1. The May 2015 issue of Fast Company profile's Disney's attempt to completely reinvent the guest experience at their theme parks. The initiative was 'green lit' in February 2011 and was centered around the use of technology, specifically the park wristbands as a part of the MyMagic+ project.
The project started out as a grand vision of using the wrist band to not only get a fast pass to the best rides but create a digital infrastructure that allowed all park employees to create a tailored experience for each individual guest. However after many setbacks along the way it has found only limited usage and primarily as to buy things at the park.
The article chronicles the political struggles inside Disney that challenged the project's original vision and has ultimately prevented the project team from getting the types of ROI that were possible. Some of the quotes from the article that highlight these political struggles include:
"Franklin managed to get some teams to collaborate well on the project, but most describe the internal politics as fierce."
"Other divisions expressed themselves passive-aggressively. "They might see a problem coming, but they don't do anything about it, like, 'Let them figure it out!' says a former Disney manager. 'Then, late in the game, these folks came in going. We knew this was going to be a problem.' We were like Really? Where have you been for the last three and a half years?!?"
"The endless finger pointing and glory hogging slowed the ambitious project. "Almost half the work was to support a political situation," says one executive at an NGE partner company. "At the beginning, we could move really rapidly, but when it got public within Disney, it changed the way we worked. It became more about fighting to survive another day."Reading these quotes bring to mind my experiences as a business sponsor for a large multi-year, multi-million $ project that I lead a few years ago. I am sure my experiences and Disney's are not isolated examples and the role that politics plays in creating an organization that is driven by fear is universal.
2. There was an article from the Wall Street Journal last week regarding the cost of bank regulation and its impact on the industry. The thesis of the article is that no one has stopped to study the impact of increasing amounts of regulation on the banking industry as the inertia of regulation rules the day.
The article included the chart above which indicates only 4 new bank charters have been created since 2011, after the Dodd-Frank regulation went into full effect.
Having spent years either in banking or serving the banking industry I have had an appreciation for the levels of fear regarding regulation and regulators but the thaw in dynamism of such a critical industry took me by surprise.
Unfortunately we are no where near the end of the impact that regulatory fear will have on this industry. As the article says,
"The costs of financial regulation go beyond what banks and their shareholders must pay for more compliance personnel. By making credit more expensive and restricting its supply, new regulations can ding growth."
3. Lastly, one more recent article from the Wall Street Journal entitled "Outside auditors get asked in" that I am all too familiar with.
The article profiles the recent hiring by Lumber Liquidators of a former audit partner as their new CFO. While not against SEC rules since the hiring was outside the 18 month rule (meaning he hadn't worked directly on their audit in over 18 months), the article talks about the cozy relationship it creates when firms hire members of their audit teams to serve in high profile financial positions.
According to the article from 1985 - 2002 over 6% of public companies had hired a former auditor into CFO or senior accounting type roles. My experience at a past employer included a CFO, Treasurer, Assistant Treasurer and Chief Audit Executive all formerly of that company's outside auditors.
At Corporate Bravery we talk often about the role outside auditors have in creating a culture of fear and while cozy relationships may not sound like a fear inducing cultural aspect it likely leads to additional work by these outside advisors over time and a strengthening of the power influence of those former auditors within the organization. This is supported by the following quote from a professor at UC Berkley quoted in the article,
"The only reason outside auditors exists is because they are independent of management," added Don Moore. "Every auditor has to make lots of subjective calls, and when it is your friend on the other side of that call, it makes it more difficult to get tough."
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