger positive feelings towards your company. It clearly explains what the company does, and for whom they do it. It gives you the possibility to disagree with it, however, it makes you "feel good" about the company, and with the added detail, not question it. It does not say that it wants to be the leader of insurance of the world, however it visions the future to be filled with trained and motivated employees, that exceed customer expectations and help gain even more trust and respect for the business. This mission statement provides more specific detail, which results in motivation of workers to work better and harder for the company, as well as people to buy their product and invest in them. 

 

 

Microsoft takes over Skype

Skype is an internet phone company that provides online calls and video calls between Skype users over the internet for free, while charging both traditional land-line phones and mobiles. Last week Microsoft announced their plan to buy off Skype for 8.5 billion dollars. Skype has been planning a share flotation; however, it has become loss-making internet phone service, and struggled to make money.  Skype has more than 650 million global users and has become Microsoft's largest single acquisition. Bill Gates was a strong proponent of this deal, despite controversy of it being a strategic move for Microsoft. Under the terms of the deal, Skype will now become a new division within Microsoft. Skype chief executive Tony Bates will continue to lead the business, reporting directly to Microsoft boss Steve Ballmer. When I read this article, I thought to myself: What will become of Skype after this move? By the move of Skype reporting to Microsoft, I wonder how the quality of service will change. What other goals and motives will Microsoft have with Skype, and what can we expect of this historical move for Microsoft? One thing is for sure, wherever it will be good or bad, it will affect us all. When we want to talk to family over seas, or just feel closer to a person who is not there, we use Skype. It has become a part of our daily lives, and now it lies within Microsoft to change it into its own idea of controlling the market.

Business news - Burberry

The fashion house Burberry, is revealing new plans to boost the year’s profit hopes.

This 155-year-old maker of handbags and luxurious accessories, reported a surge in revenues to 455 million Euros in the three months to March, which it said would result in full-year profits being at the top end of expectations.

Main concerns being that the buyers in buyers in China, the Middle East, Russia and India, which have not been affected by the European sovereign debt crisis, are now facing a downfall. The last months, Burberry and other luxury brands were noticing a “boom” in profit grown coming from the Asian part of the market. Concerns that those stellar growthrates could be under threat has seen Burberry's shares lose 17% of their valuein the past three months. China is in the big game for the luxury goods industry and is expected to become its biggest single market by 2015. Burberry bought out its longstanding Chinese business partner for about 82 million Euros last year, as it plans to expand from 60 to 100 shops.

“Angela Ahrendts, Burberry chief executive, said: ‘Burberryhad a strong finish to the year, driven by our design, digital marketing andretail initiatives, as well as good early progress in China.’ ”