Shocking increases in Top Bosses earnings

Top bosses earnings

Top bosses earnings

According to an article in the Independent top bosses are now earning 143 times what workers’ get paid. This, says the article, has tripled over the past 15 years. That is a seriously huge gap in earnings. And remember, this is an average. There are obviously a bunch of CEOs getting more than this.

Why is this happening? Because they can. It’s that straight forward.

Here are some underlying reasons. Bound to be more of course.

Shareholder’s greed for profits. ?

Provided the CEO can deliver on huge returns to its shareholders, they don’t care about the inequalities of pay rates. Of course some shareholders themselves are at the mercy of their own shareholders in having to deliver high returns. After all most investors in companies or stocks are institutions themselves. These are pension providers, municipalities, hedge funds, investments companies such as Soros Fund Management or Warren Buffet’s Berkshire Hathaway company. And they have a gun at their head to deliver high returns to their shareholders.

A misconception that high salaries retain good staff

Many research papers have pointed out that high salaries is not the most important factor in employee retention. In fact most surveys point out that ‘making a difference’ is the prime motivator for employees.

In fact a recent article in Forbes has pointed out that employee’s who stay in companies longer than two years are making less on average every year than those staff members who move around more. This puts paid to the theory that high salaries retain good staff. You can earn more by jumping around.

No action by employees to change the status quo

There is overall no concerted action by the low paid employees to actually change that status quo. The main reason for this is probably fear that they will end up getting fired if they complain. Not only could they lose their jobs but could find it near impossible to actually get another one.

Of course one problem is that an employee with low level skills is easily replaced with hundreds waiting at the door to submit their CVs. One need only to see the queues outside factories or standing in line at employment offices. These are people who have limited skills or skills that are outdated. If you have a job, you are not going to want to jeopardise your position by complaining about how high the upper level salaries are.

An Old Boys Club

It’s not what you know but who you know. It’s an Old Boys club that runs the show. This is true whether in politics or in business. A high percentage of CEOs will have come from wealthy families, and/or will have worked their way through the elite schools and universities.

Of course there are entrepreneurs that have managed to found their own empires without help from family wealth or powerful educational institutions. Thinking Steve Jobs and Apple, or Bill Gates and Microsoft. But have a look at the big banks, investments institutions, big professional firms and see who is running these. Old names, old money, big connections.

As lowly employee it is almost impossible to rise above the rank and file. And this Old Boys Club is in fact another reason why women knock at that proverbial glass ceiling. They just don’t have the in into those Old Boys Clubs to easily allow them into the top management levels.

Does this mean that nothing will change? Probably not in the near future. Unless the workers can get some form of powerful base together to make a collective noise, nothing will change. The trade unions have certainly lost their bite and their ability to make a difference. Mainly one supposes because trades themselves are no longer required manufacturing having been pushed into developing countries where there are no trade unions.

Perhaps middle management unions need to be founded, sales or marketing unions, tech support unions or banking and investment staff unions just to note a few. Or just a general union of workers reporting to CEOs could do it.

Whatever solution can be found to address this disparity in salaries should be found soon before this gets out of hand. Or more so. One thing is certain. CEO’s will continue to pay themselves as much as they can get away with. It’s the nature of the beast.

It’s never really just black or white

Hamburger Hill. Image from 'Slaughter of the innocents: The Vietnamese war as never seen before.'

Hamburger Hill. Image from ‘Slaughter of the innocents: The Vietnamese war as never seen before.’

Nothing in life is ever set in stone. Or illuminated in black and white. Nothing. Nada. Which means you should never say never. Statements like there is no reason for homes to have a PC, or what would you want a mobile phone for, or there will always be cars or trains to take commuters to work should never be believed in.

Then there are opinions held by folk that advise us that the Russians will always be our enemies (harhar) or that Communism is evil. Perhaps you would believe that North Korea will always hate South Korea? Is that possible?

Before you say yes, best have a look at this statement. The USA will always hate Vietnam and North Vietnam will always hate the USA. Mmmh. No. But it certainly felt like it during the Vietnam/USA war didn’t it. And it’s this black and white fact that has now disappeared that I want to mention.

Commemorating the 50 year anniversary of the start of the conflict a book of photographs by press photographers is being published. Slaughter of the innocents: The Vietnamese war as never seen before. It is considered to be the last newspaper war. That is one where  journalists were the bringers of actual news. What the press photographers shot was what people saw.

What made me take note was one image that showed a US paratrooper wounded in battle at Hamburger Hill in central Vietnam. You see I actually drove past Hamburger Hill in a bus with staff from Hope Center on a work outing. They pointed it out to us. We were past the little bump (hardly a hill really) within seconds, hardly seeing the gun that commemorated the spot.

Yet that insignificant spot was a nasty battleground with many dead soldiers from both sides. And what were they fighting for, both sides? Besides the hill? During those years perhaps the issue was black and white. Communist against Capitalist. Or whatever. But it wasn’t really. It was a bunch of determined locals prepared to die to keep their country safe from a foreign invasion.

And now nobody could be bothered to even remember the hill. Except perhaps the relatives of the hundreds of dead soldiers. What happened to that black and white principle that had to be fought for with guns and human sacrifice?

So before you get stuck on defending a principle you think is cast in stone think really hard. Is it still going to be this black and white in a few year’s time? Think of gay marriages, or women priests in the Anglican church, or women car drivers in Saudi Arabia or time travel or never aging. What of that list is impossible? Thought so.

Lucky to come across young violionist David Garrett

Every now and then I thank my lucky stars that I have been able to experience the interwebs. Why? Because I can find stuff on it that I would never have been lucky to experience if I did not have this resource at my finger tips.

Here is how it went down! I like to read at least one German article a day just to keep my language skills from fading entirely. But to make it easier I read a more popular magazine. In fact my German family thinks I’m truly slumming it. I don’t think so. I really enjoy their articles and the scope of what they write about. I can read and understand their articles without fuss. And it drops into my email post box every day. easy enough as I have subscribed to two newsletters a day. And it gives me easy access to German. No need to look up words. I get it.

So today I read about an Austrian jeweler who has built up a hugely successful silver jewelery business. He started off as a mechanic, ended up on a tour of Asia after his qualification and ended up falling in love with Asian funky decorative accessories. And the rest if history.

Many stores later his own as well as supplying well known jewelery stores he has made it big. Checking his website after watching a video on him on my German magazine website I see his company has signed up some long haired musician to endorse a range called Rebel. So of course I got to check this musician. And where else but YouTube.

And young musician is fabulous. A true cross over artist. That is he crosses over to every genre, kind of. But then who says you have to only play classical music as a violin player. Well of course there are the Irish who throw in violin into everything that is music. And fabulously so.

But mostly the violin has been banished ever since the demise of the local village bands who were the main entertainment of the folk back in the days. Now only allowed to perform in the hallowed halls of the classical concert venue.

Until you get to see somebody called David Garret playing Guns and Roses. Long hair tied back or waving around dramatically this young man is redefining the violin. And it’s gorgeous. Of course Vanessa-Mae kind of debuted the sexy violinist bit, but she always kind of sold it to me on sex appeal. Perhaps unkindly so. I’m sure she is totally talented and she certainly made a ton of money.

But this young man really gets it. Gets the play music to entertain bit. No matter what it is. As long as it is gorgeous. So as I was saying. Love the interwebs.

Hoping you fail

Diets - designed to fail

Diets – designed to fail

 

Have you ever considered that there are a bunch of companies and industries where the main focus of their business is on their customers actually failing. That is, they post growth and profits when their customer base doesn’t benefit from their product or service.

Scary thought that.

It had never occurred to me before. But consider the weight loss industry and businesses operating in this field. They benefit if you do not lose weight. Or at least when you put it straight back on again once you have lost it. Because if you don’t succeed you will come back for more diet pills, diet books,  plastic surgery, fad diets, motivational seminars, personal coaches, health gym contracts and the list of businesses feeding off this industry is endless.

They all make money on the fact that you can’t do it on your own. You can’t do exercise, you can’t control your appetite, you can’t get rid of the pounds and so the list goes on.

And they depend very much on this fact that you are dependent.

For instance Weight Watchers sells contracts to it’s members. They throw in a few nutritional well balanced diet books as the membership benefit plus a team leader who runs the weekly meetings and is there to encourage the folk in the group to get rid of the weight. Team leader gets a few Dollars as commission, the area leader gets some Dollars in commission and so it goes up the food chain. Pyramid scheme, almost.

What it does depend on is that people don’t take control over what they put into their mouths or what other pursuits they undertake to keep their bodies balanced and healthy. They depend on failure. They depend on you as the human being to hand over responsibility of your body to somebody else. After all, by joining Weight Watcher (and of course there are a bunch of others too) you are admitting defeat. You can’t do it yourself.

Then there is an entire industry that is supporting this world. Clothes that only look good on skeletal models. An advertising industry that promotes thin is beautiful. Have you ever seen a slightly plumper looking person -in other words normal one – advertising a cellphone, washing powder, sanitary pads, orange juice or motor vehicles to mention a few of the TV ads that are pushed down our throats.

So we buy into thin is beautiful. But to be as thin as the role models in advertising we have to give up food all together. This brings me back to the opening idea. We are going to fail. Because there is no way we can be as thin as the models we see every day on TV, online news portals, in between YouTube videos, in print, on billboards. In fact they are everywhere. Reminding us that only thin is worthy.

So if you want a business idea that will be a success, sell a product or service that depends on somebody to fail. The diet industry has certainly worked this one out. So has the motivational and self-development industry. The health gyms that sell you a one year contract at the beginning of the year knowing full well you won’t last past February know all about it. How do you think they can sell you a life time contract for next to nothing. They are not going to see you your entire life time. And the list goes on.

As a business model, selling failure is for the win.

A society focused on the young populated by the aged

Thanks for the fun image Dorothy, 87 years old.  (AP PHOTO/DALE SPARKS)

Thanks for the fun image Dorothy, 87 years old. (AP PHOTO/DALE SPARKS)

This stat came up in 2008 already. At the time the UK Office for National Statistics revealed that there were more people of pensionable age living in the UK than children under the age of 16. This was five years ago.

Look at our society. What do you see? A celebration of youth. The entertainment industries focus on young topics using young actors and actresses. Older protagonists are only thrown in as a token. The fashion industry uses teenage models to show case it’s fashions for the young. (and thin)

The marketing and advertising industries focus on selling products and services to the youth. In fact even the players within this industry disappear after the age of 35. Unless of course they own the business as is the case with Martin Sorrell who is still around at age 68. But then he owns a big chunk of WPP Group. Not sure where the others disappear to though.

Big brands such as Apple, Nike, Volkswagen, P&G direct their products at the 18 to 35 year old demographic. If they are really daring they might extend that age bracket to 45. Yet the bulk of their customers are older than 45. Your 60 year old is just as readily buying an iPhone as she is getting herself some running shoes from the Nike store or buying a new VW.

Every single person over the age of 60 will buy a cleaning product of some sort. Yet how many ads for cleaning products are directed at the ‘grey’ market? Perhaps a Gran appears in an ad but only to ‘advise’ daughter on what to buy. Never the shopper herself. Perfume? Sure Julia Roberts advertises one at the age of 45. But she has been digitally enhanced in such a way that she appears 30.

And did anybody notice that Glastonbury’s main stage in 2013 was packed out and they had to extend the area when the Rolling Stones did their gig this year. Guess what their average age is. And what does that say about the ages of Glastonbury goers?

I did an interesting exercise a day ago. I googled for weddings for young people and had 70 million results. I googled weddings for older people and my results were 6 million. So nobody is getting married over the age of 50? Certainly nobody is writing about it.

As the stores shut down all along the High Streets of the UK one thing retailers might want to consider is opening stores for older people. Comfortable sized aisles, seating areas to rest on and great displays, labels with bigger font sizes and products of all things ‘old’. Whether more comfortable clothing, health and wellness products, mobility aids or easier to cook and consume foods it’s what older consumers might be interested in. Add on excellent delivery services and you could be onto a winner.

Rather than pretending that nobody gets older and hiding the aged in old age villages waiting to die, let’s change the way we view society. Old is not redundant. Old could mean another twenty years of active life. Why pretend it’s not happening. Embrace it and enjoy it. And marketers, start making money off those oldies. They got some!

As an aside: interested in reading about weddings in general visit Yorkshire Wedding Venues or Wedding Venues.

 

Surprising divorce and marriage statistics for Baby Boomers

Celeb baby boomers Prince Charles and Camilla spot on on trend

Celeb baby boomers Prince Charles and Camilla spot on and on trend. Image credit. BBC

Many years ago my then mother-in-law spoke at their 35 year wedding anniversary. It was surprising that she wanted to speak being from a generation where the women were seen, mostly in the kitchen, and not heard. But then she was never a standard housewife working well past her retirement age.

She said, and I could see it was immensely heart felt, ‘we have had our ups and downs’. And I could hear and see from her expression that it was more the downs that she was referring to. And it has made me reflect many a time since then whether she would have divorced my father-in-law if she had been able to.

It’s therefore not a bit surprising to see that the, known as grey, divorce rate is going up. And even less surprising that it’s the women who are throwing in the towel. Kids out of the house, husband now home due to retirement, and the women have had enough.

Possibly one of the reasons is that men generally tend not to change their life long habit of sitting at home, reading the paper and watching sport. The wife who traded housework for the salary check and in many cases did the housework and earned money, is not having any more of it.

It probably works along the same principle as that experienced by divorce lawyers who have a busy time with new briefs after the main holiday season. In many cases the couples reconcile once everybody is back at work and the routine has been reestablished. I know this from first hand experience, having worked in a lawyer’s office for close on 18 years of my working life.

What may be adding to this trend is that women are earning good salaries and are able to afford to live on their own. Whatever the reasons, it’s happening. Over 25% of divorces are initiated by wives whereas only 14% by the husband. Not even spending decades together is a safeguard against the split. Al Gore and his wife recently divorced, both in their early 60s and after 40 years of marriage.

Of course being in ones 60s is not the end of the line. In fact, probably one further reason for the increase in the grey divorce rate which has doubled in the past decade is that people can look forward to many years of active life. Retirement is no longer the end of the road but in fact the start of up to 20 years of a healthy and interesting life.

Which brings me to the next surprising point. And that is that baby boomers are also quite happy to remarry.  Over three quarters of divorced and widowed baby boomers will marry again according to available statistic from the US Census Bureau.

Has the wedding industry even considered this market segment. Probably not. As with most marketing strategies it’s the youth market that is the target. Yet, baby boomers have more money than the 25 year old recent college graduate struggling to pay off loans. Why is the wedding industry not focused on selling to the older generation? White ribboned Zimmer walkers anybody?

Interested in reading about weddings in general visit Yorkshire Wedding Venues or Wedding Venues.

Spain is the most accepting Society Towards Gay People

Acceptance of Gay Rights, worldwide

Acceptance of Gay Rights, worldwide

Every now and then I find something that is surprising. And this surely is one of those items. A predominantly catholic country ends up being the most accepting towards homosexuals. Wow.

How does that work? A church that is totally against gay people, against gay marriage and calls it some nasty names rules the roost in Spain. There are more public holidays celebrating saints than perhaps even in Latin America. Although probably not. But a close second I would imagine.

Holy Easter Week procession in Almunecar, Spain

Holy Easter Week procession in Almunecar, Spain

There’s always some Virgin, or Saint, or JC himself  being carried around on heaving shoulders, paddled along the coastline or prayed to in church. Here in Spain that is. Yet one of the strongest doctrines of the very same church is totally ignored.

Of course I am totally for it. I walked in gay pride parades while still in Durban and that is early 1990s. And am totally for gay marriages and whatever makes people happy.

Still it is hugely interesting, to me anyway, that here in Spain there could be such a conflict in what the society does and what their church dictates.  And that surely should give us hope that religious people all across the world, whether Jews, Muslims, Protestants or whatever can take out of their religion that works for them and ignore those rules and regulations that make absolutely no sense in our modern society.

 

 

Language and its importance to our development

From Globalvoicesonline.org

From Globalvoicesonline.org

As recent migrants to Spain, the question of language raises its head almost daily. We don’t speak much Spanish but are acutely aware that we need to. If we want to enjoy this country to its fullest we have to. Otherwise we will always be isolated and dependent on a handful of like minded expats who also haven’t put in the work to learn the local language.

Yesterday we were surprised to come across a school in the hills behind us in Marbella that is a German School with a Spanish bilingual stream. Who would have thought that this would be available. We had been grappling with the question of language for family offsprings. As we are English speakers in Spain on German passports, German should be part of the mix we have been thinking. And here was a possible solution. English at home, German and Spanish at school.

So while checking the school’s website, the TED newsletter dropped into my inbox and I decided to view some on a Sunday for fun. Don’t normally get the time. And I discovered a talk from a previous TED session, in fact from 2011, that was totally fascinating. It was about language and what that meant to human evolution.

In fact the point this speaker, Mark Pagel, made amongst other amazing points was that having a universal language allows people to share ideas, innovate and create together and this was what was causing such enormous growth in our technological advances across the board.

In my lifetime alone, the mobile phone, internet, organ transplants, space trips, natural regrowth of human organs and so much more has appeared. Far more I think than previous generations have experienced. And the reason for that is that we can steal ideas so much quicker if we can understand the language that somebody else used when developing and describing his invention.

As a total different story though, but very much along the same principle of language, that popped into my inbox was a report (5 of them and worth reading) by Steve Blank on China and his recent visit. Talking about such things as China’s innovation hubs, investments & VCs. China invests (both private and state funds) in billions of dollars every year in innovation mostly in telecommunications, media and technology.

Yet at the same time, China bans contact to the rest of the world. No YouTube, no Google, no Facebook, no Twitter, no Flickr. All of the people and info sharing tools are restricted to Chinese products that China’s authorities are able to control and censor where required.

So the contrast between what Mark Pagel states and what China does highlights the principle that the more people can talk to each other in a common language across all borders the better and easier new technologies can be developed.

What does that mean for China, and as a matter of fact for Vietnam a country also dictated and censored by its communist government, and the billions that that country invests in innovation hubs? It’s not going to be as effective. In fact it is mostly more focused on copying and making something from overseas work in China rather than inventing something totally new and adding to the development of the world. The 10th Groupon site anybody? Sure. It’s available in China.

Imagine if China opened it’s doors to international thought – or at least allowed its citizens to. What this amazing giant could achieve. With it’s hard learning and hard working citizens who are alway striving to get better at what they are doing, this huge world power player could contribute so much to the well being of the global community. If only it opened its doors to the language of the global community.

How to change the world and other small goals

Occupy Wall Street protestor being removed

Occupy Wall Street protestor being removed

Occupy Wall Street didn’t make it. They didn’t really make a difference and the movement didn’t survive. In fact all that the Occupy movement got known for was untidy evictions from their various vantage points. Oh wait. They did manage to engineer the resignation of the Dean at St Paul’s in London. Success? Hardly.

Yet their message was incredibly important. Stop fat cat practices in the corporate world. Those practices that lead to indecent profits, huge CEO salaries and pittance pay to the people who make the organisation function. Those toilet cleaners, PA’s, support staff and more.

And sure. Warren Buffett‘s secretary earns over $100k per year. Seems a lot, but then look at the profits that his Berkshire Hathaway makes and you have to wonder about the unfairness of it. I am going to presume for the sake of the argument that the rest of the non investment broker staff also earn small salaries. Can’t see the cleaner getting more than $100k per year. Can you?

So what happened? Surely the stats of the top 20% of the population in the USA hold 89% of the wealth should be something that would ‘occupy’ the minds of the eighty percent of the USA that fight for the scraps of the wealth.

Perhaps a random idea is that the Americans are so used to thinking that everybody can make it in the USA and therefore if they are poor they can only blame themselves, surely. They just didn’t make it and they better be happy with their fate.

What the disenfranchised people in the developed world are forgetting is that they do have the power. They don’t actually need to think it’s their fault that they are not getting an equitable slice of the wealth cake. And perhaps one should not forget the developing world where the same inequalities are coming to the fore.

It was therefore great to see in Switzerland a move by the ordinary people taking back some of that power. The people voted overwhelmingly against high executive pay. Lead by one individual, Thomas Minder owner of a family-owned business, a tiny outrage ended up becoming a popular vote.

And that’s how it has to be done if you want to change the world. Messy occupy movements where people settle in tents on the fringe of financial district? No. A well thought through campaign that appeals to the ordinary people via legal and regular channels? Yes to that.

It surely applies to all of the changes that people want to make. Violence, riots, uprisings, demonstrations are not the way to do it. Even in the Arab world the uprisings have not really made a difference instead allowing lunatic fringe religious groups to run the show. Talk about a step back into the dark ages.

You want to make a change? Do it within the system. Just like the Swiss did. They changed the law. We can do that too. And with social media allowing us to talk so freely to each other and making it easy for tribes to get together it really isn’t necessary anymore to camp on the doorstep of the stock exchanges.

Jobs for everyone – don’t count on it

laborforceparticipationThere have been some interesting developments in the human resources space. The Yahoo CEO Marissa Mayer in particular has started a strong debate. Her call to bring back telecommuters into Yahoo’s offices has caused a lot of random hot air to circulate.

Whereas some companies have allowed their workers freedom to work from home Yahoo has now decided they want their staff back in the office. It seems positively old fashioned. Going backwards? Do we need to be physically together to produce the best work possible? And what about the cost to the environment and the back pocket for all the commuting to work.

But then another interesting article caught my attention. Reading about an innovative design studio based in Copenhagen and admiring their design work it was interesting to note that this award winning studio consists of two partners and one assistant. Sure they are a division of a larger agency, but their business unit is small.

How does this work? It can only work when the small unit can tap into an available freelance talent pool. And this is where work is ultimately going to. Just as this agency, Mega Design, is doing. They bring in talent when required. This means that you are never at risk with high overheads. You can expand or shrink according to the work load. It’s like having telecommuters on tap. Without the risk.

Of course there will still be the Yahoo, Facebook and Google’s out there who amass people in the hundreds and thousands. But where the big changes will happen will be in the small to mid size businesses. The ones that are most often knocked over by recessions. And the ones that used to employ those millions newly unemployed.

An interesting question was posed in a blog post recently. In response to the unemployment figures in the developed world that are not budging even though the recession is receding into history and the stock exchanges are posting highs not seen since before the crash a question was asked. (Taking the highs as an indication that the economies are doing well.)

And the question was: why are companies not hiring. Even though the economy is moving again and into positive figures. Why is there no hiring?

And probably the answer to this is that companies are going to do the very same thing that this design studio in Copenhagen is doing. Once they require staff they will outsource to freelancer on a per project basis because it’s safer. It’s a matter of keeping your overheads in sync with your project sizes.

The big headache of course is that young people coming out of formal education have been educated for the purpose of slotting into factory style work environments. Note that many hugely successful businesses out there have been started by people who never finished their post high school qualification. Steve Jobs springs to mind.

We are educating our youth for the wrong job market. There are only so many jobs at Yahoo or Google. The rest are going to have to become freelancers. Do they know how to run their own business, how to sell their services, how to keep their skills relevant so that they are marketable, network to find new business and the list goes on.

What else are we not providing our young people with? Relevant work place skills. A degree in English is not going to be enough for a regular copy writing job. And companies don’t have the budgets anymore to train up young people. This means our unemployed out there are the youth. Because on their first day at work all they can possibly do is make coffee for the boss. And there are no longer budgets for these skills.