Didier Lombard warns of troubles ahead for Telecoms

Operating margins for many telecom companies have shrunk rapidly, as mobile phone service has overtaken fixed-line service, data traffic has outpaced voice traffic, and the old bread-and-butter phone service has become commoditized. Meanwhile, global demand for data services has increased massively, especially with the emergence of video streaming and downloading on the Internet. This “data tsunami,” as it’s been called, has grown in intensity with the proliferation of data-enabled smartphones.

Read more at S+B

The Thought Leader Interview: Didier Lombard

Business plans don’t help in early stages - The Globe and Mail

If anyone believes the value of the business plan is the finished document, this article may be at least partially right. As someone who led the planning exercise in many companies, I learned that the journey was far more valuable than the destination.
Planning brings structured thinking to the business, and helps to ensure that key questions are posed for discussion. Everything in a business is connected. A decision to take a certain action will also produce re-actions. They need to be accounted for, and, if necessary, mitigated. The planning process helps to tie the pieces together, and keeps the pieces focused on the current objectives.
The inference in the article is that a plan will make a company less nimble and flexible. It might do that, if that's how planning is approached. But it doesn't have to be that way, nor should it.Planning brings structured thinking to the business, and helps to ensure that key questions are posed for discussion. Everything in a business is connected. A decision to take a certain action will also produce re-actions. They need to be accounted for, and, if necessary, mitigated. The planning process helps to tie the pieces together, and keeps the pieces focused on the current objectives.

Business plans don’t help in early stages - The Globe and Mail

Canada has Missed the Boat in Asia

Tuesday, May 3, 2011, 6 to 8:30 p.m., First Canadian Place Gallery, 100 King St West, Street Level, Toronto

Featuring:

• • Andrea Mandel-Campbell, Journalist and Author of ‘Why Mexicans Don’t Drink Molson’
• • Jacoline Loewen, Director, Loewen & Partners Inc
• • Dev Srinivasan, Vice President, BMO
• • Gordon Perchthold, Managing Partner, The RFP Company

Are Canadian corporations soft, complacent and overly protected or have the examples of Bombardier, Manulife, and RIM demonstrated that Canada can effectively compete in fast paced, high growth Asia?

Join IAAT’s debate as Andrea Mandel-Campbell – journalist and author of ‘Why Mexicans Don’t Drink Molson’, Jacoline Loewen – Director of Loewen & Partners Inc, Dev Srinivasan – Vice President of BMO, and Gordon Perchthold – Managing Partner of The RFP Company, together with the audience debate the question raised by Dean Kathleen Slaughter’s November 2nd statement in the Global & Mail Newspaper:  “Canada Has Missed The Boat in Asia.”

Canada’s relevance in Asia is a critical issue for Canada’s future economic prosperity and should be a key election issue for Canadians to ponder.

Light snacks will be served. 

Registration:

• • IAAT Supporter*: $20 ($22.60 HST)
• • Renew for or become an IAAT Support and attend this event – for alumni who graduated in 2009 or before: $70 ($79.10 with HST)
• • Renew or become an IAAT Support and attend this event – for alumni who graduated in 2010 or after: $50($56.50 with HST)
• • Ivey Alumni: $40 ($45.20 with HST)
• • Non-Alumni: $50 ($56.50 with HST)

Register for Ivey Debate

Why Changing Living Standards Around the World Measure Inflation

How do you measure inflation? Is the high standard of living enjoyed by the Western world in decline, draining away to the rapidly growing countries of China and India? Larry Cyna, Cymore Fund, wrote a thought provoking analysis of the thesis that wealth and high standard of living is flowing to Asia. Here is a quick excerpt with a link to Cymor Fund blog at the end:

Inflation is not to be measured by traditional metrics, but rather by the changing living standards around the world, and the changing GDP of major country influences around the world – in essence the drop in economic standing of the US and Europe, and the unstoppable move forward by China, then overtaken by India.

Loewen & Partners hosted a event last week in Toronto where Dr. Michael Power of Investec Asset Management gave a presentation. Dr. Power is a noted advisor to Hedge Funds and travels extensively giving presentations internationally to Hedge Fund managers and others. His presentations on current trends and matters of interest are widely followed and respected. He pointed how US debt and changing demographics were inexorably shifting power and influence to China and then to India. Essentially I agreed with his presentation.The Unpredictability of Predictions: My first response to anyone who is a futurist, or who has the ability to spot major trends, is to thank him for the insight. However, I also have a theory that is proven by history. “What we as humans will never master, is to predict with accuracy the future.” Recent events, sometimes described as Black Swan events, are a vivid example. Who could have imagined that government surpluses of a few short years ago in the US, would turn suddenly into massive deficits that everyone is running in fear of? 

The inevitability of the inevitable is flawed: Interest Rates. While in an overall sense, I cannot disagree with the thesis, there is also the effect of interest rates. We currently live in this delusional world where we think that inflation is something that can be controlled by government. Governments have many tools, but the total control of interest rates, continues to elude us. Once the Genie is let out of the bottle, interest rates have a way of running away ahead of all attempts to restrain them. The result is a massive shift of wealth. The speaker felt that this massive shift would inexorably be to the new Eastern economies. However another way to look at the issue, is that the massive accumulated reserves of the new Eastern Economies, would be reduced in value by 20% in a single year, if inflation was 20% for that entire year.

Read Cymor Fund Blog

Are the markets getting frothy again?

It's hard to pick between the bubbles-are-bad and bubbles-are-O.K. camps is that bubbles aren't all alike. The best ones create assets whose value survives the crash. The Apollo program that put people on the moon, only to lose public support in the 1970s, was a "social bubble" in which over-optimism advanced science. Bad bubbles generate worthless assets such as exurban housing subdivisions that are taken over by squatters and mold. Other bubbles don't produce any supply response at all. The only impact of China's new mania for old wine—one bottle went for nearly $233,000 last year—is to transfer wealth to whoever was lucky enough to own the bottles before the Chinese got interested.
When the tech sector gets bubbly, consumers are often the biggest beneficiaries, notes Harvard economist Edward Glaeser. 
Glaeser says:

Because investors fund ideas that help the general public, from wireless communications to solid-state data storage to the Internet. So it was in the 19th century with the railroad boom. Today's speculation in tech is concentrated in social networking. 

The question is whether the new investments will live up to the greatest hits—and productive busts—of Silicon Valley's past.