Thursday, February 19, 2015

4 ways to increase your influence

By Joseph Grenny

A Businesswoman is silhouetted as she makes her way under the Arche de la Defense in the financial district west of Paris

I find it ironic that when I ask leaders—even good ones—what constitutes leadership, I often get vague, disparate, and vapid responses. You’d think this educated and successful population could offer crisp and concrete definitions of their own crucial work. Instead, you hear a dozen tangents of real leadership like energizing, visioning, pathfinding and modeling.
Fortunately, not all leaders are missing the mark. I once met a leader who has a concrete expression of leadership on the tip of his tongue. Tim Tassopoulos, EVP of Operations at Chick-fil-A, says it this way: leadership is intentional influence. I couldn’t agree more.
For more than 30 years my colleagues and I have helped leaders increase their capacity for influencing change. But it came as a surprise that prior to helping them learn how to influence, we had to draw their attention to it as their core work.
Tim, on the other hand, understands that success comes down to whether one of his 50,000 front-line associates with a few discretionary minutes decides to lean against a wall or clean tables. Tim’s success or failure as a leader does not come down to whether he is charismatic, visionary, or inspirational, but to whether people behave in ways that improve results. Period.
Given that few leaders can even define leadership, it’s no surprise their performance is mediocre at best. We studied the successes and failures of more than 1000 leaders from 50 global companies to influence strategically critical behavior change in their companies. We were stunned to discover that fewer than one in 20 had any evidence of success in spite of their belief that change was crucial. As we combed through the data, some key insights emerged that helped us understand why so few leaders either grasp or exert influence well:
1. Leaders act as if it’s not their job to address entrenched habits
Most leaders put a great deal of time into crafting strategy, selecting winning products, and engaging with analysts, shareholders, and major customers. But few realize the success or failure of their grand schemes lies in influencing the behavior of the people who will have to execute on the big ideas—their employees.
By contrast, the most influential leaders—the 5 percent who succeed at changing behavior—spend as much as half of their time thinking about, and actively, influencing the behaviors they know will lead to top performance. The 95 percent who dither and fail tend to delegate what they dismiss as “change management” to others.
2. Leaders lack a theory of influence
Very few leaders can even answer the question, “How do you change the behavior of a large group of people?” And yet, what they’re ultimately paid to do is align people to execute on decisions. Imagine discovering, just as the anesthesia is taking effect, that your heart surgeon—the one hovering over your chest with a scalpel—is working off a “gut hunch” about how to conduct a bypass. Unless leaders become articulate about a repeatable and effective way to influence behavior—they’ll continue to rack up predictably high failure rates at leading change.
3. Leaders confuse talking with influencing
Many leaders think influence consists of little more than talking people into doing things. It’s no wonder most influence efforts start with slide presentations or rallies. But profound, persistent, and overwhelming problems demand more than verbal persuasion. Anyone who’s ever tried to “talk” a smoker into quitting knows there’s a lot more to behavior change than words (see our BS Guys video).
4. Leaders believe in silver bullets
When leaders actually attempt to influence new behavior, they commonly fall into the trap of thinking deeply ingrained bad habits can be changed with a single technique.
They host star-studded retreats and hand out inspiring posters and think people will line up for change. Still others believe it’s all about incentives and so they tinker with the performance management system or tie new behaviors to executive bonuses. The research shows that when leaders rely on just one simple source of influence (like training or incentives or verbal persuasion) to drive change, they almost always fail.
Over the past 30-plus years, my colleagues and I have sought out and studied a different kind of leader. We’ve tried to find those who had remarkable abilities to influence change—rapidly, profoundly, and sustainably.
We’ve studied the methods used by one remarkable influencer who, with no formal authority, changed behavior in thousands of U.S. hospitals. We’ve looked first hand at one influencer who saved five million lives from AIDS by influencing behavior change in a country of 60 million. We worked with a CEO who, within 12 months, influenced deeply entrenched habits in employees with an average of 26 years tenure.
What we’ve learned is that when you know what you’re doing, change can happen relatively quickly. And it all starts with gaining greater clarity about what leadership really means, then finding a way of thinking about the fundamental principles of influence.
This article is published in collaboration with LinkedIn. Publication does not imply endorsement of views by the World Economic Forum.
Author: Joseph Grenny is the Co-chairman of VitalSmarts.
Image: A Businesswoman is silhouetted as she makes her way under the Arche de la Defense, in the financial district west of Paris, November 20, 2012. REUTERS/Christian Hartmann.

Thursday, February 12, 2015

6 Tugas Seorang Chief Marketing Officer (CMO) Menurut Philip Kotler

Ciputra Entrepreneurship

Philip Kotler ialah penulis bidang marketing berdarah Ukrainia-Amerika. Ia juga menjadi seorang konsultan pemasaran yang diundang dalam banyak seminar. Di samping itu, ia mengajar dan menjabat sebagai S. C. Johnson Distinguished Professor of International Marketing di Kellogg School of Management, Northwestern University.
Kotler berpendapat bahwa ada 6 tugas pokok seorang CMO. Berikut adalah penjelasannya:
  1. Mewakili aspirasi konsumen. Kotler mengatakan Voice of Customer (VoC) harus diwakili oleh kehadiran seorang CMO dalam sebuah korporasi. 
  2. Memantau lansekap/ medan bisnis yang terus berkembang dan mengumpulkan opini dan masukan dari para konsumen. Medan persaingan bisnis tidak stagnan, tetapi selalu dinamis dan berubah-ubah setiap waktunya. Konsumen dan pasar juga demikian. Seorang CMO harus bisa memonitor perubahan yang terjadi dan melaporkannya pada perusahaan sehingga perusahaan bisa beradaptasi dan mengantisipasinya dengan sigap.
  3. Menjadi pengawal bagi perusahaan. Pengawal yang siap melayani kapan saja, itulah yang diperlukan oleh perusahaan dari seorang CMO andal. Terutama jika terjadi krisis dalam perusahaan, yang berhubungan dengan pemasaran, seorang CMO harus siap siaga memberikan tanggapan dan reaksi.
  4. Memperbaiki teknologi pemasaran dan ketrampilan pemasaran dalam diri staf perusahaan. Teknologi adalah salah satu unsur terpenting dalam bisnis yang dinamikanya tinggi. 
  5. Memperkaya sinergi dan portofolio perusahaan dengan lebih banyak masukan segar. Dengan masukan yang penuh opini dan pandangan baru dan menginspirasi, perusahaan akan bisa bergerak lebih lincah dalam persaingan.
  6. Mengukur dan menjelaskan tentang kinerja keuangan pemasaran. Sebagai salah satu bidang yang penting artinya bagi keberlangsungan perusahaan, pemasaran juga disokong oleh dana yang tidak sedikit persentasenya bahkan bisa dikatakan sebagai urat nadi bisnis. Seorang CMO yang kompeten akan dapat melakukan pengukuran kinerja tim pemasaran perusahaan dan menjelaskan kepada para pemegang saham dan pemangku kepentingan mengenai perubahan yang terjadi terkait dengan kegiatan dan strategi pemasaran perusahaan. (ap)

Tuesday, January 20, 2015

Cheap Oil: How 2015 Gonna be Like

The Economist

Cheaper oil

Winners and losers

America and its friends benefit from falling oil prices; its most strident critics don’t

IN EARLY October the IMF looked at what might happen to the world economy if conflict in Iraq caused an oil-price shock. Fighters from Islamic State (IS) were pushing into the country’s north and the fund worried about a sharp price rise, of 20% in a year. Global GDP would fall by 0.5-1.5%, it concluded. Equity prices in rich countries would decline by 3-7%, and inflation would be at least half a point higher.

IS is still advancing. Russia, the world’s third-biggest producer, is embroiled in Ukraine. Iraq, Syria, Nigeria and Libya, oil producers all, are in turmoil. But the price of Brent crude fell over 25% from $115 a barrel in mid-June to under $85 in mid-October, before recovering a little (see chart). Such a shift has global consequences. Who are the winners and losers?

The first winner is the world economy itself. A 10% change in the oil price is associated with around a 0.2% change in global GDP, says Tom Helbling of the IMF. A price fall normally boosts GDP by shifting resources from producers to consumers, who are more likely to spend their gains than wealthy sheikhdoms. If increased supply is the driving force, the effect is likely to be bigger—as in America, where shale gas drove prices down relative to Europe and, says the IMF, boosted manufactured exports by 6% compared with the rest of the world. But if it reflects weak demand, consumers may save the windfall.

Today’s falling prices are caused by shifts in both supply and demand. The world’s slowing economy, and stalled recoveries in Europe and Japan, are reining back the demand for oil. But there has been a big supply shock, too. Thanks largely to America, oil production since early 2013 has been running at 1m-2m barrels per day (b/d) higher than the year before. Other influences are acting as a brake on the world economy (see article). But a price cut of 25% for oil, if maintained, should mean that global GDP will be roughly 0.5% higher than it would be otherwise.

Some countries stand to gain a lot more than that average, and others, to lose out. The world produces just over 90m b/d of oil. At $115 a barrel, that is worth roughly $3.8 trillion a year; at $85, just $2.8 trillion. Any country or group that consumes more than it produces gains from the $1 trillion transfer—importers, most of all.

China is the world’s second-largest net importer of oil. Based on 2013 figures, every $1 drop in the oil price saves it an annual $2.1 billion. The recent fall, if sustained, lowers its import bill by $60 billion, or 3%. Most of its exports are manufactured goods whose prices have not fallen. Unless weak demand changes that, its foreign currency will go further, and living standards should rise.

Cheaper oil will also help the government clean up China’s filthy air by phasing out dirty vehicle fuels, such as diesel. Lighter fuels are dearer and, under current plans, drivers could pay up to 70% of the extra; lower prices will soften that blow. More generally, says Lin Boqiang of Xiamen University, lower prices should support the government’s efforts to reduce subsidies (it has already freed some gas prices, and electricity prices are expected to follow next year).

The impact on America will be mixed because the country is simultaneously the world’s largest consumer, importer and producer of oil. On balance cheaper oil will help, but not as much as it used to. Analysts at Goldman Sachs reckon that cheaper oil and lower interest rates should add about 0.1 percentage points to growth in 2015. But that will be more than offset by a stronger dollar, slower global growth and weaker stockmarkets.

Extracting oil from shale is expensive. So when the oil price drops, America is one of the places most likely to pull back (Arctic and Canadian tar-sands producers are even more vulnerable). According to Michael Cohen of Barclays, a bank, a $20 drop in the world oil price reduces American producers’ earnings before interest by 20%, and only four-fifths of shale reserves are economic to extract using current technology with Brent around $85. How quickly production will fall as a result, though, is unclear, since producers’ costs vary and some have locked in prices via hedging. The impact will also vary by region. “If I’m in California, it’s pretty clear-cut that this is a good-news story,” says Michael Levi of the Council on Foreign Relations, a think-tank. “If I were in North Dakota [the biggest shale-oil state], I would be a lot more nervous.”

America is a net importer, so lower prices mean Americans get to keep more of their money and spend it at home. But the stimulative impact is less than it used to be, since imports are becoming less important, and oil is shrinking as a share of the economy. The Energy Information Administration, an independent government agency, expects net oil imports to drop to 20% of total consumption next year, the lowest share since 1968. In the early 1980s, when oil accounted for over 4% of GDP, a 1% price drop would boost output by 0.04%, says Stephen Brown of the University of Nevada, Las Vegas. That had fallen to 0.018% by 2008, and he reckons it is now about 0.01%.

Cheaper oil could make more of a difference to monetary policy. Inflation expectations have become more stable since the 1980s, which means that the Fed feels less need to act when oil prices shift. But with inflation below its 2% target, it will fret that falling oil prices could be pushing expectations down, making it harder to keep inflation on target. It could decide to keep interest rates at zero for longer, or even extend its bond-buying programme (“quantitative easing”).

Fears of deflation apply with greater force in Europe. Energy imports into the European Union cost $500 billion in 2013, of which 75% was oil. So if oil prices stay at $85, the overall import bill could fall to under $400 billion a year.

But the benefits would be muted twice over. First, inflation in the euro zone is even lower than in America. Mario Draghi, the head of the European Central Bank, claims that 80% of its decline between 2011 and September 2014 was caused by lower oil and food prices. Oil at $85 could lead to deflation, provoking consumers to rein in spending further. Second, European energy policy is only partly to do with price and efficiency. Europeans are also trying to reduce dependence on Russia and to cut carbon emissions by turning away from fossil fuels. Cheaper oil makes these aims slightly harder to achieve.

Reaping the benefits

But one group of countries gains unambiguously: those most dependent on agriculture. Agriculture is more energy-intensive than manufacturing. Energy is the main input into fertilisers, and in many countries farmers use huge amounts of electricity to pump water from aquifers far below, or depleted rivers far away. A dollar of farm output takes four or five times as much energy to produce as a dollar of manufactured goods, says John Baffes of the World Bank. Farmers benefit from cheaper oil. And since most of the world’s farmers are poor, cheaper oil is, on balance, good for poor countries.

Take India, home to about a third of the world’s population living on under $1.25 a day. Cheaper oil is a threefold boon. First, as in China, imports become cheaper relative to exports. Oil accounts for about a third of India’s imports, but its exports are diverse (everything from food to computing services), so they are not seeing across-the-board price declines. Second, cheaper energy moderates inflation, which has already fallen from over 10% in early 2013 to 6.5%, bringing it within the central bank’s informal target range. This should lead to lower interest rates, boosting investment.

Third, cheaper oil cuts India’s budget deficit, now 4.5% of GDP, by reducing fuel and fertiliser subsidies. These are huge: along with food subsidies, the total is 2.5 trillion rupees ($41 billion) in the year ending March 2015—14% of public spending and 2.5% of GDP. The government controls the price of diesel and compensates sellers for their losses. But, for the first time in years, sellers are making a profit. As in China, cheaper oil should reduce the pain of cutting subsidies—and on October 19th Narendra Modi, India’s prime minister, said he would finally end diesel subsidies, free diesel prices and raise natural-gas prices.

The International Energy Agency, an oil consumers’ club, reckons that the global cost of subsidising energy consumption (mostly in developing countries) is $550 billion a year. The fall in the oil price should reduce that, all else being equal, to about $400 billion. That means many countries face a choice: seize the moment to dismantle subsidies, or keep on handing out goodies that now cost less? Either way, they will benefit—by ending an economic distortion (though with some risk of a consumer backlash), or by reducing its fiscal cost for a while.

The choice is particularly stark for oil importers in the Middle East (see chart). Energy subsidies cost Egypt 6.5% of GDP in 2014, Jordan 4.5%, and Morocco and Tunisia 3-4%. A 20% fall in the oil price would improve the fiscal balances of Egypt and Jordan by almost 1% of GDP, says the IMF. But, fears Mr Baffes, the efficiency gains may not be enough to persuade regimes, especially shaky ones, to cut subsidies that mostly benefit the politically influential middle classes.

Many other countries are also wrestling with energy subsidies. Indonesia spends about a fifth of its budget on them. Gulf oil exporters are even more profligate: Bahrain spends 12.5% of GDP and Kuwait, 9%. Brazil wants a high oil price to attract investment to its ultra-deep offshore (pré-sal) oil reserves. But cheap oil is a boon to its farmers, and in the short term to Petrobras, its state-controlled oil firm, which has been forced to import at world prices and sell at a government-capped rate in order to keep inflation artificially low. For the first time in years, it is no longer making a loss on the imports it sells.

It might seem that the country which is the world’s largest exporter must lose out. With oil at $115 a barrel, Saudi Arabia earns $360 billion in net exports a year; at $85, $270 billion. Its budget has almost certainly gone into the red. Prince Alwaleed bin Talal, an influential businessman, called lower prices a “catastrophe” and expressed astonishment that the government was not trying to push them back up. But Saudi Arabia’s long-term interest may in fact be served by a period of cheaper oil.

It can afford one, unlike most other exporters. Though public spending has risen in recent years, its foreign reserves have risen more. Net foreign assets were 2.8 trillion riyals ($737 billion) in August—over three years’ current spending. It could finance decades of deficits by borrowing from itself even if oil were cheaper than it is now.

Over the past year production by non-OPEC countries, such as Russia and America, has risen from 55m b/d to 57m b/d. The Saudis might conclude that the main beneficiaries of dear oil have been non-OPEC members. Some of the new output is high-cost, unlike the Saudis’. A period of cheaper oil could drive some high-cost operators to the wall, discourage investment in others and let the Saudis regain market share.

In the mid-1980s Saudi Arabia cut its output by almost three-quarters in an attempt to sustain prices. It worked and other countries cashed in—but the Saudis themselves suffered a big loss of revenues and markets. They see little reason to make such a sacrifice again.

Blowing windfalls

Saudi Arabia can survive low prices because, when oil was $100 a barrel, it saved more of the windfall than it spent. The biggest losers are countries that didn’t. Notable among these are three vitriolic critics of America: Venezuela, Iran and Russia.

“However low the oil price falls,” Nicolás Maduro, Venezuela’s president, declared on October 16th, “we will always guarantee...the social rights of our people.” The reality is quite different. Hugo Chávez, his predecessor, dismantled a fund intended to squirrel away windfall oil profits, spent the money and ran up tens of billions of dollars in debt. That debt is now coming due. Earlier this month a hefty service payment took Venezuela’s foreign reserves below $20 billion for the first time in a decade. Every dollar off the price of a barrel cuts roughly $450m-500m off export earnings. By Deutsche Bank’s calculation, the government needs oil at $120 a barrel to finance its spending plans—higher than before the recent tumble.

So, unlike other oil exporters’ budgets, Venezuela’s was already in trouble. Last year’s fiscal deficit was a reckless 17% of GDP. In response, the government printed bolívares, pushing inflation (even on official measures) over 60%. Industrial production is grinding to a halt and Standard & Poor’s, a ratings agency, downgraded Venezuela’s debt to CCC+ last month. Analysts have long thought it would move heaven and earth to avoid default—not least because it has overseas assets that creditors could seize and depends heavily on financial markets. But the “d” word is increasingly often heard.

The impact of Venezuela’s oil-related travails may be felt beyond its borders. The country runs a programme called PetroCaribe, which provides countries in the Caribbean with cheap financing to buy Venezuelan oil. For Guyana, Haiti, Jamaica and Nicaragua annual deferred payments under PetroCaribe are worth around 4% of GDP. But it costs Venezuela’s government $2.3 billion a year. So if Venezuela decides to cut back on its largesse, the shock waves will be felt throughout the Caribbean.

Iran is even more vulnerable than Venezuela. It needs oil at $136 a barrel to finance its spending plans, most of them inherited from the profligate and inefficient government of Mahmoud Ahmadinejad. Last year it spent $100 billion on consumer subsidies, about 25% of GDP. Sanctions mean it cannot borrow its way out of trouble.

Hassan Rouhani, who took office last year, has re-established a degree of macroeconomic stability. The central bank said the economy grew in the second quarter of 2014 for the first time in two years. But he was elected on the promise of improving living standards. It is not yet clear whether lower oil prices will force further reforms, and increase pressure for a deal with America over Iran’s nuclear programme, or whether falling revenues will boost support for conservatives who are already making trouble for him.

For Russia the impact will be less dramatic, at least at first. Its draft budget for 2015 assumes oil at $100 a barrel; below that, it will be harder for Vladimir Putin, the president, to keep his spending promises. Something similar happened when the oil price fell in the mid-1980s, leaving the indebted Soviet Union cash-strapped.

But Russia now has reserves of $454 billion to cushion against oil-price fluctuations. More important, the rouble has fallen. Next year’s budget assumes a dollar is worth 37 roubles, so it balances with oil at 3,700 roubles. A barrel currently costs 3,600 roubles (a much smaller fall than the dollar price), because the currency has plunged 20% this year. With oil at $80-85 a barrel Russia would probably run a budget deficit of only about 1% of GDP next year.

All the same, the country will suffer a slowdown. For years, real incomes rose, thanks to wage increases in the state sector. The increased spending went on imports made cheaper by a strong currency. So the slide in the rouble is cutting living standards by making imports dearer. Western sanctions have closed capital markets to Russian firms, even private ones.

Business activity is waning. A senior finance-ministry official says the share of non-oil-and-gas revenues in the budget is shrinking, making Russia more dependent on oil. Some analysts think growth in 2015 will be just 0.5-2%, compared with about 4% a year in 2010-12. Inflation is 8%. Russia, it seems, is headed towards stagflation.

For most governments—Venezuela’s is a possible exception—cheaper oil is likely to have a modest impact at first. Even Mr Putin may be able to ride out stagflation for a while. But over time, the consequences are likely to grow. The years of $100-a-barrel oil also saw the rise of a “Beijing consensus” towards more economic interventionism. Perhaps a period of $85 oil—if that were to happen—might usher in another shift in attitudes, assumptions and policies.

Corrections: In an earlier version of this article we said that the oil price has fallen from $115 a barrel in mid-July. We should have said mid-June. This was corrected on October 23rd 2014. We also said that a $20 drop in the world oil price reduces American producers' profits by 20%. We should have said "earnings before interest". This was corrected on October 28th 2014. Sorry.

How  $50 Oil  Changes  Almost  Everything
By Isaac Arnsdorf and Simon Kennedy

The plummeting price of oil means no more trout ice cream.
Coromoto, a parlor in Merida, Venezuela, famous for its 900 flavors, closed during its busiest season in November because of a milk shortage caused by the country’s 64 percent inflation rate, the world’s fastest.
That’s the plight of an oil-producing nation. At the same time, consuming countries like the U.S. are taking advantage. Trucks, which burn more gasoline, outsold cars in December by the most since 2005, according to data from Ward’s Automotive Group.
The biggest collapse in energy prices since the 2008 global recession is shifting wealth and power from autocratic petro-states to industrialized consumers, which could make the world safer, according to a Berenberg Bank AG report. Surging U.S. shale supply, weakening Asian and European demand and a stronger dollar are pushing oil past threshold after threshold to a five-and-half-year low, with a dip below $40 a barrel “not out of the question,” said Rob Haworth, a Seattle-based senior investment strategist at U.S. Bank Wealth Management, which oversees about $120 billion.
“Oil prices are the big story for 2015,” said Kenneth Rogoff, a Harvard University economics professor. “They are a once-in-a-generation shock and will have huge reverberations.”

Weak Prices

Brent crude, the international benchmark, fell as low as $49.66 a barrel today, dropping below $50 for first time since 2009. Prices dropped 48 percent in 2014 after three years of the highest average prices in history. West Texas Intermediate, the U.S. benchmark, plunged to as low as $46.83 today, about a 56 percent decline from its June high.
“We see prices remaining weak for the whole of the first half” of 2015, said Gareth Lewis-Davies, an analyst at BNP Paribas in London.
If the price falls past $39 a barrel, we could see it go as low as $30 a barrel, said Walter Zimmerman, chief technical strategist for United-ICAP in Jersey City, New Jersey, who projected the 2014 drop.
“Where prices bottom will be based on an emotional decision,” Zimmerman said. “It won’t be based on the supply-demand fundamentals, so it’s guaranteed to be overdone to the downside.”
The biggest winner would be the Philippines, whose economic growth would accelerate to 7.6 percent on average over the next two years if oil fell to $40, while Russia would contract 2.5 percent over the same period, according to an Oxford Economics Ltd.’s December analysis of 45 national economies.

Inflation Outlook

Among advanced economies, Hong Kong is the biggest winner, while Saudi Arabia, Russia and the United Arab Emirates fare the worst, according to Oxford Economics.
One concern of central bankers is the effect of falling oil prices on inflation. If crude remains below $60 per barrel this quarter, global inflation will reach levels not seen since the worldwide recession ended in 2009, according to JP Morgan Securities LLC economists led by Bruce Kasman in New York.
Kasman and his team are already predicting global inflation to reach 1.5 percent in the first half of this year, while sustained weakness in oil suggest a decline to 1 percent, they said.

Negative Inflation

The euro area would probably witness negative inflation, while rates in the U.S., U.K. and Japanalso would weaken to about 0.5 percent. For what it calls price stability, the Federal Reserve’s inflation target is 2 percent. Emerging-market inflation would also fade although lower currencies and policies aimed at slowing the effects on retail prices may limit the fall.
As for growth, a long-lasting price of $60 would add 0.5 percentage point to global gross domestic product, they estimate.
Even as cheaper fuel stimulates the global economy, it could aggravate political tension by squeezing government revenue and social benefits, Citigroup Inc. analysts said in a Jan. 5 report.
Either way, previously unthinkable events now look more likely. Byron Wien, a Blackstone Group LP vice chairman, predicting that Russian President Vladimir Putin will resign in 2015 and Iran will agree to stop its nuclear program.

Iran Losses

Iran is already missing tens of billions of dollars in oil revenue due to Western sanctions and years of economic mismanagement under former President Mahmoud Ahmadinejad.
President Hassan Rouhani, elected on a pledge of prosperity to be achieved by ending Iran’s global isolation, is facing a falling stock market and weakening currency. Iranian officials are warning of spending and investment cuts in next year’s budget, which will be based on $72-a-barrel crude. Even that forecast is proving too optimistic.
“Iran will stumble along with less growth and development,” said Djavad Salehi-Isfahani, a professor of economics at Virginia Tech in Blacksburg, Virginia, who specializes in Iran’s economy. “The oil price fall is not reason enough for Iran to compromise.”
The Russian economy may shrink 4.7 percent this year if oil averages $60 a barrel under a “stress scenario,” the central bank said in December. The plunge in crude prices prompted a selloff in the ruble with the Russian currency falling to a record low against the dollar last month and tumbling 46 percent last year, its worst performance since 1998, when Russia defaulted on local debt.

Russian Production

“The risk is that, as a badly-wounded and cornered bear, Russia may turn more aggressive in its increasing desperation, threatening global peace and the European economic outlook,” said Holger Schmieding, Berenberg Bank’s London-based chief economist. However, “the massive blow to Russia’s economic capabilities should –- over time –- make it less likely that Russia will wage another war.”
Russian oil production rose to a post-Soviet record last month, showing how pumping of the nation’s biggest source of revenue has so far been unaffected by U.S. and European sanctions or a price collapse. The nation increased output to 10.667 million barrels a day, according to preliminary data from the Energy Ministry on Jan. 2. That compares with global consumption of 93.3 million barrels a day, based on the International Energy Agency’s estimate for 2015.
Venezuela, which relies on oil for 95 percent of its export revenue, risks insolvency, Jefferies LLC said in a Jan. 6 note. The cost of insuring the country’s five-year debt has tripled since July, Citigroup said. President Nicolas Maduro is visiting China to discuss financing and expects to travel to other OPEC nations to work out a pricing strategy.

Confounding Investors

The U.S., still a net oil importer, would accelerate economic growth to 3.8 percent in the next two years with oil at $40 a barrel, compared with 3 percent at $84, the Oxford Economics study found. The boost to consumers could be offset by oil companies’ scaling back investments, according to Kate Moore, chief investment strategist at JPMorgan Private Bank. Producers are cutting spending by 20 percent to 40 percent, according to Fadel Gheit, an analyst at Oppenheimer & Co.
The mixed picture is confounding investors. The Standard & Poor’s 500 Index of U.S. equities fell 1.9 percent on Jan. 5, the biggest decline since October, as oil brought down energy shares and stoked concerns that global growth is slowing.
While cheaper oil helps consumers, business spending has a bigger effect on equities, and oil companies are set to cut investments. Oil at $50 a barrel could trim $6 a share off earnings in the S&P 500 Index this year, according to Savita Subramanian and Dan Suzuki, New York-based strategists at Bank of America Corp.
Bets on high energy prices have mashed share prices of companies such as Ford Motor Co., Tesla Motors Inc. and Boeing Co.

Redistributes Income

Fifth Third Bancorp (FITB), one of the regional lenders that tried to chase the fracking boom, is down 12 percent since June 20.
Caterpillar Inc., Joy Global Inc., Allegheny Technologies Inc., Dover Corp., Jacobs Engineering Group and Quanta Services Inc. are all down more than 20 percent since oil peaked at almost $108.
Despite those losses, Morgan Stanley last month concluded cheaper fuel is a net benefit for the U.S. economy.
“Any massive redistribution of income can raise political tensions,” Schmieding of Berenberg Bank said in the Jan. 6 report. “But, net/net, strengthening the U.S., Europe, Japan, China and India, while weakening Russia, Iran, Saudi Arabia and Venezuela, is likely to make the world a safer place in the end.”
Brent traded at $50.88 a barrel and WTI at $48.03 as of 12:03 p.m. London time.
To contact the reporters on this story: Isaac Arnsdorf in New York at; Simon Kennedy in London at
To contact the editors responsible for this story: Bob Ivry at Bruce Stanley, Rachel Graham

Plunging oil prices won't solve China's economic problems
By Sophia Yan

Tracking oil's fall across four countries


Falling oil prices are typically seen as great news for major energy importers, but even rock-bottom prices won't be enough to lift China's economy out of its current malaise.

China is the world's largest net importer of oil, and plunging crude prices should cut costs for consumers and businesses. It is also expected to help keep inflation under control and give China's central bank room to lower interest rates.
"The sharp reduction in world oil prices will help to provide a stimulus to Chinese GDP growth in 2015 and reduce China's oil import bill, boosting Chinese net exports," wrote IHS Asia-Pacific chief economist Rajiv Biswas in a research note.
Lower crude prices may also give the central government greater flexibility to pursue fiscal, financial, land and household registration reforms, according to a report by Bank of America Merrill Lynch.
But China is facing a bevy of longstanding economic risks, such as escalating debt levels and a waning property market, that are likely to overshadow gains from lower oil prices. Recent corporate defaults in the real estate sector have only added to concerns.
Analysts say relief will be temporary and a major boost to China's GDP is unlikely. Economists surveyed by CNNMoney are expecting a ho-hum fourth quarter to round out the year, and growth in 2015 is expected to slow further to around 7%.
"Given no evidence of a sharp and sustained improvement in demand growth on the horizon, the boost from lower oil prices will be washed out by the many persistent and growing challenges China faces," said IHS China economist Brian Jackson.
Overall, Asia remains the biggest global winner as oil prices continue to tumble. The slump in prices represents an estimated transfer of around $1.5 trillion from global oil producers to oil importing countries, according to IHS.
South Korea is getting the largest boost to its economy, followed by Thailand and the Philippines, according to Bank of America Merrill Lynch.

Tuesday, January 6, 2015

To Increase Your Organization’s Impact, Work With People Who Reflect Your Values

Carrie Rich
Carrie Rich

As consumers, we constantly make purchasing decisions that express our values. A consumer seeking to live a healthy lifestyle might buy organic produce; a consumer conscious of her carbon footprint might purchase a Prius.
Leading an organization provides similar opportunities to invest in our values, especially when it comes to the colleagues with whom we choose to surround ourselves.
Employees, volunteers, and contractors all play crucial roles in the growth of any organization. Indeed, the people on your extended team are as important — if not more important — than your organization’s mission and brand. They are the face of the organization, and ultimately their actions and creativity define your brand and activate your mission.

So how do you ensure your team reflects what your organization is all about? Here are some tips to consider:

Understand where they are coming from

Working with people who reflect and believe in the values of your organization doesn’t happen by accident. It requires being clear about who you want to work with and why you want to work with them. And it also requires you to understand what motivates an individual to want to work for your organization. What is it about the organization that resonates with him/her? Why do they think they would be a good fit for your team? How will they provide value to the team? The more carefully you consider these questions as you are interviewing, be it a potential new hire, a contractor, or a volunteer, the more confidence you will have in your final decision.

Highlight the mutual benefits of the relationship

Aside from the benefit of adding individuals to your team who have the skills to help your organization grow and thrive, you should make a point of letting viable job candidates know how working with and for you will help them grow. There is a give/get in any successful relationship, and it is your job to make sure every qualified job candidate, contractor, and volunteer understands the unique value proposition your organization is able to offer.At the Global Good Fund, our mission is to accelerate the leadership development of young social entrepreneurs. While our flagship program is a fifteen-month fellowship experience, our efforts don’t stop there. We go to great lengths to coach and mentor our colleagues, contractors, and volunteers, with the aim of helping them achieve their full leadership potential. In fact, over the last sixteen months we have played a pivotal role in helping launch twelve social enterprises led by volunteers or contractors who were previously engaged in helping the Global Good Fund fulfill its mission.

Seek out people who can inspire current team members

In the social good space, many volunteers and contractors will want to work for your organization because they are inspired by the work you do and the impact you have in the community; these individuals want to serve a higher purpose by helping grow your social enterprise. But as much as you want to seek out (and work with) individuals who are inspired by your work, you also want to make sure these individuals have the ability to inspire your team. For the Global Good Fund, that means contractors and volunteers often teach staff or contribute content expertise that we lack. In addition, contractors and volunteers are encouraged to share their aspirations and struggles with employees. In turn, everyone in our organization is motivated to contribute to the personal and professional growth of all team members, not just full-time staff, and that culture of sharing reinforces our mission and organizational values.

Work with your constituents

The best way to ensure that your team reflects and believes in your organization’s mission is to recruit individuals who share the values of your constituents.
When seeking to hire a contractor, for instance, we look for individuals who meet the same criteria as our fellows: dedicated to positive social impact, “cutting edge” in how they approach social entrepreneurship, and still in the early stages of their entrepreneurial careers (typically under the age of 40).
Partners who share the values of the people you serve are much more likely to be passionate about the programs you run and/or the impact you are trying to create. You won’t have to worry about calling or emailing them on weekends or at 9:00 on a weeknight because they not only value their relationship with your organization, they value the thing you are doing or building. And because they are already aligned with your values, they will be able to speak to your constituents on a more authentic level and are likely to be your best brand advocates.
To some extent, we all have the ability to choose the people we work with. Our values are our compass, and if that compass begins to show we have lost our way, we can course correct – by asking for a new assignment, by explaining to the people we work with why our values are important, or by moving to a new organization that more closely reflects our values. In the final analysis, it’s all about knowing who we are, what we believe in, and being intentional about finding and creating a team that shares those beliefs.
The above post by Carrie Rich, co-founder and CEO of the Global Good Fund, an enterprise dedicated to investing in the leadership development of  young entrepreneurs committed to social impact, originally appeared on PhilanTopic a blog of opinion and commentary published by Philanthropy News Digest . To read the original, click here

Bad Service = Bad Brand; Salah siapa?


Coba ingat kapan terakhir kali kita mendapatkan pelayanan buruk. Bisa di restoran, dept store, coffee shop, butik, gym, bengkel, car wash, hotel, dan lainnya. Ini sangat menjengkelkan karena harga yang kita bayar tidak sama dengan pelayanan yang kita terima.
Sering kita menyalahkan sang pemberi layanan. Mas atau mbak nya. Ada juga yang minta untuk bicara langsung dengan atasannya. Ada juga yang diam seribu bahasa, tapi memberikan review negatif yang bertubi-tubi di social media dan seluruh teman/keluarganya. These are very bad for a business. Super Bad for the brand.
Mari kita balik situasinya. Tempatkan diri sebagai pemilik usaha. Pemilik brand. Suasana yang kita inginkan adalah saat customers datang dan membeli jasa atau barang kita, sambil riang gembira. Padahal ngeluarin duit. Pemilik usaha seharusnya sudah tahu cara membuat customer puas. Paling tidak instingnya untuk memuaskan pelanggan sudah jalan, karena tahu benar bahwa bila tidak ada pelanggan yang beli, ya duitngga ada yang masuk!
Dengan asumsi bahwa produk atau jasa yang dijual kualitasnya sama, jenisnya sama, harga sama, packaging-nya, dan lainnya kurang lebih 11-12, faktor customer service sangat menentukan kesuksesan brand.
Nah, customer service harus berangkat dari customer experienceExperience tersebut perjalanannya panjang, bisa berbulan-bulan, bahkan tahunan. Seorang anak kecil yang terkesima dengan deru mesin motor Harley Davidson yang lewat di depan sekolahnya mungkin baru bisa membeli sendiri satu unit untuknya di umur 45 tahun. Ngilernya puluhan tahun.
Kembali ke frontliner yang mengesalkan, perlu diingat bahwa kebanyakan frontliner, contohnya dalam profesi pramuniaga, bukan merupakan customer asli dari brand yang mereka jual. They just work there. Kebanyakan tidak tahu customer journey seperti apa yang dilalui untuk akhirnya sampai di toko. Mengetahui, menghafal, dan menghayati product knowledge tentu penting, namun perlu juga menghayati sudut pandang customer.
Inilah pentingnya training yang mumpuni. Selain pelatihan SOP yang basic, perlu ada training lanjutan. Pemilik brand yang sekaligus pemilik usaha harus melakukan ini agar brand nya berkembang dan sustainable.
On the other hand, beberapa tipe pekerja memang “gemar” pindah sana sini. Employer pun sebal karena telah investasi uang dan waktu memberikan training tapi pekerja pindah ke tempat lain (bahkan ke kompetitor). Tapi mungkin saja sang pekerja tidak “nyaman” bekerja di tempat tersebut.
Salah siapa? Bisa salah banyak pihak. Agar lebih aman, brand (employer) harus punya HR team yang hebat dan berpikir secara brand agar persoalan bad service = bad brand ini bisa diminimalisasi.
Yasha Chatab
Group Business Development Director
WIR Group Indonesia
Twitter : @MrYasha

Sunday, January 4, 2015

CAREERS: A Former CIA Agent Explains How To Advance Your Career Like A Spy

In order to survive, spies have to be really good at their jobs. 
They have to gain their opponent's trust and respond to a crisis quickly. 
In the book "Work Like a Spy: Business Tips from a Former CIA Officer," J.C. Carleson writes about her experience as an undercover agent for the Central Intelligence Agency and the business and career tips she gained during those eight years.
From her experience, we compiled nine career tips that can help any employee reach the top of their professional game - and survive.

Study your industry and look for trends and connections in the field.

"You may diligently read all of the business journals, faithfully study your industry's breaking news, be able to recite from memory your competition's last SEC filing, and still be missing the whole picture."
Basically, you need to gain as much knowledge as possible in your industry and see how everything connects with one another.
Look for trends and try to predict what will happen in the future for your industry. This will help you become an expert in your field.

Create a "hook" when networking.

"CIA officers spend a great deal of time formulating personalized hooks for their targets. A proper hook contains three elements:
  • A reason to meet once.
  • A reason to connect.
  • A reason to continue to meet.
"A good hook allows a case officer to establish a mutually beneficial relationship quickly - even if this relationship is based on deception."
Similar to a CIA agent, if you want to meet someone in your industry, find a reason for them to want to take the time out to meet you. What can you offer them? Always approach the relationship with what you can do for them before asking for favors.

Keep your guard up when other people are being nice to you.

"Your cubicle neighbor may suddenly be chattier than usual because he is competing with you for a promotion."
Carleson says you should never let your guard down and you should always know why someone is being nice to you - even if you are familiar with them.
In fact, "your most talented, hardest-working, most gregarious, best-liked co-workers are your biggest threats. That might sound a bit nasty, but he fact of the matter is, you are constantly being compared to your colleagues when it comes to decisions about promotions, bonuses, or career-enhancing opportunities." 

Don't share too much information during the job interview. 

"It may seem tempting to share information in order to prove your knowledge during a job interview with a competitor's company, but a reputable company should be more interested in learning about you than your previous employer."

Know that high achievers are difficult to manage. 

"The highest achiever can also be the most difficult to manage. For better or worse, they have the confidence to stand up to authority, the intelligence to debate, and the bravery to defy - all of which can amount to a serious management challenge."

Don't force people who work best alone to work in groups.

"...[Don't] force collaboration onto talented individuals who are superstars in their own right but don't necessarily work well with others. Some people thrive on team participation, out-of-specialty rotational assignments, and constant developmental opportunities. Other people do their jobs well and just want to be left alone to do what they were hired for."

Some people might be brilliant at their jobs, but would be "disastrous managers" and "a thoroughly unpleasant team member," and in this case, Carleson says you should keep them if they're brilliant, but promote them "over the course of the years on the basis of his solo work and left alone to achieve his results."

Analyze your own weaknesses.

"Not even the best actors are infinitely versatile when it comes to playing a role. You can be as observant, responsive, and flexible as humanly possible, but there are always going to be situations in which you are, by nature of your appearance, your personality, or any other immutable characteristic, at a disadvantage."
You need to know how other people perceive you and how you tick them off. Then, you need to narrow down any commonalities to identify your weaknesses. Be aware of them when you're doing business with someone new.

Know other people's weaknesses. 

You need to know everyone's weaknesses and vulnerabilities if you're doing business with them. You should have a good idea of their background and even their competitor's background.

Follow through on both your promises and your threats.

"Whether you have made promises or threats, follow through. You may be back at the negotiating table sooner than you think; a reputation for bluffing will not serve you well."
If you're threatening to leave your employer so that they'll offer you a raise, you need to be prepared to do so if they aren't willing to give you what you want.
This post was originally written by Vivian Giang.