Hire higher
When I was starting out in business, I remember asking Ken Olsen, founder of DEC, for advice. He smiled, “Never hire someone who is not better than you are. If you are always the best, when it comes to the crunch, you will be doing the job.”
Ogilvy says in his book ‘On Advertising’ (really a management book), “If each of us hires people who are smaller than we are, we will become a company of dwarfs. But if each of us hires people who are bigger than we are, we will become a company of giants.”
Former Apple marketing guru Guy Kawasaki says, “A players hire A players; B players hire C players” – meaning that mediocrity hires inferiority, to ‘feel’ superior.
Large companies are driven toward mediocrity because they create management layers where mediocrity can hide. Middle managers in large companies have no incentive to hire higher. They hire to meet budgets (set by someone else) and usually accept the lowest-paid person who meets the qualifications. That is a primary cause of poor performance.
Hiring higher takes self-confidence and self-awareness. It is the only way to build a great team. Small company entrepreneurs have every incentive to hire well, and they do – because good individual performance and teamwork makes them rich.
Manufacturing innovation
We must recognise that major parts of the economy – government, banking, insurance, health care, consumer services – use physical wealth, but do not create it. Financial services now comprise 45% of earnings of companies on the S&P 500 index, up from 10% just a quarter-century earlier.
Manufacturing is a primary wealth-producing sector and historically is responsible for the relatively high standard of living in the US compared to other countries. Manufacturing has now declined to about 11% of America’s GNP. The continued decline is ominous.
The Society of Manufacturing Engineers (SME) has an initiative that identifies emerging technologies that are making a positive impact on manufacturing. SME’s Manufacturing Enterprise Council collaboratively selected five ‘innovations that could change the way you manufacture’:
* Direct Digital Manufacturing (DDM): Use of additive fabrication processes; manufacturing components layer by layer, direct from 3D digital data, without machining, moulding or casting.
* Ultra capacitors: Electrochemical capacitors that have an unusually high energy density and provide significantly more storage power, with unparalleled life span.
* Self-Assembling Nanotechnology: Manufacturing at the microscopic level.
* Intelligent Device Integration (IDI): Monitoring, managing and servicing of intelligent devices over the Internet.
* Integrated 3D Simulation and Modelling: Desktop supercomputers will revolutionise simulation and modelling, acting through microscope, telescope and time-machine operations to manage, view and tool a complete manufacturing system.
Perhaps a fortuitous result of the current recessionary environment is that the manufacturing decline is being recognised and addressed in new and innovative ways.
Cloud Computing on the horizon
Google, Microsoft, and Amazon are the leading players in a global race. They are building data-centre capacity around the world at a pace that has not been slowed by the current economic recession. They want to be ready with enough capacity to handle two big developments that will transform the technology world over the next decade:
1. Cloud computing: Applications and services, Internet delivered.
2. Utility computing: On-demand Internet-based server capacity.
With both of these trends, the biggest target is private data centres. Cloud computing will run the big commoditised applications (mail, groupware, CRM, etc.) so that IT departments do not have to run them from a private data centre.
Most IT departments now pay for maximum capacity at all times, with very low utilisation. If they have not planned for enough capacity at the high end, they risk downtime at peak times if their systems get overloaded.
Utility computing wants simply to take over server capacity for private services and applications. They will seamlessly scale up and scale down services so that organisations only have to pay for the bandwidth and server capacity used.
About 5% of enterprises have already implemented some form of cloud-computing, and this will increase to about 9% by 2012. Software-as-a-Service (SaaS), just one segment of Cloud Computing, is itself growing at double-digit rates. According to many experts, the real impact of cloud computing will be much more – ‘in the cloud’ applications are expected to be 25% of the net new growth in IT spending.
Watch for cloud computing to blossom in 2010.
Jim Pinto is an industry analyst and commentator, writer, technology futurist and angel investor. His popular e-mail newsletter, JimPinto.com eNews, is widely read (with direct circulation of about 7000 and web-readership of two to three times that number). His areas of interest are technology futures, marketing and business strategies for a fast-changing environment, and industrial automation with a slant towards technology trends.
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