David Lee's List: Business and Finance

• “The accolades that I get for doing absolutely nothing are amazing — I’ve been named to every list, literally, since I became the C.E.O.,” Ms. Burns says.
• the story line at Xerox has always had a little more depth and texture — the bedrock American company whose name became an everyday verb; the convulsive drama after the board’s decision to bring in an outsider to take over as C.E.O. in the late ‘90s; the five-alarm rescue by Ms. Mulcahy, another Xerox lifer, to stabilize the company and to heal the wounds in the “Xerox family.”
• She is taking over at a time when investors are eager to see Xerox build both revenue and earnings. She wants its 130,000 employees to get over the past, take more initiative, become more fearless and be more frank and impatient with one another to ratchet up performance.
• “Terminal niceness,” is how she describes an aspect of Xerox’s culture, during her all-hands speech.
• She studied mechanical engineering both in college and in graduate school and joined Xerox as a summer intern in 1980. Through her 20s, she worked in various roles in product development and planning.
• Mr. Hicks, a vice president overseeing marketing and customer operations, explained the need to manage people in different ways, not to intimidate them, and to make them feel comfortable by listening carefully.
• he offered tips about how to be more effective — “like giving people credit for ideas that they didn’t have, but you sold to them, to give them ownership,” Mr. Allaire recalls advising her.
• Ms. Burns spent much of the 1990s building a track record leading teams in areas like the fax business and office network printing . She was named vice president for global manufacturing in 1999.
• ROUGHLY a decade ago, Xerox was in turmoil, the result of misguided strategy shifts, a bloated bureaucracy, a boardroom drama, mountains of debt, a plummeting stock, bankruptcy rumors and the Securities and Exchange Commission crawling all over the company about accounting irregularities.
• Board members told her that abandoning Xerox would be like leaving a sick spouse. If she left, they said, others would take it as a sign that the company was unsalvageable.
• Ms. Burns was named president of Xerox in 2007, a signal to investors and employees that she was the heir apparent.
• “On my face, you could tell everything in 30 seconds,” Ms. Burns says. “You could tell exasperation. You could tell fed-up-ness. She said, ‘You have to develop more of a poker face because people will watch you for everything.’ ”
• She got other frank advice along the way — about polish, patience, perspective and the importance of building “followership” across the organization — from other mentors, including Vernon E. Jordan Jr., the power lawyer and former Xerox director, and Kenneth I. Chenault, the chief executive of American Express.
• During her tenure, Ms. Mulcahy focused on cleaning up the balance sheet, strengthening ties to customers and getting out of commodity businesses like desktop printers.
• But Xerox urgently needs to build revenue (sales dropped 14 percent, to $15.2 billion, in 2009) and to perk up its stock price, which remains below $10 a share after spending a long stretch of the last decade above that mark.
• “I was fortunate that we had an economic crisis right when I was taking over,” she says. “I’m serious. Without that, it would be significantly more touchy.”
• “One of the things that I was told early on is that you should never let them see you sweat,” she says. “I remember hearing that and saying: ‘Oh, my God! I think that they have to see you sweat.’ “
• She has also punted advice that she adjust her speaking style. It was too New York, people told her — too fast, too informal. Instead, she makes sure that her speeches sound like her and avoid the use of $10 words — like, she says, “bespoke.”
• “What I realized was I have to know my content and know what I want to say, and be significantly less concerned about how I say it,” she says. “I can’t try to say it in somebody else’s voice. I have to say it in my voice.”
• “People actually believe that before they come to you that they have to have perfection,” she notes. “I get the neatest presentations in the world.”
• if you ask her for a new assignment, a promotion into a new role, you’re likely to hear the speech she first heard long ago from Mr. Hicks about “getting to zero” with a job.
• If you left there, basically all this area under the curve, which is negative, which is take-away, you owe the company all of that.
• a manager is expected to contribute — what to give back — after absorbing all of the training and experience that exists below the left side of the line. The balance amounts to “getting to zero.”
• You can only leave after you put in as much above the curve as under the curve.
• What were her big influences before she joined Xerox? The answer, she says, is “150 percent my mother. My mother was pragmatic, focused and extremely, exceedingly practical, and she was the ultimate self-determining person.”
• Her family (her father was never in her life) lived on the Lower East Side of Manhattan — “when it was really bad, when the gangs were there and the drug addicts were there.”
• “Where you are is not who you are,” she would tell Ms. Burns and her brother and sister. “Don’t act like you’re from the gutter because you live in a place that’s really close to the gutter.”
• “She was very, very black-and-white and very clear about what responsibilities we had,” Ms. Burns recalls. “One was that we had to be good people. And the second thing is that we had to be successful. And so her words for success were, ‘You have to give’ — and she would say this all the time — ‘more than you take away from the world.’ ”
• Her mother, who died before she could see her daughter rise to the top at Xerox, also insisted that her children get a college education. “You have to learn and you have to be curious,” she would say. “You have to perform at your best. You have to worry about the things you can control. Don’t become a victim.”
• She repeated one of her mother’s sayings to them: “Stuff happens to you, and then there’s stuff that you happen to.”
• As president in 2008, she was paid $887,500 in salary, a $554,688 bonus and about $4 million in stock, according to an S.E.C. filing.
• Ms. Burns will often do the laundry herself, knowing that it sends a good message to her daughter, a high school senior.

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• Aging populations have been promised huge health and retirement benefits, which countries haven't fully covered with taxes. The reckoning has arrived in Greece, but it awaits most wealthy societies.
• Americans dislike the term "welfare state" and substitute the bland word "entitlements." Vocabulary doesn't alter the reality.

• As part of NEWSWEEK's partnership with Kaplan University, NEWSWEEK Chairman Richard M. Smith spoke with Hyundai USA chief executive John Krafcik, an MIT graduate who worked for a GM-Toyota joint venture and Ford before joining Hyundai in 2004.
• When we recruit and think about promoting people, one of the first things we look for is their comfort with this really important philosophy at Hyundai, which is: "Never set a target you know how to hit."
• right now every Hyundai engine goes full-throttle red-line for 300 hours on a test stand
• American automotive dealers are incredible entrepreneurs, and 50 or 60 percent of them really understand what they need to do to deliver a great experience for the customer. But a substantial portion of them haven't figured it out yet. We get letters from people who feel they were taken advantage of during the sales process.
• The key for us is to stay hungry and stay humble.

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• "The idea of a high-quality American beer had become a complete oxymoron,"
• People don't drink the marketing, they drink the beer

• a frustrating aspect of the government-mandated, free credit reports: the glaring absence of the numerical credit score

• Retailers have begged Congress for years, in vain, to limit the fees they must pay to banks when customers swipe credit or debit cards.
• Sixty-four senators, including 17 Republicans, agreed to impose price controls on debit transactions over the furious objections of the beleaguered banking industry.
• Meddling in dealings between businesses generally is anathema to Republicans and a relatively low priority for Democrats.
• Lobbyists for the wounded but formidable banking industry made clear to some senators that this decision would affect future campaign donations
• The Durbin amendment gives the Federal Reserve new authority to regulate and limit the fees that businesses pay to card companies. It specifically addresses payments processed through the Visa and MasterCard networks. American Express and Discover cards are not covered by the bill.
• Last year businesses paid Visa and MasterCard $19.71 billion on debit card transactions
• Visa and MasterCard in turn passed about 80 percent of the money, roughly $15.8 billion, to the banks that issued the cards.
• The legislation directs the Fed to cap those fees at a level that is “reasonable and proportional” to the cost of processing transactions.
• last year, fees averaged 1.63 percent of the transaction amount
• Visa and MasterCard impose an all-or-nothing requirement on businesses, requiring them to accept cards even on small transactions, and prohibiting businesses from offering discounts based on the method of payment. The amendment strikes those rules.

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• a Web site called NetworthIQ, which allows people to record their net worths and display the ups and downs for anyone to view
• We tend to have an intense curiosity about our neighbors and friends, especially those who seem to earn about what we do but spend a lot more.
• does our almost irresistible urge to rank ourselves against others based on any available data serve as a source of inspiration? Or does it lead to endless striving in search of some ever-elusive achievement?
• “We’re now extraordinarily rich by almost any standard of human history. But because we are creatures of comparison, it’s harder to get happier and happier.”
• If we could all be a little less uptight and more communicative and social about it, we’d be getting better advice, and it wouldn’t be the sort of thing that we stress about privately.
• Net worth is not precisely calibrated with financial freedom. If Mill used all of his savings to pay down some debt, his net-worth figure would remain the same, but he would have no emergency fund if he lost his job.
• “If people have a billion in net worth and are spending half a billion in a year, they’re really poor.” After all, they’re on pace to be broke in 24 months.
• Sherman’s preferred measure of financial health for retirees is a ratio that compares net worth, excluding home equity, with the amount of money people take from their portfolios each year. He generally doesn’t want clients spending more than 4 to 6 percent of their holdings annually.
• She worries that doing so would inject tension into her offline life. Her friends might think she was bragging about her frugal habits or implicitly criticizing their spending. Indeed, talking about wealth or good fortune can seem coarse or boastful, and maybe some people don’t want poor relatives to know to what extent they could be helping — and aren’t.
• When I pass out tests, the first thing students want to know is what the mean was. They don’t know how to interpret their score unless they know how well others did.

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• since 1975, the earliest year he has studied, insiders have been correct far more often than they’ve been wrong
• In the late 1970s and early ’80s, for example, he found that the average stock bought by an insider outperformed the overall market by three percentage points in the 50 days after the purchase.

• I don’t micromanage, but I have microinterest
• Every day, I read about 1,000 pages of documents, whether grants or letters or scientific articles, or whatever. I have learned what the critical things to read are.
• there may be one or two points where the outcome of the entire project is at stake, and there you’d better be on top of it
• His whole idea was that you can’t possibly be competitive in the world unless you actually go outside your own geography and learn the way other people live and think. That probably was the most important lesson I learned — that what’s out there is more important than what you already know, and that you’d better go out and learn what it is out there that you don’t know.
• what I learned from him is that when you actually are with somebody, you’ve got to make that person feel like nobody else in the world matters. I think that’s critical.
• for example, I don’t have a mobile phone turned on because I’m talking to you. I don’t want the outside world to impinge on the conversation we’re having. I don’t carry a BlackBerry. I do my e-mails regularly, but I do it when I have the time on a computer. I don’t want to be sitting here thinking that I’ve got an e-mail message coming here and I’d better look at that while I’m talking to you. Every moment counts, and that moment is lost if you’re not in that moment 100 percent.
• what are really the best things about the people I have? What makes them great, and how can I really improve them one or two notches? And if I spend my time on that, then I’ll have a great organization
• You have to have people in an organization who are willing to truly embrace change, because if they don’t, then what you have is an organization that’s constantly fighting to stay at the status quo.
• Intelligence is often more displayed in what I would call complex abstract thinking, and there’s nothing more complex and abstract than human relationships.
• You have to tell people about yourself in a self-deprecating way in order to get people to hear you.
• how do you turn a battleship? You turn a battleship by making a directional commitment and staying the course, not wavering from it.
• I also try to give positive feedback in other moments. To try to mix the two is often very hard, because the positive messages get lost in the one negative message, and the negative message gets garbled.
• figure out what your North Star is
• I don’t think anyone should do one job for too long a time. I think every five to eight years you should be willing to take on some different challenges.

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• Some labor experts say the basic functioning of the American economy has changed in ways that make jobs scarce
• Large companies are increasingly owned by institutional investors who crave swift profits, a feat often achieved by cutting payroll. The declining influence of unions has made it easier for employers to shift work to part-time and temporary employees. Factory work and even white-collar jobs have moved in recent years to low-cost countries in Asia and Latin America. Automation has helped manufacturing cut 5.6 million jobs since 2000 — the sort of jobs that once provided lower-skilled workers with middle-class paychecks.
• “American business is about maximizing shareholder value,” said Allen Sinai, chief global economist at the research firm Decision Economics. “You basically don’t want workers. You hire less, and you try to find capital equipment to replace them.”
• Traditionally, three sectors have led the way out of recession: automobiles, home building and banking.
• a work-based safety net without any work
• “There are no bad jobs now,” she says. “Any job is a good job.”

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• Selling to the poor is a tricky business. Poor people pay more for just about everything, from fresh groceries to banking; Prahalad, the economist, calls it the “poverty penalty.” They pay more for all kinds of reasons, but maybe most of all because mainstream firms decline to compete for their business.