Saturday 28 December 2013

Salary Comparison for Project Management Professionals in 2013


The median salary of Project Management Professionals has been found to vary with a number of key demographic factors, as per a '2013 Salary Survey' report published by Project Management Institute, PMI, US.  These include factors such as:
  • Country of employment
  • Number of years experience in project management
  • Position/Role
  • Average size of projects managed, including average project budget and average project team size
We present the comparison of salary information for 10 countries from the PMI report.

Country of Employment

The median salary for project management professionals vary widely from country to country.  The country with the highest median salary ($134,658 USD) is Australia, whereas India and China are amongst the countries with the lower range of median salary (around $27,000 USD).

Country


Position

Within the various levels of project managers, salary appears to increase with added responsibility as a person proceeds from being a Project Manager, to a Program Manager, to Portfolio Manager, to the Director of a Project Management Office. There are some exceptions to this order though. In Germany the salary of Director of PMO is less than the salary of Portfolio Manager. The differential salary increase between different levels appears to be low in Japan, China and India.



Position


.


Number of Years Experience in Project Management

The number of years a person has worked within the project management profession has a direct positive correlation with the salary. Again the difference in median salary varies by country.  A dramatic increase is seen in Nigeria.  The median salary ranges from $19,231 (USD) for those just starting out in the project management field to $61,538 (USD) for those who have been in the field for 10 -15 years.  This represents an increase of nearly 230% from low-to-high experience in the field.  The difference in median salary is not as striking in China.
Experience


.

Project Size (Average No of Team Members and Project Budget)

The size of projects managed, in terms of average number of team members and average project budget, also appears to have a positive correlation with annual salary.
In Nigeria, those managing projects with budgets of $10 million or more earn 96% more than those with projects under $100,000. In Japan and India the figure is around 50% more. In Japan, China and India those managing projects with larger teams (20 or more people) have a median salary that is 30 - 34% higher than those managing teams of 1 to 4 people.
TeamMem



Budget



Thursday 19 December 2013

Beginning of Fed Taper - Impact on India and other Emerging Markets


Two major events scheduled on the 18th of December, were seen as deciding factors for the stock market movement in India by the end of 2013.

First was the announcement of monetary policy by the Reserve Bank of India (RBI) governor. Raghuram Rajan beat the market expectations of a hike in interest rates and surprised the markets pleasantly with no changes to the current monetary policy. RBI kept the repo rate unchanged at 7.75 % , the reverse repo at 6.75%, the cash reserve ratio at 4% and the marginal standing facility and the bank rate at 8.75%. Markets reacted favorably to the announcement.

taper


Later on the same day, US Federal Reserve Chairman Ben Bernanke initiated pullback from Quantitative Easing (QE) before the end of his term in 2014 with Janet Yellen taking over as the Chairperson of Federal Reserve. The size of the taper, $10 bn was in line with what the market had expected back in September, 2013. The announcement saw the US markets shooting up. DJIA closed up by more than 1.84%, Nasdaq by 1.15%, S&P  500 by  1.68 % respectively. The day after, Asian markets reacted to the taper with Japan's Nikkei rallying while Hong Kong, Shanghai and Indian markets swinging between gains and losses. The European stocks rallied to US Fed taper.

In the Federal Open Market Committee (FOMC) quarterly meet held on 19th June, 2013, Fed Chairman Ben Bernanke had first given an indication about the potential reduction in Fed’s bond buying program, subject to improvement in the US economy. Some of the indicators of economic recovery considered were unemployment target (at 7 percent), targeted inflation rate (at 2 percent) and economic growth (between 2.3 - 2.6 percent) for 2013. The announcement had sent jitters in the world markets and laid bare the tremendous impact that decisions about the US monetary policy, have on markets all over the world.

The Federal Reserve had adopted an expansive monetary policy, since 2009, with the objective to spur economic growth in the US. After the financial crisis of 2008, Fed had rolled out new emergency lending programs to bail out the banks and had lowered the federal funds interest rate from 2 % to a range between 0 and 0.25 %. When the interest rates could not be further lowered, Fed started the first round of QE in March 2009 to help revitalize mortgage lending and support the housing market by increasing the availability of credit in private markets.

The second round of QE by Fed, began in November 2010, to strengthen the economic recovery and protect the economy from falling into deflation. In September 2011, Fed stepped up its purchases of Mortgage Backed Securities (MBS) and on September 13, 2012, the Fed announced QE3, thus adding a total $85 billion of liquidity a month.

The rise in liquidity in the US market due to Quantitative Easing saw money flowing into Emerging markets as US investors invested in these stock markets in search for higher returns. Inflows from Foreign institutional investors (FIIs) in Indian markets stood at $24.54 billion in 2012. In 2013, FIIs have infused around $18.7 billion into Indian equities so far in 2013.

Uneasiness crept into the world markets in June 2013, after Ben Bernanke hinted of starting a gradual withdrawal of QE by the end of the year if the economic data supported the story of improvement in the US economy. The investors, having gotten used to the excess liquidity, became very concerned about the end of Federal Reserve's accomodative policy stance and thus stock markets started exhibiting higher volatility in anticipation of start of taper.

Throughout the year Ben Bernanke was seen managing the expectations of the markets and investors, and giving assurances to start reducing its bond-buying program in a manner that would cause minimal disruption to the markets. In their previous policy meet in September, 2013 FOMC surprised the markets by delaying the taper when the market was almost prepared for it. As a result most markets were exuberant and picked up the upward momentum again. FIIs resumed buying into the Indian markets in September.

In its last policy meet for 2013 on 18th December, FOMC surprised yet again, albeit partially, as they chose to go ahead with the taper when only a minority was expecting it. Fed stated that the decision to reduce its monthly bond purchases by $10 billion was taken in light of:
  • Improvement in the US job market.
  • Easing of Fiscal restraint.
  • Expected increase in inflation up to 2%.
As a counterweight to try to avoid a very bearish market reaction, the FOMC maintained a dovish forward guidance and said that they to expect to keep the funds rate at zero until well past the unemployment hits 6.5 percent.The first rate hike is not likely to happen until 2015, according to the projections released by the FOMC.

Under the leadership of Yellen, if Fed continues to pull back on it stimulus, the markets may begin to perform more in line with economic fundamentals and the returns could diminish. The impact might be felt worldwide as the US investors investing in other countries may take money out of those markets to invest in the US. Besides, the fact that the US dollar plays a crucial role in international markets, makes the markets extremely sensitive to any policy that impacts the dollar. The effect of outflow could be pronounced in the emerging nations which depend on dollar inflows to finance their current account deficits. The currencies of the Emerging Markets, may face risk of further depreciation if large outflows take place from these countries.

With the currency stabilizing and the improvement in the current account deficit (CAD) , we hope that impact on the Indian market remains muted in the year 2014.


Monday 16 December 2013

Collaborative Attitude or Individual Brilliance


Source:   www. cutcaster.com
Source: www. cutcaster.com



Collaborative attitude vs. individual brilliance has always been a matter of debate. The subject elicits different responses depending on the socio-cultural context.

Countries like Japan, with team driven culture, have made remarkable progress in technology, thanks to their collaborative attitude. The American system and the European systems have been able to drive innovation with the help of their educational and legal frameworks that allow for collaboration between various people, encourage out of the box thinking and risk taking.

In the Indian society though individual brilliance is highly admired, but team working skills do not receive the desired consideration. That often impedes the output. The advent of electronic gadgets, internet (strangely yes!), increase in nuclear families and increased urbanization have further reduced the social interactions.Nowadays we are seeing that kids increasingly prefer to be confined to their homes playing with gadgets instead of going out to play. In the public transports, people remain glued to their phones, tablets, kindles, etc. rather than talk with their fellow travelers.  The reduction in social interactions may further deteriorate the collaborative skills and team working abilities.

Additionally, the education system plays an important role in shaping up the skills and attitude. The Western education system and some other education systems like the Japanese system focus on building up specific skills and concept learning which fosters a culture of innovation and higher productivity while the education systems in India and in some other Asian countries promote verbatim learning that does not leave much space or freedom for creativity.

The legal system too determines attitude towards work by providing mechanisms for protecting original pieces of work e.g. protection of patents, trademarks, strict laws against plagiarism etc.

If you look at the global business scenario, though some organizations are leaning towards providing work from home facility to their employees to  reduce their cost of operations, but most others believe that productivity increases in an ecosystem that encourages more social interactions between the people.

Apple and Microsoft are designing offices in which people bump into each other more and exchange ideas. Yahoo has banned employees from working from home so that employees work more effectively by having more face to face interactions rather than by using more efficient means like email, phones, etc. Jack Welch, as GE insiders say, would look at the body language and commitment exuded by the manager presenting new ideas rather than look only at the details of the plans.

One of my senior business acquaintances who hails from Korea told me that two things are very important to succeed and drive changes and innovation in an organization – team work and passion. While passion comes from within, people who can work and contribute to a group effort are very important to organizations which in turn have to build up ecosystems to nurture group efforts. He also mentioned that humans who can use their left and right brains equally well are more productive than single brained humans. The left side of the brain is used in structured and analytical work while the right side of the brain is used for instinctive work like arts, sports, etc.

The need for collaboration is further corroborated by an American research finding. In a Scientific American, article  " The limits of intelligence” published in July 2011, Douglas Fox claims that the human brain has reached its limits of intelligence. Now, this sounds counter-intuitive because if the human brain can`t get any better, then how can human output increase in this age of “innovation”.

Fox says that one way is by better social interaction leading to a collective pooling of human brain and the second way is by use of technology (viz. internet).

.

Thus, social interactions facilitated by culture and technology can actually reduce the need for greater individual smart brains!


.
This information based on the research has very important ramifications for organizations, institutions, societies, etc. which are highly influenced by human behaviours.
  • One man army teams, teams with rock stars and high calibre people who can`t gel in a team will have limitations beyond a particular point. As the saying goes – “the whole is better than sum of the parts”.
  • Well rounded personalities would be preferred as compared to uni- dimensional personalities in managerial positions. In an organization a person with high IQ but average – low EQ would be a disaster. Highly left brained or right brained people would find it difficult to contribute to an overall cause beyond a limit.
  • To identify the correct people, organizations would need to have robust recruitment and training processes. People in managerial posts would need to have interests in varied activities like sports, arts, music, etc. to be effective managers.
  • The education system would need to be modified to stress not only on academics but also in extracurricular activities and sports. Rote based systems need certainly to undergo rigorous changes to suit the new challenges in a global system.
  • Women managers would need to be given more positions of responsibility as generally they are better off in team work and more well-rounded and balanced personalities as compared to men.

As my Korean friend said

“Team work” and “Passion” are some of the most important aspects in life.

How true!!
-       Contributed By Ram Narayanan, Sloan Fellow, London Business School

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Thursday 12 December 2013

Ten Most Traded Currencies in the World in 2013


Notwithstanding the fact that trading foreign exchange on margin carries a high level of risk, the world’s largest market with 24-hour market action is the currency trading market.

There are more than 190 countries in the world with currencies that can be traded, of course, subject to government restrictions. The value of daily foreign exchange trading exceeds the value of annual international trade in goods and services by more than one hundred times.

The cumulative share in daily currency trading of the top ten currencies is about 180 percent and the rest of the currencies in the world have a share of 20 percent.  (Since two currencies are involved in each transaction, the sum of the percentage shares of individual currencies totals 200% instead of 100%.)

As per reports of The Bank for International Settlements, which is an international organization of central banks, these are the top ten traded currencies of the world in 2013.


Rank
Currency
CountryShare of trade (%)
1US DollarUSA87.0
2EuroEurope33.4
3YenJapan23.0
4British PoundGreat Britain11.8
5Aus DollarAustralia8.6
6FrancSwitzerland5.2
7Canadian DollarCanada4.6
8Mexican PesoMexico2.5
9YuanChina2.2
10NZ DollarNew Zealand2.0





1

The U.S. Dollar


Nearly 87 percent of the transactions in foreign exchange markets involve the dollar.
The US Federal Reserve System was established in 1913 as the central banking system of the United States to keep up with the changing financial needs of the country. The Federal Reserve Board created a new currency called the Federal Reserve Note. The first federal note was issued in the form of a ten dollar bill in 1914.






Euro

2

The Euro

Even though it was introduced in 1999, the euro became the second highest-traded currency in the world with a 33 percent share in daily transactions.
In 1998, the European Central Bank was established. The euro was introduced in 1999 as the new common currency for 11 Member States including Belgium, Germany, Ireland, Spain, France, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland. The euro is not the currency of all EU Member States. Denmark and UK have not adopted Euro as their currency and some EU member countries are yet to meet the conditions for adopting the single currency.


Yen

5

The Japanese Yen


With a share of over 23 percent of the daily currency transactions, the Yen takes the #3 spot.
The history of the yen goes back to 1871 when it was adopted officially as the Japanese currency by Japan's Meiji government. In 1882, the Bank of Japan was established under the Bank of Japan Act as the country’s central bank.




GBP

4

The British Pound

The British pound has a share of almost 12 percent in daily currency trades. The official name of the currency is pound sterling. As one of the oldest central banks in the world, the Bank of England was founded in 1694 to act as the government’s banker and debt-manager.
It began issuing notes the same year, where notes had a few lines of engraved text, promising to pay a specified sum at the Bank's premises with spaces for a handwritten date, number, signature, and the name of the payee.


AUD

5

The Australian Dollar

This currency has over 8.6 percent share in daily currency transactions.
Till 1924, the Australian Department of the Treasury was in charge of issuing notes. In 1924, the Commonwealth Bank of Australia was given control over the issue of currency note.

...


Swiss Franc

6

The Swiss Franc

With over 5.2 percent of daily currency transactions, the Swiss franc takes the sixth spot.
Until the mid-19th century, cantons (states or provinces) and other entities were producing their own currency.  The Swiss National Bank was established after the introduction of the Federal Act on the Swiss National Bank in 1905. In 1910, the Swiss National Bank received its monopoly position in issuing money.



CAD

7

The Canadian Dollar

As the #7 currency in the world, the Canadian dollar has 4.6 percent share in daily currency transactions in the world.
The idea that government should issue currency started gaining support in the mid nineteenth century, but it was only in March 1935 that the Bank of Canada officially started its operations as the country’s central bank.

Peso

8

The Mexican Peso

The Mexican Peso has a 2.5 percent share in daily foreign exchange transactions and has been the currency of Mexico since the country got independent in 1821.
But Peso was first introduced into Mexico by the Spanish. Till 1785, it spread over almost all of the North America and gained status as the official currency system including United States.
Mexican currency is managed and issued by the central bank of the country i.e. Bank of Mexico.



CNY Yuan

9

The Chinese Yuan

With a 2.2 percent share in daily foreign exchange transactions, the yuan became one of the top 10 traded currencies in 2013, rising to No. 9 on the list due to a "significant expansion" in offshore trading, according to a report released by the Bank for International Settlements.
It's a sharp jump from the bank's last survey in 2010, when the yuan, known in China as the renminbi or "people's money," was No. 17 on the list.
China's central bank, People's Bank of China (PBOC) was established in 1948.

NZD

10

The New Zealand  Dollar

With 2 percent share in daily currency transactions,
the New Zealand dollar takes the #10 spot in the countdown.
New Zealand became a British colony in the mid-19th century.
The national currency was introduced in 1934 and, shortly after, the Reserve Bank of New Zealand (the country’s central bank) was created.




Source:
http://www.cbc.ca/news/business/chinese-yuan-among-top-10-most-traded-currencies-1.1703612


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Currency crisis in the Emerging Markets

Sunday 8 December 2013

Leadership lessons from the life of Nelson Mandela


Nelson Mandela
Illustration by Manas Maisnam courtesy Kanglaonline.com
As the world pays tribute to the departed great soul, here are some quotes from
Nelson Mandela By Himself: The Authorised Book of Quotations

On life
What counts in life is not the mere fact that we have lived. It is what difference we have made to the lives of others that will determine the significance of the life we lead.

On death
Death is something inevitable. When a man has done what he considers to be his duty to his people and his country, he can rest in peace. I believe I have made that effort and that is, therefore, why I will sleep for the eternity.

On determination
Everyone can rise above their circumstances and achieve success if they are dedicated to and passionate about what they do.

On time 
I never think of the time I have lost. I just carry out a programme because it’s there. It’s mapped out for me.

Leadership Traits of Nelson Mandela

In an article in theguardian, Andrew Rawnsley wonderfully describes the leadership traits of Nelson Mandela that made him one of the greatest leaders of the world.
  • Nelson Mandela had natural charisma, grace, exquisite manners, sense of humour and an air of dignified command around himself.
  • His mission in life was to replace apartheid with democracy. He had the moral courage and clarity of purpose to relentlessly pursue this ideal.
  • He had a powerful sense of destiny, but what made him so very rare was that unlike many other politicians, he did not succumb to megalomania, nor did he elevate himself to the pedestal of a demi-god.
  • He was a rebel, a warrior against the established order. In old age, he liked to remind people that Rolihlahla, his given first name, means troublemaker. There would have been no Mandela, the healer, had he not been preceded by Mandela the fighter.
  • A lesser known aspects of his character is guile. His ideal of a democratic and free society was non-negotiable, yet on most other matters he was flexible, even opportunistic. Being a politician, being a human being, he had his frailties.  He was loyal to a fault to old comrades who were mediocre and corrupt.
  • Mandela did not punish others to affirm their own moral superiority. Mandela affirmed his superiority precisely by forgiving. He won over his enemies with respect, empathy, forgiveness and superhuman magnanimity.
Read the excellent complete article at
Last but not the least, I thank my friend Manas Maisnam for making this beautiful illustration and sharing it.

Friday 6 December 2013

How to Manage Expectations


Source: www.howit.com


Very few people will dispute the fact that managing expectations is critical to the success of any relationship, be it a business relationship, a professional relationship, or a personal relationship. Managing expectations is all about setting the right expectations, communicating those expectations, and meeting the expectations.
A business that manages to balance the customers’ expectations with its product/service emerges successful. Failure to live up to the expectations of the customers, leaves them disappointed  At the workplace, employees are rated on how often they exceed expectations, meet expectations or fail to meet expectations; as such, at work people need to manage expectations at different levels. These include:

Setting expectations with your manager

How many times have you felt lost when you have been put on a job and nobody told you how to go on about it? If your manager does not give you clear instructions, it is necessary that you yourself approach your manager and ask specific questions that help you to understand what is expected from you. These could be questions on:
  • What is your role on the assignment.
  • Where to seek the resources such as information, training, tools, materials, space, money or people needed to do the assignment.
  • The expected schedule for reporting milestones and meeting interim deadlines.
  • What is the benchmarks for success at the milestone.
  • Guidelines or standards that need to be followed and boundaries that need to be adhered to.

Setting expectations with your clients

Businesses are run on the basis of relationship between a firm and its customers. As such it is very important for a business to know and cater to the expectations of their clients. For that every business needs to:
  • Anticipate the Client’s Needs.
  • Set expectations upfront while cutting down on the unrealistic expectations.  If you over promise and under deliver, people will be disappointed , but if you promise too little, people won’t try your product.
  • Manage expectations through constant communication.

Setting expectations within your team

Your team’s performance reflects your own performance. As such you need set expectations within your team and communicate those expectations clearly to steer your team towards the right direction.
  • Provide Structure, define boundaries.
  • Clarify roles.
  • Provide your team with resources that they need to accomplish their tasks to facilitate their work.
  • Set Motivational goals

Managing your own expectation

Last but not the least managing your own expectation is as important as managing expectations of your clients, your boss, your pears, your family or your friends. Your ability to manage your own expectations will shape your personal brand.
  • Set small achievable, measurable goals
  • Manage expectations of the outcome. Celebrate each small success but don’t let success rule your head or failure rule your heart.
  • Be persistent with your efforts. Step by step move towards the larger target.