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At what age do institutions become calcified? Do they age like humans—confusion, followed by excitement, calming, wisdom, and fatigue—or do they possess a lifespan unique unto themselves? Is there a set time that their youth gives way to an arthritis of ideas?
I often wonder this, with regard to this magazine and its offshoots. This edition of aiCIO comes out on the eve of our fourth annual Industry Innovation Awards. Our fifth New York CIO Summit fast approaches, as does the five-year anniversary of our brand. We’ve certainly gone through the confusing part, and I hope we’re somehow bridging the gap between excitement and wisdom. But I fear, out of general concern more than specific suspicion, that one day we will wake up entrenched in the fatigue phase.
Our readers, of course, must feel this too—not about aiCIO but about their own situations and institutions. This issue, I hope, illuminates this tension.
As our founder Charlie Ruffel points out in this issue’s Consulting Corner piece, consultants have largely been sitting on the sidelines as ideas passed them by. Some—Rocaton Investment Advisors and NEPC, according to Charlie—have avoided this voyeuristic vantage point, but most have not. The result, Charlie asserts, is a calcified industry content with its lifestyle and reputation.
As shown in our two competing asset-manager profiles—FX Concepts’ John Taylor and the legendary John Paulson—calcification can occur (and can also be avoided) at the zenith of the hedge fund industry. Taylor’s fund went from $14 billion to bankruptcy in six years, the result of a lack of diversification, too many yes-men, and poor management, according to Managing Editor Leanna Orr. On the flip-side, Paulson—known universally, and likely in perpetuity, for one extraordinary trade—has quietly stuck to his knitting and evaded the petrification that sets in with so many of his peers.
Likewise, there are examples of public institutions that stay limber into their advancing years. For one—and I’m not saying he’s anywhere near done—Britt Harris, our Lifetime Achievement Award winner and the CIO of Texas Teachers, has continually reinvented the way institutions invest assets, most recently by aggressively pursing strategic partnerships with the best of Wall Street.
And, of course, there is the rest of the Class of 2013: the 10 CIOs, representing 10 asset-owning institutions, who grace this cover. Their locations range from Singapore to Detroit, and within their profiles I believe you’ll find examples of the very best in (uncalcified) asset management.
And if you don’t? Well, try to beat them. For, unless aiCIO succumbs to my worst fears, there is always a Class of 2014.