Umair Haque / Bubblegeneration
umair haque  


Design principles for 21st century companies, markets, and economies. Foreword by Gary Hamel. Coming January 4th. Pre-order at Amazon.

Friday, January 25, 2008

What Infected DNA Looks Like

"Hey guys, we just lost $7 billion!! lulz!!!!111"


The fact that Socgen getting massively blown up doesn't inspire fear (or even loathing) - but a roasting and laughter should be a stunningly visceral example of the rot in the Street's DNA.

As a very simple example, there's almost zero incentive to manage (money, assets, etc) for long-run value creation, because near risk-free short-run compensation, like cash bonuses, massively outweighs risk-bearing long-run compensation. Etc...

This should make the larger point more intuitive: DNA is how we manage stuff. It's easy for this kru to laugh about blowing $7 billion, because managerially, it really is a joke to them - no one is really punished, their costs and benefits stay largely the same.

-- umair // 2:38 PM // 0 comments


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