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D. Sidney Potter: More Smoke and Mirrors From the Bank of America Pilot Program

April 3, 2012

For my inaugural posting for the formidable Huffington Post, let me get this out there for the record. Firstly, I am a card-carry registered Independent and proud of it. In terms of politically leanings, I adhere to the 80/20 rule. What is that you may ask? As a former commercial real estate broker, all sales guys will know what I’m talking about. As for which way I lean (Is it to the Left of Right?), follow my musings on the current state of economic despair of this great country of ours and it should be somewhat evident. As a clue, if I were a true rhino I would likely be a donkey! First up to bat for critical analysis, is Bank of America’s new pilot program, titled “Mortgage to Lease.” Rolled out last week with splashy headlines, the program is structured to assist its mortgage customers that are in current default on their loans. Sounds well-intentioned, right? (Not!) When you read the fine print, its got more holes than a piece of rotting Swiss cheese. Don’t believe me. Per the Bank of America website , note the following: · Have loans owned by Bank of America. · Are delinquent for more than 60 days. · Have exhausted modification solutions or have not responded to alternatives to foreclosure, including short sale and deed-in-lieu. · Have high loan balances in relation to their current property value. · Face considerable risk of ultimate foreclosure. · Have no junior liens. · Are still occupying the home. · Have adequate income to make an affordable rent payment. And I almost forgot, the program is limited to 1,000 customers, and to the states of Arizona, Nevada (two of my former stomping grounds as a new tract home investor), and the great state of New York. In addition, the 1,000 customers have to be “invited.” Which I must admit, I’m not certain what that means. “This pilot will help determine whether conversion from homeownership to rental is something our customers, the community and investors will support,” Ron Sturzenegger, legacy asset servicing executive of Bank of America said in a statement . “This program may have the potential to further round out the broad set of solutions we offer our customers in need of assistance.” Translated (and in code): We’re doing this program to stave off criticisms that we really don’t care for our customers when in fact we don’t… excuse me… I mean we do care. In all fairness to the banks, wherein most that work for them are taxpaying, God-fearing Americans that simply want to put food on their table, a pilot program of this non-magnitude is at least a start. Albeit it’s a ‘day late and a dollar short’ — figuratively and literally speaking. Kinda like offering a terminally ill patient medical assistance while their being filled with embalming fluid on a cold metal slab. It is however freakishly similar in scope (or lack thereof), of other “pilot programs” that are meant to quell criticism that the banks are not doing enough to assist their customers out of this scorched earth environment. The fact is, they aren’t, and this program isn’t helping. Three and a half years into this mess — or four and a half, depending when you start the clock as the ” beginning of the end” — many banks are still resistance to “change.” Why are most banks resistant? Because it’s difficult, primarily. It’s not that complicated. Making a cultural and organizational change to a cataclysmic financial meltdown is fairly difficult. Remember, at 35,000 feet it takes a 747 jumbo jet five miles to make a u-turn. Imagine a bank culture steeped in decades of entrenched resistance to anything different then what their use to. And this just doesn’t go for banks; it goes for the butcher, baker, and candlestick maker. Defining new paradigms is difficult – but not forgivable. As one example, and in 2008 when the banks started to realize that the rules would have to change and that they might have to play the game differently – in what I like to call the 1st Inning in the Game of Darkness, some mid-sized commercial banks in Los Angeles started to institute partial loan forgiveness and interest rate reductions for nearly all its loan. I repeat, for nearly all its loans. Even though the market capitalization rate for small to mid-size banks, community thrifts and credit unions are substantially different – kinda like a single prop Cessna idled next to a 747 Jumbo jet, they are still from the same aeronautical tribe – and in this case, similar banking tribes. The distinction between the variant response between large banks and their more nimble sized counterparts – is the culture stupid. In short, it all comes down to culture, organizational bandwidth and accountability to shareholders. Banks too big to fail are so fortified with bureaucratic layers of Brooks Brothers suits and “yes men” that expecting a reasonable degree of change is a Herculean task. Many of the changes bandied about over the past three to four years have been promulgated through the Home Affordable Act, which gave birth (some say prematurely), to the “alphabet soup” programs, such as HAMP, HARP, HAFA, etc — some of these programs I can proudly say I was a consultant on. America has witnessed the failure of these alpha programs as a result of the alpha male — and their inherent resistance to change. Try talking about the reasonableness of a “cram down” (aka principal loan reduction), to a banking operations manager, and you would think you were taking their first-born. And believe me, I’ve had these conversations at operation sites across the country. It’s not a popular topic. Nor are “pilot programs” for consumer advocates, who in short view there negligible efforts of the banking industry, as another attempt to disguise itself again in sheep’s clothing.

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Russell C. Smith: The Hunger Games and the Death of Winner-Take-All Capitalism

April 3, 2012

Much has been written about the underlying message of The Hunger Games , and how the inspiration for the dystopian Young Adult novel series came from the author Suzanne Collins flipping through TV channels between a reality television show and news footage of the war in Iraq. From this beginning, Ms. Collins delivered a series that has captured the imaginations of readers both young and old with a theme as ancient as war itself: offering up a nation’s young as lambs to slaughter. While the cinematic version of The Hunger Games may be more politically ambiguous than the novels, the time period in which the books were published is anything but ambiguous. America’s rude economic awakening had as much to do with being overextended in ongoing wars paid for on imaginary unlimited capital, as it does with large segments of the population getting by on overextended credit and never suspecting the other shoe was about to drop, and land right on top of their houses. With some economic forecasters predicting that a full recovery may not happen until 2018, America’s younger workers are witnessing their future economic infrastructure collapse around them. One could view the ritualized “killing as entertainment” of the tributes in The Hunger Games as an allegory about cashing in on the next generation’s future hopes and dreams. Add our deteriorating education system to the ongoing financial hard times, and we have a perfect storm of social and economic problems that could easily tip the balance toward social unrest on a scale not seen since the late 1960s. Without a healthy economy where a more all-inclusive segment of the population can depend upon a livable wage, we all lose, since everyone lives in and depends upon the same unstable system. And the powers that be can’t keep expecting people to accept an economically unbalanced system that’s simply no longer sustainable. The Hunger Games is a far more dark and complex vision than other recent popular teen sensations. One can easily find articles asking whether a movie like this could have been given the go ahead by studio executives a decade ago, much less promoted as a suitable teen movie, similar to Twilight or the Harry Potter movies. Critics and parents may already be looking fondly back on the safe reliability of teen girls making moon eyes and breathing heavily toward a vampire in their midst, or boy wizards battling the dark forces with his eager, well-groomed friends by his side. Nope, in The Hunger Games the revolution’s for real kids, and may the most kick-ass warrior win. It’s true, Harry Potter had its somber moments, but even in its most harrowing scenes it was set in a fantasy world full of wizards, witchcraft, and just the right amount of thrills and chills. In The Hunger Games , the stark images of kids dying on the field of televised battle, in a future dystopian United States where a decadent power elite rule the masses, seems a little too close for comfort. Politicians vainly scream out “class warfare” and “socialism” to fuel their followers when people rise up in protest, but a bold vision put up on screen lets our culture know what’s really going on. In the same way Orwell wrote about 1948 and titled his novel 1984 , one can ask whether The Hunger Games is a reflection of our current world or a warning of horrific things to come. Is the tip-off also in the title? Aren’t we all hungry for a world where innocence doesn’t have to be needlessly killed off, much less where blood sport as entertainment sinks down to appeal to younger and younger audiences, becoming more real as it continues in a downward spiral? In the meantime, The Hunger Games poses the question: Is all of this the inevitable result of Winner-Take-All Capitalism?

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Aaron Hurst: Working for a Good Company vs. Doing Good Work

April 3, 2012

Introduction: Based in London, Jenny Davis-Peccoud serves as the global leader of Bain & Company’s Social Impact Practice. Having spent most of her career at Bain, Jenny has been able to watch the evolution of the firm’s investment in social impact from the incubation and subsequent launch of Bridgespan in 2000 to the significant expansion of Bain’s own Social Impact practice and corresponding activities over the past 10+ years. Jenny and I spoke recently about Bain’s partnership with Bridgespan and Bain’s social impact investment strategy. With the 2000 spin-off of Bridgespan as an independent social change consultancy, what pro bono work does Bain continue to do? We’ve continued to do a lot of pro bono work and invest in major partnerships at Bain & Company. And we have a strong, collaborative relationship with Bridgespan, including ‘externships’ and shared partners. We believe as a firm in reinventing our industry. Our investment in Bridgespan was one way we did that – and it was created as a separate organization, as a nonprofit that understands what nonprofits need. But we also continue to invest in our own pro-bono work with organizations committed to driving change in their sectors. So, how much pro bono does Bain do each year? Bain does about 80 pro bono projects a year, and 60% of those projects have people 100% allocated for at least several months. We provided over $40 million of pro bono consulting services in 2011 alone. How do you know you’ve been successful in your pro bono engagements? Even for our corporate clients we systematically go back and ask if they were satisfied with Bain’s work. We use the same process with our pro bono clients as well, and see high satisfaction rates. Secondly, Bain tracks its success by results, and so we are driven to try to understand the impact and outcomes of our work. I’ve personally been involved in many homeless projects in the UK and we’ve had 5,000 homeless people return to full time employment over 10 years. If I’m a nonprofit leader interested in engaging Bain, how do I do that? We select our pro bono clients as we select our corporate clients. We look for bold, ambitious leaders who are looking to challenge the status quo, have big aspirations for major changes, and are keen to see results. As a firm, we work with Fortune 1000 companies and mid-market firms that have potential to be those leaders over time. To give you an example, in our education practice we work with TFA (Teach For America) – which is like the Fortune 100 of corporate America. But we also work with Students First, with a bold ambitious leader like Michelle Rhee, and it’s more like a start up. We believe both of them have tremendous capability. Beyond education, we’ve partnered with Endeavor, an innovative organization focused on using entrepreurship to effect change on a global scale. And these are just a few. Do they come in through a partner at the firm? Again like our corporate clients, we’re very intentional about who we want to work with and who has the most potential to make a tremendous impact in this field. While we do have organizations introduced to us through partner relationships, we still put them through the same screen of “will they have an impact?” We are drawn to organizations that are passionate about driving change in innovative, meaningful ways. What are you seeing in terms of the demands of current employees? It is very important for our staff to use their business training to benefit the community. While Bain’s focus is on for-profit clients, we encourage social impact and work to make sure that it can be an integral part of the Bain experience. Something very appealing to our people is that they can, for example, take leadership roles in nonprofit organizations early on in their careers through our pro bono work, or they can do externships to get hands-on experience with non-profits. Our employees are very proactive about their involvement as well. We provide a lot of opportunities to get involved, but it isn’t all top-down: much of what we do is ‘grassroots’ and driven by an individual’s passion. What roles does social impact play in the decisions of recruits? We’ve done some research on importance to employees of CSR and sustainability. About 20% will proactively make a decision on these things and will be involved when they’re here – so they are deciding where they want to get the best opportunity. The rest want to know that the company does these things and is making a difference in the world. Either way, we hope that recruits see that Bain is a place in which they can have impact in the social sector. Speaking of the 20% who want to personally engage, what are they looking for specifically? When we go out to business school campuses, we talk a lot about the various ways that people can get involved at Bain. The majority of people in the room are excited about pro bono and externships, and others want to get involved in our internal “green team” environmental efforts or work directly in the community. At Bain & Company, we provide many opportunities for our people to engage in the social impact work that they are passionate about while continuing to further their professional career in consulting. How do you see pro bono evolving globally? The US is clearly ahead, and that gets back to the historical anchoring of philanthropy in the American cultural mindset. Asia is quickly catching up. Europe is developing more slowly – with the London office as our most developed office in the region. All of our offices believe in the importance of social impact, however, and I’d expect our pro bono efforts to continue growing.

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Beverly Macy: How Social Media Helps the 401(k) Investor

April 2, 2012

How many of you did not look at your first quarter 401(k) statement on March 31? Even though the stock market is rising, most Gen Xers and many Baby Boomers with a 401(k) are still feeling the pinch from the financial free fall that began in 2008. And most everyone with a 401(k) is scratching their heads trying to figure out the ‘undisclosed fees’ associated with their dwindling accounts. In the past, you’d sit at your desk, statement in hand, and wonder alone. No more. Social media has changed nearly everything we do and 401(k) questions are no exception. These days, when something doesn’t seem right, savvy investors take to Twitter, Facebook, and blogs to discuss and get answers. Never mind that financial advisors have their hands tied when it comes to using social media… these socially connected consumers are all over it. In late 2011 The Spectrem Group released a study entitled “Use of Social Media by 401(k) Plan Participants” that showed that more than a quarter of plan participants today rely more on social media for communication than on traditional channels such as the telephone. Beginning next quarter, 401(k) participants will receive quarterly statements showing the dollar amount of fees and expenses deducted from their account and a description of what each charge is for. These fee disclosures are required by new Department of Labor rules and could provide shocking new information to 401(k) participants. Just wait until grandma finds out! Did you know that a recent AARP survey found that 71 percent of 401(k) participants think they don’t pay any 401(k) fees at all? So while Facebook, Twitter and LinkedIn are historically a tool of younger investors, older investors are beginning to use these mediums as communication tools as well. And they are a loud bunch. Many investors who receive the new 401(k) fee disclosures will have questions about what they are paying for managed accounts (in real dollars) outside company retirement plans. Smart portfolio firms are getting ahead of the curve. Mark Cortazzo, founder of Flat Fee Portfolios , and named to Barron’s listing of “America’s Top Financial Advisors” again in 2012 says, “The middle-income investor may be surprised about what he or she is paying for asset management. Investors with accounts under $500,000 could be paying 50-100% higher advisory fees than accounts over $2M.” By the time the underlying fund expenses are factored in, investors could be paying close to 4%. That’s why his firm provides institutional-quality asset management at a low, fixed rate. Something fully transparent that the investor can easily understand. So get ready, financial advisors. That big OUCH! you’ll be feeling is the wrath of Grandma taking to her Facebook page and the GenXer posting on Twitter about how much of their nest egg has been eaten up by 401(k) fees. Once again, social media will help save the day. Beverly Macy is the CEO of Gravity Summit and the co-author of The Power of Real-Time Social Media Marketing . She also teaches Executive Global Marketing and Branding and Social Media Marketing for the UCLA Extension. Email her at beverlymacy@gmail.com.

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Peter Smirniotopoulos: Education Reform: Why a Bachelor’s Degree Still Matters

April 2, 2012

This is the third installment in a three-part series on the need for education reform in the United States. The first installment, “Doubling-Down on Dumb: The GOP War on Being Smart,” explored the emerging political discourse criticizing public education and being well-educated, and how the toxic environment it creates makes real reform even more problematic. The second installment, “We Need an Education System that Promotes Creativity, Innovation, and Critical Thinking,” argues in favor of a paradigm shift in primary and secondary education, away from an over-reliance on rote learning and standardized testing . “For cities to have sustained success, they must compete for the grand prize: intellectual capital and talent.” New York City Mayor Michael Bloomberg. “Cities must be cool, creative, and in control,” Financial Times , March 27, 2012. Assuming, as was argued in the second installment in this series, that the U.S. reforms its public education system and our high schools are graduating students who are creative, innovative, and critical thinkers, then college becomes the first opportunity where these capabilities can be applied on a much larger, and more-challenging, scale. One of the many benefits of attending college — and, to a somewhat lesser extent, a two-year community college (because of its narrower geographic market area) — is that the universe of students, and their respective life and academic experiences and attendant perspectives, are greatly expanded. The student body at a college with 2,500 students or a university with 25,000 students, respectively, will be exponentially less homogenous than a student’s high school graduating class of 250, all coming from the same community. Moreover, the teaching talents and credentials of the faculty at the college level offer additional intellectual challenges. Anecdotally, when I attended Georgetown University as an undergrad, my philosophy professor, Wilfrid Desan , was an internationally recognized expert on Jean Paul Sartre and Existentialism, and authored the pioneering, three-volume work The Planetary Man. My political philosophy professor, Jose Sorzano , went on to become ambassador and U.S. Deputy to the United Nations, serving with U.N. Ambassador Jeane Kirkpatrick, also a Georgetown government professor during my matriculation. Such distinguished faculty is not, of course, limited to private universities. But regardless of how good a high school may be it is highly unlikely the faculty will include such luminaries. And finally, the college environment will most likely be the last place where a person can truly enjoy learning for learning’s sake, taking intellectual risks along the way that might otherwise be thought to be “career-ending” if exercised freely in a traditional workplace. As Sir Ken Robinson points out in Out of Our Minds, it is only in an environment where people are free to make mistakes that creativity and innovation truly flourish. Teaching for creativity aims to encourage self-confidence, independence of mind, and the capacity to think for oneself. In teaching for creativity, teachers aim to: • promote experiment and inquiry and a willingness to make mistakes , • encourage generative thought, free from immediate criticism , • encourage the expression of personal ideas and feelings, • convey an understanding of phases in creative work and the need for time, • develop an awareness of the roles of intuition and aesthetic processes, • encourage students to play with ideas and conjecture about possibilities , and • facilitate critical evaluation of ideas. The aim is to enable students to be more effective in handling future problems and objectives; to deepen and broaden awareness of the self as well as the world; and to encourage openness to new ideas. Robinson, Ken (2011-06-28). Out of Our Minds: Learning to be Creative (pp. 270-271). Capstone. Kindle Edition. [Emphasis added.] Very few work environments encourage such risk-taking behavior, despite the fact that numerous studies have shown that it is exactly such an environment where the best solutions are forged (with a nod to management guru Tom Peter’s “do it, try it, fix it” principal). More often than not, in the working world making a mistake is often the last thing an employee does before being shown the door. Regrettably, in these tough economic times, there is little chance of gaining much traction for the idealistic notion of “education for education’s sake” without dovetailing that noble concept with the windfall benefits for economic recovery. Returning, then, to Mayor Bloomberg’s Financial Times op-ed from last week regarding how cities compete in a global marketplace, the mayor wrote: I have long believed that talent attracts capital far more effectively and consistently than capital attracts talent . The most creative individuals want to live in places that protect personal freedoms, prize diversity and offer an abundance of cultural opportunities. A city that wants to attract creators must offer a fertile breeding ground for new ideas and innovations. [Emphasis added.] In an essay published in the monthly journal of the Urban Land Institute almost ten years ago entitled “Matriculation Reloaded: University town centers can fuel local economies” ( Urban Land , October 2003), I wrote: In a knowledge-based economy, colleges and universities will be the factories of the 21st century. They are the primary source of “knowledge workers” — the smart, creative, and skilled people forming the foundation of successful companies. [Emphasis added.] This statement is even more relevant today than when I wrote it almost ten years ago. The only things that have changed are 1) the extent to which these domestically produced knowledge workers will remain in the United States, thereby contributing to its economic resurgence, versus being attracted to better opportunities overseas, and 2) whether recent college and university grads, in the current economic climate, can find meaningful, remunerative career paths in the U.S. To the extent that these “career paths” include using their creativity, innovation, and knowledge as the impetus for start-up companies, rather than merely going to work for someone else, the country’s college graduates could be at the forefront of leading the U.S.’s economic resurgence. Our current economic hardships notwithstanding, the correlation between a student’s level of educational attainment and lifetime earning potential has never been greater. This runs contrary to the emerging criticism that the value of a four-year bachelor’s degree has become somewhat diluted in the marketplace by graduate degrees becoming the “entry level degree” for some careers. In a 2002 Special Studies report by the U.S. Census Bureau entitled “The Big Payoff: Educational Attainment and Synthetic Estimates of Work-Life Earnings” researchers Jennifer Cheeseman Day and Eric C. Newberger concluded: Adults ages 25 to 64 who worked at any time during the study period earned an average of $34,700 per year. Average earnings ranged from $18,900 for high school dropouts to $25,900 for high school graduates, $45,400 for college graduates, and $99,300 for workers with professional degrees (M.D., J.D., D.D.S., or D.V.M.). [W]ith the exception of workers with professional degrees who have the highest average earnings, each successively higher education level is associated with an increase in earnings. To further make the economic case for the importance of higher education in the domestic competitiveness of the United States in a global marketplace, the scholarly research and prolific writings of Dr. Richard Florida are illuminating, to say the least. Dr. Florida is perhaps best known for his first book, The Rise of the Creative Class (Basic Books, 2000), in which he argues that those cities in the United States that attracted and retained “creatives” would fare the best economically in the domestic economy. In The Flight of the Creative Class: The New Global Competition for Talent (HarperCollins, 2005), Dr. Florida extended to the global economy his analytical approach to regional competition for “Creatives” and their economic output. As one might expect, the role of higher education figures prominently in Dr. Florida’s work. However, his sophisticated research and analysis into what makes a particular city “sticky” in terms of attracting and retaining Creatives is truly multi-faceted, addressing everything from competing cities’ arts and music scenes, to opportunities for active recreation, to correlating his research with that of Carnegie Mellon colleague Gary Gates and his “Gay Index.” However, there is no escaping the fact that without a strong system of higher education in the U.S., we would have an incredibly weak “Creative Economy.” In this sense, universities and colleges don’t serve just the economic winners of the creative age. They represent the key building blocks that cities such as Cleveland, St. Louis, and Pittsburgh can use to rebuild. Kevin Stolarick, and our research team have also found that the “higher education — knowledge — learning cluster” is always among the top employers of both creative class workers and service-sector workers in major U.S. regions. I was once asked what I thought might be one of the keys to saving Detroit’s economy. My answer was simple: Ann Arbor… that the future of the Detroit region in the creative age lies more with the technology, talent, and tolerance engine that is Ann Arbor than in stadiums and a refurbished Renaissance center in downtown Detroit. Flight of the Creative Class, page 252. On Friday, March 28th, Dr. Florida posted “Why Some Cities Lose When Others Win” on The Atlantic Cities Online , which is also directly on point. In that blog entry Dr. Florida argues that the competition for intellectual capital will define the success of the world’s — and not just the U.S.’s — greatest cities . In 1950, the world’s largest urban areas were New York and London, both with more than 12 million people, followed by Tokyo (8.4 million), Moscow (7 million), Rhine-Ruhr (6.9 million), Paris (6.7 million), Shanghai (5.8 million), Chicago (5.6 million), Buenos Aires (4.6 million), and Calcutta (4.6 million). By the mid-2000s, the ranking had changed substantially. Cities in emerging economies dominated the list of the world’s largest urban areas. Tokyo topped the list with more than 35 million people, followed by Mexico City and Mumbai with roughly 20 million each. Meanwhile, New York had dropped to fourth, followed by Sao Paulo, Delhi, Calcutta, Jakarta, Buenos Aires, and Dhaka. Los Angeles was 12th, Paris 22nd, Chicago 25th, and London 28th. [Emphasis added.] Obviously, if cities like Tokyo, Mumbai, and Shanghai continue to figure prominently among the world’s largest — and most-economically successful — urban areas, chances are that manufacturing and service companies in their respective spheres of influence (i.e. primarily in Asia) will prosper as a result, and the U.S. will see little, if any, economic benefit from such growth. If, however, U.S. cities such as New York, Washington, D.C., Los Angeles, Chicago, and Boston, as well as second-tier cities such as Pittsburgh, Cleveland, and St. Louis, are successful in attracting and retaining Creatives regardless of their respective countries of origin, then the domestic economy will benefit from the U.S.’s collective aggregation of global, intellectual capital. It is regrettable, at best, that at a time when the U.S. should be making an even-greater investment in higher education — as well as in primary and secondary education — so that we might compete much more aggressively for Creatives on a global scale, local and state governments, as well as the federal government, are succumbing to short-sighted pressures to cut education spending as a means of balancing budgets and reducing government debt. It would be truly unfortunate (but it is not even close to being outside the realm of the possible) if twenty years from now we woke up to the realization that the U.S. prominence in the world’s economy had dropped even farther from where it stood today, because we made the mistake of shortchanging our educational systems at precisely the time when we needed to do the exact opposite.

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Daniel Burrus: A Lesson From Google: Why Innovation Is the Key to Your Company’s Future

April 2, 2012

I’ve always said that innovation is a key driver of business success . We saw this in action with Google. Back when Google was a startup, they focused heavily on innovation in search. As a result, they created a major source of income and a name for themselves as the dominant search engine. Google was able to accomplish this in a relatively short amount of time because they kept the pipeline of innovation going and encouraged their engineers to spend 20 percent of their time coming up with new ideas. As a result, they gave us Gmail, Google Maps, Chrome, and a host of other advances. One of the hard trends happening right now is that the main computer people use is shifting from a laptop/desktop to a smart phone and tablet . This shift started two years ago and was fully predictable. Just look back over my previous blogs and you’ll see I was talking about this shift long before it happened. When the trend started to emerge, what did Google do? They saw the iPhone and its success and they introduced the Android. It was a bit more copying than innovating, but they did still innovate (albeit just a little bit). Where Google dropped the innovation ball was with social media. They saw Facebook grow incredibly, so they introduced Google+. Was much innovation involved? Not really. It’s definitely more copying than anything else. They simply made their own version of Facebook. No wonder Google+ is having a hard time taking off. Here’s the problem: When you focus on your competition and copy them, you end up competing with them. However, when you focus on innovation, you become the competition and others try to copy you. That’s a huge difference. Realize that no matter how hard you try to copy someone, you can never catch up because the leader is innovating. In fact, the only way to really catch up is to jump ahead. Unfortunately, Google became so focused on social media that they lost their original spirit of true innovation. I even heard that the engineers who spent 20 percent of their time on innovation were told to focus that time on innovation within the realm of social. That, of course, dilutes the innovation engine. Moving forward, I’d like to see all companies, not just Google, get back on the innovation bandwagon. For any company to thrive in the future, innovation, not copying, is the key. Remember that we’re in a world of exponential transformational change. With bandwidth, processing power, and storage accelerating so rapidly, it’s truly a time for every company to innovate at new levels. Technology has leveled the playing field, and the game is changing.  It’s time to stop playing the old game and start defining the new one. Article first published as  A Lesson From Google  on Technorati.

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Greg Voakes: Capitalizing on the Internet: From Meme to Marketplace

April 2, 2012

Sometimes described as an “internet phenomenon,” memes have been a staple to setting the standards in popular culture. Memes have been with us long before the internet became another key ingredient in today’s society. Often designed for spreading original jokes with friends and having them gain momentum, memes are now the ultra popular bits of content that provide us with the occasional stifled laugh from our cubicle. Memes in nature are a statement in everything and anything in regards to our struggles with modern life, also known as “first world problems,” our unsavory lifestyle choices represented through “advice animals.” As with most sweepingly successful online trends, the unknown sources that these silly creations originate from set a business plan in action for part-time entrepreneurs to capitalize on. Ben Huh for example, capitalized off of the success of Christopher Poole’s image board 4chan — a user-generated content site that hosted original pictures, drawings and illustrations, ranging from the good, the bad and the ugly. Startup veteran Ben Huh created microsites based around 4chan’s most popular trend — LOLCats , and ran with the idea. Currently the Cheezburger network boasts over 50 humor blogs, including an online store they’ve dubbed “LOLMart” which sells meme related clothing and accessories. Other startups like CatchKuma are also taking advantage of the marketability of modern meme’s by turning the web’s most lovable bear and his friend Longcat into novelty clothing and “key charms.” Images courtesy of CatchKuma.com. You can find the featured key charms here .

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Bill Moyers: Who Pays for Political Ads?

April 2, 2012

Great efforts are underway both locally and nationally to keep secret the identities of people and organizations paying for local political advertisements. But Americans can still do something, even when broadcasters shirk their responsibilities. Here’s what you can do to reveal who’s paying for — and hiding behind — misleading political ads on your TV. Over the years we’ve been reporting on how power is monopolized by the powerful. How corporate lobbyists, for example, far outnumber members of Congress. And how the politicians are so eager to do the bidding of donors that they allow those lobbyists to dictate the law of the land and make a farce of democracy. What we have is much closer to plutocracy, where the massive concentration of wealth at the top protects and perpetuates itself by controlling the ends and means of politics. This is why so many of us despair over fixing what’s wrong: we elect representatives to change things, and once in office they wind up serving the deep-pocketed donors who put up the money to keep change from happening at all. Here’s the latest case in point. The airwaves belong to all of us, right? They’re part of “the commons” that, in theory, no private interest should be able to buy or control. Nonetheless, government long ago allowed television and radio stations to use the airwaves for commercial purposes, and the advertising revenues have made those companies fabulously rich. But part of the deal was that in return for the privilege of reaping a fortune they would respect the public interest in a variety of ways, including covering the local news important to our communities. If they didn’t, they would be denied their license to use the airwaves at all. Alas, over the years, through one ruse or another, the public has been shafted. We heard the other day of a candidate for office in a Midwest state who complained to the general manager of a TV station that his campaign was not getting any news coverage. “You want coverage?” the broadcaster replied. “Buy some ads and then we’ll talk!” That pretty well sums up the game. But hold your nose: it gets worse. The media companies and their local stations — including goliaths like CBS and Rupert Murdoch’s News Corp — stand to pull in as much as $3 billion this year from political ads. Three billion dollars! And most of that money will pay for airing ugly, toxic negative ads that use special effects, snide jokes and flat out deception to take us to the lowest common denominator of politics. The FCC, the Federal Communications Commission, which is supposed to make sure the broadcasters don’t completely get away with highway or, rather, airwave robbery has proposed to the broadcasting cartel that stations post on the Web the names of the billionaires and front organizations — many of them super PACs — paying for campaign ads. It’s simplicity itself: give citizens access online to find out quickly and directly who’s buying our elections. Hardly an unreasonable request, given how much cash the broadcasters make from their free use of the airwaves. But the broadcasting industry’s response has been a simple, declarative “Not on your life!” It would cost too much money, they claim. Speaking on their behalf, Robert McDowell, currently the only Republican commissioner on the FCC — the other one left to take a job with media monolith Comcast — said the proposal is likely “to be a jobs destroyer” by distracting station employees from doing their regular work. The party line also has been sounded by Jerald Fritz, senior vice president of Allbritton Communications, who told the FCC that making the information available on the Internet “would ultimately lead to a Soviet-style standardization of the way advertising should be sold as determined by the government.” We’re not making this up. Steven Waldman, who was lead author of the report that led to the FCC’s online proposal, quotes a letter from the deans of twelve of our best journalism schools: “Broadcast news organizations depend on, and consistently call for, robust open-record regimes for the institutions they cover; it seems hypocritical for broadcasters to oppose applying the same principles to themselves.” Hypocritical, but consistent with a business that values the almighty dollar over public service. The industry leaves nothing to chance. Through its control of the House of Representatives, it got a piece of legislation passed this past week euphemistically titled the FCC Process Reform Act. George Orwell must be spinning in his grave – this isn’t reform, it’s evisceration. Not only does the bill remove roadblocks to more media mergers — further reducing competition — it would subject every new rule and every FCC analysis of that rule to years of paper work and judicial review, enabling the industry’s horde of lawyers and lobbyists, “to throw sand in the works at every opportunity,” as one expert puts it. There was a noble attempt by California Congresswoman Anna Eshoo to include in this bill an amendment that, like the FCC proposal, called for stations to post online who’s putting up the big bucks for political ads. Shocker — it was rejected. Score another one for the plutocrats. There is some good news. The White House opposes this latest bid by the broadcasting oligarchy to further eviscerate the public interest. And the fate of the House bill in the Senate is uncertain at best. In the meantime, as far as those political ads go, we’re not totally helpless. Here’s what you can do: Under current law, local television stations still have to keep paper files of who’s paying for these political ads, and they have to make those files available to the public if requested. You can even make copies to take away with you. So just go down to your nearest station, politely ask for the records, and then send the data online to the New America Foundation’s Media Policy Initiative or to the organization of investigative journalists ProPublica . Both have mounted campaigns to get the information online. Each is pulling together all the information on political ads they get from you and others — crowdsourcing — and making it available to the entire country via the Internet. If you’re a high school teacher or college professor of journalism, have your students do it and maybe give them classroom credit for collecting the data democracy needs to work. In other words, here’s a way citizens can take action even against the plutocrats who run Big Media and Congress. Addendum: The media reform advocacy organization Free Press is also conducting station file inspections, and has just published an easy-to-follow guide to how it’s done. —- Moyers & Company airs weekly on public television — check local listings . See more features — including our all-new TAKE ACTION page — at BillMoyers.com Previously posted on Billmoyers.com .

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Jerry Jasinowski: Manufacturing Is Different

April 2, 2012

” Do Manufacturers Need Special Treatment ,” was the headline of a commentary by Christina D. Romer, who chaired President Obama’s Council of Economic Advisors, in the New York Times earlier this year. An economist, Romer made it clear she regarded manufacturing as just another sector of the economy. “American consumers value health care and haircuts as much as washing machines and hair dryers,” she wrote. “And our earnings from exporting architectural plans for a building in Shanghai are as real as those from exporting cars to Canada.” That myopic view is all too common among economists. I surmise this is what comes from getting lost in data on spreadsheets, and losing contact with the real world. But I too am an economist and I am here to testify that Romer’s interpretation of the data simply does not reflect reality. Manufacturing is different from other sectors in three key ways: First, manufacturing is where real wealth is created. Manufacturers take raw materials from the earth, apply copious amounts of energy, mix in creative human genius, and voila, out comes the myriad of wonderful products and technologies that enhance human life. Second, manufacturing has an extraordinary “spillover effect” supporting more peripheral jobs than any other sector. This is why the states compete so vigorously to attract new manufacturing plants. And third, manufacturing is where technology is put into practice through innovation. A brilliant idea and $5 will get you a cup of coffee at Starbucks. It is the manufacturing shop floor where the potential of creative ideas is proved or disproved. Manufacturing accounts for 70 percent of private sector R&D and 90 percent of patents. For more than a decade we have stood by while foreign competitors employing predatory trade practices have absconded with major portions of our manufacturing base. The persistent weakness in our economy today, and especially the stubbornly high unemployment, is the result. The time has come to recognize this challenge and rise to meet it. There is a reason our competitors are so committed to manufacturing — they recognize that manufacturing is the foundation of a modern nation’s economy. “The world power that loses its manufacturing base,” said Akio Morita, founder of Sony, “will cease to be a world power.” The good news is that Romer has returned to academia. President Obama and his Assistant for Economic Policy Gene Sperling are highlighting the importance of manufacturing to the country, as is the presumptive Republican nominee Mitt Romney. According to political consultant Mark Mellman, there is overwhelming public support for a national manufacturing strategy focused on bringing jobs back from overseas, retraining U.S. workers, and enforcing fair trade rules. The American people fully understand the importance of manufacturing to the country, even if many economists do not. Change is coming. Jerry Jasinowski, an economist and author, serve d as President of the National Association of Manufacturers for 14 years and later The Manufacturing Institute. Jerry is available for speaking engagements.

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Raymond J. Learsy: Shell Supports Iran’s Murderous Mullahs. Should We Be Supporting Shell?

April 2, 2012

The callous greed in the oil patch seems to know no limits. Here we have a company, Royal Dutch Shell, bursting with earnings, at the apogee of its yearly returns, going after the last dollar or Euro to make things fatter still. This to the cold dismissal of the brave Iranians who rose en-masse in 2009 to rally for free elections only to be put down brutally by the Mullah’s goon squads financed in large measure by the plenitude of oil revenues streaming from Iran’s export oil loadings. The world was outraged, but helplessly stood by as the slaughter continued. From far and wide came calls to impose sanctions on Iran and to impose embargoes on Iran’s products. One would have thought any responsible organization would have desisted its activities with what had now evolved into a murderous regime. Clearly conscious of the public outrage that would result from its moral turpitude continuing to enrich the Mullahs, Shell did all it could to hide their transactional baseness with the Iranian dictatorship. As example in March 2010 the Wall Street Journal (“Oil Trade With Iran Thrives Discreetly” 05.20.10) reported that the tanker ‘Front Page’ left the port of Fujairah, U.A.E.to sail on to Saudi Arabia. All well and good. But wait, tracking information revealed a very different course. The ‘Front Page’ made an unreported stop along the coast of Iran to load a cargo of Iranian oil. Who was the charterer of this brazen attempt to hide their continuing ‘business as usual’ with an Iranian government in the midst of imposing draconian oppression on its people. Yes, Shell Oil. Since that time very little has changed, if not in becoming more grotesque. Shell’s gorging on Iranian oil continued ongoing. Just this past week CNBC reported that “Shell Scrambles to Pay Huge Oil Bill for Iran Oil” (03.25.12). We learned that Shell is struggling to pay off $1,000,000,000 that it owes the National Iranian Oil Company, the equivalent of about 8 million barrels of oil. Apparently Shell has become Iran’s second biggest oil buyer, having been outdistanced only by France’s Total, who however has ceased its Iranian oil purchases at the end of last year. But it seems Shell toils on, now having to navigate through the labyrinth of financial sanctions in order to placate their Iranian pushers. And as the CNBC report would have it, “Shell is working hard to figure out a way to pay NIOC.” All of which of course raises the question, given Shell’s willingness to help sustain the murderous Iranian regime, should we as consumers exercise our individual initiative in solidarity with the oppressed people of Iran (one needs remember the deeply poignant death of Nedā Āghā-Soltān[ on the streets of Teheran on June 20, 2009). In our daily lives perhaps it is now necessary to decide where and from whom we buy our gasoline! Oh yes, by the way, another point of focus. Should we be comfortable with the imminent ruling our government agencies, especially the U.S. Department of the Interior, are about to make permitting Royal Dutch Shell to drill off Alaska’s Beaufort and Chuckchi Seas? Vesting that responsibility with a corporation of such vacuous concern?

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Scott Bittle: Is Regulation Really Strangling Start-ups, and How Much Would the JOBS Act Do to Keep It Under Control?

March 30, 2012

Here are two facts that should be attracting a lot more attention than they are. Over the last decade, nearly two-thirds of new jobs in the U.S. economy came from businesses less than five years old. That’s a big hint on how to rev up job creation. Opening up an ice cream parlor in San Francisco can cost $20,000 in fees and include a 2-year wait for the city to approve permits. All the while, the owner is incurring rent and other expenses while waiting for the powers that be to say it’s OK for the business to operate. According to the New York Times , Juliet Pries, the owner of The Ice Cream Bar, had to hire a lawyer and pay $11,000 to get the water turned to make it through San Francisco’s marathon approval process. Her business is up and running now and she has 14 employees. That one owner persisted where others might have failed is a small step forward on job creation, but her experience raises the question of exactly who benefits by making the process so slow, cumbersome, and difficult. A lot of people try to make this issue simple: It’s government regulation versus business start-ups and job creation. That’s the way the issue is being framed in the debate over the JOBS Act , designed to exempt “emerging companies” from certain financial disclosure requirements, while opening the door to online “crowd financing.” But the reality is that for many businesses, such as The Ice Cream Bar, the problem isn’t about Sarbanes-Oxley, where the debate has been largely defined by lobbyists, and mostly lobbyists for big businesses that can take care of themselves. The reality of regulation demands a more careful assessment of what’s wrong and a set of well-thought-out remedies. Here are some points to consider. It’s not all about Washington. In the simplistic world of political campaigns, Washington is the mega-villain. But the truth is that most businesses, small businesses in particular, spend a lot more time dealing with other levels of government. Most states require someone starting a business to get a license. If you’re in a specialized field, whether you’re an accountant, barber or mortician, you probably need occupational licenses, as well. If you’re hiring people, you need unemployment insurance, and depending on what you’re selling and where, you may need a license to sell your product and another to charge your customers sales tax. Local governments often require environmental, health, building and other permits , and you’ll have to obey zoning laws as well. Is regulation the problem or is it its complexity? Just about every regulation starts for a legitimate reason — and sometimes, sadly, they emerge from horrific tragedies like New York City’s Triangle Factory fire. No one wants unsafe buildings where workers are in danger. But sometimes even good regulations seem to go bad. New York City has a seven-step process for getting a building permit — one that’s replete with admonitions to file under “Directive 14″ or “Directive 2″ and consult other documents and agencies. In Step Number 5, the department “perforates the plan.”Apparently, when you’re nearing the end, you need to bring your folder to the “Record Room,” where the “Record Room clerk perforates the plans and forms and returns them to the applicant.” Then you microfilm the plans, and return them to the Record Room so they’re “now ready for permit.” OK, we’re bewildered (And are they actually still using microfilm?) We certainly invite New York City’s Record Room clerk to weigh in and explain it to us. Maybe some periodic housecleaning is in order . Every regulation exists for a reason, usually a good one. But the reasons change long before the regulations do. Maybe we need to start thinking about a regular review process, either allowing regulations to sunset or requiring a re-examination every 10 or 20 years. And we need to look at the accumulated impact on businesses and employers, along with the need to protect employees, consumers, and the public in general. At the federal level, businesses have to comply with a whole host of regulations ranging from the Fair Labor Standards Act to OSHA to the Family and Medical Leave Act to Veteran’s Preferences. Each one fulfills a mission most Americans support, but each is also detailed and complex. Taken together — well, this is why there’s a thriving market for compliance officers. The problem with regulation is that it all adds up, and no one is really in charge of looking at the full sweep of regulation an industry faces and seeing whether it’s reasonable or not. Whether regulation is hampering business and stymieing job creation is just as important as whether the public interest is being served and what would be lost if the regulations were rolled back or pruned. In the end, there’s not much point worrying about the issues surrounding complex federal laws while still making small business owners run around City Hall with folders of perforated papers looking for someone who still handles microfilm processing.

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James Berman: Why Muppets Everywhere Should Worry

March 30, 2012

Goldman Sachs referring to clients as muppets? Like Captain Renault in Casablanca, I’m once again shocked. Goldman’s alleged disdain for their clients points to a far greater problem at the core of the financial regulatory landscape, one that should strike fear into the hearts of would-be-muppets everywhere. Many people — even those in financial services — don’t realize that there are two vastly separate regulatory regimes out there that watch the people who watch over other people’s money. On the one hand are “registered investment advisers” who are registered with the SEC and are held to a higher fiduciary standard, meaning they can only put their clients into investments that are in their clients’ best interest. Amazingly, a whole other regulatory regime exists: one of “registered representatives” who are regulated by FINRA. These registered reps are what most people call stockbrokers (brokers). Brokers do not have to put their clients’ interests first. Usually, they call themselves “financial advisers” in a seemingly transparent bid to piggyback on the term “investment adviser.” But “financial adviser” is not a legal term with any designated meaning. Stockbrokers are held to the much lower “suitability standard” — which basically means you can’t put a great-grandmother into 100% internet stocks. Since it doesn’t require putting the client first, you might have a guess at who frequently gets first dibs instead. Yes, stockbrokers are often glorified car salesmen. They sell a product, usually an annuity or sometimes a mutual fund, and not always the best one, but sometimes the one with the highest commissions and fees attached — something which benefits them at the miserable expense of the client. Of course, there are honest, well-meaning brokers out there. But if they were really serious about putting the client first, why wouldn’t they drop their stockbroker sheep’s clothing and become registered investment advisers? The good ones have already done so. I’m proud to say I’ve been a registered investment adviser since I started managing money 16 years ago — and nothing but. Goldman Sachs is such a large firm that it probably has both brokerage divisions and investment adviser divisions, which ironically would have different standards of care to their clients. But to call your customer a muppet speaks of a culture that couldn’t possibly think of clients with any dignity. If that wasn’t the brokerage division, I’d be surprised. The big firms are usually brokers, not investment advisers. And the culture is an unsurprising result. Clients should protect themselves by always asking their adviser straight-up: are you a registered investment adviser ? Only those three exact words will tell the tale. And they should get it in writing — to prove they aren’t a muppet.

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Efraim Chalamish: Lets Talk About Trade

March 29, 2012

Trade policies are not a sexy business. Customs, anti-dumping, subsidies are just some of the concepts international investors are trying to avoid. Yet, recent weeks reminded all of us that trade can make headlines. And make or break industries around the globe. The subsidies to the aerospace industry in the EU and USA, the limitations on Indian cotton, and the World Trade Organization, or WTO, claims against China by the U.S., Europe, and Japan for export control of rare earth metals all have a dramatic impact on the respective industries. We cannot avoid them. How should we explain the recent hyper-activity in this area? And what are the ramifications? First, it is important to understand the story in light of the trade-investment nexus. The foreign investment boom of the ’80s and ’90s replaced global trade as ‘the’ economic engine, with global trade being au-courant post- World War II. While the world saw a quadrupling of trade in goods between 1980 and 2008, before the global financial crisis, global investment has risen more dramatically. Global stock of outward investment, for example, grew from $550 billion in 1980 to almost $19 trillion at the end of 2009. The years since the global financial crisis of 2008 have reversed this trend. Credit crunch, a slowdown in mergers and acquisitions activity, lack of faith in the future of globalization, and regulatory reforms — all made it ever-more challenging for multinational corporations to do business abroad through foreign investment and their subsidiaries. Hence, trade is becoming a crucial element of the ‘new globalization’ and its policies even more so. Moreover, since emerging markets are the real forces behind the current recovery post-financial crisis and the developed world has traditionally led cross-border investments, it is clear why emerging markets’ exports and trade policies towards them are critical. Second, trade legislation and disputes are clearly a reflection of foreign relations and protectionist sentiment. Lack of trust and economic competition make even right wing governments think that certain market-based trade policies should be reconsidered. Recent disputes in India can exemplify that. Third, this is a big year for those who follow the link between politics and economics. France, the United States and several other developed markets are going to the polls. We tend to think about general elections as an internal event with external consequences. In other words, the nation decides on its political and economic future but it is the international community and global markets that pay part of the price. Yet, watching the current elections’ campaigns carefully, it seems like the trend is reversed. These elections become an external affair with internal consequences, at least when it comes to trade, foreign investment and growth. Foreign investment traditionally attracts very little attention in elections season. Speaking about the need to bring foreign investors is usually perceived as a threat to local industries and a trigger for unemployment. Additionally, investors would shy away from markets that may experience a political change with a potential impact on foreign investors. French candidate, Francois Hollande, for example, is talking about taxing high the super rich (75 percent) and increasing local subsidies. Some investors interpret his policies as anti-foreign investment. This kind of talk is risky. Trade, however, allows politicians to communicate to their voters without risking their standing vis-à-vis the global investment community and their supporters. Obama’s active participation in the fight against China in the WTO is a case in point. Finally, this dramatic shift that I describe is a reflection of the broader agenda of the WTO. A decade ago, when world leaders met in Cancun to negotiate trade agreements as part of the Doha Round, also known as the development round, any attempt to include non-core topics with trade impact, such as investment or trade facilitation, failed. These topics, the “Singapore Issues,” have been perceived as a barrier to trade negotiations. Recently, however, politicians and trade negotiators refer to the WTO as a weapon of last resort for dealing with strategic macroeconomic disputes, such as the old-new currency wars. While formal international institutions were part of the problem just a few years ago, now the world is looking at them as the solution. While investors will have to watch trade policies and disputes more carefully, it will also require them to develop the know-how to understand the essence of the policies and their impact on markets. The next decade will look differently. An earlier version appeared on Economonitor.

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Mark Hillary: Your Life Is Social, Why Isn’t Your Company?

March 29, 2012

Do you remember when social media really arrived about half a decade ago? It was feared by enterprises. Managers banned Facebook access at work to prevent the scourge of employees wasting the day away on Farmville in much the same way we had to promise to not make personal calls from our desk phone back in the eighties. These thoughts returned to me when I read an interesting document titled ” Top 10 Corporate Social Media Predictions for 2012 ,” published by the Useful Social Media group — an advisory firm. They picked ten executives responsible for social media strategy within their company and asked them what would be the most important change in 2012. Take a look at the prediction of Jen McClure , the director of social media at news organization Thomson Reuters: The term “social business” will become more ubiquitous as organizations of all types and sizes start to think of social technologies more strategically as business tools, not just marketing channels. And then it will eventually become a meaningless phrase as we come to realize that all business is, at its core, social. This is a complete about turn. Now executives are telling us that companies need to become more social. Of course there is a precedent for this, like the telephone calls, then email access, then the company mobile phone. New technologies are always seen as damaging to the enterprise, but end up being adopted as essential. McClure is arguing that social media is going to fundamentally change companies and how they operate. Forget about social media being just a tool for PR or marketing or community building — it is changing every part of the enterprise, root and branch. If you don’t believe me, take a look at your personal life. You probably have an online diary, address book and news feed with information on current affairs as well as what your friends are up to. Let’s just call it Facebook. But whether it is Facebook or not, you have tools easily available that let you talk without cost to your family overseas, to find out which friends of your friends went to the same university as you, to find out which of your friends is around in New York when you are visiting. This is taken for granted in your personal life. So your own life really is social and connected, yet most companies still languish with CRM systems that cost millions and have never really worked. Imagine if you had the same level of knowledge about your colleagues at work, and your customers, as you have about your friends online. Companies are just collections of people, with various skills, all attempting to pull in the same direction. Companies are social, yet we often use better tools to organize our social life than to organize how we work. McClure from Thomson Reuters is absolutely correct, business is not “going social” because of social media tools; it already is social, we just need to learn how work more effectively with the tools around us.

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Daniel Dicker: Oil Market Itself Proves Gas Prices Are All Speculation-Driven

March 29, 2012

Why are crude oil futures traded on the Intercontinental Exchange (ICE) $30 cheaper, or almost $1 a gallon less, three years from now? That just doesn’t seem possible — unless the oil trade is totally overrun with speculators and Fed-inspired, cheap-money risk investors. On CNBC on Friday, I got into a discussion with an executive at one of the larger derivative brokerages about the amount of speculation and investor interest in the oil markets today. He made a number of good points, but one that he made that wasn’t so good was in comparing the oil market to stocks. He claimed that current oil prices reflected risk in the market accurately because they are “forward-looking.” That’s an old saw for equities traders and posits that stocks can react today to events and cycles that are still many months from taking hold. The equity market can be “forward-looking” and price in better or worse — news that is only expected to happen, but hasn’t occurred yet. You can believe that or not — it’s not really the point. The point is that futures markets are not like stocks. For any company, there is one primary instrument to trade: its common shares. With futures you have monthly deliveries — and you can trade in any of them of your choosing at any time. In other words, futures don’t need to be forward-looking — they are, in fact, real forwards — with an expiration date attached for every investment or hedge you choose. If you want to bet that something will happen three months from now or three years from now to affect oil prices, you need not buy “oil” or today’s closest month to delivery — you can buy or sell oil delivering exactly when you think it will happen. Most investors probably don’t even know this. But it is more than telling that futures for delivery in December 2015 Brent crude oil traded at the ICE are almost $30 lower than the spot price, which reflects global oil prices today at more than $125 a barrel. One of three things is definitely going on here: One, all of the oil analysts who are talking about increasing Emerging Market demand and dropping marginal supplies and continual long-tail geopolitical risks over the next several months and years are all wet. Or: Much of that $30 premium is composed of investment and fund speculation, driven by commodity indexes, ETF’s and hedgies, collectively up over $300 billion nominal dollars, hiking prices and punishing consumers at the gas pumps. Or: December 2015 Brent crude oil futures are the most undervalued investment ever seen, and will make you a virtual fortune in less than three years, the kind you can retire on and never worry about your grandkids’ grandkids’ futures. Spoiler alert: I have a lot of respect for oil analysts and their research, and also don’t think you should bet the farm in December 2015 futures. That leaves only one. Here’s the CNBC clip:

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David Fagin: Flying The Unfriendly Skies

March 29, 2012

From the cheerful way United’s CEO, Jeff Smisek, virtually greets you at your seat before takeoff, you’d think everything was just peachy in the newly-merged, friendly skies. More routes are being added, new planes are being bought, the online reservation system is supposedly getting easier and cabins are being modernized with wireless Internet access. So, how come everyone you talk to now refers to it as “United F#&*n Airlines?” That’s easy. Just pull back the first-class curtain and you will see the “friendly skies” aren’t so friendly after all. First off, it’s no secret, when it comes to customer service, United is commonly regarded as one of the worst airlines in the business. They may brag about their “most admired” status in the industry, but that survey , conducted by Fortune magazine, only polled industry insiders, not consumers. A look at the recent data compiled by consumer research company the Temkin Group paints a different picture. While almost every airline in the business enjoyed a bump in customer satisfaction last year, only two dropped significantly: American and Continental. At this point, you’d expect it from American, as it’s in bankruptcy. But what even Continental employees seem to be saying about their chipper CEO, is that he’s well on his way to guiding the nose of this once-proud airline down to where United currently is, and, at the same time, betraying the legacy of former Continental chief executive Gordon Bethune. One senior flight attendant in Houston even went as far as to coin the phrase, ” It’s all Jeff’d up! ” — referring to Continental’s current day-to-day operations. When Bethune, a former Boeing executive, took the reigns of Continental back in the early ’90s, the airline was at rock bottom in almost every category. Within a few years time, he took the struggling carrier from worst to first. After his departure in 2004, Larry Kellner stepped in as the new CEO and maintained the above-average experience Continental customers had grown accustomed to. (It was Kellner who introduced DirectTV, lie-flat seats and other amenities in a post-9/11 industry.) No one can say for sure why he chose to resign as CEO, but insiders say he was against the merger with United from the start. While, on the opposite end, Smisek, then president, was eager to become CEO of the world’s largest airline. Whatever advancements Mr. Smisek has been touting for the past year-plus in his welcome message, ask most customers and they’ll agree, it sure seems like they’re heading in the wrong direction. For example, one change not welcomed by its lower-tiered elite passengers is the change to the Economy Plus seating policy. Used to be, extra leg room seats were made available to elite members when booking the flight. Since the merger, that policy has been scrapped, and United now only offers whatever seats may remain at check-in. In order to ensure an extra leg room seat for a long journey, loyal elite members must purchase the seat like everyone else. Strike one. Next, is United’s new pet policy . On one hand, the airline says it has made it “safer” for pets to travel, requiring they now be labeled as “cargo,” rather than “baggage,” which allows them to be placed in a climate-controlled space in the plane’s hull. On the other, instead of costing a few hundred dollars to ship a dog overseas, it now costs several thousand . This rule, in particular, has been financially crippling to our servicemen and women in the military who routinely need to move from base to base and are now being forced to find other means of transport. It also has everyday passengers with pets up in arms. Strike two. Last, but definitely not least, is United’s overall customer service. A glimpse of the airline’s Facebook page shows a staggering number of negative comments on a variety of issues, with dozens of additional comments supporting the criticism; i.e., one man who earned a million-mile status with Continental was put in coach and denied an upgrade because the agent said his ticket was “too cheap.” A first-class passenger had condensation from the AC dripping on him the entire way to LAX. Another woman states she recently returned from a trip to Florida with her 80-plus-year-old mother who was just out of the hospital and needed special assistance, and, she said, when they tried to board early, she was literally yelled at by the attendant at the gate and told to “Wait her turn!” It may be old hat for United travelers, but Continental customers are simply not used to being treated in that manner. Yet, all signs point to the fact that they better get used to it fast. Strike thr- wait, that was a foul ball. If you’ve flown United/Continental coast-to-coast recently, you know you’d be lucky to get a power adapter at your seat, as the planes they use for the long hauls are inexplicably much older. Why? Not even customer service reps seem to know. Rumor has it it, it’s because the older planes are apparently bigger. This obviously allows United to book more seats, but, meanwhile, the smaller planes, fitted with power adapters, DirectTV and everything else you’d expect on a cross-country flight, are used for short hops up and down the East Coast. Forget about Wi-Fi. If you’re flying from L.A. to New York, it’s a crap shoot if you’ll even have your own video monitor. And, this, supposedly, is from the “most admired” airline in the business? Strike three. Yer out. It definitely seems, instead of raising United to the level where Continental used to be, Mr. Smisek is content in lowering the expectations of Continental’s employees and customers to that of United’s employees and customers. And, that just doesn’t fly .

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Jon Carson: Corporate Social Responsibility — Bandwagon or Built-in?

March 28, 2012

There is a lot of noise these days around Corporate Social Responsibility (CSR) with some saying it’s long overdue and others saying it’s really just “greenwashing.” Moreover, trust in corporations is at near-record lows so there is plenty of incentive for business leaders to jump in. There is a right way but, just as importantly, also a wrong way to jump. I’ve been watching and collaborating with folks in the corporate sustainability world for some time, and I think it is important to put some context into how this can and must work, and when it doesn’t. Two Kinds of Corporate Players: The first are companies whose very offering comes with high social good built in. Examples of this are BigBelly (solar powered municipal trash dumpsters), Bright Horizons (child day care centers), Zipcar (car sharing), and my own BiddingForGood (online fundraising auctions). The very nature of what these companies do is for a better society. The second category is companies whose product has nothing to do with sustainability or social good (and in fact can sometimes go in the opposite direction) but who are trying to build sustainability and responsible corporate citizenry into their DNA. The Problem: The problems start when, as one academic said to me, “The CEO hasn’t drunk the Kool-Aid” and considerations for shareholders and senior management dominate over customers and employees. Far too many companies have set up CSR initiatives simply to provide some window dressing or PR to their corporate story. I recall one CSR manager from a nationally known outdoor clothing company telling me she had never met her CEO, there was virtually no internal support for her work, and the bulk of her activity was PR-driven. Contrast that with Patagonia, whose founding CEO Yvon Chouinard has espoused his vision for a sustainable planet since the day he started the company. Every decision made at Patagonia is made with an eye toward sustainability. The problem gets more complicated because there is much research showing that consumers favor brands that show social responsibility. So the temptation to greenwash is real and brands do the logical thing and try to ride the bandwagon. In my own space, there are any number of companies who are trying to drive incremental sales by tying themselves to a pink ribbon or a Red campaign. The percentage of revenue actually going to good works is usually pretty small (less than 5 percent) but in most cases it works. Or does it? What happens when inquiring journalists “out” the fakers? We end up with a more cynical citizenry. Educated Consumers and Educated CEOs: They key to ensuring that companies become increasingly sustainable in an authentic way is talking about it and letting companies (especially their CEOs) know that you care. Key to sleuthing out the fakes from the real deal is a vigilant press and an educated consumer who has a healthy bit of skepticism. The more CEOs educated on the virtues of CSR (and there are many practical bottom line benefits like motivated employees, reduced supply chain costs, and loyal customers), the more they will rationally drink the Kool-Aid. But it starts from the bottom up with citizens letting companies and CEOs know that this matters and they will take their business to brands that are showing they are responsible in how they treat employees, their commitment to their own local communities, and making sure their supply chain and corporate footprint factors in sustainability. The key is to continue to have the discussion, for citizens to engage, use their social networks and if they see bad behavior to alert the press and to write to the CEO to let them know they are being watched.

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Jeremy Rifkin: The Third Industrial Revolution: How the Internet, Green Electricity, and 3-D Printing Are Ushering in a Sustainable Era of Distributed Capitalism

March 28, 2012

The great economic revolutions in history occur when new communication technologies converge with new energy systems. New energy revolutions make possible more expansive and integrated trade. Accompanying communication revolutions manage the new complex commercial activities made possible by the new energy flows. Today, Internet technology and renewable energies are beginning to merge to create a new infrastructure for a Third Industrial Revolution (TIR) that will change the way power is distributed in the 21st century. In the coming era, hundreds of millions of people will produce their own renewable energy in their homes, offices, and factories and share green electricity with each other in an “Energy Internet” just like we now generate and share information online. The creation of a renewable energy regime, loaded by buildings, partially stored in the form of hydrogen, distributed via a green electricity Internet, and connected to plug-in, zero-emission transport, opens the door to a Third Industrial Revolution. While the TIR economy allows millions of people to produce their own virtual information and energy, a new digital manufacturing revolution now opens up the possibility of following suit in the production of durable goods. In the new era, everyone can potentially be their own manufacturer as well as their own internet site and power company. The process is called 3-D printing; and although it sounds like science fiction, it is already coming online, and promises to change the entire way we think of industrial production. Think about pushing the print button on your computer and sending a digital file to an inkjet printer, except, with 3-D printing, the machine runs off a three-dimensional product. Using computer aided design, software directs the 3-D printer to build successive layers of the product using powder, molten plastic, or metals to create the material scaffolding. The 3-D printer can produce multiple copies just like a photocopy machine. All sorts of goods, from jewelry to mobile phones, auto and aircraft parts, medical implants, and batteries are being “printed out” in what is being termed “additive manufacturing,” distinguishing it from the “subtractive manufacturing,” which involves cutting down and pairing off materials and then attaching them together. 3-D entrepreneurs are particularly bullish about additive manufacturing, because the process requires as little as 10 percent of the raw material expended in traditional manufacturing and uses less energy than conventional factory production, thus greatly reducing the cost. In the same way that the Internet radically reduced entry costs in generating and disseminating information, giving rise to new businesses like Google and Facebook, additive manufacturing has the potential to greatly reduce the cost of producing hard goods, making entry costs sufficiently lower to encourage hundreds of thousands of mini manufacturers — small and medium size enterprises (SMEs) — to challenge and potentially outcompete the giant manufacturing companies that were at the center of the First and Second Industrial Revolution economies. Already, a spate of new start-up companies are entering the 3-D printing market with names like Within Technologies, Digital Forming, Shape Ways, Rapid Quality Manufacturing, Stratasys, Bespoke Innovations, 3D Systems, MakerBot Industries, Freedom of Creation, LGM, and Contour Crafting and are determined to reinvent the very idea of manufacturing in the Third Industrial era. The energy saved at every step of the digital manufacturing process, from reduction in materials used, to less energy expended in making the product, if applied across the global economy, adds up to a qualitative increase in energy efficiency beyond anything imaginable in the First and Second Industrial Revolutions. When the energy used to power the production process is renewable and also generated on site, the full impact of a lateral Third Industrial Revolution becomes strikingly apparent. Since approximately 84 percent of the productivity gains in the manufacturing and service industries are attributable to increases in thermodynamic efficiencies — only 14 percent of productivity gains are the result of capital invested per worker — we begin to grasp the significance of the enormous surge in productivity that will accompany the Third Industrial Revolution and what it will mean for society. The democratization of manufacturing is being accompanied by the tumbling costs of marketing. The internet has transformed marketing from a significant expense to a negligible cost, allowing startups and small and medium size enterprises to market their goods and services on internet sites, like Etsy, that stretch over virtual space, enabling them to compete and even out compete many of the giant business enterprises of the 21st Century. As the new 3-D technology becomes more widespread, on site, just in time customized manufacturing of products will also reduce logistics costs with the possibility of huge energy savings. The cost of transporting products will plummet in the coming decades because an increasing array of goods will be produced locally in thousands of micro-manufacturing plants and transported regionally by trucks powered by green electricity and hydrogen generated on site. The lateral scaling of the Third Industrial Revolution allows small and medium size enterprises to flourish. Still, global companies will not disappear. Rather, they will increasingly metamorphose from primary producers and distributers to aggregators. In the new economic era, their role will be to coordinate and manage the multiple networks that move commerce and trade across the value chain. The rapid decline in transaction costs brought on by The Third Industrial Revolution are leading to the democratization of information, energy, manufacturing, marketing, and logistics, and the ushering in of a new era of distributed capitalism that is likely to change the very way we think of commercial life in the 21st Century. For a more detailed look at how 3D printing in the Third Industrial Revolution era is going to transform the global economy you can link to my cover story in the current issue of The World Financial Review here . Jeremy Rifkin is the author of The New York Times best selling book, The Third Industrial Revolution, How Lateral Power is Transforming Energy, the Economy, and the World. Mr. Rifkin is an adviser to the European Union and to heads of state around the world. He is a senior lecturer at the Wharton School’s Executive Education Program at the University of Pennsylvania and the president of the Foundation on Economic Trends in Washington, D.C.

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Dr. Serena Reep: Meaning of Work: What For-Profit Corporations Can Learn From Non-Profits

March 28, 2012

According to PricewaterhouseCoopers’ 2010 data , 33 percent of the U.S. workforce is highly disengaged from the work they do as compared to 20 percent in 2008 and 10 percent pre-2008. Gallup 2010 also reports that 33 percent of employees in world-class organizations are either not engaged or actively disengaged and 67 percent of employees in average organizations are either not engaged or actively disengaged. What is the cost of this disengagement to the U.S. corporations, you ask? About $292-$355 billion annually, according to Gallup. What gives? Why is there such disconnect and dissatisfaction with the work we do? We spend the largest portion of our wakeful moments at work; if these precious moments are spent in emotional detachment, it speaks volumes about our quality of life. The way the corporations “run” their business with the “profit first” philosophy ignores the fundamentals of human nature. When people have the opportunity to develop trusting, caring and mutually supportive relationships and form a sense of community with the people they work with, they have a stake in the outcome of the individual and team performance. When this is lacking, however, it becomes “just a job that pays the bills.” They will trade their bodies and time for the paycheck but not their hearts and souls. Contrast this with Martha’s story — a clear example of what “employee engagement” looks like in everyday life. I’ve been honored to work for a short time with breast cancer awareness charities. I can’t get one particular lady, Martha, out of my mind. She was the most pleasant, vibrant, and positive woman that I’ve ever met. She was a volunteer; she didn’t make a dime from her work but somehow you knew her sentiment was worth more than a paycheck. She helped, she advised, she rolled up her sleeves, she marched, raised money and answered the phones when needed. Martha was the perfect employee who wasn’t hired. I couldn’t help but think about why more people like Martha weren’t actually working at a for-profit company. How can we bottle her incredible attitude and infectious optimism? Why is the nine-to-five worker largely unhappy and disengaged from work while this unpaid woman is eager to get to work every morning? Why? There is clearly a lack of meaning and passion, lack of relevance, in their jobs, compared to Martha’s. Everything Martha did as a volunteer had meaning and was fueled by inspiration. She had beaten the breast cancer that took her mother. Her motivation was not only personal but positively vengeful. After seven years of intense chemo, losing all her hair, her confidence and her marriage, she had one chance left. The chance came in the form of a little known alternative cancer treatment used widely in Asia. She traveled there as a last resort, and this became her saving grace. Now back in the U.S., Martha had made it an obsession to have alternative remedies approved by the FDA, so other woman can have access to treatment options. She is passionate and unrelenting. She squeezes more productivity out of one day than most people do in a month, because she found meaning for her remaining days here on earth. When your work makes a difference in the world, you will never fully grasp its true influence. The magic of passion is that it lights the passions of others in areas outside of your purpose. When was the last time you saw someone doing something with such passion and intensity that you could only think about what lies dormant in your own life? Martha not only affected those passionate about research and development of cancer treatments but also lit the fires of anyone whose dreams were covered by hesitation and disbelief. The point is this — when you find meaning in your life’s work and lean into it with all that you have, others cannot help but be inspired and lean into their own dreams. When corporations can replace process with passion, and re-engineer the workplace to sustain a culture of caring and trust, there is much better likelihood that employee engagement statistics will improve and so will their bottom-line.

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James Doran: Free Trade Like Manna From Heaven for Middle East Entrepreneurs

March 28, 2012

A colleague staggered into the office a couple of days ago weighed down by a rather large, ornately designed cardboard box. Inside it were dozens of brightly wrapped candies, each the size of a bantam’s egg. They were, she told us, a delicacy from her native Iraq, recently delivered by her mother who had just returned from a brief trip to Baghdad. The gold-and-purple wrappers peeled away — eventually, as the heat of the journey had taken its toll — to reveal a beige mass of toffee studded with pistachios. They were scented with rose water and a hint of saffron. Al man wa salwa is a heavenly treat for many Iraqis, especially those, it seems, who are far from home. The term translates into English as “manna from heaven” and is borrowed from a sura in the Quran. With such credentials, and such a following, it is a wonder that the delicacy is not an international marketing success story, with al man wa salwa sold at every street-corner candy store the world over. Perhaps it could be. Why would an Iraqi manufacturer not use such a household name as the foundation to create the region’s own Hershey’s or Cadbury? The truth is politics, geography, conflict and red tape conspire to make life tough for entrepreneurs all across this region. But it could be so different. As expatriates in the UAE, we are surrounded every day by friends and colleagues from every country in the Middle East and North Africa. Each one of them holds a product from their homeland so dear they would go to the ends of the Earth and pay handsomely for a ready supply. The examples are endless and each one underscores a vast untapped potential for regional and international trade. A friend from Yemen loves his Yemeni honey — Sidr honey, to be precise. It is harvested just twice a year in the Hadramaut mountains. A single kilogram of the rare nectar costs Dh3,500 ($952) or more today as supplies are restricted by continuing unrest, making it more expensive than caviar. Palestinian olive oil is recognized by gourmands the world over as the finest available. (Don’t tell the Italians, though.) The fair-trade community has made substantial progress over the past year branding and selling Palestinian olive oil on international markets. Members of the Canaan collective, for example, were last year paid twice the going rate for their olives and secured contracts with J Sainsbury supermarkets in the United Kingdom and Whole Foods in the United States. Canaan, the company that markets the oil, says it works with more than 1,500 farmers from 43 villages across the Palestinian Authority, accounting for more than half of all West Bank olive oil exports. Sales are expected to hit $5 million this year, with a profit of at least $600,000 to be shared among the farmers. Canaan was started by Nasser Abufarh, a young entrepreneur with a relatively small $100,000 of seed capital. Mr. Abufarha’s international success is notable, sadly, as it is an exception, despite a recent surge in bilateral free-trade agreements between countries of this region and counterparts all over the world. The path to such free-trade agreements has long been hindered by familiar obstacles. A lack of transparency, corruption, political instability and unreliable supply chain management are the most common problems cited by organisations such as the U.S.-Middle East Free Trade Coalition. Not all countries are equal in this regard, however. The UAE has used the free-zone model to encourage international trade, and to facilitate trade from other countries in the region. Within zones such as Jebel Ali in Dubai and the nascent Kizad free-zone in Abu Dhabi, entrepreneurs from all over the world, large or small, can find a haven for trade. Campaigns are under way in the U.S., Latin America, Asia and Europe to strike fresh trade agreements with new governments in Egypt, Tunisia, Libya and hopefully one day with Syria, Yemen and others. The free-zone model should be given equal consideration by the new governments as they forge important new ties. If they succeed, perhaps one day we will all enjoy Iraqi manna from heaven, wherever on Earth we happen to be. For more Middle East Business, News and Features visit www.thenational.ae

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Don McNay: Injured People and the One Percent

March 28, 2012

Most people perceive my job as strictly helping people make money. What I really do is help injured people. I keep injured people from wasting a settlement. I help them find every government benefit and program that might make their lives better. I find ways for them to minimize taxes and maximize what they keep. I assist in mediations and help them get claims settled. Many of my clients are in the top one percent of income earners. The bracket that some people are marching against. Most of my “one-percenters” are in wheelchairs or had their families wiped out in accidents. I’ve been doing my work for nearly 30 years and would never trade places with any client who got a large settlement or judgment. No sane person would give up their health or their family for money. Thus, going to war against the top one percent is not black and white for me. I’m for making hedge fund managers pay ordinary income tax like the rest of us do. I’m for tying Wall Street bonuses to doing something productive for society, instead of taking a bonus but not creating wealth. I want to see more being done for Main Street and less being done for Wall Street. I want the average American to get a fair shake and not be ignored by Washington. But what I really want is to keep doing things to help injured people with their money. A financial guru once called me a “financial evangelist.” I think I am more like a financial pastor or minister. I want to comfort the injured and help them heal. I also want them to hang on to their money. Thus, when they start going after the top one percent, I want to make sure that my clients are not the one percent of people they are going after. I want Congress to go after Wall Street but have found that Wall Street have a lot better lobbyists than injured people do. I’ve been encouraged that injured people will benefit from health care reform. I’ve spent the past few months becoming immersed in the nuances of the new health care reform act. I’ve read all 1990 pages of the law several times. After months of study, I understand it. I see how it helps people I want to help. If you like the law, you call it health care reform, if you don’t like it, you call it Obamacare. Before I took the time to really study the legislation I called it Obamacare. I encouraged my Democratic Congressman to vote against it, which he did. Now I am calling it health care reform. It is going to turn the medical system upside down. I don’t know how we will pay for it but I see where it truly helps injured people. Some of the reforms are coming to place now, before 2014, and I am learning how to use them to help my clients. When you dig into the details of the law, you see how health care reform empowers people who have been shut out or minimized by the health care system. It promotes wellness and good health. That’s not such a bad thing. I can also see the new law, along with the bailouts and stimulus packages of recent years, putting a huge strain on the federal budget. There have been calls of “tax reform” to pay for the looming larger deficits. I’ve learned one thing from watching Washington. Whenever there is a “reform” or “call to sacrifice” it is the little people who are supposed to do the sacrificing. Wall Street gets paid back 100 cents on the dollar. I can see reforms, aimed at the “one percent,” actually hitting people like my clients who are using their resources for medical care and a better quality of life. I don’t mind taxing a Wall Street banker’s second yacht or third vacation home. I don’t want them taxing a client who wants to buy a lift for his wheelchair. It’s simple to aim focus at the top one percent of income earners and assume they are all doing something wrong. It’s more complicated when you add in people who got to the one percent by having a drunk driver smash into their car and kill their family. When we start talking about the “one percent,” we need to think about the one percent of society who are hurting and need government assistance and help. And make sure that help is provided. Don McNay, CLU, ChFC, MSFS, CSSC is the bestselling author of the book, ‘Wealth Without Wall Street’; McNay, who lives in Richmond, Ky., is an award-winning financial columnist and Huffington Post contributor. You can learn more about him at www.donmcnay.com. He is the Chairman of the Board for the McNay Settlement Group (www.mcnay.com) which provides structured settlement consulting for injury victims, lottery winners, and the families of special needs children. McNay founded Kentucky Guardianship Administrators LLC, which assists attorneys in as conservators and setting up guardianships. It is nationally recognized as an administrator of Qualified Settlement (468b) funds.

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Penny C. Sansevieri: How to Market Your Fan Page With the New Facebook Changes

March 27, 2012

Starting on March 30, Fan Pages on Facebook will be undergoing big changes, and if you aren’t sure what’s going to happen to your Fan Page you should know that the changes are pretty significant. I’ve asked our Facebook expert Amy Porterfield to share some insights into these changes. First up, Amy can you tell us what the biggest difference is with the new Fan Page changes? Here’s the thing, it is no longer about the number of Likes. Just because you have a lot of Likes, a lot of fans, doesn’t mean you’re going to have success on Facebook. If you want bottom-line results you must create ways to keep fans coming back for more, collect leads from quality fans and get them to take action inside and outside of Facebook. With all the new changes, Pages are now more visually stimulating, which means that you can actually get more engagement just by the fact that there’s a new layout on your Facebook page. To couple that with some of these strategies we’ll talk about in this blog post, you’ll have some surefire ways to get more action from your Facebook fans. A lot of people are concerned that their Welcome Tab is going away and there’s a new cover photo that some businesses are already using, can you tell us about that? You bet. First let’s go over the Timeline Cover Photo. Here are some specifics about these changes. As you probably know, on March 30 your page will change to the new timeline cover layout. You can change it over now or you can wait until March 30. What’s going to happen is when you do change over to the new timeline layout you’re going to have a big cover photo on the top. That big cover photo is a great opportunity for you to brand your business. First of all what you need to know is the specs for that cover photo are 851 x 315 pixels. I know 851 is kind of an odd number but the closer you get to that, the crisper your photo is going to be, it’s not going to be blurry or it’s not going to be stretched too much or whatever. Also, you have a new profile image. Here ‘s an example of Coca Cola’s page where you see the little profile image on the left. That image is 180 x 180 pixels. Here’s the frustrating thing about these new timeline covers for pages. There are a lot of restrictions. You can see these right on the Facebook Blog, too: Facebook says that you cannot include price or purchase info, such as 40 percent off or Download it at our website, you can’t put that type of information on your cover photo. You also cannot include contact information such as web address, email, mailing address or any other info intended for your About section on your Facebook page. You know we all have that About section where we can give details of how to reach us. They don’t want that type of information on your cover photo. In addition, you cannot reference a user interface element. What that means is you can’t say “Like” or “Share” or any other Facebook site features. They don’t want you to say Like our page or Share our information on Facebook on that cover photo. No calls to action, which is the hugest bummer. You can’t do “Get it Now” or “Tell Your Friends” or “Sign up here” or “Go here to get more info,” you can’t do any type of call to action. Facebook says that the cover timeline photo is not meant for promotions, coupons or advertisements. They also say that the cover photo should not be primarily text-based or infringe on anyone else’s copyright. As you can see, these timeline restrictions are pretty strict. There are a lot of things that we cannot do on the timeline cover. Here are some examples of what other companies have done with their cover photo: www.facebook.com/social.fresh : They have a really cool image, it’s colorful, it catches your attention and it makes things interesting on their page. You could just go with an image and do some type of creative branding like they’ve done here. www.facebook.com/CaptainMorgan : Or you can do what Captain Morgan does, and they’ve basically expanded their brand. www.facebook.com/AmyPorterfield : With mine, I set it up to be more of a list building opportunity. I will say I know that I’m walking the line with this experiment here. I promoted my webinar on my cover photo. I’ve heard that they have taken people’s cover photos down and you’ve had to fix them and replace them. I haven’t heard anybody losing their Facebook page over this but do what you feel most comfortable with because I don’t want to get you into any trouble. Facebook is rolling out something called Applications, or Apps, can you speak to that? Along with the timeline cover photos being a huge change on Facebook, Facebook has also changed how we use tabs. Tabs used to be on the left column of our Facebook page — now tabs are called Apps. Tabs and Apps — those words are pretty much interchangeable right now. It’s your custom page that you can create inside your Facebook page. The specs for these custom apps are now 810 pixels wide which really allow you to do so much more with your custom pages inside Facebook than you ever could before. I’m going to show you some examples of this. In addition to that, Facebook has also allowed you to create thumbnails to highlight your different applications. You can create thumbnails that have an image on top of them. That image could be 111 x 74 pixels, kind of a weird number but trust me, these are the best dimensions to make your images look really great. You cannot have thumbnail images on top of photos, videos, notes, Likes and events. Those application boxes cannot be changed. Also you can move around your thumbnails and you can have up to 12 applications on your Facebook page. If you go to my Facebook page, right below my cover image you’ll see my applications and you’ll only see the top four unless you click that button on the right, then it will be a drop down and you’ll see the other four. What’s cool about this is I was able to create custom thumbnail images for the three you’re seeing right there on top and the two on the bottom; Social Media Updates, Free Video Series, Webinars, those are all thumbnails that I created. I created the jpeg image, then uploaded it. There are some strategies for thumbnails that I want you to think about: Create a reason to click inside your thumbnail — as you saw, I have Social Media Updates, Free Video Series, these are things that I know my ideal audience will find valuable. Get strategic with the three apps above the fold — those three that you saw next to the big thumbs up; those three you can move around. Make sure those are the best three you have on top because until someone clicks that blue arrow to the right that I showed you, they won’t see the ones below it. Rename the app itself, and you should think in terms of getting your fans to take action. There’s a lot you can do with the Applications or Apps, and we’ll talk about that in part two of our Facebook Fan Page Marketing strategy session with Amy Porterfield. About Amy: Amy is the co-author of Facebook Marketing All-In-One for Dummies and a Social Media Strategist for entrepreneurs and small businesses. With 12+ years marketing experience, Amy has worked with mega brands like Harley-Davidson Motorcycles, along with Tony Robbins International where she oversaw his content marketing team and collaborated on multiple online marketing campaigns. She currently creates online programs to teach entrepreneurs and small businesses how to leverage social media to gain greater exposure, attract quality leads and turn their fans and followers into loyal customers. To learn more about Facebook and social media for your business, check out Amy’s blog. www.amyporterfield.com .

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Karen Steuer: Where Have All the Farms Gone?

March 27, 2012

During the past 50 years, animal agriculture has gone through a seismic shift in the United States. Long gone are the iconic scenes of American landscapes dotted with family farms and red barns. Most of these have been replaced by industrialized facilities controlled by large corporations that rely on concentrated animal feeding operations (CAFOs). In this system, cavernous warehouses crowded with thousands — even tens of thousands — of animals form the equivalent of an agricultural assembly line. And independent farmers, once the cornerstone of rural America, struggle to compete in a marketplace dominated by a few big corporations. As large corporations (known as integrators) have applied an industrial model to farming, they have also generated a host of new problems. The CAFO model relies on three interlinked practices in order to increase profits: Maximize the number of animals squeezed into the least amount of space and require the fewest number of employees to provide care. Administer continual doses of antibiotics to the animals to prevent the diseases prevalent in their close-quarters housing. Minimize the disposal cost for the substantial volume of animal waste produced by the facilities. These practices may turn a profit for the big corporations, but they are disastrous for human health and the environment. Up to 1 billion tons of manure is generated by livestock operations every year, much of it from CAFOs. In some cases, the waste is stored in large lagoons or open piles that can leak or spill into adjacent land and water. In other cases, manure is liberally spread on fields in such overwhelming concentrations that soil and crops often cannot impede all of the nitrogen, phosphorus, and pathogens from reaching public waterways. The mishandling of manure has resulted in contaminated drinking water sources for 40 percent of the U.S. population in recent years, according to Environmental Protection Agency estimates. Tainted drinking water, destruction of fish and other aquatic life, and polluted recreation areas, however, are just part of the damage caused by CAFOs. Countless independent farmers have been pushed out of business. Millions of animals have been confined to crates or cages and subjected to inhumane practices. The human health threat of antibiotic-resistant infections continues to rise. And the corporate integrators have largely been insulated from regulation, transparency, and requirements many other industries must follow with regard to pollution. Shortly after the Pew Commission on Industrial Farm Animal Production released a groundbreaking report on this topic in 2008, the Pew Environment Group launched a campaign aimed at reforming this sector of agriculture. Pew is working to address these challenges by securing effective, sensible government oversight to protect water resources and human health; urging the industry to change its practices; and building public awareness of the problems. During the next several months, I will use this series to describe the environmental concerns associated with CAFOs, the impact on independent farmers, the industry’s resistance to change, and how this issue affects our quality of life in the United States. For more information and to take action, please click here .

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Geri Stengel: Redesign Business for a Robust Economic Future

March 27, 2012

We need more women in leadership roles This isn’t a call for a feminist revolt; it’s a call for a healthy, growing economy and leadership by women is needed to accomplish that. If you don’t buy that, check out some of the research : The more women in the board room, the greater return on sales, equity, and invested capital. Maybe because, as the Harvard Business Review reports , women also excel at leadership skills. One place where women are falling behind is high-growth businesses, a failing that the Kauffman Foundation dubs a loss of potential economic drive. Facts we need to change: Women start businesses but don’t grow them. Women are under-represented among venture capitalists and angel investors. Women get a high percentage of the degrees in biological sciences and physical sciences but are woefully behind in taking out patents and building businesses based on their research. Women score higher in the competencies that make good leaders but are under-represented in higher-level corporate positions. To paraphrase Lily Tomlin, we can sit around waiting for somebody to do something or we can realize that we are somebody. Let’s make change happen. Make women visible: Four years ago, venture capitalist Jorge Calderon realized that he couldn’t find women- and minority-led enterprises to invest in. Not because they weren’t there, but because they aren’t visible. He started Springworks to show women and minority innovators how to catch the eye of venture capitalists. Women are missing from the science advisory boards of corporations, which means they don’t have the contacts they need when they do come up with a great idea, according to the Kauffman Foundation and ” The Entrepreneurial Puzzle: Explaining the Gender Gap ” from Georgia State University. Redesign workplaces: Build businesses that can accommodate the differing lifestyles of employees, whether male or female . You can retain and grow talent by being flexible — flexible about taking a year off for family without losing a rung on the career ladder; flexible in working hours; flexible about telecommuting. Flexibility also cuts costs and improves customer service. It’s a smart business strategy, not a give-away. If we don’t restructure business culture, we’re going to keep losing the talented people we’ve paid money to train. And we won’t be able to serve customers in the 24/7 world of e-commerce and global customers. Redesign informal networks: Either all women need to learn to love sports and play golf or informal gatherings where relationships are built and deals made must become more inclusive. Guys, this isn’t about giving up your bonding moments. It’s about finding the best business relationships. When you leave out half of those who might have the best deal, what does that do for you? Redefine “tough” and “bitchy”: Nice girls do fire people . If they don’t do what’s needed, they aren’t helping the business or the employee. Being tough or, as it’s called when men do it, assertive and strong, is good business if done right. Network and mentor: Women need to support and mentor each other. Those few who have made it to the c-suite or own their own businesses must reach out to help those starting out, perhaps by forming angel investment groups, such as Pipeline Fellows do. As Karen Barbour, founder and president of The Barbour Group says of her efforts to help women get a start in federal construction contracting, “Sometimes I feel like Tinkerbell. They never knew this existed. I say take my hand; we will go fly.” Or it could mean building the alumnae network at your school, going back to speak and inspire young women, as Deborah Sweeney CEO of MyCorporation does. Better yet, start all if it younger. Girl Scouts of the USA has announced the launch of ToGetHerThere, a bold advocacy and fundraising cause, dedicated to girls’ leadership. The multi-year effort will seek to create balanced leadership — the equal representation of women in leadership positions in all sectors and levels of society — within one generation. Again, this isn’t a feel-good effort; it’s about facts. Research shows that Girl Scout alumnae are more confident, achieve higher levels of education, earn more money, give back to their communities, and vote more regularly than those who didn’t participate in Girl Scouts. And the longer women were in Girl Scouts, the more advantages they have. Volunteer to lead a troop, work on a project or otherwise help girls achieve the confidence, teamwork, and leadership skill they need to become the next Bill Gates. Back to Lily Tomlin: You are somebody. So do something.

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Timothy A. Ridout: Satellite Security Requires More Rules, Not Fewer

March 27, 2012

Satellites are crucial to modern life. We rely on them for civilian uses such as TV, Internet, ATM banking, GPS, agriculture, and weather forecasting. On the military side, we use satellites to guide munitions, operate drones, gather intelligence, and monitor enemy movements. Unfortunately, satellites are increasingly threatened. Earth orbits in which satellites operate are becoming cluttered with debris. As the number of operational satellites increases, competition for orbital “slots” is intensifying. The military uses of outer space also mean that space-faring nations are eying each other warily as they work to “harden” their own space assets while simultaneously developing new ways to destroy or incapacitate those of potential adversaries. This intensified competition has led to a debate about how to ensure that outer space remains viable for productive use. Russia and China have proposed a treaty that would ban the deployment of space weapons and prohibit the threat or use of force against space assets. The Bush administration pursued a policy of U.S. space dominance , but the Obama administration has since reversed this in favor of a cooperative multilateral approach. In January, Secretary Clinton indicated that the United States would work with the European Union in developing an International Code of Conduct for Outer Space Activities . In their recent op-ed in the New York Times , John Bolton and John Yoo advocate a return to Bush-era unilateralism, supporting near-absolute freedom of U.S. action in space. They begin their argument with the false claim that “The Obama administration recently declared that America would follow, though not sign, a European Union code of conduct for outer space.” In reality, the administration has agreed to work with the EU on creating a code of conduct, but it has explicitly refused to follow the EU code of conduct as it stands, saying that it is too restrictive. Aside from this inaccuracy in their argument, Bolton and Yoo’s opposition to greater cooperation in outer space is worrisome. The kind of muscular, unilateral policy that Bolton and Yoo advocate would encourage unrestrained anarchy in a fragile environment. If the U.S. acts as it pleases, other countries will do the same. Without efforts to coordinate traffic or restrain dangerous behavior, outer space will remain in the kind of anarchic limbo that led the Chinese to conduct an anti-satellite test against their own weather satellite in 2007, destroying it and creating a lot of debris in the process. Russia and the United States have had the capacity to destroy satellites this way since the 1980s. The Chinese test could have been avoided if there were a clear norm discouraging such behavior. Additionally, a more cooperative atmosphere would have reduced the security concerns that created a perceived need for a show of force in the first place. A non-binding code of conduct of the sort proposed by the European Union in 2010 is currently the best way to improve outer space security. A treaty banning space weapons is not realistic both because defining a “space weapon” is infinitely difficult given the dual-use nature of space assets, and because there is little political will for a new outer space treaty. Broad principles are already outlined in the 1967 Outer Space Treaty , which ensures the universal right to peaceful use and extends international law to outer space. What a code of conduct would do is clarify specific norms and best practices. Article I of the Outer Space Treaty — to which the United States and 100 other states are party — establishes space as “the province of all mankind,” adding that it “shall be free for exploration and use by all States.” In this sense, outer space is roughly analogous to the high seas: free for all to use for peaceful transit. In the maritime case, a broad set of rules and standard practices have developed over centuries, providing guidance on issues as mundane as which ship has the right of way in given situations. Without these international norms governing maritime operations that enable the safe transit of ships all over the world, global commerce could grind to a halt. Of course, the physics in outer space are quite different. In the event of hostilities or accidental collisions at sea, destroyed ships and debris will sink to the bottom of the ocean. In outer space, debris in lower orbits could be pulled into Earth’s atmosphere in maybe 25 years. However, debris in higher orbits can last for centuries, endangering any space assets seeking to use those orbits. The speed at which objects in orbit travel means that even a marble-sized piece of debris could destroy a satellite. As of yet, there is no cost-effective way to eliminate space debris, although some are trying . Aside from the threat of hostile acts foreshadowed by the Chinese anti-satellite test, mere negligence and lack of coordination pose a serious danger to the outer space environment. For example, if an operator does not maneuver a satellite into a useless “graveyard” orbit before it runs out of fuel, that satellite becomes a hunk of debris at risk of colliding with other objects (as occurred in 2009 with an Iridium communications satellite and a defunct Russian spy satellite). Clear rules and accepted best practices can help mitigate such threats. An outer space code of conduct would codify and strengthen emerging norms such as those outlined in the Space Debris Mitigation Guidelines , a set of best practices formulated by the world’s major space agencies. Whatever the specifics of a code of conduct or other agreements may be, developing norms and promoting a cooperative framework are in the U.S. interest. With nearly half of the roughly 1,000 operating satellites , the United States has the most to lose. We must emphasize collective traffic management and condemn the initiation of hostilities in outer space rather than supporting unrestrained freedom of action.

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Connie Dieken: Influencer of the Week: Apple’s New CEO Tim Cook

March 27, 2012

“Just do what’s right,” Apple’s co-founder Steve Jobs reportedly advised Tim Cook, his successor as CEO of Apple Inc. That’s how shift happens. Cook proved his inner boldness this week in a major shift with the late Jobs’ philosophy. He announced the company’s new dividend and buyback plan, essentially bringing sexy back to the musty old dividend. The quarterly check, one seen as taboo for tech companies, is now cool again. This is an extraordinary move for a company that is still in high growth mode. In the past, issuing regular payments to stockholders has signaled that growth mode is over and a company’s best days may be behind. Other sleek tech companies like Google and Amazon don’t pay a dividend. Cook begs to differ. And he does so with precision. During last week’s teleconference with New York analysts, he front loaded his announcement with influential buzzwords, such as: “We are innovating at an incredible pace.” “We’re building a tremendous ecosystem with apps and content.” “We’re expanding our footprint with new carrier partners and other third-party resellers.” “We continue to open stores, including 40 this fiscal year alone.” “We are investing in our direct enterprise sales force.” The last comment is another telling departure from Steve Job’s approach. Jobs famously loathed corporate IT buyers. Cook emphasizes their importance. Apple was hoarding a ridiculously large cash reserve — at last count, $97.6 billion — the largest reserve of any non-financial organization in the U.S. To put that number in context, Apple’s reserve was larger than the entire market value of 485 of the 500 companies in the Standard & Poor Index. The measure of any communication is the listeners’ response. Wall street responded by pushing Apple shares to a record $601.10 , its first-ever close above $600. And Cook’s message is also resonating with large fund families such as Vanguard and Fidelity, whose rules previously prevented them from including stocks that didn’t pay a dividend. They’re now able to include Apple in their funds. Sure, there are grumblers. Some analysts are disappointed with the size of Apple’s 1.8 percent divided. In comparison, Hewlett-Packard pays 2 percent and Microsoft pays 2.5 percent. But as Cook summed up his announcement, he noted , “Simply stated, we don’t see ceilings to our opportunities.” The same can be said about Cook. He appears to be fueled by an inner boldness to do what’s right — he delivered a compelling message that resonated with his target audience, and he gained their commitment. Like his predecessor, the late, great Steve Jobs who handpicked him, it appears that Tim Cook is a true influencer.

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Patrick Sharma: Fixing the World Bank

March 26, 2012

With the economy still struggling and campaign season heating up, it is not surprising that the World Bank is far from most people’s minds. But President Obama’s surprising choice to tap Dartmouth President Jim Yong Kim as the Bank’s next president is an important one, for it has the potential to determine the fate of an institution that is running out of time. Founded in the waning days of World War II, the International Bank for Reconstruction and Development, or World Bank for short, stands at a crossroads. Although not without serious flaws , the organization has long worked to promote international development by providing loans, grants and advice to governments in the global South. The Bank and its affiliate bodies, the International Development Association and International Finance Corporation, have also served as a clearinghouse for information on development, publishing reports, convening conferences, and running programs on everything from business regulation to HIV prevention. Yet, partially as a result of its own success, the Bank teeters on the brink of irrelevance. Last year the organization lent $26 billion dollars to developing countries — a paltry sum compared to $1 trillion in loans and investment those nations received from other sources during the time. The Bank’s largest borrowers, countries like India, Brazil, and China, are increasingly important players on the world stage and will have little need for the organization’s capital in the years ahead. Moreover, in an era of globalized financial markets many poorer nations are likely to be more interested in tapping private funding and other forms of foreign aid, such as that provided by China, than relying on the Bank’s assistance, which often comes with strings attached. The fact that so many countries are graduating from Bank lending is something to celebrate. So should the organization declare victory and close up shop? The answer, unfortunately, is no. Today’s major development challenges — whether climate change, migration, or access to energy — are increasingly global in scope, and the Bank is one of the only organizations that can address them in a meaningful way. This is because the Bank has the unique ability to provide both intellectual and financial assistance on a global scale. Unlike foreign aid programs, think tanks, or private foundations, the Bank combines knowledge creation and dissemination with significant on the ground development experience. As a result, the organization continues to have considerable influence in the developing world. Additionally, because of its unique governance (the Bank’s president has significant latitude in running the organization) and funding system (the Bank gets most of its money from selling its bonds on the private market), the organization is less beset by the inertia that plagues most other multilateral institutions. Kim — or whomever is ultimately selected as the Bank’s next president — will need to take advantage of these powers to remake the organization. Although each of the World Bank’s previous eleven presidents has left their distinct mark on the institution, none has faced a development landscape quite as unsettled as today’s. With the vast majority of the world’s poor residing in a handful of fast-growing middle-income countries, low-income nations facing unprecedented environmental and resource challenges, and industrialized countries preoccupied with their own economic difficulties, the Bank’s next president must move quickly to put the organization on a sound footing. This will require many things, but the major need is to turn the Bank into a more global institution. The success that many developing countries have had in increasing their economic growth over the previous years should force the Bank to question its intellectual foundations. Staffed mainly by American-trained economists, the Bank has long advanced a development model that calls for reducing the government’s role in the economy. While this might have made sense during the Cold War, in the aftermath of the financial crisis the Bank should move faster than it already has in embracing a development philosophy that recognizes that government can be a positive force in the economy. By bringing the organization back to a more balanced vision of development, the Bank’s next president can take an important first step in preparing it for the future.

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Harvard Kennedy School Democrats: A New Name for Occupy

March 26, 2012

By Cassandra Nelson As Occupy activists take stock at the six-month mark and look for ways to make their movement sustainableby appealing to a wider audience, I offer one concrete suggestion: change your name. The Bush administration was smart enough to stay away from it. The war in Iraq lasted exactly six weeks — from the invasion on March 20, 2003 to the now infamous “Mission Accomplished” photo op on May 1 of that year. By that point, Iraq’s conventional armed forces had been defeated. What dragged on for eight more years was an occupation. Most Americans, though, thought of the conflict as Operation Iraqi Freedom or the War on Terror. Was it honest for President Bush and his staff to phrase it this way? Not entirely. Was it clever? Very much so. The word “occupation” suggests illegitimacy. It suggests force. It suggests a temporary and unfair arrangement. Occupiers in history don’t win: it’s the people whose land they occupied who are vindicated in the end. The Nazis occupied France. France once occupied Algeria. That’s not the side of the fight anyone wants to be on — not just because it’s the losing side, but because it’s the wrong one. The Occupy movement’s strategy up to this point has also made them look like squatters — squatters in front of buildings where people go to work and make money. And if there’s one thing a lot of Americans want to do right now, understandably, it’s to go to work and make money. They don’t want to sit in a park with people who perhaps don’t have the opportunity to bathe every day. It may sound glib and cruel, but living in a park is what homeless people do. I suspect that many people viewing the Occupy movement on television or in the news have made this connection, though not necessarily on a conscious level. Finally, the name Occupy suggests stasis, as if the goal were just to sit around in as many existing spaces as possible and point out what’s wrong with them. This spatially-oriented approach limits Occupiers’ agenda and also puts them on the defensive. They have to apply for permits; they have to shout over speeches others have organized; they have to explain their presence in a public space. It seems to me that the ones who really ought to be explaining themselves are the people who have turned the American dream into a nightmare. The people who have let the middle class go on thinking that hard work, strong will and a good education are all it takes to succeed in this country — that those elements alone are enough. On the one hand, maybe they never were. ZIP code, skin color, sex, religion, nationality and other factors largely beyond one’s control have long played a role in determining who succeeds in America, and how much. On the other hand, an individual’s chances for upward social mobility today are as good in the United States as almost anywhere on the planet. In between these two truths is a story of the ways in which the system has been increasingly rigged in the last half century. I don’t even pretend to know what happened exactly, but it had something to do with the growth of an increasingly complex, perilous and largely imaginary financial infrastructure; a decrease in government regulation of same; a cozy and mutually beneficial relationship between corporations and lawmakers; and trends in both executive compensation and federal income tax that can only be described as bananas. Fun fact: today, the richest people in America pay 35 percent of everything they make over $388,000 — or less . Under Reagan, they paid 50 percent of everything they made over $175,000. Under Eisenhower, they paid 91 percent of everything over $400,000. Ninety-one cents on every dollar above a certain amount! It’s admittedly a Gala to Red Delicious to Pink Lady comparison, but still telling. So even if we concede that the playing field was never perfectly level, and that it isn’t perfectly level in other parts of the world today, it remains safe to say that the opportunity of the average American to make a decent living — enough money, say, to raise a family, own a home and retire — has diminished substantially in recent decades. How we got here, and what we intend to do about it, is a conversation that we as a nation need to continue. To that end, I propose a new name for Occupy — a name that better expresses why people are upset right now, a name that appeals to everyone who’s not directly profiting from the unfair and corrupt system currently in place, and a name that puts those people responsible for the most incredible income inequality this country has ever seen on the defensive. Justify. Justify Wall Street. The Justify movement. It can be applied to any physical space or any institution, and it puts the pressure on the questionable party. On the CEO who makes an exorbitant bonus, for instance, or the Congressman who takes advantage of insider trading, or the local official who cuts education funding for the third, fourth or fifth year in a row. The image that the Justify movement would call to mind wouldn’t be its own supporters. It would be a split screen of sorts — with private jets on one side and food pantries on the other. It would be a picture of a yacht, alongside toys on the lawn of a foreclosed home. It would be the face of Stephen Helmsley, who took home $102 million last year as the country’s highest paid CEO , next to the face of an uninsured child . And it would ask how you can justify all of the things on one side of the screen when confronted with those on the other. It would cut through much of the current vagueness, apathy, and annoyance, and it would steer the conversation to what it’s really about: justice. Cassandra Nelson is a PhD candidate in English literature at Harvard University focusing on postwar American fiction. HKS Democrats leadership reviews and approves all op-eds that appear in this space.

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Soren Petersen: ROI on Design and Risk Reduction

March 26, 2012

Co-written by Jed Simms. Creating innovative products is fraught with risk due to the inherent gap between the knowledge one has and the knowledge one needs to make good decisions. Usually one knows only 5 percent of what is needed at the stage where 70 percent of the product’s cost is determined. At this juncture, one has to make a qualified bet on the design team’s ability to close the gap faster than the money is being spent. Fortunately, there is some predictability, since return on investment (ROI) and risk go hand in hand. Small incremental investments in product improvements offer small rewards at a low risk where market and technology are known, while breakthrough innovations have the potential of offering huge rewards along with large investments and potentially scary risk. With only a vague sense of the odds, this may look like pure gambling. However, unlike roulette, product development has four winning strategies that, when combined, vastly improve the return on investment. Applying the four steps: (1) Business definition, (2) Portfolio management, (3) Hedging product concepts and (4) Managing process, ROI in design is effectively managed, execution and market risk is systematically reduced while real ROI becomes transparent, measurable and controllable. One — Stating and agreeing upfront on what the new business-as-usual end states are to be and how the results are to be made operational, in clear specific measurable terms is the most important step to optimizing ROI. This is accomplished though formulation of a dynamic and inspirational design brief for the projects considered, describing how projects fit with the corporation’s strategy. The briefs describe the desired outcomes of nine design quality criteria: strategy (philosophy, structure and innovation), context (social/human, environmental and viability) and performance (process, function and expression). Formulating the brief requires all stakeholders to convene and consider potential options in business outcome terms and then co-create a brief that is flexible enough to adjust to changes in assumptions, new learning as well as to solidify the team and inspire action. Creating a brief is actually a small design specification project in itself for management to conduct. Two — Product portfolio management, like any investment portfolio, is balancing one’s portfolio for long-term ROI, determining which projects to initiate in the first place. This can be accomplished by spreading the corporation’s investment into combinations of low and high market and execution risks. The right mix depends on the dynamics of the market and the strategy of the corporation. Three — Option management by segmenting the product development process into a number of phases, small steps where investment is made for one phase at a time, each phase reducing risk though prototyping and testing. In addition one can hedge one’s risks by investing in parallel alternative designs during a phase and then pick the most promising product concept at its end for further development. Four — Comprehensive risk/reward focused project management is the strategy for translating the brief into real-time decisions and actions — it is where the rubber hits the road. As with rally driving, mastering project management takes lots of practice in holding the original business outcomes in mind while continuously managing activities and optimizing the allotted time and cost to meet the expected quality. Besides doing all of the above well, the key to totally optimizing ROI and risk is to recognize when the team has discovered unanticipated hurdles or unforeseen game-changing opportunities. Communicating these changes to management is crucial so they can reassess their investment, take advantage of the situation and plan outcomes to optimize the resultant ROI. As in life, luck in new product development is when opportunity meets preparation. Not just once, but every month, week, day and sometimes every hour. Long-term superior ROI is achieved when direction, preparation and execution is consistent and is clearly communicated to all project participants. Special thanks to Jed Simms for researching and co-writing this article.

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Nelson Davis: Small Business and Politics

March 26, 2012

Right now political discussions are like so much confetti that seems to be dropped on us every day whether we want it or not. This is the season when political aspirants show their love and attention like no other time. However, in the lives of most small business owners there’s usually a long list of concerns ahead of politics and polling data. In fact, I don’t particularly like politicians because our goals are divergent in important ways. Their job is to get elected and then re-elected while mine is to earn a survivable profit in business. That leads to our common ground being measured in dollars! But alas, in the real world even the smallest business owner needs to realize that we are in a co-dependent relationship with office holders in our cities, counties, states and even at the head office in Washington, D.C. Many naive years ago, I was surprised to learn that some of the biggest and most successful entrepreneurs had donated funds to both of the major parties regardless of what they thought of the candidate’s talents or prospects. An oddsmaker would call it hedging your bets. The guiding principle for the donors seems to be it is better to have friends and not need them than to need friends and not have them. My issue with most politicians is a feeling that they don’t really understand the life, struggles and community benefits that small business owners bring to the table. Here in the greater Los Angeles area, there is only one remaining Fortune 100 company head office and that is one of our electric utilities! Obviously the quilt of our economy is made up of many smaller patches. In the world of politics, fund-raisers prefer the biggest patches for obvious reasons. I suggest that you consider inviting your City Council representative to visit your place of business. If your enterprise is very small, consider collaborating with other owners on your street or neighborhood so that Mr. or Ms. Politico finds the offer of hospitality more interesting and attractive. Don’t ignore the fact that in addition to the freshly baked chocolate chip cookies that you serve, a donation to their upcoming campaign or to their favored charity should be part of the larger process. Expect that if you are building friendships at the state or federal level, may involve more zeros after the first two digits. Unlike the movies, you won’t be slipping them an envelope stuffed with Benjamins! There are laws and rules governing political donations. I’m not a cynical person and believe that some wonderful mutually beneficial relationships can be built between the small business community and those people who preside over the public purse and regulations. The combination of taxes, fees, regulations and campaign costs are a complex brew that should bring you together with officials on a regular basis to learn more about each other’s worlds. We have to be proactive by inviting them to dance because they are constantly being wooed by the folks with nicer suits and bigger checkbooks.

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Ed Lawler: Sustainability: It Should Be About More Than the Bottom Line

March 26, 2012

Going green can be profitable — that is the conclusion of multiple studies that have looked at the financial outcomes of corporate efforts to improve their environmental impacts. By reducing emissions, packaging materials, and waste, Walmart, Unilever, and many other companies have been able to reduce their costs and improve their environmental impact. This has led some to conclude that the best way for corporations to serve society and to operate sustainably is to focus on reducing costs and maximizing their profits. I think that this is a flawed conclusion. The alternative to this profit-above-all approach is a sustainably effective approach that focuses on the triple bottom line of people, planet and profit. Organizations that practice and integrate sustainability thinking put it into all of their operations — they do not just work on what leads to profits. They integrate sustainability into their very DNA, and everything proceeds from that. These organizations measure themselves in all three areas and structure and design their operations to perform in ways that have a positive impact on all three. Another huge difference is that sustainably effective organizations don’t look at green or sustainable initiatives as special programs — as mere window dressing. One-off social or environmental initiatives are not enough. A sustainably effective organization makes much deeper and more comprehensive organization changes. Sustainable performance is a part of everything the company does — from how employees are managed to the overall structure of the organization and how work is designed. It must be part of the company’s identity and embedded into every aspect of the organization. My recent book, Management Reset: Organizing for Sustainable Effectiveness , explains what organizations must do to make this happen. A number of CEOs see the value of the sustainable effectiveness approach, including Kenneth Chenault of American Express and John Mackey of Whole Foods. In fact, Chenault has said that in order to pursue profits, corporations must act in ways that protect and enhance the world we live in. Many organizations still have the “profit-above-all” mentality. They focus primarily or exclusively on the obvious financial gains that exist from doing the right things environmentally and socially. If they do something that does not immediately have a positive affect the bottom line, they usually deem it a philanthropic act and strive to get public recognition for it. The problem with organizations that adopt a bottom line orientation toward sustainability is that they only do those things that are visible and have a quick financial payoff. They do not go beyond them to search for practices and policies that make sustainable performance a core issue in everything the organization does. They look for cost savings and try to avoid fines, public criticism and other negative outcomes. They spread a good veneer over the organization, but they do not change the essential nature of the organization. BP had a long history of being fined for damaging the environment and having a high employee accident rate even before the Deepwater Gulf of Mexico explosion. Does anyone remember the company’s “Beyond Petroleum” marketing efforts? BP started a highly publicized green energy business in order to improve its image, but it did not alter its commitment to profits above all else. And it did not redesign itself to achieve triple bottom line performance. The “problem” with the sustainable effectiveness approach is that it takes strong leadership at the top of a corporation to put it in place and a willingness to live with the reality that at least in the short-term it may not be the most profitable way to run a corporation. Thus, there is the issue of why a corporation should commit itself to this approach. One reason for adopting the sustainably effective approach it is that if more and more corporations adopt it there will be less and less need for government intervention into the private sector. The most important reason, however, is that it will lead to a world in which all of us will enjoy a higher quality of life. Let’s hope more and more corporations and their executives see the world this way and commit their organizations to sustainable effectiveness, not just sustainability programs. Crossposted from forbes.com .

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Andrew Winston: Corporate Sustainability Efforts — Feast or Famine?

March 26, 2012

Is corporate sustainability on the wane or growing more important to top executives? At the beginning of the year, two big-picture reports on the state of green business painted divergent pictures. In GreenBiz’s annual review of 20 indicators of “how business is doing” on green, we learn that 6 of those indicators are on a downward trend. But in the report ” Sustainability Nears a Tipping Point ,” MIT and BCG prove their point with a fast-rising graph of companies that recently put sustainability “on the management agenda.” While they seem at odds, both views are right — companies are no longer ignoring sustainability; most big companies now have someone focused on it, at least in part. That’s why execs can honestly tell MIT that it’s on their agenda. But with sustainability often siloed into just one person or department in each organization, it’s hardly a surprise that, at the same time, we’re seeing some loss of momentum. Sustainability has moved from being a hot, new management trend to being just one more thing for execs to keep an eye on: for many it’s become a check-box exercise. This structural gap reveals the fundamental misunderstanding about what sustainability really means for organizations. I’ve seen it time and again in the companies that I work with or study. For them, sustainability is a thing to tackle, a functional area; it’s a what , like marketing or product development. But sustainability needs to be viewed as much more of a how concept, like quality or innovation. It’s a way of operating that creates the most value when it’s embedded throughout the organization. Of course companies have distinct quality or R&D departments and professionals, but the most committed companies drive the thinking into every aspect of the business. This is the mindset that sustainability needs to engender throughout an organization. And as with quality, this isn’t just about ethical or aspirational hopes — acting with sustainable values, for example, as covered well by many, including Dov Seidman in his book How . No, I’m talking here about the more prosaic, everyday, tactical, blocking-and-tackling of business. Sustainability pressures force changes in how we build our supply chains, how we design and manufacture products, how we deliver services, how we create and execute our business models and strategies, how we develop financial metrics to measure success, how we attract and retain 21st-century, holistic thinkers, and on and on. So sustainability pressures, if acted on, drive us to create and build better products, design more efficient services, execute better, and hire the best. Those are goals that reach throughout the entire organizational structure, and they’re actually enabled by sustainable thinking. Given the scale of these goals — and the global challenges we all face — putting just one (or a few) people against the what of sustainability is a woefully inadequate response. Resource constraints and rising input prices; increasing demands from customers, employees, and consumers; the risks of severe business continuity disruptions from water, climate, or labor problems in the supply chain… the list of big pressures grows more complicated every day. And these issues require a full-court press from all aspects of operations. It’s become a mantra in the sustainability world that green needs to be a part of everyone’s job. Of course that’s true, since detecting risks and innovating around them will often fall to those closest to the ground (hint, that’s rarely the c-suite). But most companies are missing a big step. To conquer a how you need more than just a mantra. You need a significant investment of resources in time, top-leader focus, people, and money. You need people to ride herd and drive the agenda — to do the cross-cutting analyses such as lifecycle assessments, to track and get a handle on the many diverse and complex issues, to present a unified front to employees and external stakeholders, to question business models and find new, heretical ways to operate and serve customers… the list goes on. There’s no “ideal” structure for sustainability efforts, just as no two companies would tackle innovation the same way. Most large companies have now appointed a lead on sustainability, but have provided limited financial support and fewer human resources. There are exceptions: a few well-known sustainability leaders, such as Starbucks, Nike, and Coca-Cola employ central teams with specialists in areas like water, climate, and packaging, as well as reps spread out around the organization. One of my clients, Kimberly-Clark, a much quieter sustainability leader, has a centralized team of 5 to 10 sustainability-only managers (and that’s only part of the 50-plus central staff covering environmental, health &safety (EHS), OSHA, and, yes, quality). More importantly, Kimberly-Clark has another couple dozen professionals in dedicated sustainability roles (again, not EHS) embedded in business lines and geographic regions. But even the leaders with robust organizations are rarely putting much money specifically into sustainability-driven innovation or disruptive changes that might dramatically reduce the value chain footprint of the company’s products. Let’s be honest: It’s very hard to assess how much is “enough” when you’re investing in a strategic priority. But it helps if the organization first defines it as a strategic priority. And given the ever-rising costs of under -reacting to sustainability pressures (such as direct costs from rising input prices, or business discontinuity risks from extreme weather), it’s clear that companies should put a lot more people and money against an agenda as large, complicated, pressing — and let’s not forget profitable — as sustainability. Only with significant investment can we move down the path to sustainability integration and real, ongoing, full value creation. A robust network of sustainability professionals within a company — whether or not they sit in one “department” — may need to obsolete themselves over time. But until then, sustainability can’t drive anything — it will just remain a nice side show. (This post first appeared at Harvard Business Online .)

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Ralph Gomory: Making Corporate Actions Visible

March 26, 2012

In a recent article we wrote: “America today is very different from the country that fought the Revolutionary War and framed the Constitution. Then, it was a nation of farmers; today, it’s a nation of corporations.” Though we are today a nation of corporations, there is remarkably little discussion about corporate actions and the impact of those actions on our lives, even though it’s clear that what our corporations, especially our major corporations, choose to do affects in major ways wages, jobs, healthcare and the overall economy. There is even less discussion on what we want from our corporations. Is it, for example, enough that their sole goals are to maximize the return to their shareholders? This article suggests something citizens can do to spur these needed discussions and to make visible what corporations are actually doing and the effects of their actions. Here we are not calling on the government to mandate this transparency, rather we are calling on ordinary citizens and citizen organizations to act to make the actions of corporations more visible, more transparent. Labeling the Corporation We are used to the idea that many of the products we buy are labeled. For example, many processed foods are obliged to disclose their ingredients, and they are labeled so that we do not have to guess at what we are eating. Consumers are often encouraged to “read the label”, so they will know what they are buying. Similarly, let us now insist on labeling and making visible what corporations are doing. Corporations affect us and our country through their decisions on outsourcing and on wages and pensions, and by what their goals are. Do they consider in their actions the effects on customers, their own employees, the communities in which they operate, and on the country that sustains them with its laws? Or do they only consider shareholder value? Do they pioneer with new and valuable products, and if they do, how do they decide where those products are made? Or, in the realm of services, do they exploit the ignorance of their customers to either give them loans they cannot repay or investment advice more tailored to corporate profits than to the welfare of the customers. Let’s label corporations with labels that tell us what they are actually doing. How to Label the Corporation We are not talking here about physical labels attached to products that corporations make, but about electronic labels attached to the corporations themselves. But where would these labels come from? How would they be made? What would they look like? What would they do? An example of corporate labeling already exists. It was created by a cooperative effort between the Zicklin Center for Business Ethics Research at The Wharton School of the University of Pennsylvania and the Center for Political Accountability (CPA). While this is a label that only describes the political spending activities of corporations, the methodology can be applied equally well to other corporate actions. Together the two organizations developed a set of twenty-nine criteria by which the corporate approach to managing, overseeing and disclosing political expenditures could be judged. The criteria covered disclosure of the range of a company’s political spending — contributions to candidates, Party committees and ballot initiatives as well as payments to trade associations and other tax exempt entities organized for political purposes — and its policies and practices for associated decision making and oversight. They then scored the top 100 U.S. corporations on all twenty-nine criteria, and for each company the weighted scores for the individual criteria were combined into a single rating, specifically, the CPA-Zicklin Index of Corporate Political Accountability and Disclosure. Before the Index was made public each company was informed of its rating and had the opportunity to dialog with CPA about them. This also gave the company the opportunity to make changes in the policies and practices they were publicly posting on their website. Only after that was the rating made public. The result is that you can see today this well thought out rating of the top 100 U.S. companies on the CPA website and also, for those who want it, a detailed d e scription of how it was determined. We believe that something very much like this can be done for other corporate activities. The essential step is to work out criteria about which you want information, then see what information can be obtained for each company. It was important to the CPA-Zicklin effort, that a corporation not providing information to the public on a specific criterion would result in a score of zero on that criterion and thus a lower rating when the result is made public. We suggest that civic organizations with a particular interest, label corporations on that interest., whether that is the environment, how they treat their employees, the quality of their goods, or the degree of outsourcing. They should then develop their criteria, and gather information; not always only from the corporations.. They should then produce a publicly available rating that is easy to link to. Modern technology makes all this possible and more. People with a particular interest in a particular company could organize a Facebook page. There could also be Smartphone apps, similar to those that already exist for comparison shopping. Pointing the camera of a Smartphone at a product would immediately reveal the company that makes it and the rating given to that company by a selected website on a selected issue. Any and all of these actions will contribute to making visible, transparent and discussible what our corporations are doing. We are a nation of corporations, but our press and our conventional politics do not in any systematic way make visible the effect of corporate actions on the country. Let us as citizens make up for that significant omission.

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Ciara Torres-Spelliscy: Could Connecticut Be the First to Get Serious About Shareholders Rights Post-Citizens United?

March 26, 2012

Connecticut may be the mouse that startles the lion. Connecticut is a small state, but it has a strong record of leadership in addressing the trouble posed by money in politics. Now Connecticut may be the first state to take shareholder protections seriously post-Citizens United. After a governor went to jail for corruption charges for accepting gifts from state contractors, Connecticut decided to regain its good name by getting serious about campaign finance reform. The Legislature pushed the reset button by adopting a ground breaking public financing system as well as pay to play restrictions on state contractors in 2005. Also in 2010, it adopted beefed up disclosure requirements, which require political ads to show the top five donors. This small change brings more transparency to the Connecticut elections than exists almost anywhere else in the nation, including federal elections, which are still hopelessly dark. Now in 2012, Connecticut could break ground again by requiring shareholder approval of corporate political spending. A bill pending in the Legislature would adopt this change. As I testified this morning, such a new Connecticut law would follow a best practice that has existed for a dozen years in the U.K. under the Companies Act that requires a shareholder vote to approve future political spend by U.K. companies. Citizens United v. FEC (the 2010 Supreme Court decision) allowed corporate political spending in all of the states and federal elections. Connecticut was one of a score of states that had banned corporate money from their elections. Citizens United stripped Connecticut of its ability to protect its elections from this type of spending. But Connecticut can still take steps to protect shareholders in companies that are now free to spend in Connecticut’s elections by requiring a vote by shareholders before money is spent in an election. Here, Connecticut is building on the work of its sister states Iowa, Missouri and Louisiana, which each require board approval before corporations can spend it their elections, as well as Maryland, which mandates disclosure of political spending directly to shareholders. Connecticut is in a federal circuit that is open to strong money in politics laws. For example, the Second Circuit recently upheld New York City’s ban on corporate political contributions and the City’s robust pay to play laws. In his concurrence upholding New York City’s laws, Second Circuit Judge Calabresi had these choice words referencing the Bible, about the trouble with money in politics in America today: The wider the economic disparities in a democratic society, the more difficult it becomes to convey, with financial donations, the intensity of one’s political beliefs. People who care a little will, if they are rich, still give a lot. People who care a lot must, if they are poor, give only a little. Jesus’s comment about the rich donors and the poor widow says it all. Today, the amount of an individual’s campaign contribution reflects the strength of that individual’s preferences far less than it does the size of his wallet. Given this and other recent opinions, the Second Circuit would likely defer to Connecticut’s legislative judgment. And even Citizens United itself spoke approvingly of shareholders holding corporations accountable for their political spending. As Justice Kennedy wrote, “With the advent of the Internet, prompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions… Shareholders can determine whether their corporation’s political speech advances the corporation’s interest in making profits.” Connecticut has a clear path forward with the blessing of the Supreme Court. They can adopt a requirement that shareholders get a say on politics. With any hope, Connecticut can be the mouse that roars, exhibiting national leadership in this post-Citizens United America. Ciara Torres-Spelliscy is an Assistant Professor at Stetson University College of Law where she teaches Election Law and Constitutional Law. She is the Co-Author of “Shareholder-Authorized Corporate Political Spending in the U.K.” which is available here .

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Bill Robinson: Memo to Small Business: RingCentral Will Take Your Calls

March 24, 2012

Small businesses have always had a simple but nonetheless nagging problem: answering their phones with a consistent, professional presence. Does the fearless leader hire an effervescent receptionist and pay the base salary plus all those excruciating payroll taxes, healthcare and other costs? Or, do they get one of those bleak, soul-less automated, ‘interactive voice response’ (IVR) systems that put us all through a soul-destroying telephonic chase? RingCentral wants to be the third option in that management decision. “We started out with two guys named ‘Vlad’ just to make it interesting,” said Vlad Shmunis , RingCentral co-founder and CEO. The other Vlad is RingCentral CTO and co-founder Vlad Vendrow who Shmunis says “is the original architect of the system and the smarter of the two.” Vlad Shmunis RingCentral, which was founded in 2003, has a very interesting evolutionary path. Schmunis started a company called RingZero Systems in the 1990s which, according to Shmunis, provided “a fee-based PBX system for SMBs (small and medium sized businesses) which ran on Windows.” The company’s distribution was solely through OEM and bundling partners which Shmunis would later change in RingCentral. In spite of what he now looks back on as a failed business model, Shmunis had IBM as a major partner and eventually sold the business to Motorola. Later, as it became apparent Motorola had no idea how to integrate RingZero into their org chart, Shmunis bought his assets back from Motorola to build what is now RingCentral. “I learned not to do it on a PC system; it wasn’t the right platform for an answering system,” Shumnis reminisced. “I learned that a stand-alone, hosted service was the right business model and that’s what RingCentral is built upon.” Shmunis says, “We don’t compete with the telcos; we compete with the hardware manufacturers. And simultaneously, RingCentral is more than just a PBX .” As the RingCentral business model was refined and shifted, Shmunis was after one big, traditionally hard-to-reach market of customers: small business. Making this jump in markets served could not have been easy but it was done, Shmunis said, as the delivery method also changed dramatically from ASP to SaaS to, finally, the Cloud. Shmunis said, “We thought, ‘How do we enable a very small business to communicate like a bigger corporation? How does the small business owner downscale from the big, expensive phone systems?’ Small business really needs a product like RingCentral.” When asked what the size of his ideal SMB customer is, Shmunis doesn’t equivocate. “For us, there’s no such thing as too small a market; we developed our product for the smallest of VSBs (very small businesses). Not to sound too corny but we really had in mind when we founded RingCentral that we would make the world a better place.” Shmunis used his own money to start and grow RingCentral initially, referring to his personal funding as “the first round.” The first true Series A occurred in 2006 when he said RingCentral “had a couple of million in revenue and good clients.” Doug Leone from Sequoia Capital and David Weiden from Khosla Ventures jumped aboard the USS Shmunis and are both on the Board of Directors today. With key strategic investments from the likes of Cisco Systems and Silicon Valley Bank, the total outside investment in RingCentral today stands at approximately $55 million. Vlad Shmunis was born in Odessa, Ukraine on the Crimean Peninsula and came to America at 14. In many ways, he is the embodiment of the ‘American Dream,’ with his parents and younger sister learning English on the fly and then doing well in Bay Area schools. “I did well in my school in Russia,” he said smiling while delivering a jab to the U.S. educational system, “so I did very, very well in my American school.” As is common amongst Russian emigrants to America, Shmunis’ parents were involved in some form of mathematics, science or engineering. His father was a mechanical engineer specializing in “extreme precision instruments” and his mother, an electrical engineer. Does growing up in this kind of technical household mean the ensuing generations tend to be more technically oriented? Undoubtedly. Going on to San Francisco State University in the late seventies, Vlad Shmunis took an interest in computers and obtained bachelors and masters degrees in Computer Science. “I was programming in Pascal and Fortran but always avoided Cobol ; Cobol wasn’t cool,” Shmunis said with the look of a man who missed coding, “I really loved LISP though and ended up teaching a course on LISP at San Francisco State.” After finishing his college degrees, Shmunis worked for several years as a software engineer then software manager at Ampex. It was after this work experience that he decided to start his own company, RingZero later becoming RingCentral. RingCentral is headquartered in San Mateo and has offices in Denver; the Philippines; China; St. Petersburg, Russia; and the Ukraine with a total of about 900 employees. “What RingCentral is all about,” Shmunis observed, “is complete parity between landline phones, mobile phones, VoiP, tablet PCs and faxes. The Cloud is perfect for this and the PC wasn’t because Windows crashes, hard drives freeze and dogs eat power cords.” Moving to the current day, RingCentral is striving to expand their SMB market penetration but refuses to release precise numbers on how many SMB clients they have. Pursuing strategic relationships with partners such as Go Daddy, LegalZoom and Vistaprint are key for Shmunis’ SMB strategy. For example, Vistaprint is one of the world’s largest printers of business cards and has millions of small business-owner customers. Vistaprint sends out a RingCentral offer with every business card order. “Our biggest challenge is awareness,” Shmunis stated, “once you’re aware of us, you’ll use our product.” For access to some reviews of RingCentral’s (and others) service, see VoipReview.org . Asked about the widely rumored possible RingCentral’ IPO, Shmunis only says he “can’t comment on an IPO.” He is similarly coy about how RingCentral will turn out; whether the creation will sell in a trade sale or continue to grow as a publicly-traded or independent enterprise. How does Shmunis want RingCentral end up? “Our investors are pretty happy,” he says, “I’m not sure I want it to end up. RingCentral as a stand-alone might be best.” One thing is for sure, if RingCentral gets even a minuscule percentage of the gargantuan SMB market, it will be writing its own ticket.

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LearnVest: Who Are America’s 6 Richest Women?

March 24, 2012

Forbes’ comprehensive list of the world’s billionaires (there are 1226) came out recently, and we were curious — are there women on the list? Turns out, there are. Yes, men far outnumber the ladies. But starting at number 11, women help fill out the ranks of the fabulously wealthy. Where do these fortunes come from? Uniformly, these top six women have shrewdly managed the companies and fortunes handed to them by husbands and fathers. But most of these women have put in their own hard work into these companies to grow them, especially the woman who is now president of Fidelity Investments. (Because women do make better investors !) Of course, it took a few generations for these fortunes to build up, and many of the male billionaires on Fortunes’ list are, well, advanced in age, having worked hard for their wealth over a lifetime. We’re looking forward to a few years down the road when the list is populated by many more women and their own companies, instead of those founded by the the men in their lives. After all, the founder of Spanx just broke into the billionaire list . Who knows what kind of riches she’ll have by the time she retires? Learn more about some of the richest women in the world: 6. Laurene Powell Jobs Estimated net worth: $9 billion Rank: 100th richest person in the world, 36th richest person in the U.S. Age: 48 Why she’s rich: She’s the widow of Steve Jobs. Lives in: Palo Alto, California 5. Abigail Johnson Estimated net worth: $10.3 billion Rank: 85th richest person in the world, 33rd richest in the U.S. Age: 50 Why she’s rich: She owns and runs Fidelity Investments with her father, Edward Johnson III. Lives in: Milton, Massachusetts 4. Anne Cox Chambers Estimated net worth: $12.5 billion Rank: 61st richest person in the world, 25th richest in the U.S. Why she’s rich: She is the primary owner of the media empire Cox Enterprises, which was founded by her father James M. Cox. Lives in: Atlanta, Georgia 3. Jacqueline Mars Estimated net worth: $13.8 billion Rank: 52nd richest person in the world, 22nd richest person in the U.S. Age: 72 Why she’s rich: She’s the granddaughter of Frank C. Mars, the founder of the candy company Mars, Inc. Lives in: The Plains, Virginia 2. Alice Walton Estimated net worth: $23.3 billion Rank: 17th richest person in the world, 9th richest in the U.S. Age: 62 Why she’s rich: She’s the daughter of Walmart founder Sam Walton. Lives in: Fort Worth, Texas 1. Christy Walton Estimated net worth: $25.3 billion Rank: 11th richest person in the world, 4th richest in the U.S. Age: 57 Why she’s rich: She’s the widow of John T. Walton, the son of Walmart founder Sam Walton. Lives in: Jackson, Wyoming More From LearnVest Want to get on this list? Learn from other women in our Entrepreneurship 101 series. Women tend to top out on raises at 37. Don’t let this happen to you ! Oh joy. Women tend to make more money than men …. in occupations like shoe shining and house sitting . This story originally appeared on LearnVest.com .

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Paul Abrams: Responding to Romney’s Op-Ed on Abolishing the Affordable Care Act, and His "Alternative"

March 23, 2012

On the second anniversary of the passage of the Patient Protection and Affordable Care Act (PPACA), Mitt Romney penned an op-ed for USA Today . One must respond immediately, because Mitt may Etch-a-Sketch himself to a different position before this is published. And, the only reason this is even necessary is because the administration has done an exceedingly poor job of explaining the many virtues of the Act. Sandra Fluke eloquently explained the benefits of the PPACA better than the administration has done in two years. But, in case Mitt is spending his time praising the economy under President George W Bush — after all, Romney’s economic plan will land us in the same place, or worse! — Romney’s vision may persist a news cycle or two, so it may be worth answering his ridiculous claims, lies and the ineffective nothingness he proposes to replace the PPACA. Romney’s first claim is that the PPACA is: “an unfolding disaster for the American economy, a budget-busting entitlement, and a dramatic new federal intrusion into our lives.” Note that these words are courtesy of Frank Luntz, the right-wing Orwellian word-maestro who provided Newt Gingrinch the word-lies to use against Democrats in the 1990s such as “pathetic,” “weak,” “unpatriotic,” “death tax,” “government bureaucrat,” and so forth. In this incarnation Luntz found, for example, that health care reform was exceedingly popular, and thus the president’s bill had to be called “a government takeover” whether it was or not (and, it is not!). Romney, of course, cites no evidence to support that any disaster for the economy has begun to “unfold.” There is none. The economy is better today than it was two years ago when it was passed. The greatest disaster for the economy occurred under George W Bush, years prior to the PPACA. That disaster enriched Romney’s friends but “unfolded” on the American middle class, wiping out their savings and wealth. But, is the PPACA a “budget-busting entitlement,” as Romney asserts? Not according to the Congressional Budget Office that scored it. In its first decade, the Act was projected to save about $143 billion , but it is probably more conservative to call it “break-even.” In the following decade it is projected to save 0.5% of GDP or about $1 Trillion . Since, as years pass, the “next 10 years” also analyzes different years (2010-2020 initially, now 2012-2022, and so forth), and the law is slowly implemented, expenses increase but so do revenues. Overall, the law is deficit neutral . Is the PPACA, nonetheless, a “dramatic intrusion of the federal government into our lives”? For the vast majority of Americans, it is not. They can, if they wish, purchase the same health care coverage, from the same insurer, and go to the same doctors, as they were before the Act. The rate of growth of premiums will be slowed because these folks will no longer be paying for the uninsured (~ $116 billion per year in higher premiums for that). But, for a substantial minority, the Act provides subsidies so that they can purchase coverage they could never afford before, from health exchanges organized by the states that need to meet certain criteria so that enrollees qualify for their subsidies. One doubts whether the people so helped will consider this a “dramatic intrusion” into their lives any more than Paul Ryan considered his use of social security benefits from his father’s untimely death to help him afford college, or other students who receive Pell Grants (named after the late Republican Senator, Claiborne Pell) “dramatic intrusions” into their lives, except in the very positive meaning of that term. Although the Act does reform the health insurance business, Romney basically endorses reform, at least for pre-existing illnesses, so this category cannot be what he means by a “dramatic intrusion” into our lives. (Note: Romney even fudges the pre-existing illness problem by applying the reform only to those who have been “continuously insured.” To all those knocked off insurance because of the Bush Recession or because Romney fired you while enriching himself at Bain Capital — sorry). Romney also makes the extraordinary claim that in his state, “we instituted a plan that got our citizens covered without increasing taxes, and without a government takeover.” Really? Does that not prove the point that the PPACA is not a government takeover? If the Massachusetts plan was not a government takeover, and it is almost identical to the PPACA, then how does the latter become a “dramatic intrusion”? Not that logic, truth or consistency are major characteristics of Mitt Romney, but has he not caught himself here in another total contradiction within the same article! And, what about Romney’s prescription for health care reform to replace the PPACA? Well, he favors giving the states “the resources and responsibility” to craft their own health care systems. That is exactly what the PPACA does, but it sets guidelines. So, one gathers that the difference is that Romney would set no federal guidelines, but he would provide the resources. One can only wonder how that saves the federal government any money, and where in Romney’s multi-trillion budget cutting scheme he finds that money. Indeed, without some cost-containment measures, it could be very much more expensive to the federal government. Ah, he says, I neglect the competition that will arise from opening other states’ insurance plans to each state. Is that not the federal government being VERY intrusive, basically abrogating state laws that exist to protect (in the way each state wishes) its consumers from inadequate coverage or fraud? Moreover, if my state has higher medical costs and I purchase coverage from a low-cost state, then at what rate does the out-of-state insurance policy cover me? And, if those policies will pay at the same rate as in my state, then will they not charge me more? Or, will Romney turn health insurance companies into socialists? In any case Romney claims that this competition (for what exactly is not clear) will lower rates so that everyone can afford them. He provides no evidence whatsoever that this will happen. In the 100 years prior to the PPACA being passed, the free market failed to provide affordable coverage for everyone. Moreover, the PPACA contains, as Senator Kent Conrad (D-ND) put it, every cost saving measure the Congressional Budget Office told them about. Romney’s does not. There is no provision in Romney’s scheme for prevention — the most cost-effective means to improve health and lower costs that exists. Romney would provide a tax benefit to individuals, not just companies, who purchase health insurance apart from their employer. He has no suggestion about where in the budget that lost money will come from — remember, he is going to cut, cap and balance the budget. But, let us count that as the single positive feature with respect to making health care potentially more affordable in his entire plan. The PPACA was passed ONLY when CBO scored it as not impacting the deficit. One cannot pencil out how Romney’s meets that criterion. Romney cites the 10th Amendment as the basis of his plan. His invocation of the 10th Amendment immediately after mentioning the poor and chronically ill was instructive — are you sick and cannot afford health care? Well, just read the 10th Amendment, that will improve your health. But, Romney appears to be quite willing to violate the 10th Amendment not only by superseding states’ laws about insurance requirements (so consumers can purchase plans out-of-state), but also by federal government capping non-economic damages in medical malpractice. Whatever one believes about those damages (often referred to as “pain and suffering,” and there is little evidence they have much of an impact on costs), Romney cannot claim that such a federal law would not be the “dramatic intrusion of the federal government into our lives” that he decried about the PPACA. What about Romney’s snide comment that his Massachusetts reform did not take any money out of Medicare. Of course it did not. Medicare is a federal government program (that Romney also wants to gut), and thus not available to a state to cut. And, neither did the PPACA. By getting hospitals and others to reduce their reimbursements by $500 billion over the next decade — they were willing to do this because they expected to make it up in increased payment collections from the now-insured population — that money was not transferred from Medicare but saved by it. Indeed, the CBO initially scored the PPACA of extending the solvency of Medicare by 12 years. That has been reduced by two years due to the passage of time, and by another two years due to reduced tax revenues caused by unemployment. Romney says nothing about how many people will be insured, how much of the $116 billion in cost-shifting will still be occurring, so that those of us fortunate enough to have insurance will be paying for it in increased premiums, estimated at $1000/yr per insured today. Romney basically claims that his proposal, providing an unpaid for tax credit to individuals, capping pain-and-suffering damages in malpractice suits, and eviscerating state laws that set health insurance standards so that patients can purchase plans from other states will magically transform the system and cover most of the uninsured, as if those were the matters that impeded a century of laissez-faire health care coverage. And, by the way, it won’t cost anybody anything. But, you knew that of course. Nothing they do ever costs anybody anything. To be fair, Romney did not say that his plan was designed for the United States where he lives, or for the Cayman Islands where his money lives.

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Martin Varsavsky: The Internet Did Not Sink the Markets a Decade Ago, the Markets Almost Sunk the Internet

March 23, 2012

10 years ago all of us on the Internet were licking our wounds. We had been taken for a crazy ride in which we went from a point in whatever we touch was champagne to whatever we did was shit. As an entrepreneur that lived through 1998 to 2002 I emerged reasonably well, I sold my shares in Viatel when it was worth $1.2bn, I sold Ya.com for $700 million but did not sell Jazztel when it was worth $5bn because I was its CEO and saw it go down to $700M (now it`s worth $1.4bn). Then I lost $50M in Einsteinet one of the best cloud computing start ups in Europe that was killed by the post bubble era in which financing completely dried out. So as you read this post you will see no bitterness. But looking back at 2001/2002 I see this time not as a period in which Internet companies destroyed the financial markets, but as a time in which the financial markets almost destroyed the Internet. It was financiers/analysts who drove those insane valuations up and then down. What should have been a smooth ride on the internet, an era of taking more and more global citizens in its midst, became a crazy ride in which the internet itself gained enormous prestige and was later, for a while, seen as a useless gimmick. Only around 2007 people again realized that the Internet was simply transforming the world economy and was here to stay. And then came 2008, when the financial industry practically destroyed the world economy. That was when the same financial firms did to the world what they had done to the Internet, inflate it and let it fall like dead weight. Having been a happy customer of Goldman Sachs, Morgan Stanley and others I don’t want people to read this post as a rant against financial firms. We need financial firms. But what we don’t need is financial firms to do what they did first to the Internet and then to the overall economy, namely to hype them out of value and sink them hard for no reason. In simple terms what I am advocating has been done before and that is to separate trading from advising. The Chinese Walls in these firms never worked and never will.

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Bernie Bulkin: About Leadership: Building Best Teams

March 23, 2012

I once went on a BP course called Building Best Teams. It was a group of about 15 of us from various parts of the company, working with two very skilled people, Roy Williams and Dick Balzer, both of whom knew the company (and most of us) very well. And what was the essence of what we did for three days together in a nice country house hotel? We worked on giving and receiving feedback. Yes, we did a lot of other things, and learned a lot of other things, but the one thing that ran through all the exercises and presentations and learning that we had during that week was how to give and receive feedback. Some years ago, I studied Japanese. Someone told me that you can only understand the Japanese by understanding their language, and that is very true. Because at the heart of this language is levels of respect, as it is in Japanese culture. Thus there are many verbs for giving and receiving in Japanese. If you give something to a pet you use a very different verb from giving to a child, or for giving to a servant, or to a peer, or to your boss — likewise with receiving. Only if we can get the subtlety of the language — deep in us, not memorized — can we also be adept at integrating into the culture. So in our Building Best Teams course, we all realized that we needed to learn, or re-learn, the language we used in talking to others in our team, in giving feedback to colleagues, and, when asked, to our boss. Right down to our pronouns; When to say “I,” “and,” “when,” “we,” for example); What should be done in the group, and what should be done in private; When to be gentle, when to be firm. So, how to give. I have been through several mergers and know now that work between teams that are integrating is a time when I need to be most sensitive on giving feedback, and I failed at it several times. We we taught to understand when it is a time to sit and listen and learn from what is being said to you, and when it is a time to discuss and get more clarity, or even defend. How to be pleased to receive criticism rather than be hurt by it. Mostly, the first law of receiving feedback is to keep your ears open and your mouth shut. These and lots of other things are not instinctive, and we don’t learn how to do them really well as we grow up, when in school, or, for that matter, by being in the teams of others. I found that they helped me as a parent as well as at work. But how to give and receive feedback is either the essence, or close to the essence, of team building. And like other learned skills, it needs to be practiced and improved. Indeed, we need to get feedback on how well we do this. About Leadership: About Leadership is a series of 52 columns on corporate leadership – essential skills, leading teams, managing your career, the strategic and business practices to make a company and its leader distinctive from competitors. These columns will be of interest to people leading small and medium sized companies today, many of whom have not had much formal training in management skills and techniques; for the many people in big companies who aspire to senior management; and for anyone who thinks: Give me a hint, how can I do this better?

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Andrew Shaindlin: Will the Internet Obsolete Alumni Associations?

March 23, 2012

I recently spent a day lecturing at Carnegie Mellon University in Pittsburgh, Pennsylvania. As a small lunch hosted by President Jared Cohon, I met Andy Shaindlin — the very thoughtful head of Alumni Relations & Annual Giving. After the lunch we sat down to discuss the future of the Alumni function at universities, entertaining a very provocative idea — Will the Web Cause the Disintermediation of Alumni Associations? His views about how Alumni Associations need to transform themselves to avoid disintermediation were so stimulating that I asked him to write a blog about them. — Don Tapscott In 2008, I picked up a new book by the well-known author and professor Clay Shirky. The book, Here Comes Everybody , looked interesting. But the provocative sub-title is what hooked me: The Power of Organizing Without Organizations . My entire career has depended entirely on the success of a very specialized kind of organization — an alumni association. I needed to check this out. And I quickly found what I was looking for. On page 66, in a discussion of bloggers’ relationship to traditional news media, Shirky wrote: “[Blogs] are not merely alternate sites of publishing; they are alternatives to publishing itself…” In mid-2008, when I read this, there was a lot of speculation as to what online social networks’ long-term roles would be… I did a quick word-substitution exercise and produced the following version for my profession: Online social networks are not merely alternate sites for alumni organizations; they are alternatives to alumni organizations themselves. Before this, alumni relations professionals and university fundraisers had been thinking about how to recreate the features of popular social networks on our own websites: Facebook has photos to go with members’ profiles? We’ll let alumni add their photo to our alumni directory! LinkedIn lets users list past jobs? We’ll add a field for “Past employment” to our alumni directory! One problem with this approach was that we focused almost entirely on the features of our so-called online communities, instead of explaining the benefits. We were like car salesmen, telling buyers, “Our vehicles have 270 horsepower” — instead of explaining that “you can go from zero to 60 in under 5 seconds.” Another problem was scale. Behind our ivied walls, we arrogantly believed that exclusivity was all-important. For the average alum, however, valuable though the alumni community might sometimes be, having one’s many networks connect to each other was more important. Classmates, neighbors, co-workers, friends, family — they were all on Facebook (or soon would be, it was clear). So why require yet another URL, username, password, and profile when alumni could already do it all on a single site? Or on two sites, once LinkedIn became known as “more professional” than Facebook. So scale trumped exclusivity and alumni websites lost the battle for online community. But to this day, it’s as if alumni associations still don’t understand what happened. We still pay tens of thousands of dollars every year for “online community” software that alumni don’t want, but that alma mater just can’t bear to give up. Why? Fast forward to 2012. Many alumni associations stubbornly cling to the idea that alumni relationships should be hosted on a .edu website. But we’ve grudgingly populated Facebook (Groups, then Pages), LinkedIn (individual profiles, then Groups), and Twitter (individual streams, then institutional ones). And many of us, including some campus marketing and communications professionals, haven’t yet acknowledged that online social platforms aren’t broadcast outlets. People join Facebook to share their interests, ideas and activities with friends and family, to tell stories about what matters to them. They don’t join because they need to download a PDF of the press release announcing this year’s teaching awards. Communities like ours (as opposed to individuals) must learn to maintain slightly more modest expectations about how alumni will interact with us online. And yet, things are changing at last. Several signs point to a more effective accommodation between alumni associations and the online venues that have usurped their roles. For example: We finally understand that we’ve lost the monopoly we long-held over data. Itching to get back in touch with your old flame from senior year? Powerful online search means you’ll scan Google, Facebook and LinkedIn without wondering whether alma mater will put you back in touch. The alumni directory is dead. We don’t expect alumni to come to our website for discussions. Facebook comments, LinkedIn Group discussions, and tweets are the coin of the realm (plus the occasional blog post, Tumblr, or maybe — someday — Google+ Hangout). Our outdated bulletin boards have always been a wasteland, but we’ve finally stopped gazing at them expectantly. We’re becoming accustomed to small, dense networks of alumni planning and holding their own mini-reunions. Ubiquitous, free online event software (including built-in tools on popular social sites) enables alumni to choose the date, time, format and cost of alumni events. And the volunteers can pick and choose who makes the invite list, and who is excluded. We can sum up the outcomes of these examples just the way I interpreted Shirky’s observation in 2008: Alumni are organizing — without alumni organizations. This is a function of technology’s influence on group behavior. Accepting this means we need no longer devote our staff time (and meager budgets) to fighting Facebook for attention. And if we’re prudent, we’ll use these newly liberated resources to establish our next viable role in the lives of alumni. But what is there left to do? Alumni associations’ future roles will be less authoritative and more participatory. They will be equal contributors to online conversations, not know-it-all sources of official information. There are too many channels for alumni to choose from when seeking solutions to real-life problems. We’ll need to be happy serving as one source among many, and will need to adjust our expectations for online interaction accordingly. And I’m sure we can make the transition. The question is, will we do it before we render ourselves obsolete to alumni? Because when that happens, we’ll be obsolete to our institutions as well. Andy Shaindlin has 23 years of experience in higher ed, and holds a master’s degree in education. He is the founder and author of the Alumni Futures website (http://alumnifutures.com), and tweets from @alumnifutures.

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Andrea Sittig-Rolf: Don’t Waste My Time, Strategy Tips For Getting the Sale

March 23, 2012

Contrary to popular belief, the secret to successful sales isn’t necessarily the “close.” While asking for the business is an important and crucial step, sales is a process that requires careful strategic planning. The “close” should be a natural next step in the sales process, not just a question you ask your prospect out of the blue such as “Are you ready to place your order?” Here are a couple of ideas to consider when walking your customers through the sales process so that closing the business is seamless, and the natural next step. A philosophy I live by in my business is “the purpose of a meeting is to get another meeting.” In other words, the purpose of a meeting is not necessarily to close the business, unless you’re in a business where “one-call closes” are common. If your business is like most, it will require more than one meeting, as well as other forms of communication such as phone conversations, e-mail exchanges, and other written correspondence before you actually close the sale. By ending the first meeting with agreeing to the next step with your prospect, you’re ensuring that the prospect is willing to move through the sales process with you. Another key factor at the end of the first meeting is to ask your prospects for a commitment that they will, in fact, respond to you when you follow up. How many times have prospects asked you to follow up, and when you do, they don’t respond to you? Maddening, isn’t it? I don’t know about you, but if the answer to doing business together is “no,” I’d rather know that sooner than later so I don’t waste my time following up with someone who isn’t really a prospect anyway. One way to insure that your prospects will respond to you when you follow up is to give them an “out” if they decide not to do business with you. To do this, after you’ve agreed to the next follow-up step, say something like, “Can I ask you a favor? When I follow up with you in two weeks, if for some reason you’ve decided not to proceed, will you please let me know? There’s a saying in sales that ‘a fast no is better than a slow no’ and if you’ve decided to go another way, that’s okay, just let me know so I won’t waste your time or mine.” Sounds a little bold, I know, but most prospects will respond positively to this because one, it gives them the out they need if they decide to go with another solution, and two, it shows your prospect that you are a busy professional and you don’t want to waste anyone’s time. This technique also works well because suddenly you’re not a desperate salesperson, but rather a confident consultant who has something of value to offer. I’ve found it necessary to practice this technique over the years when coming across prospects who are just too nice to say “no.” As much as we hate to hear “no,” I know you’ll agree that you’d rather hear it early on in the process so you don’t waste time working with someone that’s never going to become a customer anyway. The funny thing is, more often than not when using this technique, based on my personal experience, you will not hear “no” and will actually end up closing the sale. Next, you’ll need to prove your solution doesn’t just show a return-on-investment, but actually creates a profit center for your prospect. For example, if by implementing the solution you provide your customer will invest $10,000 but actually save $15,000 in other operating costs within six months, you can show not just an ROI of six months, but an actual profit (or savings) of $5,000. (Savings can also be viewed as profit since it ultimately affects the bottom line, which is probably the thing your prospect cares about most.) Finally, creating a sense of urgency will help move the sale along through the sales process. Creating a sense of urgency requires your solution to be so compelling that it doesn’t make sense for your prospect to go another day without it. A sense of urgency is created by emphasizing the pain your prospects are experiencing by not having your solution and showing that by comparison, your solution will help. Now all you have to do is show that the sooner your solution is implemented, the sooner their pain will go away, and the next logical step in the sales process will be the sale, but don’t forget to ask for it.

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Emilio Azcarraga Jean: A Mexican trade: More Open Television And Telecommunications

March 23, 2012

Last month brought mixed news for Carlos Slim, the world’s richest man . Mexico’s Federal Competition Commission disapproved an investment by Televisa, the country’s largest television broadcaster, in Iusacell, a cellular phone company. That was good news for Mr. Slim because it hampered a rival to his telecommunications empire. The bad news: The nation’s Federal Communications Commission failed to reach an agreement to clear the way for a third and fourth broadcast television network. Mr. Slim badly wants to get into the television business. Both decisions lock in the status quo, are bad for consumers, bad for Mexico, and bad for Televisa, the company I chair, manage and in which I am the largest shareholder. First things first. While we may have seemed against this in the past, Televisa does not oppose the creation of a third, fourth or even fifth nationwide broadcast TV network. If and when the Communications Commission announces the terms of an auction for additional television frequencies, we will not legally challenge it — so long as the rules create a level playing field for competition. We would also not challenge an attempt for a new television network backed by a U.S. partner, so long as we receive reciprocal treatment in the U.S. Currently, U.S. law prohibits foreigners from owning more than 25% of any television station. We welcome greater competition in the Mexican mass media market, particularly in television, because we think our company is the best, and has been so for over a half century. Before launching new networks, however, it is essential to establish regulations that level the playing field for the telecommunications industry. Otherwise, the future of the broadcast, cable and satellite television business would be severely jeopardized. Mexico’s broadcast TV advertising pie is slightly more than $2.5 billion per year; the pay-TV market is another $2.5 billion. But while 95% of Mexican homes have TV sets, cable television (which we own a large subsidiary in) only reaches 30% of all households. And since U.S. law makes it difficult for us to expand our stake in Univision (the U.S.’s largest Spanish-language network and No. 5 overall), Televisa has to branch out to grow. This is why we made a deal last year with Iusacell, a small mobile operator with a 4% market share, owned by our broadcast competitor TV Azteca (which has roughly 30% of the broadcast TV market). We want to participate actively in the telecommunications market, especially cellphones. Mexico’s mobile-phone market is today worth roughly $15 billion. Mexico’s antitrust agency, Cofeco, blocked our transaction with Iusacell on concerns that two broadcasters joining in a common venture in the telecommunications industry could collude in the mass media market. This has never happened and is not Televisa’s intention. We are prepared to establish firewalls in order to address the agency’s concerns. The antitrust agency should understand that not only is it good business for us to enter the telecommunications market, it is also good news for Mexico. That’s because Mexico’s telecommunications market sorely lacks competition. Companies owned by Carlos Slim control 70% of Mexico’s mobile phone market, 74% of fixed broadband service and 80% of the country’s landline market. According to a recent study by the Organization of Economic Cooperation and Development (OECD), Mexico loses 2.2% of its gross domestic product each year because of astronomically high cellphone rates, low Internet penetration, and mediocre connectivity. Mexico has 10% as many wireless Internet subscribers per 100 inhabitants as Turkey. Its cellular phone rates are by far the most expensive in the OECD. Relative to other OECD countries, Mexico is ranked last in terms of investment in telecommunications per capita; but, says the study, “profit margins of the incumbent nearly double the OECD average.” We welcome competition in television. But Mr. Slim has fought tooth and nail to block competition in telecommunications, and delayed government attempts to regulate his fixed-line firm Telmex and cellphone provider Telcel in Mexico’s courts. The OECD recommends that “Telmex should be authorized to provide television services only when it is subject to adequate asymmetric regulations, and there is evidence that it is complying with them and not resorting to judicial challenges to delay or suspend their fulfillment.” Such “asymmetric” regulations would regulate Telmex more heavily than companies trying to enter the market to make up for Telmex’s market dominance. Mexico is changing for the better. Televisa is too. So should someone with the vision, the talent and the clout of Carlos Slim. Originally published in The Wall Street Journal

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Carol Roth: Using Mobile Content Effectively

March 22, 2012

As technology evolves at a breakneck pace and new tools are created to reach and connect with customers, many businesses are losing focus on how to effectively utilize the tools to drive the results they are seeking. As a business, you have to think about more than just the tools, you have the think about your audience and context. This becomes even more important as customer touchpoints and interactions increase. For example, let’s take QR codes. Say that you are using a QR code in an advertisement or even a window display. There are two pieces of context that you must take into consideration. The first is that your potential customer, should they scan the code, will be using a mobile device to retrieve information. Therefore, any information that is linked to that code needs to be mobile-ready. Second, is that if they are scanning the code, they have already gotten some information that is interesting enough for them to want to learn more. As Greg Slapp, CEO of leading free QR Code generator QRStuff.com said: Once a customer pulls out their smart phone to scan a QR code, they want to continue the conversation, not start it over from scratch. Far too many businesses don’t think about the logical next call to action once a code is scanned. They often take a customer back to a web home page or other information that repeats the same information the customer learned before scanning the code to begin with. This is very ineffective. So, what does this mean for your business and its mobile efforts? It means that you need to design a strategy where your collateral introduces a concept that is worthy of the customer taking action (i.e. scanning), Then it means that your web presence needs to be mobile friendly. Remember, the only gateway to your offer is through the smartphone, so once a customer engages with his or her phone, the information should be accessible in a mobile-compatible format. Finally, continue the dialogue. Know what collateral is driving the interaction and move the customer to the next logical step, whether that is delivering next-level information or letting the customer consummate a purchase without having to go back to square one. Don’t repeat what you have just told them to get them to scan the code in the first place. If mobile engagement is going to work, you have to move past the form of the tool to get into the nitty-gritty of its function and relevance to your business and your customer.

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David Wilson: It May Be Just Dirt to Some, but to Small Business Owners, It’s the Essence of Our Lives

March 22, 2012

I found myself recently in a discussion with a renowned lawyer about the financial and foreclosure crisis that’s gripping at the heartstrings of individuals and small business owners across America. His comment to me was, “It’s just dirt.” My guess is, if you are fortunate enough to be on the outside looking in, that’s really all you see in its totality. But if you’re unfortunate enough to be in its throes, it’s much more than that. Our hopes, our dreams, and our sense of self worth have all been devastated by this calamity. The personal and financial security we aspired to achieve through our homes and our businesses are in peril of becoming another more fortunate soul’s cheap acquisition — or at the very least, someone else’s American dream, at much less toil and stress. Behind these purchases and investments, lay wasted and broken dreams, retirements in jeopardy and promises of a brighter future growing dimmer by the day. Lying, too, in the rubble is our best opportunity to belong and have a vested interest in our community. Our senses of pride and ownership in our hometowns and neighborhoods have been shaken to the core. Maybe it was greed that in the hands of a few became the determining factor in the overall demise of many. “Shame on us all.” There was a time, not too long ago, when common sense prevailed, a sufficient down payment was required and verifiable income was the rule. Very few, if any, in the mortgage and banking industry wanted to make a bad loan; they were “here” to help us succeed, to live our dreams, to help us build for our family and community, a brighter and better tomorrow. My hat’s off to those great men of yesterday, as well as the select few of today, who monitored my finances with tenacity, held me accountable to each dime drawn and treated our monies as if they were their own. However, banks today have become the lifeblood of yesterday, throwing us to the wind as they try to meet federal guidelines, which by all accounts reminds me of being tightly wrapped in razor wire, then trying to breathe without blood letting. Loans current are now classified; thoughts of expansion are now just whimsical dreams and seasonal cash flow requirements, well, you might as well forget it. “If you can prove to us you don’t need it and or have as much as you need, we’ll loan it to you, if you don’t, I’m sorry, you’re just SOL,” so say many of our current loan officers. Sadly enough, our well-respected Canadian neighbors to the north maintained this earlier integrity throughout “our” financial crisis and have weathered the storm relatively unscathed. I’m proud that someone else still gets it. My question is when will we? Allowing now, this knee-jerk reaction from our government and its financial oversight to go from one extreme to another has smothered us, individually, as well as, corporately and stifled our proven ability to survive, let alone thrive. Where is the common sense in all this? Why not just pull out banking regulations from the ’80s and reapply them to today? My next question is, just where do small business owners go when the economy crashes around them and life as we knew it, no longer exists? We have followed our hearts, we have pursued our dreams, we have created jobs in the millions, yet through all our tireless efforts, we have not been able to survive and thrive through this continued economic disaster. No matter how long we have held on, no matter how hard we have tried, for the most of us, it continues to get worse. Speaking as an owner of small businesses over the last 30 years, I have overcome so many obstacles in my quest to succeed that it’s no longer soothing to reflect on the past, it’s actually heartbreaking. Working 14 to 16 hour days, we were inspired by the fact that so many people counted on us to succeed that failure was never an option. That all infallible F word, never once was uttered, nor was it ever spoken. We were the heartbeat and soul of America, we supplied good quality products with pride and service; we met the needs of our customers, made a fair profit and contributed to the overall well being of our communities and charities. But, just look at where we are today. Our relationships are in shambles, our “friends” have disappeared and our former employees somehow blame us for turning their world upside down. We have become the forgotten few who wagered it all for the success of many. Most of us were never fortunate enough to be part of the 1%, we were, however grateful, along with our hard working employees, to be a part of the 99%. “Just go get a job” forever rings true from those in my circle who are 9 to 5er’s; but these well-meaning words fall on deaf ears to me. I’ve been self-employed most of my life. These words may be easy to say but again, they have never walked in my shoes. “What are your qualifications, do you have a resume, where are your references and just what all can you do?” are just some of the questions that I’m sure will come my way. Legitimate questions, though they may be, from someone half my age, questions that are all too humbling and strike at the core of the reality of what is and or once was. What if we created an employment website just for humbled, small business owners — one that provides an in depth and visual interview process that reveals more of what all we’ve accomplished throughout our business life and less on what could ever be summarized within the confines of a resume? Could we count on employers in our fields of expertise to hire us as seasoned employees and managers, who can do almost anything or would we be relegated to the abyss, just biding our time, where we’re far out of sight and eventually out of mind? We’ve hired, we’ve fired, we’ve trained and nurtured; we were mentors, bankers, pseudo lawyers and doctors; we were auto mechanics and instant taxi drivers; we were marriage counselors, confidants, “almost family” and lifelong friends; we were all these things and more. As an employer, no matter what your field, you have to be all things to all people to insure your small business, along with your employee’s, thrive. It’s going to be hard, but impossible, to start from scratch again, especially when the word unsuccessful comes to the forefront, when you think back on what was. Harder still, with the former in mind, will be the ability to dream again for the opportunities to make a difference. It can be done; we’ve done it before, maybe just not in perilous times like these, where very few, if any, have our back. It’s time we band together as brothers and request from our all-inclusive dysfunctional elected and if I might say so, gainfully employed Congress, a Stimulus II just for small businesses, managed completely by small businessmen. We have the tenacity and the wherewithal to create millions more jobs; just give us the freedom and the flexibility in our financing to do so. Give us back the credit lines and our abilities to invest, to buy and build. Small business made this country great and we can do it again. We can, better than anyone, insure people will stay in their homes by hiring back our talented workforce that has and will continue to be our nation’s greatest asset. We are inside looking out. It’s more than dirt to us. It’s our livelihoods, as well as our children’s futures. To the powers that be, if you will allow us, by God’s grace, to thrive, we will rally and re-institute the belief that through hard work and strong ethics, dreams will still come true. All we ask is that you lead from the front or follow in our footsteps, as we venture again into deep waters, far beyond the safety of the shore. We hope and pray, you will continue to use our goods and services, allowing us, to remold, remake and rebuild what once was. If, however, you’re not willing or able to do so, please just get out of the way.

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Donna Spellman: You’ve Been Unemployed for HOW LONG?

March 22, 2012

“You’ve been unemployed for HOW LONG?” “If you’re qualified and marketable, then why isn’t anyone hiring you?” “Do you seriously think you’re going to find a job after all this time?” These are just a few of the last things you want (or need) to hear when you are unemployed and searching for work. So, where do these comments stem from? Perhaps they have something to do with the harsh realities surrounding unemployment today. Today’s research shows that the longer you’re unemployed, the harder it is to find work . In fact, for every month that someone is unemployed, it generally takes twice as long to find a new job. But despite these predictions, there are thousands of people who defy the odds and prevail, managing to land the positions they seek and quickly take themselves off of the unemployment list. The question is: “How do they do it?” Let’s face it… finding a job is significantly more time consuming than holding a job. Job hunting can’t be a once-in-awhile task for anyone who is really serious about it. On the contrary, finding a job must become your passion and must include clearly defined goals and objectives — regardless of the job you’re vying for. For serious job seekers, finding work IS their job. They get up in the morning as if they were going to the office. But instead of preparing for a commute, they wait for their laptops to load up. They remove distractions and don’t not allow themselves to stop along the way. Serious job seekers are committed to submitting as many resumes and applications as they can possibly get out in a day. No limits. The more, the better. They’re working the phones, analyzing their social media contacts and finding any to get their foot in the door. Here’s a quick stat to chew on: For every 50 resumes a job seeker sends out, only one response comes back . So if you think sending out one resume is going to land you a job, your odds are just about the same as the odds of winning the lottery. When it comes to employment, serious job seekers consider all possibilities. Although you might have left a particular position that you loved at a level that really worked for you, the serious job seeker considers all possibilities — even if it means taking a step down the corporate ladder. One might wonder why, if it were this easy, more people aren’t finding employment faster. The truth is that none of this is easy. The secret to success is all about commitment and maintaining a positive attitude, both attributes that are easily lost when people are struggling and questioning their self-worth. Most people lose steam and perseverance when the clock starts to tick louder and louder each month. Not to mention the increased anxiety that people experience when their cash flow starts to dwindle away. The true answer to these challenges is to find a support system, a cheering squad, a coach or any other means of support that will help to keep you focused, enthusiastic and optimistic. Family Centers’ Reaching Independence through Employment (RITE) Program does just that. Based in Fairfield County, CT, RITE provides individual support to those who are job seeking in the form of designing the job search, career exploration and counseling, vocational coaching, providing encouragement, and addressing issues that might be getting in the way of finding success. The RITE Program maintains a success rate of more than 83 percent of those clients who came to the program unemployed and successfully secured employment within a three to six month period of time. This success rate defies the unemployment rate by a landslide. Why? Because the RITE Program helps the average job seeker become the SERIOUS job seeker — the job seeker who understands that quitting is not an option until he/she ultimately lands the job that he/she is seeking. Again, there is no magic answer to finding employment other than stick-to-itiveness, keeping your eye on the goal and not letting up until you’ve reached it.

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Arianna Huffington: Delivering in a Delevering World

March 22, 2012

On Monday, I was in Newport Beach to speak at the annual client conference of PIMCO, the world’s largest bond investment company — whose CEO Mohamed El-Erian is a frequent and very popular HuffPost blogger . More than 300 of PIMCO’s clients gathered for a three-day retreat around the timely theme of “Delivering in a Delevering World.” “Delevering,” as it’s traditionally used, means decreasing a company or country’s leverage, usually by paying down existing debt. It is a term more likely to be heard at finance conferences than around dinner tables, but it’s an idea that gets to the heart of our current economic crisis. Because the ways we pay down our debts, in life and in business, have a real influence on our ability to arrive at what El-Erian recently labeled “win, win, win” outcomes: “a win for the individual; a win for the unit, be it the family or a company; and a win for society.” We desperately need some win, win, wins. Unfortunately, on both the political and economic level, we’re being told that delevering means that we must cut, cut, cut. And we’re about to go into another budget battle in which the word “deficit” is likely to be heard a lot more than the word “growth.” But smart delevering isn’t just about cutting. Delevering is a means — but to many in Washington (and on the campaign trail) these days, it’s become an end unto itself. And the relentless emphasis on cutting has obscured the more important question of what is being cut. In far too many cases, our approach to delevering is keeping us from growing, and keeping us from developing our human capital and tapping into all our resources. And it’s no comfort to know that the U.S. isn’t alone in its misguided approach to delevering. In Europe, imprudent delevering has a host of countries facing, as PIMCO managing director Saumil H. Parikh puts it , the “twin underlying problems of too little growth and too much debt.” Europe’s response to recession was austerity, and, as they’re finding out, you can’t cut your way to growth. As Businessweek’s Peter Coy writes , “Europe is choking off its own recovery by insisting on premature austerity,” as opposed to the idea of “Gas now, brakes later.” Now they’re teetering on the brink of another recession and have taken one of the main recovery weapons out of their arsenal. But according to Herman Van Rompuy , European Union President, the EU must rigidly keep to its self-destructive austerity limits for the sake of “the credibility of the whole operation.” So I guess sending a dozen or so countries into another recession, and causing misery for tens of millions of people, doesn’t hurt “credibility” as much as simply admitting your mistake and course-correcting. In Europe, excessive delevering is in danger of delivering them from their future. So it’s clear that in America, as around the world, what we need is delevering that delivers a more prosperous economy, a more compassionate society, and a fuller use of our human resources. One of the tragic stories of our time has been the inability of our leaders and institutions to deliver these things, a failure that, as El-Erian wrote on HuffPost in February, has undermined America’s ability to “regain economic dynamism, create ample jobs, and deal with growing inequalities.” But we also need delivering from the obsolete dogmas of the past, from the dysfunctional political and economic systems of the present, and from all the distractions that take us further from our own creativity, ingenuity and wisdom. In his office, PIMCO founder Bill Gross has a quotation from the financier J.P. Morgan: “Lending is not based primarily upon money or property. No sir. The first thing is character.” But our capitalist system has strayed dangerously far from the path charted by Alfred Marshall, who in 1890 explained that the “desire of men for approval of their own conscience and for the esteem of others is an economic force of the first order of importance.” There’s a reason Adam Smith’s free-market gospel, The Wealth of Nations , was preceded by his Theory of Moral Sentiments . He understood that economic prosperity has to be built on a firm moral foundation. But the evidence of capitalism without conscience is all around us. I suspect that if JP Morgan were to claim today that “character” was at the heart of our country’s finance system, he would be laughed out of the room. Earlier this month, Parikh wrote , “Is the global economy in the eye of the hurricane or has the hurricane passed over completely?” For millions of people around the world the forecast is still dark and stormy. Here in America, more than 4 million homes have been foreclosed on since 2006, five million people have been out of work 6 months or longer, and the average student loan debt is $25,250. But instead of proposing solutions that would deliver us from these multiple crises, our leaders are throwing up their hands and asking us to accept this as the new normal — or what Bill Gross has termed “the paranormal.” Such a response would have been completely unacceptable during an actual hurricane like Irene, which prompted such admirable responses from ordinary citizens, the media, and government. So why are we accepting it when, as El-Erian put it , there is still the “clear and present danger of America losing the war against the curse of joblessness”? And when Joseph Stiglitz’s footnote to the drop in unemployment to 8.3 percent is that, at this rate, it will take 13 years to regain full employment? We clearly need to be delivered from a shrunken presidential campaign that is missing the opportunity to bring the country together around real solutions. As David McCullough once told me , “Every presidential election is a renewal. Like spring, it brings up all the juices. The people are so tired of contrivance and fabrication and hokum. They really want to be stirred in their spirit.” Anybody’s spirit felt stirred over the last 6 months of this presidential race? Fortunately, there are plenty of people using incredible innovation, creativity and empathy on a local level to help us overcome our problems — from Code for America to DonorsChoose to SeeClickFix . Delevering and delivering. Delevering can be used to help us establish the right priorities. In my own life, my mother was certainly an expert at wise delevering — and leveraging. She skimped and saved to put my sister and me through college. She wore the same coat for 10 years. She never took vacations. We lived in a one-bedroom apartment. And when that wasn’t enough, she borrowed money, too — to pay for our education. And it was a wise investment — because it helped deliver her children’s dreams. She never let our lack of resources crush our aspirations and our hopes for the future. Whether it’s at the individual, the community, or the national level, delevering can lead to contraction or it can lead to a focus on what really matters. It all depends on what we intend to deliver. Add your voice to the conversation on Twitter: twitter.com/ariannahuff

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Denice Kronau: Spending Time With People I Admire Makes Me Happy at Work

March 22, 2012

If you’re someone I admire, please come sit next to me. I could use a little time breathing the same air as you. Most people I know admire people who are out of reach — Mother Theresa, Derek Jeter, Lady Gaga — to name a few and I do as well. We all have role models who inspire us. And many of us admire “the usual suspects”: our parents and siblings. Over the years, I’ve realized that I also admire a lot of people I work with. It starts with attraction and no, I don’t mean in a creepy want-to-have-sex-with-you kind of way. I meet someone new at work and there’s a spark that gets my attention: either from what they say, or their demeanor, or their personality. Something intrigues me about this person, and as we spend more time together I often find that the initial attraction turns to admiration. I turn into a groupie. Usually it’s not the people at the top of the work hierarchy whom I admire. Most of the time, it’s the folks who are in the lower ranks of the organization. Let me give you an example. I have a colleague, let’s call him Sam, who’s five years out of college, so he’s just beginning his career. Several years ago, he started a project to build a health care clinic in one of the poorest regions in the Amazon in Peru. In effect, this is his hobby. At the risk of sounding like my grandmother, when I was Sam’s age my hobby was watching TV. I’ve thought about why I admire certain people at work. Maybe I’m attracted to qualities that I know I lack, but I think it’s simpler than this. I feel good when I’m around them. It’s like I’m hoping that some of their character will rub off on me if I sit next to them at a meeting. I also like seeing their impact in the moment we’re together. Think about the people you admire. Why do you admire them? Are there people you admire at work? Do you get to spend time with them during your normal work day? I have people I admire who I see very often. But, if I am having a bad day: watch out! I stalk the people I admire when I am having a bad day — just being next to them seems to be an antidote to whatever is making me miserable in the moment. Sometimes I ask them for advice, mostly, I just enjoy the light they bring to my dark mood. Why am I writing about this? Simply because it’s one of the things that make me happy at work: I like spending time with people I admire. I walk away from these encounters feeling better, energized, motivated and just… happy.

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Richard (RJ) Eskow: Three Hidden Time Bombs in the GOP’s Medicare Budget

March 22, 2012

By now most people have heard some of the worst things about the Republican budget proposal — commonly called the “Ryan plan” and unironically described by the GOP as “the Path to Prosperity”: That it decimates programs for middle class and lower-income Americans while giving even greater tax breaks to the rich — $3 trillion worth , in fact. That it guts education, research, and transportation while preserving tax breaks for Big Oil. That it undercuts Medicare with a voucher system that will be worth less and less with each passing year. And that, despite all that, it would actually increase the deficit. You’d think that pretty much covers it — but it doesn’t. When it comes to Medicare, there are three more ugly facts about this plan that have yet to attract widespread attention — mostly because the Republicans have done their best to keep them secret: 1. They’re secretly planning to raise the Medicare age. It’s not in House Budget Chair Paul Ryan’s Wall Street Journal editorial , the one where he sneered at “some who would distort for political gain our efforts to preserve programs like Medicare” and said “our plan provides guaranteed coverage options financed by a premium-support payment.” It’s not in the summary description of the GOP budget , which claims it “strengthens health and retirement security by taking power away from government bureaucrats and empowering patients instead with control over their own care.” It’s not even in the full budget document itself, which is 99 pages long and contains a section entitled “Strengthening Health and Retirement Security.” So how do we know that the GOP wants to raise the Medicare eligibility age from 65 to 67? Because that’s what Ryan and his staff told the Congressional Budget Office when they asked the CBO to calculate the impact of their plan. It’s right there in the CBO report on the budget . Here’s the key sentence: “In addition, the eligibility age for Medicare would increase by two months per year beginning in 2023 until reaching age 67 in 2034.” That’s right: When Ryan and his staff instructed the CBO to calculate the impact of the Republican budget, they told its analysts that the GOP plan included an increase in the eligibility age for Medicare. Apparently they didn’t have room to mention that fact anywhere in their 99-page document, and didn’t see fit to bring it up while they were spouting all that rhetoric about “preserving entitlement programs for the future.” The Republican Party intends to raise the Medicare age for people as they approach the costliest years for receiving health insurance, and they’re keeping it a secret from the public. This change alone would indirectly cut Social Security benefits by as much as 45 percent , by forcing seniors to spend that much of their benefit check on additional health care costs. And remember, the GOP wants to raise the eligibility age for Social Security, too. The net effect of these two changes means that older Americans would be forced to keep working — or looking for work — at an age when their medical expenses would make hiring them prohibitively expensive for employers who offer health insurance. They would be forced to try purchasing health insurance on the open market. Which gets us to our second dirty secret … 2. Insurers will get to set their own rates. The Ryan plan lets private, for-profit health insurers set their own rates — rates which, according to the Ryan plan, will determine the Federal budget for senior health. It doesn’t say that, of course, but that’s how it would work. According the the GOP’s proposal, “All plans… would participate in an annual competitive bidding process …The second least expensive approved plan… would establish the benchmark that determines the premium support amount… Program growth would be determined by the competitive bidding process…” What does that mean in English? That Medicare goes away, to be replaced by a system of private health insurance companies who’ll be paid to provide services that are supposed to (but won’t) resemble the level of coverage seniors currently receive under Medicare. That health insurers would submit their bids to provide those services once a year. And then comes the surprising part: The Federal government’s expenditures for senior health care will be determined by the private insurers themselves, because the second-lowest bid establishes what the government is willing to pay for health insurance. How crazy is that? Private health insurance rates have been climbing at three and four times the rate of today’s Medicare. They’ve shown no ability to restrain costs — and have no motive to do so, since they make money the old fashioned way: on the mark-up. And now they — or the lowest bidder among them — will dictate what the government must pay. The plan says so, very clearly. “As opposed to pegging the growth rate to a predetermined formula,” the GOP document say, “competitive bidding offers the ideal means of harnessing the power of choice and competition to control costs, while also securing guaranteed affordability for patients.” In other words, the Republican Ryan plan places budgetary control for a major government program in the hands of the very insurance companies that profit from it. At least that’s what it would do, if they didn’t contradict themselves in the very next paragraph. 3. The GOP plan radically cuts per-person spending for Medicare. Remember that sentence we just quoted, the one about not pegging the growth rate to a predetermined formula? They totally lied about that. The plan does peg the growth rate to a predetermined formula, and Ryan’s staff were very specific about it in their instructions to the CBO: “Total spending would grow in subsequent years,” the CBO was told, “with nominal growth in per capita GDP plus 0.5 percentage points per year.” That’s a “predetermined formula.” And it’s important to note that “nominal growth in per capita GDP” is not the same as the the growth in per capita health care costs, which have risen much more quickly than general inflation or GDP. That amounts to a major cut in benefits every year. It gets even worse. The “per capita GDP” applies to everybody in the nation, not the ever-swelling ranks of Medicare-eligible seniors. This gets technical, but here’s what it means: After this formula takes effect in 2023, there will be much faster growth in the Medicare-eligible age group than in the overall population. By structuring their formula this way the Republicans have ensured that there will be dramatic benefit cuts, especially as the “age wave” of Baby Boomers retires in the 2023-2030 period. The “predetermined formula” is itself a secret, since they said there wasn’t one. And the way it’s structured will lead to dramatic cuts in Medicare. Three-Pronged Attack While the contradictions and evasions make exact forecasts difficult, it’s clear that the net effect of these three changes would be to create a budget-busting giveaway to rich insurance corporations while at the same time slashing health coverage for seniors. And this isn’t some radical ideologue’s manifesto: it’s the Republican Party’s official Medicare proposal. One terrible plan, three dreadful secrets. Presidential candidate Mitt Romney has said very, very nice things about this budget. In fact, all of the GOP’s leaders have been bragging about it. Since they’re so proud of it, why don’t they tell more people what it really does?

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Women 2.0: From Students to Startups: Rebellion Photonics Founder and CEO Allison Lami Sawyer

March 22, 2012

By Angeline Evans (Writer & Blogger, The New Professional) Allison Lami Sawyer was born to be an entrepreneur. The Rice University MBA student always knew she wanted to start her own business, and armed with a master’s degree in nanotechnology, she hit the pavement in Houston in search of the right product. After a year and half, she met her co-founder, and before the ink on their diplomas was dry, Rebellion Photonics was born. In the two years since Allison and her co-founder finished their degrees and started the company with $175,000 in business competition winnings, Rebellion Photonics has grown to eight employees and brought in over $2 million in income. Recently, the company was awarded two Small Business Innovation Research Grants totaling $1.3 million. From their academic beginnings, Allison and company are well on their way to commercial success. Technology for the taking Universities are a prime breeding ground for cutting edge technology, and, in the best cases, entrepreneurs can find ready and willing prototypes that have stood the test of research and benefit from thousands of dollars of grant funding already put to use. Working with someone else’s product and research doesn’t come without challenges. Building a company from the ground up usually means spending several years pinching pennies while your fellow biz school alums may be raking in six figures off the bat. Entrepreneurship can also be a lonely path, and not everyone is suited to that lifestyle. Convincing a researcher to sign on for commercialization can be tough as well. From Allison’s experience, graduate students seem more receptive to taking their work out of the lab and into the market. University research is patented through technology transfer offices, but once patented, technology often languishes for years. Researchers may not realize that they don’t have to leave academia, but can work out licensing deals instead. Sometimes, as in Allison’s case, entrepreneurs find their match in a researcher that is willing to make the jump with the technology. Even so, it’s important to find someone with the same “appetite for risk,” as she puts it, who holds the same company values and goals in mind. Procuring a product Finding the right technology for you might take a few tries, but Allison encourages budding entrepreneurs to jump right in and get to know some graduate students, researchers, or local companies. “If you’re looking to start and you’re not an inventor, get in touch with local organizations and give time for free,” says Allison. “Make a name for yourself in that community. Allison started her search for an inventor at Rice University, offered free business assistance at the Houston Technology Center, and got involved with the Rice Alliance for Technology Entrepreneurship. Word spread quickly about her search, and in the end, her technology inventor (and now CTO) found her. Digging through patents at university offices of technology transfer is also a good way to find cutting edge technology. Where are the women? On her path so far, Allison has yet to meet any other women hard tech entrepreneurs, but she thinks women are perfectly suited for working with inventors and researchers to bring new technology to market. “You have to be very gentle and gain their trust, not just talk but actions,” Allison says. “I think a lot of women could be really good at that: not coming in all type A, but instead ‘Let’s grow this together.’” To encourage fellow female entrepreneurs, she mentors business students at her alma mater. But she thinks women who have already blazed the trail can do more. “Women in positions of power think [self-promotion] is unnatural or arrogant,” she says. “But they should do better at publicizing themselves not for their own sake but for girls everywhere.” About the guest blogger: Angeline Evans is a freelance writer, nonprofit communications consultant and career and style blogger at The New Professional . She believes that business casual doesn’t have to be boring and strives to help the everywoman find balance and success in the office lifestyle and in their careers. Prior to striking out on her own, Angeline spent over five years in magazine publishing and public sector and nonprofit communications. Follow her on Twitter at @angelineevans .

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David Tereshchuk: Under-reported: Man-Bites-Dog Story of Global Poverty

March 21, 2012

Oh wow! — a media storm over the great Goldman Sachs being disavowed by one of its own in an Op-Ed article (in the New York Times ) that became, controversially, a news story. Overtaken only by a storm over a semi-journalistic public radio show ( This American Life ) disavowing one of its own episodes attacking the great Apple, Inc. Amid all this tortured media navel-gazing, I found myself staring instead at some other quite different information — straight news, not opinion pages material — that is going largely unattended. I’ve been helped here by a whistle-blower who is coincidentally another Goldman Sachs man. It’s actually their top Asset Management executive, Jim O’Neill. And “flag-waver” or “horn-tooter” are probably better terms for him — since we’re not talking about raising a disturbing alarm here. Pretty much the opposite. And it’s nothing to do with Goldman. Indeed, it is some really good international news that’s evading our close attention, even though O’Neill — an astute man who, like me, I’ll say gratuitously, attended high school in Manchester, England — has been eager this week to tell anyone who will listen. The trouble is, this good news seems counterintuitive. There’s been a global financial crisis, right?Along with that there’s been a serious price hike in food-prices, and now oil-prices, correct? Unemployment is staying stubbornly high in countries desperate for post-recession recovery, isn’t it? And remember the United Nations’ Millennium Goals from the turn of the century? Especially that crucial First Goal which committed the international community to the lofty ambition of “halving the proportion of people living in extreme poverty” by 2015. If you’ve been following the not-very-numerous but always well-meaning media outlets who care about these issues, that goal has for years appeared doomed to failure, given the grim global conditions as reported. Well, the good news is that the facts contradict that pessimism. A World Bank report by its Development Research Group reveals the surprising secret… the world’s poor are now doing better, in fact. Somewhat astonishingly, if we look at the commonly accepted measure of “extreme poverty” — meaning living on less that $1.25 dollars a day — then the goal has already been achieved — was in fact achieved by 2010, a full five years earlier than the target. While in 1990, when the goal was being discussed and formulated, nearly half the developing world’s population (actually 43 percent, well over two-and-one-half billion people) lived below that daily income level, and by the time the first decade of the 21st Century was coming to its close, that proportion had dropped to less than a quarter (22 percent — or 1.29 billion people). Here’s the Bank’s own multlmedia summary of the findings, at a little over three minutes: video platform video management video solutions video player “And to top it all off,” says Goldman’s O’Neill, who can scarcely contain his glee, “it is those who were the absolute worst off that have made the most progress”. What indeed is perhaps the big surprise-within-the-surprise is that, while we might imagine the improvement can be ascribed to the vast and very singular industrialization of China … that simply isn’t the case. Even if you exclude China’s case — gargantuan part of the gobal landscape though it is — the global improvement is still enormous. And Africa — so often considered simplistically as the mother of all basket-cases — turns out to be aggressively improving its grim statistics. Sub-Saharan Africa — generally speaking the poorest region of the world — had by 2008, says the report, reduced that $1.25-a-day poverty rate to 47 percent, the first time it ever dipped below the 50 percent level. And since then it has continued to see falling numbers for the extreme poor, setting in reverse the continent’s previously dispiriting, steady upsurge through the 1980s and ’90s. I’m reminded of working with Kofi Annan, the UN Secretary-General at the time the Goals were published to great fanfare, and his speechwriter Edward Mortimer, as we made a TV program about the world financial scene. Annan was anxious that we emphasize what he impishly (or sardonically?) called “Africa’s best kept secret,” meaning that a lot of money could be made, quite legitimately, through quite above-board transactions, in Africa. He would extol the healthy rates of return at the Johannesburg or Lagos stock exchanges, rolling in then at 25 percent or more. It’s good to be able to point up some under-appreciated economic betterment taking place in Africa nowadays, and taking place to the benefit of more than just the financial elite. Just as it’s good for any journalist, once in a while, to write a “Man Bites Dog” kind of story. * * * * Read more of David Tereshchuk’s media industry insights at his weekly column, The Media Beat , with accompanying video and audio. Listen also to The Media Beat podcasts on demand from Connecticut’s NPR station WHDD, and at iTunes .

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