Joseph Blass, CEO, WorkPlaceLive
Warren Buffett, the American business magnate, said in a recent shareholder letter relating obliquely to corporate bankers ‘advising’ on mergers and acquisitions, “Don’t ask the barber if you need a haircut”. Of course he will say you do.
Whilst business managers rely on their employees and advisors for professionalism, expertise and objectivity and want to believe that they are always fully aligned to doing what’s best for the company, this isn’t always necessarily the case. Often employees have their own agenda. This is known in economic theory as the ‘principal-agent problem’.
This refers to the situation when the ‘principal’ or employer has one goal but an employee or advisor, called an ‘agent’, may have a different agenda altogether. For example, sales agents might work towards maximising their commission rather than the company’s profit. Ideally, these two objectives would be perfectly aligned, but this is not always the case.
This phenomenon is an intrinsic element of human nature. As long as managers are aware of this possibility, it becomes part of their parameters when making a decision. A business manager realises that the corporate banker or the sales person has an agenda just as the local barber has one.
However, when it comes to IT, most businesses rely for expertise either on a company employee or an outsourced provider. This expert recommends which hardware to buy and where, which systems to use and how they should all be integrated, deployed and ultimately supported.
But the IT manager may have a built-in principal-agent problem if the agents feel that they might actually be doing themselves out of a job by simplifying the IT. Under these circumstances, they will not consider certain IT solutions, even though a particular solution may be best for the company.
If IT suddenly became smooth to operate, let’s say as easy as the company’s electricity supply where all one needs to do is flick on a switch to make it work, where would that leave the IT manager? Would anyone ask the ice delivery man what he thinks about buying a freezer? Would anyone ask a video shop whether they’d recommend Netflix? Not very likely.
Yet, business managers sometimes baffled by IT jargon still ask on-site IT guys for their advice about Cloud solutions that might put them out of a job. Luckily for the IT people, Cloud can mean so many things that they can actually recommend some form of Cloud, thus giving the business manager a false sense of comfort that the business is actually adopting the latest technology.
However, it is likely that the IT people aren’t necessarily presenting the business with all the options available. Some Cloud solutions are partial and still require local servers. If a company has some software packages in the Cloud, its data held locally, backed up to another Cloud provider, and its email on Gmail, the IT provider has created a complicated eco-system that will safeguard his job for many years with the promise of future on-site visits and constant hardware upgrades which can be very costly. Good for the IT guy! But is it the best solution for the company?
A better option might be for companies to purchase IT as a utility, like electricity, and just pay a monthly per-user fee.
Opting for a fully managed cloud computing service can mean the end of expensive and disruptive hardware upgrades, inefficient downtime or problematic delays when requesting the simplest of tasks, such as setting up new users. Companies will receive one simple invoice for services, including email and their usual Microsoft Office suite of services, thus adopting a ‘pay for what you use’ pricing model.
A Hosted Desktop service through the Cloud is an IT solution that many businesses are adopting. A Hosted Desktop unlike other Cloud services, doesn’t just backup to the Cloud, but does everything in a secure Cloud environment, including the computing itself.
The benefits of this service include cost savings and allowing employees to work from anywhere and on any device. Employees have access to their usual work desktop – with exactly the same look and feel, as well as their emails and all their business applications using a web-enabled device such as a smartphone, laptop or tablet. The service works well through the 3G network and can offer a corporate-grade computer system at any location with an internet connection with existing 3G, and rapidly developing 4G services.
The provider performs daily data back-ups for its clients; this date is stored securely in a corporate-level datacentre with backup power and generators, cooling, fire suppressant systems and 24-hour security, making it more secure than an in-house server set up could ever be.
The main benefit, however, is peace of mind. With a Hosted Desktop, businesses will enjoy a simple eco-system. Imagine this scenario: no need for weekly local visits or laptop formatting, no need to consider servers or cooling, or backup or security, just one simple, low monthly bill for all your IT needs.
So would every IT expert recommend every solution? Probably not. But it’s important that business owners be aware that any objection they have might be tainted by an understandable, and perhaps subconscious, personal interest.
And you don’t have to be a technology expert to choose the right IT solution, so don’t be bamboozled by acronyms or tech-babble. Just as you can choose a car based on your needs, such as fuel consumption, comfort, cost and reliability without having to understand the workings of a combustion engine, so, too, a business manager can just ask for seamless, secure, capex-free IT. He doesn’t have to be an IT guru to work out that such a service already exists.
Tech demand drives Asia’s factory revival, China’s slowdown puts dampener
By Leika Kihara
TOKYO (Reuters) – Solid demand for technology goods drove extended growth in Asia’s factories in February, but a slowdown in China underscored the challenges facing the region as it seeks a sustainable recovery from the shattering COVID-19 pandemic blow.
The vaccine rollouts globally and pick-up in demand provided optimism for a vast number of businesses that had grappled for months with a cash-flow crunch and falling profits.
In Japan, manufacturing activity expanded at the fastest pace in over two years while South Korea’s exports rose for a fourth straight month in February, suggesting the region’s export-reliant economies were benefiting from robust global trade.
On the flip side, China’s factory activity grew at the slowest pace in nine months in February, hit by a domestic flare-up of COVID-19 and soft demand from countries under renewed lock-down measures.
“The big picture, supported by the latest figures, is that China’s growth remains fairly robust, but it is slowing from previously very rapid rates,” Mark Williams, chief Asia economist at Capital Economics, wrote in a note to clients.
China’s was the first major economy to lead the recovery from the COVID-19 shock, so any signs of prolonged cooling in Asia’s engine of growth will likely be a cause for concern.
With the global rebound still in early days, however, analysts say the outlook was brightening as companies increased output to restock inventory on hopes vaccine rollouts will normalise economic activity.
“The recovery in durable-goods demand is continuing, which is creating a positive cycle for manufacturers in Asia,” said Shigeto Nagai, head of Japan economics as Oxford Economics.
“As vaccine rollouts ease uncertainties over the outlook, capital expenditure will gradually pick up. That will benefit Japan, which is strong in exports of capital goods,” he said.
China’s Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) fell to 50.9 in February, the lowest level since last May but still above the 50-mark that separates growth from contraction.
That was in line with official manufacturing PMI that showed factory activity in the world’s second-largest economy expanded in February at the weakest pace since May last year.
Activity in other Asian giants remained brisk.
The final au Jibun Bank Japan Manufacturing Purchasing Managers’ Index (PMI) jumped to 51.4 in February from the prior month’s 49.8 reading, marking the fastest expansion since December 2018, data showed on Monday.
In South Korea, a regional exports bellwether, shipments jumped 9.5% in February from a year earlier for its fourth straight month of increase on continued growth in memory chip and car sales.
The Philippines, Indonesia and Vietnam also saw manufacturing activity expand in February, a sign the region was gradually recovering from the initial hit of the pandemic. (This story corrects to add name of institution linked to analyst comment in paragraph 5)
(Reporting by Leika Kihara; Editing by Shri Navaratnam)
China’s factory activity growth slips to nine-month low – Caixin PMI
BEIJING (Reuters) – China’s factory activity expanded at the slowest pace in nine months in February as weak overseas demand and coronavirus flare-ups weighed on output, adding pressure on the country’s labour market, a business survey showed on Monday.
The slowdown in the manufacturing sector underscores the fragility of the ongoing economic recovery in China, although domestic COVID-19 cases have since been stamped out and analysts expect a strong rebound in full-year growth.
The results back an official survey released over the weekend showing China’s factory activity expanded at the weakest pace since last May.
February also saw the Lunar New Year holidays, when many workers return to their hometowns, although this year saw far fewer trips amid coronavirus fears.
The Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) fell to 50.9 last month, the lowest level since last May.
Analysts polled by Reuters had expected the index to remain unchanged from January’s reading of 51.5. The 50-mark separates growth from contraction on a monthly basis.
“Overseas demand continued to drag down overall demand…Surveyed manufacturers highlighted fallout from domestic flare-ups of Covid-19 in the winter as well as the overseas pandemic,” said Wang Zhe, senior economist at Caixin Insight Group, in comments released alongside the data.
A sub-index for production fell to 51.9, the slowest pace of expansion since April last year, while another sub-index for new orders fell to 51.0, the lowest since May.
Export orders shrank for the second month. Factories laid off workers for the third month, and at a faster pace, with Wang noting “companies were not in a hurry to fill vacancies.”
An index of confidence in the year ahead rose however to 63.0, the highest since October. Input and output prices continued to rise albeit at a slower pace.
“Now the major challenge for policymakers will be maintaining the post-coronavirus recovery while paying close attention to inflation,” Wang added.
Analysts from HSBC this week forecast that China’s economy would grow 8.5% this year, leading the global recovery from the pandemic.
(Reporting By Gabriel Crossley; Editing by Ana Nicolaci)
For manga’s striving artists, success lurks online
By Sam Nussey
TOKYO (Reuters) – Manga artist Kamentotsu didn’t expect much when he uploaded a four-panel strip about an anthropomorphic bear who runs a cake shop to his Twitter account three years ago.
But the first instalment of “Koguma’s Cake Shop”, drawn as consolation for a tired friend, attracted tens of thousands of likes. Within a week, 40 companies had approached him with offers.
“Publishing company editors have gone from bringing up manga artists, like they are farming, to hunting for them,” said Kamentotsu, who goes by his pen name and wears a mask in media appearances.
By searching for talent online, publishers squeezed by the rise of the internet can see an artist’s audience potential out in the open.
For Japan’s striving manga artists, many of whom toil in obscurity for low pay, that means going viral can be life changing.
Kamentotsu’s strip, which is published by Shogakukan, has gone on to sell more than half a million books. The titular bear, who wears a chef’s hat, has become a popular soft toy and its image was used to promote frozen dumplings.
Japanese pop culture is piled with such cute, memorable characters.
Industry observers say that a feel-good style – known as the “iyashikei” or “soothing” genre in Japanese – is particularly fitting online audiences.
But other recent hits are quite a bit darker, such as “Jujutsu Kaisen” and “Demon Slayer”.
Kousuke Oono’s “The Way of the Househusband” has a high concept idea: a feared yakuza gangster – tattooed, clad all in black but wearing an apron – quits crime to take care of the home while his wife works.
“A comedic story with easy-to-understand characters and title is suited to the internet… we thought about that from the planning stage,” said Arimasa Nishikawa, an editor at manga site Kurage Bunch, which first published the strip.
“Househusband”, popular on manga apps and in print, plays with gender stereotypes at a time of social change in Japan. A line of aprons has been a hit with fans.
The strip has been made into a TV drama, with an animated version set to stream on Netflix this year.
(Reporting by Sam Nussey and Yuki Nitta; Editing by Gerry Doyle)
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