1. Know Where Motivation Comes From

There was a manager named Tom who came early to a seminar we were presenting on leadership. He was attired in an olive green polo shirt and white pleated slacks ready for a day of golf.

The golfer Tom walked to the front of the room and said, "Look, your session is not mandatory, so I'm not planning on attending."

"That's fine, but I wonder why you came early to this session to tell us that. There must be something that you'd like to know."

"Well, yes there is," the manager confessed. "All I want to know is how to get my people on the sales team to improve. How do I manage them?"

"Is that all you want to know?"

"Yes, that's it," declared the manager.

"Well, we can save you a lot of time and make sure that you get to your golf game on time."

The manager Tom leaned forward, waiting for the words of wisdom that he could extract about how to manage his people.

And we told him:
"You can't."
"What?"
"You can't manage anyone. So there, you can go and have a great game."
"What are you saying?" asked the manager. "I thought you give whole seminars on motivating others. What do you mean, I can't?"
"We do give whole seminars on this topic. But one of the first things we teach managers is that they can't really directly control their people. Motivation always comes from within your employee, not from you."
"So what is it you do teach?"
"We teach you how to get people to motivate themselves. That is the key. And you do that by managing agreements, not people. And that is what we are going to discuss this morning."
The manager put his car keys in his pocket and sat down in the first seat closest to the front of the room for the rest of the seminar.
So learn the truth that anything or anyone you motivate must start from you and only You. 

"Leadership is the art of getting someone else to do something you want done because he wants to do it".
—Dwight Eisenhower

Ways of Motivation

Introduction


Don't believe anything you read in this series.
Even though these 100 easy articles were written from real-life coaching and consulting experience, you won't gain anything by trying to decide whether you believe any of them. Belief is not the way to succeed here. Practice is the way.
Grab a handful of these tried and proven ways to motivate others and use them. 
Try them out.  ..........See what you get................ Examine your results................ That's what will get you what you really want: motivated people.

Most people we run into do what doesn't work, because most people try to motivate others by downloading their own anxiety onto them. Parents do this constantly; so do managers and leaders in the workplace. They get anxious about their people's poor performance and then they download that anxiety on their people. Now everybody's tense and anxious!
Downloading your anxiety onto someone only motivates that person to get away from you as quickly as possible. It doesn't motivate them to do what you really want them to do. It doesn't help them get the best out of themselves.
Managers blame their own people for poor numbers, when it's really the manager's responsibility. CEOs blame their managers, when it's really the CEO. They call consultants in a panic, talk about the numbers, and then ask, "Should we do FISH? Do you recommend FISH?"
"FISH" is a current training fad that has a great deal of value in inspiring employees and focusing on the customer. But we don't deliver fish in this book. We deliver an observation about fish. "A fish rots from the head down," we remind the manager whose people are not performing. And that's our version of fish.
So, the first step in motivating others is for you, if you're the leader wanting the motivation, to realize that "if there's a problem, I'm the problem." Once you truly get that, then you can use these 100 ways.
The mastery of a few key paradoxes is vital. They are the paradoxes that have allowed our coaching and consulting to break through the mediocrity and inspire success where there was no success before.
Paradoxes such as:

1. To get more done, slow down.
2. To get your point across, stop talking.
3. To hit your numbers faster, take them less seriously and make a game of it.
4. To really lead people, go ahead of them.
These are a few of the paradoxes that open leadership up into a spiral of success you have never imagined.
Hope you'll find, as we have, that leadership can be fun if you break it into these easy pieces. 
 
 

Understanding World Indexes: Baltic Dry Index

The Baltic Dry Index/Dry Bulk Index (BDI) is an index covering dry bulk shipping rates and managed by the Baltic Exchange in London. The index provides an assessment of the price of moving the major raw materials by sea. It is a daily average of prices to ship raw materials. It represents the cost paid by an end user to have a shipping  company transport  raw  materials  across  sea  on  the  Baltic Exchange.  The  Baltic  Dry  Index  is a composite of three sub-indexes that measure different sizes of merchant ships - Capesize, Supramax and Panamax carrying a range of commodities including coal, iron ore and grain.

The Baltic exchange maintains prices on several routes for different cargoes and then publishes its own index, the BDI, as a summary of the entire dry bulk shipping market. Changes in the BDI can give investors insight into global supply and demand trends. To be more precise, the index measures the demand for shipping capacity versus the supply of dry bulk carriers. However, since the demand for shipping varies with the amount of cargo that is being traded in the market and the supply of ships, the index indirectly measures  global supply and demand for the commodities.

As the dry bulk primarily consists of materials that function as raw material inputs to the production of finished goods, such as concrete, electricity, steel, and food, the index is also seen as a good economic indicator of future economic growth and production.

Investing in the Index

When an investor buys a shipping stock which has presence in dry bulk, they are effectively buying into the Baltic  Dry  Index.  But  the  quantum  of  exposure  depends  on  how  the  company  enters  into  shipping contracts. For  instance  if  the  company has  its ships  contracted on  a spot  basis  then  it  implies  that  the contracts are  directly corelated  to the daily  price  of the  BDI.  This means  that their revenues are  directly dependant on the movement of the index. For example if the BDI price shows an increase it would entail a profit for the shipper. Another way of contracting is the time charter contract which means the shipper has entered into a contract which is usually 2-5 years in duration. This contract follows a fixed daily rate which protects the shipping companies profits in case of a fall in the BDI price. This gives the company an opportunity to hedge their risk against the falling BDI rates.

What makes the BDI rates / freight rates fluctuate?

The freight  market is subject  to a wide  range  of external variables, but it is  fundamentally driven  by the following factors:

•      Commodity demand – This can be understood from the levels of industrial production and the demand for different commodities such as steel , coal , iron ore, other metals , crude oil across the globe. Also, the performance of the specific industry gives us an indication of the level of demand. If the commodity demand is  strong,  BDI  rates  will  increase  regardless  of  the  spot  price  of  those  commodities.  For example – China being a major producer of commodities, if coal is demanded by them, then the BDI rates would see an increase.

•      Supply of Fleet – This depends on the different types of vessels available and the number of vessels being delivered/scrapped.The average age of ships is 25 years. If the average age of a ship is closer to that number, supply would decrease in the short term. But on the other hand supply is also determined by the delivery of new vessels.

 •    Seasonal pressures -The weather has a big impact on the shipping demand. For instance cold weather may increase the demand for coal and other energy creating raw materials which would push up the freight rates.

 •      Bunker  prices -With bunker fuel  accounting  for  between  one  quarter  and  one  third of  the  cost  of running a vessel, oil price movements directly affect shipowner margins.

 •      Market sentiment – Market opinion can greatly affect the freight exchange. The recent fall in the BDI can   be   attributed   to   many   companies   forecasting   lower   global   growth   and   cutting   their production/demand targets.

 

Index Interpretation for an Investor       

 
 

The index is the purest leading indicators of economic activity, devoid of speculative players. It measures the demand to move raw materials to the point of production. It helps an investor understand the demand for raw material as per the growth in the infrastructure sector and economy as a whole.

The BDI is totally devoid of speculative players as the trading is limited only to the member companies. The parties, which are relevant to secure a contract, are those who have actual cargo to move and have the ships to move it. The  BDI  will  show  how  much a company  or country  is  willing  to pay  to import raw  materials immediately.

For example, if a Chinese company has contracted out coal prices for the next year from Rio Tinto (RTP), then the  spot  price  of coal  increasing  after a mine accident will not impact that  established  contract. However, when this company is willing to pay more (per ton) to ship the coal then an investor can see that the price growth would accelerate.

When the BDI rates shown an increase, the cost of raw materials also goes up as the producers and refiners pass the cost of procuring the raw material along the value chain. At the end, the consumer would pay a higher price for the goods they derive from the raw materials, which get shipped across with a higher dry bulk rate.

For example when the rates of BDI went up in 2007 the cost of importing coal also saw a jump. A country, which meets its energy requirements through importing coal witnesses the situation that the overhead costs for factories goes up with the increase in the price of coal. As the overhead cost increases, the end product price also goes up in order to maintain the margin.

So in a nutshell we can say that when BDI increases, it has a positive impact on the margins and revenues of shipping companies. On the other hand when BDI decreases, the producers in the value chain stand to gain as their procurement cost comes down.

The index has gone through a flat move in the recent period and has seen a gain of ~10% and ~41% since the beginning of January 2010 and December 2009 resp. Note: The index has shown a strong recovery as it had not seen gains when the BDI was performing. Therefore 41% is basically on a low base. Additionally, increased OPEC spot fixtures in December 2009 and expectation of increased petroleum trading activity has led to the spurt in the index.