I know that I am not known as the most financially sophisticated of IU's bloggers, and I sure as heck don't proclaim to have inside information. But I am going to give you a can't-miss stock tip, which I got from the most unlikely of sources: Jeremy Lin.
You can't spell "listen" without Lin
Yes, I am jumping on the Linsanity bandwagon
. I believe in the Power of Lin. His Harvard degree, personal upbringing, and humble demeanor are all that is needed to bring world peace and equality to all mankind, not to mention bringing the O'Brien Trophy to Madison Square Garden. (Whew!
That was one strong cup of coffee.)
OK, back to reality. Mr. Lin can't take all of the credit here. In fact, Mike D'Antoni and the Knicks brass deserve a lot of praise for doing some things that most CEOs and analysts fail to do: listening to their support people about what is happening on the street, and listening to people who are sitting at the end of their bench, not to just give a breather to someone, but to add lasting value to a company. The C-suite might get all of the credit when things go well, but the people who are at the end of the bench of the companies where you invest can be just as valuable. Plus, you cannot spell "listening" without "Lin." (I had to bring it back to my POV, right?)
I bring this up because I was recently reacquainted with Barry Libert, a former Arthur Andersen partner and a longtime client of mine. (Note: I worked for Ketchum, a well-known PR agency, back when Arthur Andersen was one of its clients.) Barry was always ahead of the game when it came to predicting trends and how companies use their assets. Later in life, he was one of the first people to join the community-building brigade and advocate letting social media play a crucial role in how companies communicate.
So it came as no surprise when Barry called me and told me about an article he wrote for Knowledge@Wharton with a powerful thesis: Too many boards have not embraced social media as a way to communicate and drive business forward. This article, and his thinking, really resonated with me.
For years, corporate communicators have embraced the power of social media to tell them what customers think. Many more companies have moved beyond social media and more toward "social business." Yet the people responsible for some of the most important business decisions of an organization are not listening to what lower levels of the organization are talking about, and they are not taking customers and other stakeholders into consideration. They're saying that they are relying on old-fashioned means of communication to get information -- and that is cause for concern in this age of real-time, high-frequency trading, when companies can gain or lose value in the blink of an eye.
Barry has outlined a plan of attack for boards wanting to become more social, but the more difficult thing for CEOs (and investors) to do is to find the Jeremy Lins of their companies. The smartest companies listen to their customers, their employees, and other stakeholders before making decisions. Here's why.
- These people might have a previously undiscovered cost-cutting idea.
- They might have ideas on how to create more revenue.
- They even might have thoughts and plans for how to create new revenue streams.
Companies that don't fully leverage their bench strength and connect with the Jeremy Lins of the world are not going to reap the fullest rewards. They will sit at the end of their benches and not garner high stock prices.
Let me ask the IU community: Do you feel companies do a good job of listening to their people? Do they listen to their investors?
Meanwhile, I'm pulling for J-Lin and the rest of the benchwarmers out there.