Actions speak louder than words???

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It’s an old saying, and one that is meant to have us think twice before making a rush to judgement. Unfortunately, today with so much talk and social media, it’s hard to drill down and measure someone by what they actually do.

At BBT Financial we are not perfect, nor ever will be. When we get something wrong, like a tax assessment we immediately relay this to the client and tell them where we went wrong. We show them our calculations or where the CRA had a different opinion. We then adjust our process to correct future calculations and ensure it never comes up again. Mistakes are the best teacher. Honesty goes hand in hand with Accountability.

We believe we owe it to the client to be as transparent as possible. If they choose to go elsewhere, we never stop them.  Trust is our business, and our clients deserve the truth as a measure of that trust.

 

Rick Barbosa

Bombardier and Yahoo: A Tale of Two Losers

Last week we were informed of another billion user hack at Yahoo. Not sure of the circumstances as to why now, but my best guess is that they uncovered it while still in Verizon’s due diligence investigation. The sheer stupidity that must have been covered up as to why there were 2 breaches years apart, and the failure to learn from their mistakes in preventing the second is beyond belief. Here we have a large multinational in the tech space, not able to come up with a tech solution to this centuries most pressing issue, security, is mind boggling.

How does this happen? It comes down to having the wrong people employed in the wrong positions. The culture of “just go along” is rampant in larger companies, and as soon as someone questions the mentality of the herd they are ostracized and HR’d (human resourced) to the curb…  Until we have senior managers who are held criminally responsible for their actions things will never change. The side-effects are lost jobs, lost credibility and increased pressure on an already fragile working class and social services.

Bombardier is another prime example of a company that should have gone bankrupt decades ago. By artificially propping up a failed business you are saying it’s ok to keep failing, and that there are no consequences to your actions. It’s like saying to a criminal, we know you stole our money but we’re going to give you more just so you don’t have to break in next time.

The City of Toronto got what was coming to it for going with a poor company to begin with. We cause ourselves more harm by doing what seems to be the right thing instead of taking our medicine and getting better the old-fashioned way.  Like the Buckley’s commercial says ” it tastes awful, but it works”

We need to take some strong medicine and get better soon as a country, or we’ll be the poor northern neighbour again waiting for scraps to fall from the table to nourish our economy. We need to lead and not follow. Plain and simple.

Real leadership and management takes courage. It’s not easy, but nothing ever worthwhile is.

Rick Barbosa

 

 

 

Playing by the Rules

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Whatever your Politics, you cannot argue with the recent market uptick and how it’s been impacted by pre-emptive policy choices of the new U.S Administration. In my recent posts you will have read that Free Trade and Trade Agreements in general only work if the playing field is level. The playing field is not level, and Large Multi-Nationals like it that way. We have systematically exported our manufacturing expertise to nations that are not democratic and do not see raising the standard of living as a priority. Product quality, safety, pollution and labour practices have all suffered as a result of non-level playing fields.

North American companies can compete with any company in the world on a level playing field. Our access to talent and innovation, capital, and natural resources is beyond compare. The standard of living we all share in the developed world was the result of investments made by both private and public sources, for the long-term prosperity of our companies and countries.

The current administration is disrupting the status quo. By refocusing and rebuilding North American industries we are saying that it’s time we focus on ourselves and our standard of living. The message is simple and effective. We must put our country, its industries and it’s people first or we risk our very way of life.

Play fair or don’t play at all.

Regards,

Rick  Barbosa

 

 

Has “Free Trade” really helped us?

In my humble opinion NO.

Here is what I used to base my answer on. When we lowered tariffs in North America it was meant to encourage a freer flow of goods between nations. Economists tell us that increasing trade creates wealth and was essential to grow economies on both sides of the border or for that sake internationally (TPP, CETA). Free or tariff reduced trade is only a recent trend so we must look at why we had tariffs in the first place.

Tariffs or “taxes” were meant to protect our local and mature markets that were the envy of the world. Our Markets (Canada/US) harbored a healthy working population with disposable income and a robust manufacturing sector. Unlike other parts of the world North America (Canada/US) had made investments for the betterment of it’s population that included:

  • Health and Safety
  • Organized Labor
  • Minimum wage
  • Social Security/Government pensions
  • Workplace or Self-Directed retirement plans
  • Workers Compensation
  • Employment standards Legislation
  • Environmental Protection

Anyway you cut it, these programs increased our cost of production, albeit while producing a higher standard of living. The Tariffs made cheaper goods that were made in countries or states that did not have any of these obligations competitive by increasing their landed cost. In most cases local was cheaper when you factored in tariffs. This drove investment in both countries by companies who wanted to serve these rich markets by making it cost effective to produce locally.

We were told that lowering tariffs would drive competition and innovation because we would be allowed access to their markets on an equal footing in exchange for access into our markets. That did not happen. Restricted or limited access is what we got.

Too often national or state interests fell outside of NAFTA like Health and Safety, minimum wage, and environmental standards. So what in essence happened is that for companies to survive the onslaught of cheaper goods they too had to go offshore to remain competitive. In fact the standard of living has not increased in Mexico, the U.S and Canada. All the wealth that has been created did not raise the standard of living in any developed country, instead it only boosted the multi-national corporations bottom lines. This came at the expense of blue-collar and lower level white collar workers.

I am a strong proponent of responsible capitalism and competition. It’s the best system period and one that drives growth and innovation. When Free Trade was introduced and as other European and Pacific agreements pop up we must ask ourselves one fundamental question:

Is the playing field really level on  both sides?

Rick Barbosa

Albert

 

I wanna be a weather forecaster or economist when I grow up

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When it comes to job security, where else can you be wrong most of the time and still be employed? These two professions have the luxury of formulating “educated guesses” with no accountability for their outcome. How many times have you planned an evening out or a quick trip based on forecasted weather, only to be let down when it was nowhere near what was promised.

On a more serious note, economists and more specifically central bankers like Steven Poloz and Mark Carney are glorified weathermen. Steven Poloz’s insistence that lowering the benchmark rate to .5% was going to offset Oil and Gas’s demise by propping up manufacturing in Central Canada. #Epicfail. All it did was spur more borrowing for investment in the housing sector which is in a “bubble”. Mark Carney during his tenure never really did anything, including change rates. All he did was talk. Now that the BOE has Mr. Mark, he is doing much of the same thing which is nothing. What people are slowly realizing is that these “forecasts” are just guesses. Like those who bet with the “experts” on Britain never leaving. Unless you are held accountable for your actions your words mean nothing. True professions like Doctors, Lawyers, and yes Accountants, are held to professional codes of conduct and practice standards. If they fail to live up to these there are consequences and disciplinary processes in place. It’s a matter of public trust.

So next time you hear someone’s forecast or projection, ask yourself what they’re on the hook for if it’s wrong.

‘Till next time

Rick

cufflings

The cost of drinking the Kool-Aid

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Now with tax season winding down, I finally have some time to reflect and write about recent events and provide my spin on these.

In any corporate environment we all know of those individuals who have attained their positions either by

  1. Selectively being drafted from upper management for their sympathetic views
  2. Taking shortcuts to achieve short-term results, neglecting long-term consequences

The first type of promotion is what’s known as Empire Building. This comes about when senior management wants individuals around them willing to “go along” with their direction and corporate outlook on how to best serve the interests of the company. Interests of the company in Empire Building more often than not will miraculously coincide with Senior Management’s own self interests. These interests can take the form of Bonus’, Stock Options, Board Positions, Fringe Benefits and Gold Plated Pensions. The least amount of resistance that they can have while attaining these interests the better.

The second type closely mirrors the first, but is distinguished only by the individualistic approach to the end result. WIIFM (what’s in it for me) Managers see employees and subordinates as tools and assets to employ in attaining the quickest, most cost effective, and most personally rewarding path to success. They often do not take into account longer term issues such as quality, impact on brand, societal impact and human cost of their decisions.

Many out there would see nothing wrong with either approach and tout that it is often necessary to employ these tactics to achieve the results the market expects. “Market Expectations” is another name for a Giant pitcher of Kool-Aid. Once we drink from the Kool-Aid pitcher as an organization we start to rationalize the decisions we make to make the market happy. Trouble is, this can’t and won’t last forever. What’s often left in the wake of pandering to the market and drinking the Kool-Aid, is broken trust, lost resources and damaged lives.

As owners and managers, we have a fiduciary and moral duty to think long-term on how to best achieve sustainable and realistic results that elevate our companies and staff as a whole. It’s not a 100-yard dash, it’s a marathon. Play to finish.

Some recent examples of “Kool-Aid” corporations:

Volkswagen takes $18 billion hit over emissions scandal Friday, April 22, 2016 02:03 PM EDT Toronto Sun

Mitsubishi Motors mileage scandal widens, U.S. regulator seeks information TOKYO 
— Reuters

General Motors will pay $900 million to settle criminal charges related to its flawed ignition switch that has been tied to at least 124 deaths. CNN Money

Till next time.

Rick Barbosa

 

 

Getting up from “Under the Bus”

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Recently, although it has happened to me before, I let my guard down and confided in someone whom I though I could trust (in a business sense). This information (not proprietary or classified)  was meant as an aid to improve performance prior to any real actions being taken. I was under the impression that the party in question wanted to understand what others where thinking so they could make preemptive corrections, thereby avoiding any confrontations.

It didn’t turn out that way. Instead the party in question confronted the accusers and followed up with proof by using my name in the process. Blind sided as I was to hear of the incident, I knew I needed to react the right way and learn from this mistake. I owned my error and proceeded to acknowledge the issue with those affected. I can’t expect the same level of trust from the group, nor would I give it if I had been betrayed. Wounds will heel, but going after the person who betrayed my trust would just make two wrongs.

When you are in the middle of a situation like I was, how you respond and own it says a lot about your character. I hope to regain this groups trust over time, but I know that individual responsibility and accountability are the hallmarks of my practice. What we do after we screw up is just as important as learning from the screw up.  All of us at times fall prey to this type of betrayal. It’s how we learn to cope with it that sets leaders apart from the rest. We must hold ourselves to the same if not higher standards, as those we manage and consult, otherwise we risk hypocrisy.

Dusting myself off,

Rick Barbosa