How Sick is Your Company?

Is your company Passive-Aggressive, Fits-and-Starts, Outgrown, Overmanaged, Just-in-Time, Military Precision, or Resilient? These are the fun categories that make up your organization’s DNA, according to the folks at BAH.
Read the HBR article: The Passive-Aggressive Organization by Gary L. Neilson, Bruce A. Pasternack, and Karen E. Van Nuys.
“Healthy companies are hard to mistake. Their managers have access to good, timely information, the authority to make informed decisions, and the incentives to make them on behalf of the organization, which promptly and capably carries them out. A good term for the healthiest of such organizations is “resilient,” since they can react nimbly to challenges and recover quickly from those they cannot dodge. Unfortunately, most companies are not resilient. In fact, fewer than one in five of the approximately 30,000 individuals who responded to a global online survey Booz Allen Hamilton conducted describe their organizations that way. The largest number—over one-quarter—say they suffer from the cluster of pathologies we place under the label “passive-aggressive.’’ The category takes its name from the organization’s quiet but tenacious resistance, in every way but openly, to corporate directives.
“In passive-aggressive organizations, people pay those directives lip service, putting in only enough effort to appear compliant.”
I used to work for someone like that once. Her strategy was to say yes and do nothing. The result? Nothing happened. Everything I accomplished happened despite of my boss, not because of her. I also knew an entire IT department at a Fortune 500 company that behaved the same way. The modus operandi was: “What can we NOT do today?”

Wait. There’s more.
Here’s a full report on the research – “A Global Check-Up: Diagnosing the Health of Today’s Organizations”

Tom Davenport on Personal Knowledge Management

Says TD: “Most interventions to improve performance in business are at the organizational or process level, but it doesn’t have to be that way. We can also improve individual capabilities. Ultimately, knowledge worker performance comes down to the behaviors of individual knowledge workers. If we improve their individual abilities to create, acquire, process and use knowledge, we are likely to improve the performance of the processes they work on, and the organizations they work for.”
Right on! Read this insightful post on Tom Davenport’s blog- BabsonKnowledge.org.

Reputation Management: Doug Smith’s Recommendations to Harrisinteractive

For several years, Harrisinteractive of the Harris polling company has done an annual survey of the ‘reputation quotient’ of what it calls the 60 ‘most visible’ companies. The survey asks respondents to evaluate companies against 20 attributes ranging from social responsibility to financial performance to product quality. Each of the twenty can earn a top score of 7 and a low of 1.
Here’s what Doug Smith thinks…

The Economist: Fat Turkey Takes All the Gravy


Says the Economist:
“Executive compensation in America—already far ahead of the rest of the world, despite the best efforts of overseas managers to catch up—is now rising inexorably again. In fiscal year 2004 the total compensation of the median American company boss rose in every industry, by between 9.7% in commercial banking and 46.1% in energy, according to a new report by the Conference Board, a research organisation. In the big companies that comprise the S&P 500 index, median total chief-executive compensation increased by 30.2% last year, to $6m, compared with a 15% rise in 2003, according to a study published last month by the Corporate Library, a firm that tracks corporate-governance data.”
One of the interviewees – Bob Pozen, chairman of MFS Investment Management, is pissed off at executive pay packages that reward bosses generously even if they fail. He is extremely critical of the role of compensation consultants. They, he says, tend to be chosen by the chief executive, and to drive up pay by recommending that the top man should be paid more than his peers, having chosen a group of peers whose pay errs on the high side.
Hmmm. Can we outsource the CEO to a low-cost country? Is there no cure for Enron-ititis? Read the full article.
Maybe that’s why Peter Drucker wasn’t so popular at the end. He called this “looting.”
The last word – again from the Economist: “…hell is more likely to freeze than bosses’ pay.”

Country Branding: The Futurebrand Version

Why do so many PR and branding companies have the worst websites? Because they don’t understand how branding works online.
In spite of their website, they’ve done some interesting work at Futurebrand. I’m talking about their Country Brand Index.
Apparently Italy ranks as the top overall destination, according to a global survey that identifies countries as brands… Australia and the U.S. take the second and third positions.
China is the “most improved” country brand, the U.S. is “best country brand for business travel” and Italy is the “best country brand for art and culture.”
“If a ‘brand’ is defined as an experience, then some of the world’s most powerful and recognizable brands should be countries. The challenge the industry faces is that it must move away from the traditional reactive and tactical marketing approaches and instead, create and deliver an overall brand experience that drives sales and turns visitors into country-brand evangelists,” says Rene A. Mack of Weber Shandwick, the agency involved in the creation of the index.
He’s right and wrong. Your travel experience in a country is not the same as the country’s brand. These days its important how you act in public. Like children, some countries behave better than others. Some are unruly, some loud, some mild-mannered…
A better survey is the Anholt-GMI Nation Brands Index. I talked about it in a previous post – The Rise and Fall of Brand America.
Also: see what Peter Drucker thinks. You have to listen to the whole thing!

Shooting Birds or Catching Fish: Dunk on Branding

William Dunk gets it.
Here’s a letter he posted on his Global Province site back in 2004.
“Basically there are a couple of ways of making sales. Either you shoot them down or they come to you. For most of the mass market era, we took a shotgun, cost be damned, and pumped lead into the skies, hoping to knock as many pigeons—i.e., customers—down as possible. Right now, as we transition out of the mass era, we are using rifles, and assuming that with careful targeting, we can hit a choice quail, duck, or wild turkey on the wing, and then send a bird dog out to retrieve. The idea is to hit many less prospects, but to hit the choice ones that count. You should understand that any form of marketing that has targeting in its name is expensive and probably a poor return on investment. Nonetheless, targeting is the craze of this moment.
“But then there’s catching fish. We put a worm or fly down in the water and wait for the fish to come to us. Stream fishing. It’s more subtle. Less energetic. We use the inquisitive hunger of fish to lure them into our clutches. Sight and sound and touch are compounded. This is allure. It’s very, very related to “word of mouth,” which, at the end of the day, is the most effective form of marketing.
“We think longer term that it’s time to lay down lures in the water. That will drive companies to provide horribly accurate product information that tells the user how to get good results at low cost from a product, even suggesting alternatives to their own that may work better for some applications. Straight poop becomes the strongest form of advertising.”
He’s describing double-loop marketing… read the article.

Using Cheerleaders to Sell Drugs

“Exaggerated motions, exaggerated smiles, exaggerated enthusiasm – they learn those things and they can get people to do what they want.” – LYNN WILLIAMSON, an adviser at the University of Kentucky, on why so many former cheerleaders are hired as sales representatives for pharmaceutical companies.
This article in the NYTimes says that drug companies hire “sexy drug representatives as a variation on the seductive inducements like dinners, golf outings and speaking fees that pharmaceutical companies have dangled to sway doctors to their brands.”
“In a crowded field of 90,000 drug representatives, where individual clients wield vast prescription-writing influence over patients’ medication, who better than cheerleaders to sway the hearts of the nation’s doctors, still mostly men.”
“But pharmaceutical companies deny that sex appeal has any bearing on hiring. “Obviously, people hired for the work have to be extroverts, a good conversationalist, a pleasant person to talk to; but that has nothing to do with looks, it’s the personality,” said Lamberto Andreotti, the president of worldwide pharmaceuticals for Bristol-Myers Squibb.”
Right.
I’m comforted to know that our doctors, with all their years of “education,” are swayed so easily… Sex still sells. Maybe we should use cheerleaders as environmental lobbyists…

“Competing on Analytics” – Tom Davenport and friends

Competing on Analytics is a Babson Executive Education report by Tom Davenport, Don Cohen and Al Jacobson.
The report describes the emergence of a new form of competition based on the extensive use of analytics, data, and fact-based decision making. The analytics— quantitative or statistical models to analyze business problems—may be applied to a variety of business problems, including customer management, supply chains, and financial performance. The research assessed 32 firms with regard to their orientation to analytics; about one-third were classified as fully engaged in analytically oriented strategies. Both demand and supply factors for analytical competition are described. Of the two, demand factors are the more difficult to create. The presence of one or more committed senior executives is a primary driver of analytical competition.
Registration is required for download, but it’s worth it.

John Byrne on Drucker: “The Man Who Invented Management”

A human look at Drucker’s contributions from John Byrne and Lindsey Gerdes at BW:

— It was Drucker who introduced the idea of decentralization — in the 1940s — which became a bedrock principle for virtually every large organization in the world.
— He was the first to assert — in the 1950s — that workers should be treated as assets, not as liabilities to be eliminated.
— He originated the view of the corporation as a human community — again, in the 1950s — built on trust and respect for the worker and not just a profit-making machine, a perspective that won Drucker an almost godlike reverence among the Japanese.
— He first made clear — still the ’50s — that there is “no business without a customer,” a simple notion that ushered in a new marketing mind-set.
— He argued in the 1960s — long before others — for the importance of substance over style, for institutionalized practices over charismatic, cult leaders.
— And it was Drucker again who wrote about the contribution of knowledge workers — in the 1970s — long before anyone knew or understood how knowledge would trump raw material as the essential capital of the New Economy.

read it here

Check out this very, very interesting podcast… John Byrne talks about his first meeting with Peter Drucker and his wife Doris at the YMCA in Estes Park, on how Drucker saw “business as an opportunity to build community” – the problem of executive pay – and much, much more.

Warren Bennis: “Peter Drucker, how do you learn?”
Answer: ” By listening, only to myself!”

Great podcast!

Koppel Steps Down: The End for Nightline?

During his 42 years at ABC News and 26-year run on “Nightline,” Ted Koppel has seen — and reported — it all.
As he prepared to anchor his last edition of “Nightline” Tuesday night, Koppel spoke about his experiences as an anchor and reporter for the show long regarded as the smartest news program on TV.
Read the ABC Interview here.
Note that it is filed under “entertainment.” Prediction: Nightline is finished.
The new format stinks. Since when is “less news, more crap” a formula for success? Oh I forgot, this is US TV- i.e. “entertainment.”
Note to the BBC: you can now safely take over the news marketspace in the US.

Neil French: The Strategy Interview

November 2005 – Strategy Magazine
One is enough
Q’s and cocktails with…Neil French, outgoing worldwide CD, WPP Group
by Lisa D’Innocenzo
By now, you surely must have heard about the Neil French kerfuffle. The short version: Last month, he resigned his post at WPP because of reaction to controversial comments he made about female CDs during a Toronto event, organized by ad site ihaveanidea.org.
Strategy interviewed French a day before that fateful night and felt he made some salient points about the state of the industry, as well as what it takes to be brilliant. So, despite the fact that he called said reporter “Sweetpea,” we thought this was still worth a read.
LD: What do you think of the state of the ad industry?
NF: What in Canada? Please don’t ask me, because I don’t know. I could have got somebody to brief me about Canadian advertising. That would have been wrong, because it’s like a politician being told what to say. I don’t do that shit. I’ve never been to Canada before – what the hell would I know about Canada? I like the place – I love the weather. [Spoken on a 28 degree day in late September.]
LD: How about overall?
NF: There’s this hysteria on at the moment about how television is dead and it’s all going to interactive. That’s such bollocks. Yes, in the Western World there are a lot of computers out there and interactive thingy-bobs. But actually 90% of the population of the earth is not sitting in front of an Apple tonight. You go to some huge shack city in Brazil, or Thailand, and that light from the shack is a television. Why is everybody panicking? I remember when radio was dead. I remember when newspapers were dead. They’re fine. Now television is dead. No it’s bloody not. It’s just a lot of inept people who think that with the next thing, there might be some good ads. There won’t be of course, because they are genetically inept.
LD: What do you think of the fact that more money is going into interactive then?
NF: If you put everything into mobile, it’s going to piss people off much more than the television ads. Mostly mobile’s used by kids. They are going to make the phone calls, they are going to text their mates, they do not want to be interrupted by some jerk who wants to sell them a soft drink. So this is more likely to burn out very quickly. They will watch the stuff they want to see, and that’s when you get them. Yes, TiVo can make sure you don’t watch the ads, but if it’s a really good ad that appears during the moto racing or the soccer, you’ll leave it on to hope the ad comes on. I’ve heard people say this: “I love this one. I’m not going out for a pee.” It’s human nature. If the media buyer’s clever enough, it’s going to always be in the same program. Having your ad liked by the consumer, that’s the Holy Grail. No more conversation needed on that subject; move on.
LD: So what does it take to make a good ad?
NF: Talk to people. That’s all it is. When Winston Churchill said: “We shall fight them on the beaches,” he was talking to one bloke. Every single person in his little house in the middle of England saw himself standing shoulder to shoulder with Winston, with a pitchfork in his hand on the seashore. And when Hitler said: “We’re going to take over the world; we’ve had a rough deal,” every soldier at Nuremberg, said: “He’s talking to me, and I must not let him down.” So good or evil, the great communicators talk to one person. That’s what advertising does – I’m talking to you, this is the right car for you, or beer, or insurance company, or whatever the hell it is. Only for you. Luckily, there are millions of people like you and they will all buy it, but you don’t say that in the ad. There’s no you plural in advertising, it’s you singular.
LD: How come more advertisers don’t get that?
NF: Because 95% of the people in this business are buffoons. They’re clowns. The creatives blame the clients and the suits, and that’s only because the suits frequently come into advertising because they couldn’t get into banking or retail, so you get an awful lot of those. But the client has every right to make his own decision on his own product. It is our responsibility to explain to him why this will work better than that, and if we fail to do that, we don’t deserve to do good advertising.
LD: What work have you seen recently that gets it right?
NF: I have to bring this one up, because it’s a great example of talking to the audience. It was an ad [I did] for [Panadol] in China. They researched aspirins and the Chinese got a bit upset that it said: “Take two,” because they thought: “It seems like such a waste, using all these aspirins up.” So they brought out the single pill.
If you want to talk to people, tell them something that’s relevant to them, and then twist it in the direction of your product. So I wrote the line of “One is enough,” and the picture was a picture of George Bush and George Bush. It was huge.
Next year’s big winner is going to be the Big Ad from Australia [for Carlton Draught]. It is the heaviest irony possibly ever used in advertising and utterly hilarious. If you look at it and deconstruct it, it’s the perfect ad for beer, without having to show a lot of people in the public going “yo-ho-ho.”
LD: Why do so many ads in categories like beer look the same?
NF: Why? I’ll tell you why, and this is where the client is to blame. He sees an ad, and says: “Oh, that’s good, can we have one like that?” And it’s the very thing he shouldn’t say. He should say: “Can we have one not like that.” Otherwise, how can a consumer, who doesn’t really care, ever differentiate? The client’s problem is only that his widget means to him his house, his wife, their kids, their education, their retirement and his funeral. Whereas to anyone in the street, it doesn’t come in the top million of things to worry about. Our job is to say: “This might be irrelevant, this widget,” but of course the client’s saying “No, no it’s really important; this is the best widget in the world.” But actually, they don’t care, mate. All we can say is: “When you need a widget, we do good ones.” So our job is to bridge the gap between the client’s enthusiasm and the audience’s apathy.
LD: How hard is that to do?
NF: It can be extremely difficult. The whole trick is to explain gently to the client why this is so. There are stupid people, but generally speaking the guy that runs the client is highly intelligent and highly motivated and a bit of a pirate. You don’t get to run a big brewery or big car company without being a little ballsy. Unfortunately for the hewers of wood and fetchers of water, further down the hierarchy, their interest is keeping their job.
I can’t remember a single occasion I’ve sold a decent campaign to anyone but the top guy. I did a campaign for Martel brandy, which was long copy and nobody had ever done long copy for brandy before. People down the line weren’t sure about it, but I made them let me present it to Edgar Bronfman, who in those days was the head of Seagram’s. The suits put me up front with great trepidation and I explained the ad. Edgar got it before I explained it to him. He understood the whole concept. He said: “Yeah, that’s great. We’ll go there. Looks like nothing we’ve ever seen before.” All the racks of suits sighed with relief because they didn’t have to make any decisions. At the end, he walked all the way down to the far end of the table, and said: “Neil, when these guys screw this up, you call me.” And I said: “You mean if?” And he said: “No, I mean when.”
LD: Are presidents getting more involved in marketing?
NF: No. I wish they bloody did. The only benefit of being old and wizened, like myself, is I can generally see the top man. Because I’ve been around forever, longer than God. The guy they want to see is the superstar, somebody like Bogusky, or an old bozo like me.
LD: How do you convince marketers to take a risk?
NF: Something I say to clients a lot is: “Are you actually just spending this money to mark time, or do you really want to make a difference? And how much of a difference do you want to make specifically? How much do you want sales to go up? How much can you supply if this was successful?” Ask all those questions and then you can say: “Now I know how brave you’re going to be. Not at all or very.” And of course, all bravery is risky, and so is safety.
LD: When do you know you can’t work with a marketer?
NF: There are three things important when running an ad agency. Someone called it the three F’s: fun, funds and fame. If a client gives you money and fame, that’s great. If he gives you fun and fame, but not much money, that’s still great. If he gives you lots of money and lots of fun, that’s ok. But if there’s no money in it, and no fun, but it will make you famous, you have to think about it. If it’s just fun, then you should have left years ago. One is bad. Two is ok, three is unbearably wonderful. After all, it is your life. The client doesn’t own you; you’re not a slave; you can say uncle.
LD: Why are boutique agencies becoming increasingly popular?
NF: The boutiques are attractive to big clients because they have a personal stake in the success of this relationship. The client joins and asks a smaller agency to help them in the knowledge that there might be a few moments of stress in this relationship, but in the end they will succeed. These are the mistresses, not the wives. The mistresses get the jewelry, the wives get the washing machine. It’s sad but true.
I was once talking to a boss of another very, very big agency. And I said: “You’ve had these clients so long. How do you do it?” He said: “Because they can’t be bothered to fire us.” It’s too much hassle.
LD: Like a divorce?
NF: Absolutely. “God, this is a problem. Oh, well, stick with it. It could be worse, not much, but it could be worse.” How sad is that? There comes a time, where you’re going to say: “Actually, screw this.” Or go get yourself a mistress, for just part of the time. And that’s what these big clients do. “We’re tied up to the teeth with these people, but I hate the bloody work, so I’m going to get a babe, and go out to dinner with a babe a lot, which will be great. It’s much more fun, makes us feel good, and hey, then we’ve got to get back to the sodding wife again.”
There will be more and more boutiques. There was a point where it was just about the big, big blocks taking over, but then the big, big blocks [started] buying the boutiques. Why do they buy the boutiques? Not for the money they’re making. They buy them to give themselves a certain sexiness – a nice set of legs, or high heels.
LD: A boob job?
NF: A boob job! Very good. Absolutely. That’s exactly it. Let’s stick them on to the front and it looks like we have big boobs. It doesn’t work.
LD: Does it help to have an ego in the ad business?
NF: I taught myself self confidence in my early teens. I was very shy. Pain and agony, and beating down embarrassment, teaching myself not to blush and all those awful things. Ego is really: “Do you really believe in yourself?”
[In Canada], there’s a cringe factor. There’s the permanent apology. I mean, I love the fact that people on the street are all saying “sorry” all the time. But, come on guys. Politeness is great, but sometimes it’s not said in a politeness way, as much as a “Please don’t hit me” way. That’s sad. I remember a young guy, saying: “You’re an egomaniac. You’re all ego and no talent.” That may be true. I said: “Do you have an ego?” “No,” he says. “Do you bathe? Then you have an ego. You care about what people think about you. You take a shower, you care.”

On Drucker: John Hagel, Tom Peters, William Dunk

Here are more views on Drucker from some very smart people:
>> John Hagel on his Edgeperspectives Blog:
Drucker’s Gone
“I am laid up with the flu so I am still having trouble processing the reality that Drucker’s gone. Drucker was an iconoclast who lived on the edge throughout his life. Prolific until the very end of a long life (he was 95 when he passed away last Friday), he always sought to move beyond established boundaries, believing that they limit the potential for insight and understanding…” Read the post >>
>> Tom Peters, in his “Dispatches from the New World of Work” blog:
Peter F. Drucker: Right Man for His/Our Times
“…Peter Drucker did arguably (1) “invent” modern management as we now think of it; (2) give the study and craft of management-as-profession credibility and visibility, even though biz schools like Harvard had been around for a long time; and (3) provide a (the first?) comprehensive toolkit-framework for addressing and even mastering the problems of emergent enterprise complexity…” More >>
>> William Dunk at Global Province:
Death at Claremont.
“The ultimate prophet of profit, Peter Drucker died last Friday, his mind churning to the end. He had spent his last years in residence at Claremont, having made his early imprint at New York University with Juran, Deming, and Feigenbaum, and as one of these four horsemen helped remake Japan’s economy after the war. Standard reading in business schools and corporate suites, his books turned heads from here to Tokyo. Compared to him, all the gurus out of McKinsey and the business schools have always seemed to be pretty tame stuff…” Read more >>
BTW, I’m amazed at the response my Drucker cartoons are getting. It seems like the “community of Drucker fans” is alive and well.

Do you Speak Soccer?

Emerson Ferreira da Rosa in the Economist:
I am increasingly aware of how football has become an effective and universally known “language” that can project images of pure sport, beautiful play and enjoyment: a “language” that is used and appreciated all over the world. I am amazed at the number of dads who play football with their kids in Central Park on Sunday morning. In the United States soccer is starting to compete with baseball, American football and basketball. There is also a “desire for football” in China, in Japan—where Juventus recently played in a tournament—and in the Middle East. This shows us unequivocally that football can “speak” with the greatest simplicity—through different media, but above all through television—to millions of fans.
Read the article here >>

Wage Inflation as a Result of Offshoring


Another article from McKinsey…
On the supply side
What, for instance, would be the effect on the wages of engineers in emerging markets if labor costs were the most important factor for US companies choosing offshore locations? Our analysis shows that salary levels for engineers in the lowest-cost countries would likely double (exhibit). But salaries in emerging markets wouldn’t reach the prevailing level in the United States or Western Europe, since they will be capped at about 30 percent of average US wages, or the current level in Brazil and Mexico.
Local wage inflation will probably continue in some offshoring locations as long as the multinationals concentrate their demand in a few cities. Because of the sunk costs of setting up an offshore facility, if demand in that location begins to outstrip local supply, the wages paid by individual companies may rise above the levels prevailing in neighboring countries. Dispersing demand will slow down overheating in the hot spots.
Overall, although wages in the supply-side countries will probably rise, they won’t reach the level of wages in the demand-side countries.
On the demand side
Companies are moving their operations offshore at a slow pace, which means that over the next five years offshoring will have a negligible effect on overall employment in the demand-side countries for the occupations we analyzed.
Consider the impact in the United States. Over the past 30 years, the share of manufacturing jobs in total US employment has declined by 11 percentage points, to 21 percent, from 32 percent. By comparison, we estimate that only 9 percent of all US service jobs could, even in theory, be performed remotely, and it is unlikely that all of them will move offshore during the next 30 years. Wage levels too are unlikely to drop, for the same reason. Indeed, in the United States, growth rates for wages and the number of jobs in computer and data-processing services—a sector where offshoring is prevalent—are higher than those in the economy as a whole.1
This moderate impact and generally slow pace won’t soften the blow for people who do lose their employment to offshoring. A sustained effort to retrain them is likely to yield results, since most of them are college graduates.

I think this is much too narrow a view. There will be another effect as well: wage deflation in the West.
Management consulting firms to always paint a narrow picture without looking at social costs. Let’s talk about this again in three years. Predication: India will eat our lunch, China our dinner, and we’re going to eat one meal a day – breakfast – like the poor in so many third world countries.

Ratan Tata: The $2,200 “People’s Car”


Tata speaks about the Indian group’s international strategy, his plan to create a $2,200 “people’s car,” his vision of India as a knowledge center for the world, and his dedication to the social responsibilities required from companies operating in developing markets.
On the car:
“Today we’re producing a $7,000 car, the Indica. Here we’re talking about a $2,200 car, which will be smaller and will be produced in larger volumes, with all the high-volume parts manufactured in one plant. We’re also looking at more use of plastics on the body and at a very low-cost assembly operation, with some use of modern-day adhesives instead of welding. But the car is in every way a car, with an engine, a suspension, and a steering system designed for its size. We will meet all the emissions requirements. We now have some issues concerning safety, mainly because of the car’s modest size, but we will resolve them before the car reaches the market, in about three years’ time.
“In addition—and this again touches on the social dimension—we’re looking at small satellite units, with very low breakeven points, where some of the cars could be assembled, sold, and serviced. We would encourage local entrepreneurs to invest in these units, and we would train these entrepreneurs to assemble the fully knocked-down or semi-knocked-down components that we would send to them, and they would also sell the assembled vehicles and arrange for their servicing. This approach would replace the dealer, and therefore the dealer’s margin, with an assembly-cum-retail operation that would be combined with very low-cost service facilities.
On India:
“If we play our cards right as a country, we could be a supplier of IT services and IT solutions to the world. We could also be a product-development center for pharmaceuticals. We could be a very good global R&D center in biotechnology and in some of the emerging technologies, such as nanotechnology, provided we really give them the focus they would need.
On bringing talent back to India:
“Indians coming back to India really go through a cultural shock. They give up a lot in terms of the quality of life, the education of their children, the availability of medical facilities. This will also have an impact when we want to hire people who are not Indians, as we will have to do in a world without boundaries. Even if we start only with pockets of the country and make those pockets less of a cultural shock, the benefits will spread. In some ways, this is what China did with the economic zones.
On values:
“What I feel most proud of is that we have been able to grow without compromising any of the values or ethical standards that we consider important. And I am not harping on this hypocritically. It was a major decision to uphold these values and ethics in an environment that is deteriorating around you. If we had compromised them, we could have done much better, grown much faster, and perhaps been regarded as much more successful in the pure business sense. But we would have lost the one differentiation that this group has against others in the country. We would have been just another venal business house.
“I think it is wrong for a company in India to operate in exactly the same way, without any additional responsibilities, as if it were operating in the United States, let’s say. And even in the United States, I think if you had an enlightened corporation that went into the Deep South, you would see more of a sense of social responsibility, of doing more for the community, than the company might accept in New York City or Boston. Because it is inevitable that you need to be a good corporate citizen in that kind of environment. And companies that are not good corporate citizens—those that don’t hold to standards and that allow the environment and the community to suffer—are really criminals in today’s world.”
Read the McKinsey Quarterly article >>

Laurence Haughton on Peter Drucker

I received an email from Laurence
Haughton
, the author, on Peter Drucker.

With his permission, here it is:

It is now five days since Peter Drucker passed away and the tributes have
filled the air like so many streamers and confetti at a ticker tape parade.

According to columnists in journals and blogs Drucker was, “an American
sage,” “the uber-guru,” “profound,” and “a visionary.”

America’s two most popular business pundits agree. “[Drucker was]
the right man for our times,” wrote one. And the other was just as reverential,
“The most influential management thinker in the second half of the twentieth
century.”

But I don’t see it that way.

If Drucker was “the most influential” shouldn’t he have changed
a lot of executive behavior? If he truly was “profound” or the “right
man for our times” wouldn’t he have a lot of followers who practice
what he prescribed?

Peter Drucker is, as he himself once wrote about management sciences pioneer
Mary Parker Follett, the “most quoted and least heeded” teacher
of management.

Why he is so quoted is easy to understand. Pick up anything he wrote. I just
went back and skimmed through 1964’s “Managing for Results.”
You’ll find Drucker is incredibly insightful yet totally clear and practical.
He’s no ivory tower theorist. Drucker explains exactly what to do and
what not to do, giving systematic, logical, and consistent answers to all
the fundamental challenges of management. If you are opining about management,
he’s a perfect source to quote.

But as far as being heeded… I don’t think so. What company is managed
according to his prescriptions? What leader follows his clear, specific advice?
Frankly, is there anyone who gives him anything more than lip service?
Take just one of Drucker’s lessons. He criticized organizations who issued
directives to “cut 5 or 10 percent from budgets across the board.”
He said, “This is ineffectual at best and at worst, apt to cripple the
important, result-producing efforts that usually get less money that they
need to begin with.” Yet, when have you seen a company cut costs using
Drucker’s clear distinctions between efficiency and effectiveness instead
of the across-the-board cop out?

And I’ll bet others can find 100 additional quoted and ignored lessons
from Peter Drucker just like that one.
Years ago I was told “performance is the proof that the learning took
place.” If that’s true I’m sorry to say that despite all the
tributes, up to now, we’ve learned very little from Peter Drucker.

 

Rebranding Intel

“This might be the company’s most important makeover campaign ever.”
What’s the big deal? Apparently the Intel logo no longer has the “e” letter dropped, and the blue label is now wrapped around the corporate name.
The chip names are rebranded: single core Yonah processors will be named “Core Solo” and dual core versions will be called “Core Duo”.
Yawn.

Google Base: Googlespace & Open Knowledge Management

Another giant step in Googlespace?
“Help the world find your content. Google Base is a place where you can add all types of information that we’ll host and make searchable online.”
And so Google takes another step with another micro-service. Try it here.
And it’s not just about classifieds. It’s about Open Knowledge Management.
Wonder what Tom Davenport and Larry Prusak have to say about this… I’ll let you know when I find out.

The 7th Face of the Web: Googlespace

Back in 2000, Bill Joy, Sun’s Chief Scientist and co-founder, told people that the economic future of technology is rooted in the notion of what he called “the six Webs.”
– the “near” Web, the traditional desktop computing environment.
– the “far” Web, which includes simple interaction through, for example, a remote control while flipping through an interactive television screen.
– the “here” Web, or the industry of mobile Internet devices, which, Joy stresses are going to continue to grow in importance and popularity.
– the “weird” Web, or those systems of access that actually immerse the senses, like virtual reality or voice-activated surfing.
– the eCommerce (Business-to-Business) Web and, quite simply, the “pervasive computing” Web, or “the networks that connect people to other people and the information they need, enabling them to act on it anytime, anyplace.”
Today, there’s a 7th web- the “Search-driven” Web, i.e. the Googlespace. The “search-driven” web will bridge all 6 faces of Bill Joy’s web. And that’s why Microsoft is is trouble.
A simple way of looking at this: Joy’s 6 faces are technology or platform-based. This is the old geek view of technology- shared by Microsoft et al.
In reality, the user doesn’t care about platforms – just finding what they need- the “user-based” view. And that is fast becoming Googlespace.

The Hidden Drivers of Demand


Customer Value Engineering™ reveals what matters most, says MercerMC:
“Customers often start a negotiation by emphasizing price and product features. These things always matter, of course. But buying decisions encompass many other considerations, such as reliability, service arrangements, certainty of delivery date, and the opinions of users inside the organization or expert analysts.
“Cumulatively, these influences may account for 70% to 80% of the purchase decision. That’s why there is gold to be mined by truly understanding the customer’s world.
“The Customer Value Engineering approach goes beyond market research to uncover what customers will value and actually pay for, link these insights with the economics of the business, and create a process for building consensus and driving rapid implementation. It combines four capabilities:
– Uncovering the drivers of demand
– Segmenting customers in a smarter way than traditional categories of size or demographics
– Modeling the drivers of business economics to determine whether a given move will make or lose money
– Creating dynamic, robust modeling of the strategy that can evaluate “what if” scenarios and rapidly turn strategy into action with a minimum of risk
Download the article >>

The Birth of Internet TV: Finally!

AOL, Warner Bros Team for Online TV– In2TV.
The channels are:
– LOL TV (comedies such as Welcome Back Kotter, Perfect Strangers and Hangin’ With Mr. Cooper),
– Dramarama (Falcon Crest, Sisters and Eight Is Enough)
– Toontopia (animated shows like Beetlejuice and Pinky and the Brain)
– Heroes and Horrors (Wonder Woman, Lois & Clark: The Adventures of Superman and Babylon 5)
– Rush (action shows such as La Femme Nikita, Kung Fu and The Fugitive)
– Vintage (Growing Pains, F-Troop and Maverick)
Soon this will go global, and we’ll be able to watch TV from other countries on our “Internets.” Cricket, anyone?

The Remarkable Opportunities of Unbundled Media

Terry Heaton’s essay: TV News in a Postmodern World
“…driven by the very real demand of less time, we’ve begun the process of tasting that which is unbundled. We unbundle television shows by skipping the commercials with our DVRs. We unbundle CDs by downloading the songs we want. We unbundle the national media by subscribing to specific RSS feeds. The signs of a burgeoning unbundled media world are everywhere.”
What Terry doesn’t say: we are unbundling reality: our politics, our minds, our society, and our souls as well…

Mckinsey: Don’t blame trade for US job losses

Via outsourcingstrategy.org– from the McKinsey Quarterly:
“Many people in the United States have looked at the enormous US trade deficit and concluded that a flood of imported goods from China and the offshoring of services to India are to blame for the loss of US jobs. CNN’s Lou Dobbs has called the problem “a clear call to our business and political leaders that our trade policies simply are not working.”1 The issue isn’t the concern solely of US policy makers: the same fears about trade are rampant throughout Europe and Japan, while protectionist sentiment is rising around the world.
“But trade, particularly rising imports of goods and services, didn’t destroy the vast majority of the jobs lost in the United States since 2000. We analyzed detailed trade and industry data to estimate the extent of job dislocation due to offshoring in the manufacturing and service sectors from 2000 to 2003. This work was the first complete analysis of how the economic downturn, imports, exports, and global competition interact—directly and indirectly—to affect employment.
So who or what’s to blame? Read the article >>

Foreign Investors Lose Appetite for Treasuries as Deficit Rises

The U.S. government is growing more dependent on investors from abroad just as their appetite for Treasury securities is waning.
Overseas investors, who own half of all U.S. government debt, bought 14 percent of the $79 billion in benchmark 10-year notes auctioned this year, down from 21 percent in 2004, Treasury Department data show. Bidders including foreign central banks purchased a smaller percentage of the $44 billion in three-, five- and 10-year notes the Treasury sold last week than they did a year ago.
more from Bloomberg >>
Looks like interest rates will rise with or without inflation…

Gartner: Microsoft Far Behind

Gartner’s Nick Gall:
“I just played with Windows Live this morning, and it’s (so far) nothing but an AJAX-enabled portal – and a pretty poor one at that.
“I think the real news is how far behind Microsoft is. If this is all it has at this late stage of the consumer portal market, the company is really in trouble. With no synergy with the Windows OS or even IE (there’s not even a toolbar yet), and no compelling content on the site itself, what would possibly draw users from another consumer portal?
more>>
Microsoft is always slow. In the past they’ve always been great at catching up and passing their opponents. Google isn’t going to make the Netscape mistake, though!

Global Culture: Steel Pulse


How does a band like Steel Pulse make it?
Word-of-mouth plus quality…
They’ve been around forever [over 25 years], nobody plays them on the radio, and yet they’re everywhere. We do live in a global village. And David Hinds is a global voice.
Here’s a Steel Pulse history from NPR >> Check it!

Google Analytics: Another Dagger in the Heart of Microsoft?

Take a look- Google Analytics gives you a free ride into the world of web behavior, and it’s integrated w/ adwords.
Here’s the pitch:
Google Analytics tells you everything you want to know about how your visitors found you and how they interact with your site. You’ll be able to focus your marketing resources on campaigns and initiatives that deliver ROI, and improve your site to convert more visitors…. blah blah blah
So what’s really going on? Here’s what: Microsoft used to own your desktop, but Google will own your universe. Google will learn how users behave across websites, beating Alexa/Amazon.com at its own game and setting the stage for the final fight with Microsoft.
Every website manager will sign up for free, and Microsoft can them make them part of their network- from Adsense, to Adwords, to the applications which will replace Office.
BTW, did I forget to mention that Google is also buying cable companies? I’m sure Microsoft is freaking out right about now. This is going to be a war.
MEMO to Microsoft: guys, open up!!
On the privacy front:
# We may use personal information to provide the services you’ve requested, including services that display customized content and advertising.
# We may also use personal information for auditing, research and analysis to operate and improve Google technologies and services.
# We may share aggregated non-personal information with third parties outside of Google.
# When we use third parties to assist us in processing your personal information, we require that they comply with our Privacy Policy and any other appropriate confidentiality and security measures.
# We may also share information with third parties in limited circumstances, including when complying with legal process, preventing fraud or imminent harm, and ensuring the security of our network and services.
# Google processes personal information on our servers in the United States of America and in other countries. In some cases, we process personal information on a server outside your own country.

Do no evil, Google.

Jimmy Carter: A Voice in the Wilderness

Jimmy Carter’s op-ed in the LA Times is interesting.
Here we have a middle of the road, I’d even call it conservative, view of what’s wrong with us these days:
This isn’t the real America
By Jimmy Carter, JIMMY CARTER was the 39th president of the United States. His newest book is “Our Endangered Values: America’s Moral Crisis,” published this month by Simon & Schuster.
IN RECENT YEARS, I have become increasingly concerned by a host of radical government policies that now threaten many basic principles espoused by all previous administrations, Democratic and Republican.
These include the rudimentary American commitment to peace, economic and social justice, civil liberties, our environment and human rights.
Also endangered are our historic commitments to providing citizens with truthful information, treating dissenting voices and beliefs with respect, state and local autonomy and fiscal responsibility.
At the same time, our political leaders have declared independence from the restraints of international organizations and have disavowed long-standing global agreements — including agreements on nuclear arms, control of biological weapons and the international system of justice.
Instead of our tradition of espousing peace as a national priority unless our security is directly threatened, we have proclaimed a policy of “preemptive war,” an unabridged right to attack other nations unilaterally to change an unsavory regime or for other purposes. When there are serious differences with other nations, we brand them as international pariahs and refuse to permit direct discussions to resolve disputes.
Regardless of the costs, there are determined efforts by top U.S. leaders to exert American imperial dominance throughout the world.
These revolutionary policies have been orchestrated by those who believe that our nation’s tremendous power and influence should not be internationally constrained. Even with our troops involved in combat and America facing the threat of additional terrorist attacks, our declaration of “You are either with us or against us!” has replaced the forming of alliances based on a clear comprehension of mutual interests, including the threat of terrorism.
Another disturbing realization is that, unlike during other times of national crisis, the burden of conflict is now concentrated exclusively on the few heroic men and women sent back repeatedly to fight in the quagmire of Iraq. The rest of our nation has not been asked to make any sacrifice, and every effort has been made to conceal or minimize public awareness of casualties.
Instead of cherishing our role as the great champion of human rights, we now find civil liberties and personal privacy grossly violated under some extreme provisions of the Patriot Act.
Of even greater concern is that the U.S. has repudiated the Geneva accords and espoused the use of torture in Iraq, Afghanistan and Guantanamo Bay, and secretly through proxy regimes elsewhere with the so-called extraordinary rendition program. It is embarrassing to see the president and vice president insisting that the CIA should be free to perpetrate “cruel, inhumane or degrading treatment or punishment” on people in U.S. custody.
Instead of reducing America’s reliance on nuclear weapons and their further proliferation, we have insisted on our right (and that of others) to retain our arsenals, expand them, and therefore abrogate or derogate almost all nuclear arms control agreements negotiated during the last 50 years. We have now become a prime culprit in global nuclear proliferation. America also has abandoned the prohibition of “first use” of nuclear weapons against nonnuclear nations, and is contemplating the previously condemned deployment of weapons in space.
Protection of the environment has fallen by the wayside because of government subservience to political pressure from the oil industry and other powerful lobbying groups. The last five years have brought continued lowering of pollution standards at home and almost universal condemnation of our nation’s global environmental policies.
Our government has abandoned fiscal responsibility by unprecedented favors to the rich, while neglecting America’s working families. Members of Congress have increased their own pay by $30,000 per year since freezing the minimum wage at $5.15 per hour (the lowest among industrialized nations).
I am extremely concerned by a fundamentalist shift in many houses of worship and in government, as church and state have become increasingly intertwined in ways previously thought unimaginable.
As the world’s only superpower, America should be seen as the unswerving champion of peace, freedom and human rights. Our country should be the focal point around which other nations can gather to combat threats to international security and to enhance the quality of our common environment. We should be in the forefront of providing human assistance to people in need.
It is time for the deep and disturbing political divisions within our country to be substantially healed, with Americans united in a common commitment to revive and nourish the historic political and moral values that we have espoused during the last 230 years.

What’s wrong with us? Wake up, America!

ZIBS: The Latest Collection of Branding Articles

The Zyman Institute of Brand Science at Emory University just put out a collection of branding articles:
– “Branding as Cultural Activism” by Douglas Holt
– “The CEO as Brand Guardian” by Will Rodgers and Christian Sarkar
– “In Search of a Reliable Measure of Brand Equity” by Jonathan Knowles
– “How Market-based Assets Generate Customer Value” by Raj Srivastava
– “Brand Hijack: When Unintended Segments Desire Your Brand” by Greg Thomas
– “ZIBSForum: The Power of Retail Branded Experiences” by Sarah Banick
– “The Power of an Emotional Connection” by William J. McEwen
– “ZIBSFORUM: Emotion Mining – Leveraging the Emotions Underpinning Brand Behavior” by Greg Thomas
– “Restoring the Power of Brands” by John Hagel III
[OK- so I wrote one of ’em.]
Visit zibs.com

13 “Knuckleheads” from NY Show Us How to Win the War on Terror

Here’s a story that woke me up:
(CBS) Five weeks ago, an earthquake struck Pakistan, and then the event seemed to disappear. It disappeared from our newspapers, from our television screens and from our minds.
Perhaps it was just one natural disaster too many this year. But here’s the aftershock: the situation in Pakistan is worsening by the day. The death toll continues to rise and is now close to 90,000.
Three million people are still living without shelter and a harsh winter is weeks away. The United Nations says conditions in Pakistan are worse than after the tsunami and it is the biggest humanitarian nightmare the UN has ever dealt with.
Even if you’ve read about the earthquake, even if you’ve seen the pictures, nothing can prepare you for being there. It’s hard to imagine that all the destruction happened in two minutes.
The towns look like they had been bombarded by a brutal air force for weeks. It’s hard to believe that this happened five weeks ago. It could have been yesterday. Nothing has changed. Even the horizon is still strewn with rubble.
There are sights which defy belief. Streets are littered with clothing, sent up by charities and discarded by people. They don’t need tattered shirts. They need shelter, food, water, medical care.
The large relief agencies and governments are doing what they can in the cities and the towns, building tent cities for the homeless and handing out food.
But go up into the mountains and you will find a different story. Helicopters drop food to villages, but there are no relief workers on the ground. Except for 13 paramedics from New York City.
They came to Pakistan with no backing or support or agenda except to help. They wound up in Pakistani Kashmir, a disputed territory of undisputed beauty.
When they were dropped off here, Chris Summers was surprised to learn they were the only aid workers there. “I can’t believe we haven’t seen anyone else in this valley,” Summers says. “There’s such a need here. You know? And we’re isolated here. I don’t really know what’s happening in the rest of the country. But in this valley, Jeelum Valley, an enormous need and how is it possible that it’s just us, you know, 13 knuckleheads from New York here?”
Knuckleheads? This is Osama bin Laden country, dotted with training camps for jihadists, where Islam is at its most radical and America is seen as the enemy.
But now, people were walking for miles to be treated by the Americans. Some 200 a day were making their way to the clinic, people who were being cared for for the first time since the earthquake.

Listen to this:
And, as it learned in Indonesia, when the U.S. military went in after the tsunami, nothing does this as well as helping people after a disaster.
This is not why the New York medics came here, of course. They didn’t come to win hearts and minds, but to save lives. Hearts and minds just seemed to follow, and that’s fine with Steve Muth.
“We can inoculate an entire valley, if we’re lucky, against radical Islam,” says Muth. “And it’s so simple. I’m just a paramedic. It’s just a bandage. It’s not a $100 million dollar ad campaign from Madison Avenue. It’s not, you know, it’s not complicated. Could something work better to change somebody’s mind? I can’t think of anything.”

C’mon USA, we can do this. Karen Hughes, are you on it?

Best Drucker Obituary: FT

And the award for the best Peter Drucker obituary goes to- Simon London of the Financial Times:
Peter Drucker, who has died at the age of 95, hated being labelled as a “guru”. But that is what he was for thousands, probably millions, of managers. Never mind that the dictionary definitions of the word range from “venerable” and “weighty” to “mediator of divine truth.” To Drucker, guru was synonymous with “charlatan”. He preferred to be known, he often said, as “just an old journalist”.
As so often in his life, he was indulging not so much in false modesty as in good-humoured self-mockery. For he was manifestly very much more than that.
To his many admirers, in Asia almost as much as his native Europe (he was born in Vienna) and his adoptive United States, he was the grand old man of provocative theory and thoughtful practice. He could always be relied upon to provide a helping hand through the latest trends in politics, society, economics, and especially business.
For people whose only exposure to his work was a single article or speech, his constant use of the quick insight, the aphorism, the analogy and the metaphor sometimes created an impression of glibness. But Drucker saw this as an occupational hazard of communicating clearly about complex issues.
From his early writing days as a journalist in the 1930s to the very last years of his life, with several professorships and three dozen respected books behind him, he continued to believe that the best ideas have to be simplified, often to the limit, in order to be effective. When criticised in the 1980s for writing a cursory newspaper article about “the five rules of successful acquisitions”, he grinned ruefully and pronounced in typically gnomic Drucker-ese: “My best ideas have only one moving part.”
That hardly did justice to the erudition and sense of perspective which underpinned his commentary. His cool, deliberate analysis whether of “pork-barrel” politics, post-communist economics, or a range of management topics from leadership to productivity, motivation to marketing was peppered with a constant flow of vivid references and parallels drawn from history, and from fields as diverse as medicine, music, even the nursery.
Talking about the importance of entrepreneurship and innovation which occupied him powerfully in his later years, along with the growth of what he called “knowledge work” and management’s wider role in society he revelled in such observations as “for the first four years, no new enterprise produces profits. Even Mozart didn’t start writing music until he was four”.
Such bon mots were often more scurrilous, as in his remark that Friedrich Engels might never have made his seminal observations of the British working class if his sexual behaviour had not so scandalised his parents that they sent him out of his native Germany. Told in Drucker’s strongly accented English, such stories produced a mixture of hilarity and wonder in his audiences.
He was certainly “one of the last encyclopaedics”, as he was introduced at a conference a few years ago. His knowledge reached far beyond the world of affairs, deeply into literature, biology and even Oriental art in which he was recognised as an authority even by the Japanese.
One of the most thoughtful analysts of Drucker’s contribution to management, Alan Kantrow, says that “many of his ideas have become part and parcel of today’s commonsense understanding of business. He had a pervasive influence.” Though by no means all his ideas were original, Drucker’s real value, says Kantrow, lay in the rigour with which they were formulated. “One could learn more and more deeply from watching him think than from studying the content of his thought.”
For decades, many managers did just that. Whether they worked for Shell, Gillette, a British bank, a German engineering company, a large hospital complex, or a medium-sized shipping company, they paid repeat visits to sit at his feet, or buy his latest book. One such executive talked of needing his “Drucker fix” every two or three years.
Drucker’s reputation, among many practitioners and theorists alike, as the father of post-war management went back to two of his early works, “Concept of the Corporation” in 1946, and “The Practice of Management” in 1954.
The former, a study of the workings of General Motors, was the first detailed account of the way a large company operated. The latter contained pathfinding work on such varied topics as the key role of marketing; the importance of clear objectives, both for the corporation and for the manager; and the need to balance long-term strategy and innovation against short-term performance.
This early work laid the foundation for such basic principles of modern business as asking: “What business are we in, and who are our customers?” It dealt with the recruitment and development of executives, the proper role of boards of directors, the defence of profits as an essential foundation of future survival, and the development of the responsible and productive worker.
Only on the last of these counts did Drucker’s principles fail to be translated into practice. In a mid-1980s interview he called this “my most conspicuous failure”, grumbling that “only now that Japan has shown the way is it being taken seriously” in Europe and the US.
It was Drucker’s ability to examine complex issues in depth, while also relating them to each other, that had such a strong influence on the study of management. Yet this landed him in bad odour with most business academics. “He is vastly undervalued by most academics”, Tom Peters, the management writer and Drucker disciple, said a few years ago. In several years at Stanford University, first as a masters student and then as a doctoral candidate, Peters found that “Drucker wasn’t mentioned once. None of his work was on our reading lists”.
Things were little better at Harvard. Even though it offered him a professorship four times, Drucker chose instead to take up appointments at lesser institutions. Nor does Drucker rate much of a mention in most histories of management thought. All that is in spite of the fact that, as Peters puts it, “Drucker was the first to provide an intellectual framework to analyse the corporation”.
Drucker’s own explanation of his relations with academia was revealing, not only of his own character and that of the university system, but of the nature of high-class gurudom. “Earlier theorists wrote only for a small circle their jargon was often impenetrable,’ he said.
“I put together the bits and pieces of the jigsaw, including what was missing, such as the role of top management, strategy, management-by-objectives, entrepreneurship and innovation. I went to work on it and built a discipline. But I have a deep horror of obscurity and arrogance, so I presented it in a form that people could apply. I don’t believe in specialisation, and academia has always resented that.”
In the words of Tom Peters: “Drucker effectively by-passed the intellectual establishment. So it’s not surprising that they hated his guts.”
With the passing of the years, however, relations became a little less strained. Unlike most of the previous generation, several of the top business academics who came to prominance in the 1980s and 90s paid tribute to Drucker’s impact on their own work. Rosabeth Moss Kanter, of Yale and then Harvard, admitted to having been influenced heavily by Drucker’s early writings and praised his “remarkable” sense of being able to foretell the future.
Yet not everyone agreed. Despite Drucker’s protestations about the importance of small business, he remained identifed with the notion that the large corporation was the centre-piece of society. And, right to the end of his life, he was typecast as having an excessively rational view of the management process.
Moreover, despite his praise ever since 1954 for Douglas McGregor’s “Theory Y”, Drucker did not seem to fit comfortably into the school of enlightened motivation, which blossomed into management theories of worker ’empowerment’. He tended to use tell-tale phrases such as “the basic task of management is to make (our italics) people productive”. Peters, Moss Kanter et al would prefer the verb “encourage”. In the words of one long-standing student of Drucker’s writing, “he was always a bit too top-down”.
In one sense, Drucker could be accused of having lost something of his intellectual vitality in his earlier years. Today’s business community is searching for more advice on how to stimulate entrepreneurship and innovation, and how to manage joint ventures and strategic alliances. Drucker was writing about such issues extensively right up to his death, yet his basic view, expressed several years ago, was “we already know how to do all that just organise yourself properly”.
Right across the management spectrum, he claimed, “the academic work that’s being done is on perfecting things it’s variations on themes we all discovered some time ago”. Business studies had therefore entered a long and rather sterile period, he argued. The main exception to this view of the rather arid future of management studies concerned management as a social function. “We have become a society of organisations,” he used to say, in what became a familiar Druckerism. “Yet who takes care of the public good?”
The need for much better management extended not only to private enterprise, he argued, but also to the public sector and, much more broadly, to the body politic itself. In a memorable phrase, he said “politics has become the theatre of the absurd, with politicians declaiming in front of an empty audience, just like the Comédie Française. There’s a new pluralism in society that we don’t understand but that we have to make work”.
In his last few years, Drucker felt increasingly in common, to some extent, with Britain’s Charles Handy that the major new challenges for management lie well beyond its commonly accepted field of operations. In the process of developing into “the distinct organ of our society” over the past 50 years, management had become intricately bound up with political, legal and social issues. It had, in other words, become “affected with the public interest”. To work out what that implied, for both theory and practice, would constitute the prime management agenda of the next 50 years, he forecast.
Peter Drucker might have ended his life a little weary of the “old” issues, as he saw them, but, half a century after his first breakthrough into management, he was still extending its boundaries with his customary energy and clarity of mind.

What Happened to Nathan Myhrvold

The article I mentioned in the previous post also mentions Nathan Myhrvold:
Nathan Myhrvold, part of Microsoft’s early brain trust and the former head of its heavily endowed research arm, founded Intellectual Ventures, a fund that he says spends “millions of dollars” annually to support individual inventors in long-term projects. Mr. Myhrvold started his fund about five years ago after he retired from Microsoft; he now backs about 20 inventors in such fields as nanotechnology, optics, computing, biotechnology and medical devices.
“As far as we know, we’re the only people who are doing this – which means we’re either incredibly smart or incredibly dumb,” Mr. Myhrvold said. “There’s a network of venture capitalists for start-ups that have created thousands and thousands of businesses, but very little for inventors.”
Mr. Myhrvold says that most public and academic grants are for investigating well-defined research problems – and not for backing, as he does, “an invention before it exists.” His staff of about 50 people files about 25 patent applications a month on behalf of inventors and his fund. He and his staff also help inventors refine ideas, pay for their time and labor and share ownership stakes in projects with them.
“We all love the goose that lays the golden eggs but somehow we’ve forgotten about the goose,” Mr. Myhrvold said. “This decade I’m hoping will be the decade of the invention.”
Very cool:
Intellectual Ventures is an invention company. We conceive and patent our own inventions in-house through a world-renowned staff of internal and external scientists and engineers. We also acquire and license patented inventions from other inventors around the world. Our network of invention sources includes: large and small businesses, governments, academia, and individual inventors. These inventions span a diverse range of technologies including: software, semiconductors, wireless, consumer electronics, networking, lasers, biotechnology, and medical devices. Our current focus is on developing our invention portfolio. Over time, we intend to market our portfolio on a broad and non-exclusive basis through a variety of channels including spin-out companies.
A new intellectual-property business model.

Have We Given Up on Science?

Are U.S. Innovators Losing Their Competitive Edge? asks as article in today’s New York Times.
The article cites a report from the National Academy of Sciences which tries to ring the alarm: “Although many people assume that the United States will always be a world leader in science and technology, this may not continue to be the case inasmuch as great minds and ideas exist throughout the world. We fear the abruptness with which a lead in science and technology can be lost – and the difficulty of recovering a lead once lost, if indeed it can be regained at all.”
The report cites China and India among a number of economically promising countries that may be poised to usurp America’s leadership in innovation and job growth.
“For the first time in generations, the nation’s children could face poorer prospects than their parents and grandparents did,” the report said. “We owe our current prosperity, security and good health to the investments of past generations, and we are obliged to renew those commitments.”
The Industrial Research Institute, an organization in Arlington, Va., that represents some of the nation’s largest corporations, is also concerned that the academic and financial support for scientific innovation is lagging in the United States. The group’s most recent data indicate that from 1986 to 2001, China, Taiwan, South Korea and Japan all awarded more doctoral degrees in science and engineering than did the United States. Between 1991 and 2003, research and development spending in America trailed that of China, Singapore, South Korea and Taiwan – in China’s case by billions of dollars.
Read the report. Here’s the TOC:
1 A Disturbing Mosaic
2 Why Are Science and Technology Critical to America\’s Prosperity in the 21st Century
3 How is America Doing Now in Science and Technology
4 What Actions Should America Take to Remain Prosperous in the 21st Century
5 Ten Thousand Teachers-Ten Million Minds
6 Sowing the Seeds
7 Best and the Brightest
8 Innovation Incentives
9 What Might the United States Be Like if it is Not Competitive in Science and Technology
Ouch!
BTW, the National Academy of Sciences also has this report available online: Science and Creationism: A View from the National Academy of Sciences, Second Edition (1999)
Heck, just listen to what Peter Drucker had to say.
All is not lost, yet. But we took a wrong turn somewhere.
The article raises another point:
“The inventiveness of individuals depends on the context, including sociopolitical, economic, cultural and institutional factors,” said Merton C. Flemings, a professor emeritus at M.I.T. who holds 28 patents and oversees the Lemelson-M.I.T. Program for inventors. “We remain one of the most inventive countries in the world. But all the signs suggest that we won’t retain that pre-eminence much longer. The future is very bleak, I’m afraid.”
Mr. Flemings said that private and public capital was not being adequately funneled to the kinds of projects and people that foster invention. The study of science is not valued in enough homes, he observed, and science education in grade school and high school is sorely lacking.
But quantitative goals, he said, are not enough. Singapore posts high national scores in mathematics, he said, but does not have a reputation for churning out new inventions. In fact, he added, researchers from Singapore have studied school systems in America to try to glean the source of something ineffable and not really quantifiable: creativity.
“In addition to openness, tolerance is essential in an inventive modern society,” a report sponsored by the Lemelson-M.I.T. Program said last year. “Creative people, whether artists or inventive engineers, are often nonconformists and rebels. Indeed, invention itself can be perceived as an act of rebellion against the status quo.”
Which brings us to Richard Florida