Monday, March 29, 2010

Moffat Pleads Guilty

With his guilty plea today in the Galleon insider trading case, Bob Moffat now faces up to six months in jail.

According to the New York Times, Moffat admitted to providing material non-public information to Danielle Chiesi, consultant at Bear Stearns, about AMD, Lenovo, and IBM. In his statement today in court, Moffat said that he knew what he did was wrong. He also acknowledged that he breached his duty of confidentiality with IBM. Moffat is not cooperating with the prosecution.

A hearing is schedule for July 26th.

What's the verdict here? Has justice been served?

Thursday, March 25, 2010

Breaking Down Healthcare Reform

After watching NCAA basketball all day Sunday I know what you did. You tuned to CNN to watch the votes on the health care bill, right? Okay, neither did I. But I did wake up Monday morning to the news that the bill had passed. On Tuesday, President Obama signed the Affordable Health Care for America Act into law.

I’m not quite sure how I feel about this.

The New York Times describes this bill as the most sweeping social legislation enacted in decades. Yes, I can agree with that statement. But does it accomplish what we need it to? I have maintained that the problem with health care is about both coverage and cost.

Let’s take a look first at coverage:

I think there’s some good news here. In January I wrote about my concern about continuing medical coverage for my son graduating from college. The Health Care Reform bill does address this concern. Instead of coverage to age 23 if the child is a fulltime student, young adults will now be eligible for coverage under their parent’s policy until the age of 26. It’s no longer necessary to be a student to qualify, but this does help the case for students going on to graduate school, as well as those who don’t yet have their own coverage through an employer.

Insurance companies will no longer be able to exclude those with pre-existing conditions from coverage. Nor will they be able to drop coverage for those who get sick. This is a big win. After all, what is the point of having health insurance all your life if you can’t get medical care once you get sick?

Everyone will be required to have coverage… sort of. For the record, I am in favor of this. We need everyone in the coverage pool to have any chance of costs coming down. But, the penalties for not having coverage may not be compelling enough to ensure compliance. The fine for not having coverage will start at $95 per year (or 1% of income) in 2014, and will increase to $695 (or 2.5% of income) in 2016. Low income families (with subsidized insurance) will need to spend up to 2% of their income for insurance premiums. But middle income families with an annual income of $88,200 will need to spend up to 9.5% ($8400) of their income on insurance premiums. For many, the penalty will cost less than the cure.

Everyone who would like to have health insurance, will be able to. The bill will help those currently uninsured, and those with chronic and critical medical conditions. CBS MoneyWatch has more details on who gains and who loses.

So how are we going to pay for this?

In theory, taxing individuals and families making more than $200,000 and $250,000 per year, respectively, will pay for the expanded coverage. They will pay an additional 0.9% in Medicare tax, and a proposed (additional) 3.8% tax on unearned income (including interest, dividends and capital gains). Yes, we are taxing the rich to cover the poor. Or, some may prefer to look at this the way this New York Times article does, as an attack on economic inequality.

And in theory, the new taxes will outweigh the costs. In theory.

But now let’s get to the elephant in the room – the rapidly rise cost of care.

Aside from a provision that will require new plans to offer basic preventive care, nothing has been done to address the fact that we are sicker than ever before. And yes, we love the fact that we have better technology, and better techniques, and drugs that can work wonders. Sure, the doughnut hole (which leaves seniors without prescription coverage after they spend $2830 on drugs but before they reach their annual out-of-pocket cost of $4550) will be phased out (starting with a $250 rebate in 2010). But let’s stop and ask why we need to spend so much on prescription drugs? How about incentives to stay healthy? How about incentives to eat better, exercise more, lose weight?

And dare I mention the costs associated with medical lawsuits and malpractice insurance? What about medical malpractice reform?

I’m happy that we’ve taken steps to expand coverage. Fundamentally, I do believe that everyone should have access to medical care. But our medical insurance premiums today are already way too expensive, and I continue to be concerned about costs.

What do you think? Do the positives of the bill outweigh the negatives?

Wednesday, March 24, 2010

Galleon Watch – Moffat to Plead Guilty

News sources including the New York Times are reporting that Bob Moffat, former senior VP at IBM, is expected to plead guilty in the Galleon insider trading case.

It’s been nearly six months since the first arrests in the case were made. Of those six, only Raj Rajaratnam and Danielle Chiesi have entered ‘not guilty’ pleas. According to Bloomberg.com, Moffat has agreed to waive indictment and is expected to be the 11th of the 21 charged to plead guilty. It is not yet clear whether he will cooperate with the prosecution.

Moffat has previously maintained that he did nothing wrong.

A hearing is set for Monday.

You can catch up on earlier Galleon updates here.

Friday, March 19, 2010

A New Kind of Collaboration

What I am going to say today may seem a little out of character. (Blame it on the weather and being cooped up inside too long.) Here goes:

Corporate America needs to get with it and more effectively use social media.

Okay, I can hear you grumbling, “What is she talking about?” I’m talking about being able to reach the masses. I’m talking about building mindshare. I’m talking about leveraging the knowledge of both employees and clients, and competitor’s clients, and even people who don’t yet know they will be your client someday, to help you build a better product, market more effectively, and even reach new markets.

In his bestselling book The Wisdom of Crowds, James Surowiecki describes a new kind of collaboration – one where a crowd's "collective intelligence" will produce better outcomes than a small group of experts.

Consider this proof point:

SRMedia Digital Publishing recently ran their sixth annual Beat the Crowd Oscar prediction contest. Of the 318 participants, only 30 had more correct predictions that the collective wisdom of the crowd. (I scored a measly 11 out of 24.) The collective group correctly predicted 17 out of 24 Oscar winners. Interesting, right?

How should companies reach new constituents and build their collectives? One tool they need to add to their kit bag is social media.

We can all find many examples of small companies and companies that grew up on the internet that are very effectively leveraging social media. After all, they have to be nimble and adaptive to survive. But does this really apply to big corporations?

I will admit that as a marketing executive in a big corporation I would have argued that the people who buy things like say – mainframes – aren’t in the blogosphere. But is that really true? This may sound almost blasphemous coming from someone who practically bleeds blue, but this blogging/twittering/linked-in convert is predicting that if large corporations don’t start effectively leveraging social media, soon they will be left in the dust. Why? Because the people who are going to buy their products five years from now will have formed their collectives elsewhere.

What do you think about collaboration via social media? What do you think about the wisdom of the collective? Do you have an example of where this is working effectively?

Friday, March 12, 2010

Is One Enough?

Now that Kathryn Bigelow has a Best Director Oscar to place on her mantle, it seems everyone is talking about the glass ceiling again. Bigelow has attained the top achievement and broken through the glass ceiling.

Or has she? Consider this:


Is a proof point of one enough to declare success? Why did it take so long? And did Bigelow have to work harder for this achievement than her male peers?

Let’s contrast her Oscar win for directing Hurt Locker at the age of 58 (after 27 years making films) with her ex-husband James Cameron’s Best Director Oscar for the movie Titanic in 1997 at the age of 43.

Certainly this is a huge success, and in no way do I want to downplay that. Bigelow worked her butt off to get that award. She deserves it. But Bigelow’s success is merely a crack in the ceiling, albeit an important crack. Someone has to be first.

I think we’ll know when the glass ceiling has been shattered when the news articles are titled “Bigelow wins Best Director” instead of “Bigelow Breaks the Glass Ceiling”, or “First Female Best Director Oscar Winner”, or even “Oscar winner Kathryn Bigelow is no longer just James Cameron's ex-wife”.

Let’s hope it doesn’t take another 82 years for another woman to win. What do you think?

Friday, March 5, 2010

Jobs We Shouldn’t Accept

If you’ve worked for the same company in Corporate America for more than four or five years, chances are that you have had more than one job in that company. Sometimes you even have the opportunity to make a decision whether or not to accept those new jobs.

During my corporate career I was lucky in that most of the jobs I chose were indeed a good choice, but there are a couple that stand out – because they were the wrong choice. The first of these happened about 10 years into my career. A new organization was being formed, and the management team asked for volunteers. The job was exciting.

It seemed like a good idea.

During the interview I realized that the new manager of this team and I would not see eye to eye. He was from a field organization and knew nothing about a lab environment. I could see that he wanted to be very hands on – not a quality I preferred in my managers. But I was sure he’d soon recognize my value and let me have some autonomy.

I was wrong.

I took the job … and I was miserable. I couldn’t wait to move on, but I learned a valuable lesson. I vowed never to take another job where I didn’t think I could successfully work for the direct manager of the team.

We can’t always pick our jobs or our bosses, but when I could, I made sure to interview the manager at the same time as they interviewed me. I did my own research on the manager – checking with prior employees and asking questions before accepting a job. This strategy worked well – until two decades later. I forgot my own advice and quickly accepted a new job.

I actively pursued this job. It was a job that appeared to be tailor made for me, and in an organization that I considered ‘home’. I asked questions about the manager after I accepted the job – and I got an earful. People who had worked with my new manager had a lot to say – none of it positive. I reasoned that it couldn’t possibly be that bad. It might be a challenge, but I could handle it.

I was wrong. Again.

So what did I learn? Never ever take a job where you don’t think you can successfully work with your immediate manager. Never. Ever.

What was the job you shouldn’t have accepted? And why was it the wrong choice for you?