All posts by MyOrbit-Team

Capital Markets, Market News, Risk Management

Société Générale hit by $7 billion loss by Rougue Trader- video report

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As you may be aware, amidst this past week’s financial market turmoil world wide, we had another very significant development happening. French banking giant Societe Generale revealed a trading fraud which cost the bank $7.2 billion.

Trader Jérôme Kerviel had built combined trading positions over recent months, totalling about €50 billion or $73 billion. SO in this past week, SocGen unwinded about $70 billion dollars of positions (after considering that about $3 billion were direct position losses acknowledged by the bank). One can only imagine the kind of challenge given to SocGen’s best traders to unwind such large positions without causing panic in the markets and protecting their stock price.

This report by Wall Street Journal is the best so far.

We can probably use the simple thumb rule that for every one fraud revealed, at least one more will not be revealed, and one can only imagine what all is hidden in those back office billion dollar trades.

Here are two video reports:

Imagine… SocGen is known internationally for its expertise in equity derivatives. And Risk Magazine had awarded the bank its “Equity Derivatives House of the Year” this month. So a lot of work is needed on the reputation front, to ensure that it does not lose profits from its equity derivatives business. Building reputation is hard; rebuilding is harder.

Innovation, Internet, New Media, Online Marketing

Podcasting For Business Communications

Podcasting is one of the newer methods for Business Communications. You may have already seen podcasts from a variety of special interests groups sending out their messages online to interested individuals. in the same promotional theories.

If you use podcasting properly, you can send a recorded audio message/discussion to all employees or to specific customers who has agreed to receive the information. Podcasting for business can also be information made available to recipients without it being automatically delivered to their device – like sending a URL where the actual podcast is available. This practice is more friendly to the target audience as they can view the message at their convenience.

Podcasting for business can be used to send information to employees by way of their cell phones or handheld devices. For example, a recording by the CEO on the new market challenges.

The podcast is uploaded to a server or distribution service where it can automatically to broadcast to all intended recipients at the same time. This ensures that all employees get the same message at the same time. The receiving devices can be used to view the message at the recipients’ convenience and with the right software and structure a confirmation message can be transmitted back to allow the sender to know the information has been received.

Other uses of podcasting for business include sending information to customers through wireless devices or by sending an email to them giving them the address at which information about products and services are available through podcasting.

This is ideal for sharing information that customers may find useful. For example, some best practices, or an interview with a product/solution expert that answers FAQ on a given topic.

Distribution: Sending an email or text message direct ing them to a podcasting site is recommended when podcasting for business. For example, here’s a podcast from Harvard Law School

Respect Privacy: When using podcasts for sharing information with customers, please make sure the customer has agreed to receive the information, to protect your business from any charges of spamming.

Artificial Intelligence, Innovation, People

Artificial Intelligence Evolution & Trends

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If you are interested in the concept of Artificial Intelligence, this post if for you. Here’s an interesting video on the topic of technological singularity.

The technological singularity takes place when the human race succeeds in creating an A.I being more intelligent than any human could ever be. Let us call it Alpha. Since the act of creating Artificial Intelligence is a task that benefits directly from the intelligence level of the creator, this more-intelligent-than-men being would surely be faster and more efficient at creating his own A.I being, let us call him Beta. This second generation being would too be better than its predecessor, and could in turn create a third one, Gamma, who is even more powerful, and so on. As capacity increases, the median generation time decreases, resulting in an exponential rate of evolution that quickly becomes asymptotic, at which point it becomes difficult to speculate further. No one knows what Omega will bring…

Many people think of Artificial Intelligence (or AI) as the stuff of movies, but it is not. AI is slowly but surely moving forward in multiple fronts. Every time, we develop a software (or a combination of software and hardware) that can make a decision on its based on dynamic events, it is AI.

We can be sure about the potential and very realistic possibility of AI playing greater role in more common works, like helping companies in analyzing data and trends to make business decisions. It may not be something that will be launched like a shining brand new car, but fair amount of groundwork continues to happen – for example, how Google analyzes the activities of millions of web surfers – developing a system that can do more than what any group of peoples can achieve. Some other companies are actively using Neural Networks in a variety of market data analysis and prediction. There are endless possibilities.

Do let us know if you are involved or interested in such projects. Some of our team members keenly follow such projects.

Business Development, Business Strategy, FAQ, Internet, MyOrbit Blogs, New Media, Online Marketing, Outsourcing, Start-ups

Top 5 Questions: How to Increase Online Sales?

2007 was the first year of MyOrbit – and full of great experiences. We consolidated our ground in E-Business and learned new things from our clients worldwide. Though we have completed 3 quarters, this New Year 2008 gives an opportunity to share the top 5 questions from our customers in 2007. If you are in any form of business – these will help you.

Q1. How can I increase my sales through online channels?

Answer: This really is a big question with no one answer – otherwise everyone would have done it! What we have found from our experience of running multiple businesses is that there is a need for a structured approach to attract targeted visitors (prospects) and ensure that the entire chain of events is planned – till the time an order is placed.

Many services companies will say “oh, this may work for product companies, but not for us”. This is just a lame excuse by someone who fears change. We have seen successful examples of services companies generating almost 80% revenues from their website + other online channels. The need is to create an online platform (say, a part of your website/blog) which shares valuable information with prospects, and a system which can do all of what a physical sales person can do. With Audio and Video possible on web-pages, a good website can generate more sales than a team of salespeople, at a fraction of the cost. The only expenses you have to make are for online marketing, for which you can see other posts on this site.

Q2. We have built a great website…now how do we promote it?

Answer: Do you know which places your clients and prospects visit often? That’s the place you need to advertise in some way. Consider buying text links, we have found them best on performance/price. Some sites also offer paid articles referring your site – those are good too. For example, our clients often visit sites like: www.cio.com, www.cfo.com, www.ft.com, and many smaller sites – all of them are good options to advertise. Small sites and blogs can give a great return on online ad spend. So invest some effort in that. Over the last 6 months, we have developed a way to identify such small sites relevant to each business, and you can contact us for more info.

Q3. What are the options to increase my online sales?

Answer: There are numerous options, and each product/service should plan a suitable mix of them: Pay Per Click (PPC) Advertising, Text Link or Banner Advertising on High Traffic Sites, Sponsored Articles on Sites or Blogs, Email Marketing, Mobile SMS Marketing (this is a very exciting area, and will evolve rapidly in 2-3 years – if you are a consumer products/services company – you just can’t afford to ignore this).

Q4. How much should I spend on online marketing?

Answer: Just like in a physical, brick & mortar business – your online marketing budget would have two components: (1) Brand Building (2) Product/Service Marketing. Now, if you already have a known brand, then skip (1), and spend effort and money only on (2), which is more focused towards earning dollars by selling your Product and Services. Plan to spend up to 10% of the sales volume, and spend in phases to ensure results are coming. So if you have a product/service of $500 value, and you want to sell to 200 customers, then your desired sales volume = $100,000. So you should plan to spend up to $10,000 in online marketing. This does not include your fixed costs, like staff salary and business operating expenses.

Now, it’s important to note that the amount you spend will depend on the gross margin you have on the product/service. So you can choose to spend just 4-5% as well. But 10% is on the upper side, and will perform very competitively to physical sales people. If you are spending more, you are probably not executing well and there is room for improvement.

Q5. What kind of team and skills do I need to increase my sales online?

Answer: The team can be very lean, but must understand your business and products/services well, and also understand how information is shared in the Internet space. Many Small and Medium businesses are able to do it (with some initial guidance) with just 1-2 full-time staff because they can easily coordinate with the sales and production teams. But its a different problem in large companies: the marketing departments often don’t have the skills and support to generate online sales, and the sales teams don’t have access to any part of the website – so it’s a difficult situation.

Our recommendation is to give the responsibility of online sales also to the Sales/Product Teams, and give them the tools and training to make it happen. Regardless of your company size, new media tools can be (and should be!) used successfully. If you are not sure about your team’s understanding/skill of operate your blog (write and discuss with audience), you can contact us for inputs as we have done it for a few companies in 2007. At its core, your website is an extension of your key business people and presentations – and is best suited to generate business leads.

We hope you found these answers useful. You are welcome to ask your questions on how to increase online sales.

Wishing you a great 2008!
Shankar AVSB
CEO, MyOrbit