Truth...from Om Malik at GigaOm
"Sitting on the very bumpy flight back from New York to San Francisco, I finally had a chance to catch up on all the hullaballoo around the newly launched Color app. With the stunning amount of cash the company raised from white-shoe venture firm Sequoia Capital and the big-name founding team, not to mention the help of a VP of communications and marketing amongst its ranks, team Color got everybody’s attention.
But it was for all the wrong reasons. I say that because the only attention any app needs is from the end users. After reading Jason Kincaid’s write-up, I downloaded the location- and socially-aware photo-sharing app, but found it as barren as the endless sands of the Sahara. Some say that will change in time as more people show up on the service.
But lost in this back and forth is a bigger problem encompassing the entire web and mobile ecosystem. The Color app faces the same challenge as many of today’s mobile apps: How can it earn a user’s attention in a world that is increasingly crowded with options? In fact, you can extend that argument to any consumer service: new appliances, new devices and media entities new and old.
These services are like the flickering, flashing and constantly changing billboards that plaster the buildings around Times Square: It’s almost impossible to focus on any one of them. Some are bigger, some are brighter, but most are completely forgettable. That, unfortunately, holds true for today’s web and mobile services.
Many entrepreneurs and their backers don’t quite give the proper weight to “attention.” If a new startup can carve out time in our Facebook- and Twitter-dominated, CityVille-playing, Lady Gaga-listening, Rebecca-Black-video-sharing day, then it should really be the one to watch.
Instagr.am is one of those apps that managed to figure out a way to squeeze itself into our busy lives. It has several million users now, and only a few thousand of them are what would be described as technology insiders. Similarly, Beluga (acquired by Facebook), Spotify, Evernote and Instapaper have found a way to draw attention (and thus usage) from its users.
Do they need to displace something from our daily web/mobile app die? I don’t know. I do know that I have not opened PicPlz for nearly a month, despite the service sending me repeated email notifications. Compared to Skype, Nimbuzz gets more of my attention because it allows me to send instant messages to my colleagues via Google Talk. As a result, I end up using its call-out service more often than Skype to place long-distance calls.
Looking at all of these examples, I see two clear reasons why these services have my attention:
Happiness (alternately, enchantment)
Utility (alternately, solving a problem)
I am currently reading two books that address these issues. Typically, these aren’t the kind of business books I read; I like books that are about explicit learning. Nevertheless, these books were from two guys who are extraordinarily nice and thus worth a read.
Guy Kawasaki, a former Apple evangelist turned self-evangelist has a new book out, Enchantment. When you take away the marketing babble, what Kawasaki is saying is that as long as you delight your customers, they are going to reward you with their attention, and hence their dollars.
Guy learned that lesson from Apple. Most of us think Apple is in the business of making hardware. Nope; Kia and Dodge are in the business of hardware. Apple is in the business of happiness. It’s the first and foremost emotion associated with an Apple product. The rest of the business is just the formality of handing over your credit card to the annoyingly smug guy at the Apple store.
This also applies to Bose audio systems. As an audiophile, I cringe at the very idea of Bose speakers. My brother-in-law hears a simple way to find audio bliss. The world, fortunately for Bose, is full of people like my brother-in-law.
One of the reasons Instagr.am works is because it has that “happiness” attached to it. When I see my friend’s baby boy, it brings me joy. I see Mathew Ingram at an ice hockey game, and it warms my heart to see him enjoying time with his family. I reward Instagr.am with my attention because it makes me happy. That is its utility.
This is the emotion at the heart of Gary Vaynerchuck’s idea of The Thank You Economy, in which the companies that provide the most value to their customers win. It’s a quaint notion, as old as the first bazaar, but somehow it got lost in postindustrial over-commercialization.
When I use Marco Arment‘s Instapaper, I quietly thank him, pretty much every single time. Why? Because he solved a problem for me and made my life more manageable. As a result, I gladly upgraded to the paid version of the app. And when I’m not saving or reading articles using Instapaper, I’m telling everyone I can tell: Try it. That’s what the “thank you economy” really is: me doing marketing for a product I have only an emotional or utilitarian connection to.
I look at all these great tablets coming to market. They are feature-laden, power-packed, and have bundles of computing oomph. And yet, they will all struggle because the makers are all looking through the wrong end of the telescope. My friend Pip Coburn emailed me, pointing out that people with iPads are the ultimate commercial for the device. The more people who have them, the more people want them. “People will trust other people who do not carry an agenda to build revenues and manipulate you,” Pip wrote. Bing!
Don’t believe me? Put all the things that are part of your daily routine into these two buckets — happiness and utility — and you will see it for yourself that in the end those two are the driving forces behind a successful app, service, device or media property.
So when it comes to services like Path, PicPlz and now Color, I’m not a hater. It’s actually worse. I don’t really care. Why? Because these apps lack the empathy that drives constant interaction. You can’t buy empathy with a $100 million valuation or $41 million in the bank. And you certainly can’t ensure happiness with a resume and an executive team.
Mar 26, 2011
Far From Ordinary People: How Far Should One Push the Concept of Corporations Having the Same Rights As Individuals
The US Supreme Court ruled that corporations are 'people' under the law, thereby enjoying the same rights as individual citizens. No, this was not within the historical framework of American law. It was, according to most observers, an act of conservative judicial activism unrivaled in recent memory. The point, from an idealogically-dominated court, was to reinforce their belief in the primacy of corporate interests in American life.
In the following essay from the Economist, the question is asked whether this doctrine may have been taken too far, even for supportive business interests:
"Over the past year and a bit the United States Supreme Court has produced two landmark rulings on the metaphor at the heart of corporate law: the idea that companies are legal persons. Unfortunately, the rulings point in opposite directions. In Citizens United (2010) the court ruled that the constitution’s first amendment guarantees companies the same right to free speech as flesh-and-blood people. This means they have the same right as individuals to try to influence political campaigns through advertisements. But in a case involving AT&T the court ruled this month that the company has no right to personal privacy.
The legal conceit that companies are natural persons is vital to capitalism. It simplifies litigation greatly: companies can act like individuals when it comes to owning property or making contracts. Timur Kuran of Duke University argues that the idea of corporate personhood goes a long way to explaining why the West pulled ahead of the Muslim world from the 16th century onwards. Muslim business groups were nothing more than temporary agglomerations which dissolved when any partner died or withdrew. Legal personhood gave Western firms longevity.
The concept of companies as people became ever more vital as capitalism developed. Until the mid-19th century companies (as opposed to partnerships) were regulated by corporate charters which laid down tight rules about what they could do. But reformers used the idea that companies, like people, should be captains of their own souls, to free them from these restrictions. The result of this liberation was an explosion of energy: Western companies turbocharged the industrial revolution and laid the foundations for mass prosperity.
America’s legal system has been forced to grapple with the meaning of corporate personhood more thoroughly than other countries’ courts have done, because the constitution is so specific about the rights it bestows on people. And for the most part the Supreme Court has been generous in extending the rights of flesh-and-blood people to artificial persons (which include trade unions and other collectives as well as corporations). In Santa Clara County v Southern Pacific Railroad in 1886, for example, it ruled that companies enjoy the protections of the 14th amendment (including due process and equal protection under the law).
Yet these artificial persons have always provoked worries, too. Aren’t they likely to use their collective muscle to trample over the little people? And won’t they invoke the rights of ordinary people without burdening themselves with the responsibilities? These worries started in Britain in the age of chartered corporations. In the 17th century Sir Edward Coke, a jurist, complained that “they cannot commit treason, nor be outlawed, nor excommunicated, for they have no souls.” But the complaints have grown louder as companies have been freed from their charters and the Supreme Court has reinforced their rights.
Some critics of corporations have also put the idea of corporate personhood to their own uses. Joel Bakan, a legal academic, has produced a book and a film—both called “The Corporation”—which argue that, if companies are people, they are particularly dysfunctional and irresponsible ones. In the film, he even consults a psychiatrist who argues that companies display all the characteristics of a psychopath: callous disregard for others’ feelings, inability to maintain relationships, a willingness to bend any rule and break any law if it advances their interests, and an obsession with amassing power and money.
This is overheated rhetoric, to be sure. But you do not have to be a radical to worry about the might of organisations that can live for ever and take up residence in dozens of countries at once. Nor is it unreasonable to wonder why the idea of corporate personhood should only cut one way: if companies enjoy the same rights as flesh-and-blood humans then shouldn’t they be under the same obligations? The conservative majority on the Supreme Court is in danger of digging a trap for itself: strengthening the arguments of people who insist that companies have a moral duty to pursue social rather than merely business ends.
Don’t take it personally
The court knows it can take the analogy too far. It has ruled against companies being allowed to take the fifth amendment (against self-incrimination). It has restricted companies’ rights to make political contributions: for example, they cannot give donations directly to individual candidates. In the AT&T decision John Roberts, the chief justice, devoted a lot of effort to demonstrating that “personal” is more than an adjectival offshoot of “person”: when a company’s boss asks his finance director a “personal” question he is not likely to be asking about the company’s balance-sheet. Indeed, the term “personal” is frequently used to mean the very opposite of “corporate”. But all this umming and erring confuses more than it clarifies.
What would help is if the Supreme Court (and indeed corporate law in general) adopted a clear principle when it comes to the analogy between artificial persons and real ones: that companies should be treated as people only in so far as it is expedient. They clearly need to be able to enter into contracts just like individuals. But they should not be treated as if they experience such essentially human emotions as embarrassment and a desire for self-expression. Thus they should not have the same rights to privacy and political freedom as a citizen, but should have only as much of a right to confidentiality and political participation as is helpful for the efficient functioning of business (including letting firms contribute to the public debate on the regulation of business). Companies—or rather their bosses and owners—should welcome such constraints: any further “rights” would, sooner or later, be matched by onerous responsibilities.
In the following essay from the Economist, the question is asked whether this doctrine may have been taken too far, even for supportive business interests:
"Over the past year and a bit the United States Supreme Court has produced two landmark rulings on the metaphor at the heart of corporate law: the idea that companies are legal persons. Unfortunately, the rulings point in opposite directions. In Citizens United (2010) the court ruled that the constitution’s first amendment guarantees companies the same right to free speech as flesh-and-blood people. This means they have the same right as individuals to try to influence political campaigns through advertisements. But in a case involving AT&T the court ruled this month that the company has no right to personal privacy.
The legal conceit that companies are natural persons is vital to capitalism. It simplifies litigation greatly: companies can act like individuals when it comes to owning property or making contracts. Timur Kuran of Duke University argues that the idea of corporate personhood goes a long way to explaining why the West pulled ahead of the Muslim world from the 16th century onwards. Muslim business groups were nothing more than temporary agglomerations which dissolved when any partner died or withdrew. Legal personhood gave Western firms longevity.
The concept of companies as people became ever more vital as capitalism developed. Until the mid-19th century companies (as opposed to partnerships) were regulated by corporate charters which laid down tight rules about what they could do. But reformers used the idea that companies, like people, should be captains of their own souls, to free them from these restrictions. The result of this liberation was an explosion of energy: Western companies turbocharged the industrial revolution and laid the foundations for mass prosperity.
America’s legal system has been forced to grapple with the meaning of corporate personhood more thoroughly than other countries’ courts have done, because the constitution is so specific about the rights it bestows on people. And for the most part the Supreme Court has been generous in extending the rights of flesh-and-blood people to artificial persons (which include trade unions and other collectives as well as corporations). In Santa Clara County v Southern Pacific Railroad in 1886, for example, it ruled that companies enjoy the protections of the 14th amendment (including due process and equal protection under the law).
Yet these artificial persons have always provoked worries, too. Aren’t they likely to use their collective muscle to trample over the little people? And won’t they invoke the rights of ordinary people without burdening themselves with the responsibilities? These worries started in Britain in the age of chartered corporations. In the 17th century Sir Edward Coke, a jurist, complained that “they cannot commit treason, nor be outlawed, nor excommunicated, for they have no souls.” But the complaints have grown louder as companies have been freed from their charters and the Supreme Court has reinforced their rights.
Some critics of corporations have also put the idea of corporate personhood to their own uses. Joel Bakan, a legal academic, has produced a book and a film—both called “The Corporation”—which argue that, if companies are people, they are particularly dysfunctional and irresponsible ones. In the film, he even consults a psychiatrist who argues that companies display all the characteristics of a psychopath: callous disregard for others’ feelings, inability to maintain relationships, a willingness to bend any rule and break any law if it advances their interests, and an obsession with amassing power and money.
This is overheated rhetoric, to be sure. But you do not have to be a radical to worry about the might of organisations that can live for ever and take up residence in dozens of countries at once. Nor is it unreasonable to wonder why the idea of corporate personhood should only cut one way: if companies enjoy the same rights as flesh-and-blood humans then shouldn’t they be under the same obligations? The conservative majority on the Supreme Court is in danger of digging a trap for itself: strengthening the arguments of people who insist that companies have a moral duty to pursue social rather than merely business ends.
Don’t take it personally
The court knows it can take the analogy too far. It has ruled against companies being allowed to take the fifth amendment (against self-incrimination). It has restricted companies’ rights to make political contributions: for example, they cannot give donations directly to individual candidates. In the AT&T decision John Roberts, the chief justice, devoted a lot of effort to demonstrating that “personal” is more than an adjectival offshoot of “person”: when a company’s boss asks his finance director a “personal” question he is not likely to be asking about the company’s balance-sheet. Indeed, the term “personal” is frequently used to mean the very opposite of “corporate”. But all this umming and erring confuses more than it clarifies.
What would help is if the Supreme Court (and indeed corporate law in general) adopted a clear principle when it comes to the analogy between artificial persons and real ones: that companies should be treated as people only in so far as it is expedient. They clearly need to be able to enter into contracts just like individuals. But they should not be treated as if they experience such essentially human emotions as embarrassment and a desire for self-expression. Thus they should not have the same rights to privacy and political freedom as a citizen, but should have only as much of a right to confidentiality and political participation as is helpful for the efficient functioning of business (including letting firms contribute to the public debate on the regulation of business). Companies—or rather their bosses and owners—should welcome such constraints: any further “rights” would, sooner or later, be matched by onerous responsibilities.
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Appearance vs Reality: Shareholders & Ownership
Robert Monks is the dean of corporate governance experts. In this statement from his blog he comments on the growing chasm between the meaning of being a shareholder and the realities of ownership in 2011.
"Adolph Berle wrote 80 years ago about “...the dissolution of the old atom of ownership into its component parts, control and benefit ownership.” Very crudely this means there are owners who only want a return on their investment and there are owners who want to have a say in how their investment is used.
These two very broad umbrella categories cover a myriad of interests held by owners. Ira Millstein’s telling metaphor describes shareholders as a zoo comprised of animals with very different dispositions and appetites (Charkham Memorial Lecture, 2008). Like any other cross section of society, owners are a diverse group with diverging (and conflicting) interests. And, since modern ownership sometimes amounts to short term holdings managed by computer algorithms, people do not always see themselves as owners (indeed, even if they ever know of this “ownership”).
The Delaware Chancery Court has recently identified two different categories of shareholder – arbitrageurs and the rest – in holding that the board acts correctly in serving the interest of the rest (Air Products v. Airgas). In my opinion, if a court is at liberty to decide which category of shareholder a director is obligated to serve, the disciplining impact of “hostile takeovers” is diluted significantly.
Under the present conditions where shareholders do not share a common interest - indeed, their interests may be diametrically opposed - the traditional pillar of corporate law and governance that accountability to ownership is the duty of management must be crumbling. And without the involvement of active and engaged shareholders, the entire corporate system lacks its basic foundation.
Where there is no identifiable group on whom to focus the fiduciary responsibilities of management, a new basis for corporate legitimacy is needed.
Here are my questions:
1. What do owner and shareholder mean in regards to corporations and governance?
2. Can we lump all stock owners together or do we need multiple classes of stock to accommodate owners with different levels of interest and participation?
3. To whom does management owe fiduciary duty when considering the interest of owners? Does having one class of ownership work in management’s favor because it keeps shareholders from ever truly working together to enact change?
4. How can you have “shareholder responsibility” when there is no possibility of shareholders having a common interest and working together. Because there are today so many different classes and categories of shareholders – arbs, derivatives, borrowed stock, etc – that common purpose is impossible.
"Adolph Berle wrote 80 years ago about “...the dissolution of the old atom of ownership into its component parts, control and benefit ownership.” Very crudely this means there are owners who only want a return on their investment and there are owners who want to have a say in how their investment is used.
These two very broad umbrella categories cover a myriad of interests held by owners. Ira Millstein’s telling metaphor describes shareholders as a zoo comprised of animals with very different dispositions and appetites (Charkham Memorial Lecture, 2008). Like any other cross section of society, owners are a diverse group with diverging (and conflicting) interests. And, since modern ownership sometimes amounts to short term holdings managed by computer algorithms, people do not always see themselves as owners (indeed, even if they ever know of this “ownership”).
The Delaware Chancery Court has recently identified two different categories of shareholder – arbitrageurs and the rest – in holding that the board acts correctly in serving the interest of the rest (Air Products v. Airgas). In my opinion, if a court is at liberty to decide which category of shareholder a director is obligated to serve, the disciplining impact of “hostile takeovers” is diluted significantly.
Under the present conditions where shareholders do not share a common interest - indeed, their interests may be diametrically opposed - the traditional pillar of corporate law and governance that accountability to ownership is the duty of management must be crumbling. And without the involvement of active and engaged shareholders, the entire corporate system lacks its basic foundation.
Where there is no identifiable group on whom to focus the fiduciary responsibilities of management, a new basis for corporate legitimacy is needed.
Here are my questions:
1. What do owner and shareholder mean in regards to corporations and governance?
2. Can we lump all stock owners together or do we need multiple classes of stock to accommodate owners with different levels of interest and participation?
3. To whom does management owe fiduciary duty when considering the interest of owners? Does having one class of ownership work in management’s favor because it keeps shareholders from ever truly working together to enact change?
4. How can you have “shareholder responsibility” when there is no possibility of shareholders having a common interest and working together. Because there are today so many different classes and categories of shareholders – arbs, derivatives, borrowed stock, etc – that common purpose is impossible.
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US-China Relations: Establishing Trust
Frenemies is a term that has both business and diplomatic meaning. It refers to the contemporary fact of life that one's competitors may also be crucial allies. The world is simply too complicated to easily categorize such relations. Shen Dingli offers some thoughtful suggestions about the implications for Chinese-US relations in The Diplomat:
"Competing visions and expectations complicate China-US ties. They need to try and walk in each other’s shoes, argues Shen Dingli.
It has been ‘normal’ in recent decades for China-US relations to experience regular turbulence. Although the two countries have frequently collaborated on issues of common interest, they have also faced setbacks as they’ve tried to advance their own economic prosperity and national security.
The key reason for the ups and downs in this complex relationship has been a combination of contradictory expectations and a lack of real trust. On the one hand, the two countries still hope that the other will act responsibly when it comes to the big decisions. And yet despite such hopes, they still seem destined to constantly hedge against each other, in both domestic and foreign policy.
The fact that China and the United States have so often been forced to confront major crises in ties, despite efforts to create a relationship that isn’t constantly hijacked by individual events, has been damaging not only to bilateral relations but also to their own security and welfare.
So what’s behind the trust deficit, and is there any chance for improvement?
One fundamental reason for the periodic clashes is diverging values and interests, which means there are times when the two find it difficult to read each other’s intentions. Such differences have at times prevented them from developing common values and sharing core interests.
For example, China has stressed its core national interests as being institutional security, economic development and territorial integrity. Among these, institutional security has been the most important, with serving the people supposedly its primary tenet. Indeed, from anti-feudalism to anti-imperialism, from anti-warlordism to anti-colonialism and anti-hegemonism, China has experienced some genuine changes. But they are also changes on a path toward change, and it’s possible that the United States simply does not recognize this particular platform of democracy.
I hope that eventually, the American people will become more objective in judging the performance of the Chinese system (and that they’ll also better understand China’s criticisms of the United States’ own civil rights problems, such as racial discrimination, as an effort to encourage US advances in social reforms). As China develops and grows in confidence, its leaders should also find themselves better able to review foreign critiques, including from the United States.
There is a Chinese saying: ‘Modesty helps one go forward, whereas conceit makes one lag behind.’ Through criticism and self-criticism, China and the United States are learning to treat each other more equally, and to respect the other’s institutions. Despite a strained year in 2010, there have been some encouraging signs of progress recently, underscored by the state visit to Washington last month by President Hu Jintao.
But building on these improvements won’t be easy as the two countries explore the boundaries and compatibility of their ‘core interests.’ On the Chinese side, despite more international exchanges and greater cooperation being crucial to China’s continued growth, it also needs to consider how best to protect its nationals and overseas investments. With this in mind, it’s understandable why China feels inclined to build a more capable defensive capacity in order to protect its off-shore interests. But if China also wants to build trust with the United States, it would do well to explain its objectives and plans more clearly to avoid any misunderstandings and misjudgements.
Correspondingly, China must also try to understand legitimate US desires–especially its long-stressed notion of freedom of navigation on the open seas. The United States has long monopolized the oceans, including in Asia, a reality that has prompted concerns among Chinese policymakers that the United States has been policing international waters merely for its own benefit.
But with China growing rapidly economically, and with it being increasingly inclined to tap the ocean for its resources and access, freedom of navigation is becoming less of a US-led privilege, a shift that poses genuine challenges for the China-US relationship. The United States appears anxious, for example, about China’s intention over a number of its Exclusive Economic Zones (EEZs). The associated mutual suspicions, if uncontained, could deepen mistrust between the two.
If China and the United States are going to tackle such mutual suspicions they will need to improve cooperation, and demonstrate more understanding and respect for the other’s goals. The US, for example, should respect the legitimate rights of China and other countries to access the high seas. China, for its part, may be obliged to reinterpret its use of its EEZs in accordance with the United Nations Convention on the Law of the Sea. If they can manage this, they will be able to guarantee genuinely open maritime access, something that is surely in everyone’s interests.
A sign of the difficulties ahead, though, came last July at the ASEAN Regional Forum in Hanoi, when the two sides clashed over ‘core interests’ in the South China Sea. The US side seemed to assert that the South China Sea should be largely open to all, with no single country able to claim sovereignty over all of it—a clear reference to China’s historical claim.
When the two sides are at odds like this, it does neither any good to be discussing ‘core’ interests and the implied exclusivity. It would be better for China, the United States and relevant ASEAN members to try to reconcile their positions by creating a regime that facilitates free access to the South China Sea for all parties, while retaining China’s privileges in tapping the area for economic purposes. Encouragingly, the Joint Statement released last month after the Hu-Obama meeting appeared to narrow the differences between the two sides by emphasizing their ‘mutual respect and interests’ in lieu of the ‘core interests’ of any single state. This smart move, if it can be built upon, should help boost trust.
Sino-US relations are still constantly developing and it’s true that a single successful state visit won’t sweep away their various differences. Still, as long as China and the United States can work to genuinely place themselves in the other’s shoes, they have a good chance of minimizing the potential for conflict and of building lasting trust.
Shen Dingli is director of the Center for American Studies at Fudan University
"Competing visions and expectations complicate China-US ties. They need to try and walk in each other’s shoes, argues Shen Dingli.
It has been ‘normal’ in recent decades for China-US relations to experience regular turbulence. Although the two countries have frequently collaborated on issues of common interest, they have also faced setbacks as they’ve tried to advance their own economic prosperity and national security.
The key reason for the ups and downs in this complex relationship has been a combination of contradictory expectations and a lack of real trust. On the one hand, the two countries still hope that the other will act responsibly when it comes to the big decisions. And yet despite such hopes, they still seem destined to constantly hedge against each other, in both domestic and foreign policy.
The fact that China and the United States have so often been forced to confront major crises in ties, despite efforts to create a relationship that isn’t constantly hijacked by individual events, has been damaging not only to bilateral relations but also to their own security and welfare.
So what’s behind the trust deficit, and is there any chance for improvement?
One fundamental reason for the periodic clashes is diverging values and interests, which means there are times when the two find it difficult to read each other’s intentions. Such differences have at times prevented them from developing common values and sharing core interests.
For example, China has stressed its core national interests as being institutional security, economic development and territorial integrity. Among these, institutional security has been the most important, with serving the people supposedly its primary tenet. Indeed, from anti-feudalism to anti-imperialism, from anti-warlordism to anti-colonialism and anti-hegemonism, China has experienced some genuine changes. But they are also changes on a path toward change, and it’s possible that the United States simply does not recognize this particular platform of democracy.
I hope that eventually, the American people will become more objective in judging the performance of the Chinese system (and that they’ll also better understand China’s criticisms of the United States’ own civil rights problems, such as racial discrimination, as an effort to encourage US advances in social reforms). As China develops and grows in confidence, its leaders should also find themselves better able to review foreign critiques, including from the United States.
There is a Chinese saying: ‘Modesty helps one go forward, whereas conceit makes one lag behind.’ Through criticism and self-criticism, China and the United States are learning to treat each other more equally, and to respect the other’s institutions. Despite a strained year in 2010, there have been some encouraging signs of progress recently, underscored by the state visit to Washington last month by President Hu Jintao.
But building on these improvements won’t be easy as the two countries explore the boundaries and compatibility of their ‘core interests.’ On the Chinese side, despite more international exchanges and greater cooperation being crucial to China’s continued growth, it also needs to consider how best to protect its nationals and overseas investments. With this in mind, it’s understandable why China feels inclined to build a more capable defensive capacity in order to protect its off-shore interests. But if China also wants to build trust with the United States, it would do well to explain its objectives and plans more clearly to avoid any misunderstandings and misjudgements.
Correspondingly, China must also try to understand legitimate US desires–especially its long-stressed notion of freedom of navigation on the open seas. The United States has long monopolized the oceans, including in Asia, a reality that has prompted concerns among Chinese policymakers that the United States has been policing international waters merely for its own benefit.
But with China growing rapidly economically, and with it being increasingly inclined to tap the ocean for its resources and access, freedom of navigation is becoming less of a US-led privilege, a shift that poses genuine challenges for the China-US relationship. The United States appears anxious, for example, about China’s intention over a number of its Exclusive Economic Zones (EEZs). The associated mutual suspicions, if uncontained, could deepen mistrust between the two.
If China and the United States are going to tackle such mutual suspicions they will need to improve cooperation, and demonstrate more understanding and respect for the other’s goals. The US, for example, should respect the legitimate rights of China and other countries to access the high seas. China, for its part, may be obliged to reinterpret its use of its EEZs in accordance with the United Nations Convention on the Law of the Sea. If they can manage this, they will be able to guarantee genuinely open maritime access, something that is surely in everyone’s interests.
A sign of the difficulties ahead, though, came last July at the ASEAN Regional Forum in Hanoi, when the two sides clashed over ‘core interests’ in the South China Sea. The US side seemed to assert that the South China Sea should be largely open to all, with no single country able to claim sovereignty over all of it—a clear reference to China’s historical claim.
When the two sides are at odds like this, it does neither any good to be discussing ‘core’ interests and the implied exclusivity. It would be better for China, the United States and relevant ASEAN members to try to reconcile their positions by creating a regime that facilitates free access to the South China Sea for all parties, while retaining China’s privileges in tapping the area for economic purposes. Encouragingly, the Joint Statement released last month after the Hu-Obama meeting appeared to narrow the differences between the two sides by emphasizing their ‘mutual respect and interests’ in lieu of the ‘core interests’ of any single state. This smart move, if it can be built upon, should help boost trust.
Sino-US relations are still constantly developing and it’s true that a single successful state visit won’t sweep away their various differences. Still, as long as China and the United States can work to genuinely place themselves in the other’s shoes, they have a good chance of minimizing the potential for conflict and of building lasting trust.
Shen Dingli is director of the Center for American Studies at Fudan University
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The Future of the Internet: Are Apps Killing the Web?
Some profound thoughts for your weekend contemplation:
By Farhad Manjoo in Slate:
Last summer, in a much-read cover story, Wired proclaimed that the Web is dead. Chris Anderson, the magazine's editor, argued that loading pages in a browser is passé. The future, Anderson wrote, is in downloadable apps, which have several advantages over the Web. They're fast, they can be customized for specific purposes, and—perhaps most importantly—people seem to have no problem paying for them, which means that software and media companies have an incentive to keep creating more. Few of us, meanwhile, pay for Web content—and our reluctance, Anderson argued, spoke volumes about what we really want from our computers: "Much as we love freedom and choice, we also love things that just work, reliably and seamlessly."
Anderson's argument was instantly showered with criticism—much of it from people who write on the Web—but if you went beyond the blustery headline and graphics, it wasn't an unreasonable prediction. People spend a lot of time and money on apps these days, and many developers are indeed devoting more of their resources to apps than to the Web. Still, I've been skeptical of the Web-is-dead idea. The Web has one main advantage over apps: It works everywhere, and that's important in a post-Windows world. Since our computers, phones, and tablets use different operating systems, we need a single platform to unite them all. Sure, programmers can theoretically write different apps for the iPhone, iPad, Android, Windows Phone, BlackBerry, Palm, and every other gadget that comes along, but that doesn't seem tenable. Instead, they'll come to see the advantages of creating content and applications that work across devices. There's no better uniter than the Web.
But as I began to think about how the Internet will evolve—for this, the second article in my series on the future of tech—I found myself splitting the difference. Both Anderson's view—"The Web is dead!"—and my view—"Ditch the App Store!"—lack nuance. It seems safer and wiser to bet that the Web and apps will survive over the long run or, at least, for the next five years. Indeed, as mobile browsers and Web programming systems improve, the difference between sites you access from a browser and apps you download from a centralized store will surely shrink. Web sites will grow more adept at storing content locally (so you won't have to be online to use them), they'll get better at using your device's specialized hardware, and their interfaces will look and feel just as complex and responsive as those of native apps.
By Farhad Manjoo in Slate:
Last summer, in a much-read cover story, Wired proclaimed that the Web is dead. Chris Anderson, the magazine's editor, argued that loading pages in a browser is passé. The future, Anderson wrote, is in downloadable apps, which have several advantages over the Web. They're fast, they can be customized for specific purposes, and—perhaps most importantly—people seem to have no problem paying for them, which means that software and media companies have an incentive to keep creating more. Few of us, meanwhile, pay for Web content—and our reluctance, Anderson argued, spoke volumes about what we really want from our computers: "Much as we love freedom and choice, we also love things that just work, reliably and seamlessly."
Anderson's argument was instantly showered with criticism—much of it from people who write on the Web—but if you went beyond the blustery headline and graphics, it wasn't an unreasonable prediction. People spend a lot of time and money on apps these days, and many developers are indeed devoting more of their resources to apps than to the Web. Still, I've been skeptical of the Web-is-dead idea. The Web has one main advantage over apps: It works everywhere, and that's important in a post-Windows world. Since our computers, phones, and tablets use different operating systems, we need a single platform to unite them all. Sure, programmers can theoretically write different apps for the iPhone, iPad, Android, Windows Phone, BlackBerry, Palm, and every other gadget that comes along, but that doesn't seem tenable. Instead, they'll come to see the advantages of creating content and applications that work across devices. There's no better uniter than the Web.
But as I began to think about how the Internet will evolve—for this, the second article in my series on the future of tech—I found myself splitting the difference. Both Anderson's view—"The Web is dead!"—and my view—"Ditch the App Store!"—lack nuance. It seems safer and wiser to bet that the Web and apps will survive over the long run or, at least, for the next five years. Indeed, as mobile browsers and Web programming systems improve, the difference between sites you access from a browser and apps you download from a centralized store will surely shrink. Web sites will grow more adept at storing content locally (so you won't have to be online to use them), they'll get better at using your device's specialized hardware, and their interfaces will look and feel just as complex and responsive as those of native apps.
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Capitalism: Is It Still Working?
The snail-like pace of the economic recovery and the starkly uneven distribution of its rewards has led, of late, to reappraisals of capitalism as the meta-theory governing modern economic, political and social policy. The basic charge is that capitalism prevailed because it promised - and largely delivered - a better life for many, if not all. That may no longer be true. In the following essay printed in the Guardian, Ian Cheshire, CEO of British DIY retailer Kingfisher offers his prescription for sustainable capitalism:
"In the middle of the most protracted downturn for a generation, many businesses could be forgiven for just concentrating on surviving, rather than re-imagining their future. However, I believe that we are now faced with the need for real reinvention of our high resource-impact business models, and that those leadership businesses that rethink their future will benefit in the next wave of change.
Starting with need for change, in a world of $100 a barrel oil, business models assuming an implicit abundance of free resources cannot by definition be sustainable. The stress on the natural capital in our world, the impacts on ecosystems such as forests, reefs and fisheries are producing major changes in costs and supply of materials for all businesses.
Infinite high resource intensity growth is simply not possible, and we are already living off our future capital. It may be gradual but most businesses will have to adjust to a very different reality.
That reality will still be a a version of capitalism, and needs to be a positive vision rather than a doom-laden return to the stone age, but it needs to rethink the point of the system.
Instead of the goal of maximum linear growth in GDP, we should be thinking of maximum wellbeing for minimal planetary input. That starts to challenge business to go beyond efficiency gains, useful though they are, and really redesign their business models.
So, for example, we as retailers are examining how we might shift from selling items such as a power drill to selling the use of it, perhaps through leasing or fractional ownership. The other possibility is for us to redesign products in a cradle to cradle context, so that we run the whole recycling loop, making our value-add from controlling the component materials in the product rather than a one-time fire and forget sale.
The wellbeing challenge also forces us to think about our total impact as a business rather than the narrow shareholder value lens, since businesses that do not create broader social value will again not survive the longer term.
This is easy to say, but extremely difficult to make real, for two reasons. Firstly, it is very hard when you are inside one paradigm, to really visualise a different one. For example, asking someone in an agrarian society to imagine a mass industrialised world, or another extreme, asking the slave owners of the 18th century to imagine a world of free labour being better for economy and society in the long run. So we will have to work at this, with initiatives such as Business in the Community's vision for a sustainable future offering practical tool kits to get started.
The second challenge is that businesses get comfortable with success and tend to treat new developments with suspicion, creating a sort of tissue rejection. Because of this, we need to work with the commercial grain of the organisation to make change happen, rather than leave it to a specialist CSR department. Unless the commercial teams embrace this change and see it as creating opportunity, it will not succeed.
The unlock is to see this crisis as creating opportunity for the leaders of change, and harnessing all our human ingenuity. For us at Kingfisher/B&Q, the sustainability challenge started back in the late 80s when we started thinking about the sources of wood in our garden furniture. That question lead to our founding involvement in the Forestry Stewardship Council, and then took us on similar journeys on topics as diverse as peat-free compost, cleaner paint and now into helping our customers "ecovate" their homes. Along the way we are proud to have developed some key partnerships to drive our thinking, notably with WWF/Bioregional on One Planet Living as well as the Cambridge Programme for Sustainability Leadership.
All these initiatives and links came from us facing into a future challenge and working out what opportunities it created. I remain an optimist since I believe we have not really started the task of reimagining our future and not yet really harnessed the talent in the organisation.
One last suggestion is that each organisation needs to find it's own distinctive contribution to this revolution. Whilst everyone will look at cutting emissions, reducing waste, etc, what are the real priorities where you uniquely can make a difference?
For our part we will be focusing on four big themes as well as doing the day job of improving our business models resource impacts. Firstly, timber, where we have become the first UK retailer to have 100% responsibly sourced wood products, but where globally more needs to be done, notably on illegal timber.
Secondly, energy efficiency - both in our business but also to help our customers create more energy efficient homes.
Thirdly, community - as we operate over 800 stores in neighbourhoods around the world, we are in many communities with 80% of our customers coming from less than 20 minutes away. Along with the wellbeing of our customers and colleagues, communities will be central to our future.
Finally, cradle to cradle product design - radically rethinking our ranges to create a different lifecycle of product use and different business models for creating value. The challenges in our future are enormous but the opportunities for the leaders are even greater.
Ian Cheshire is CEO of Kingfisher
"In the middle of the most protracted downturn for a generation, many businesses could be forgiven for just concentrating on surviving, rather than re-imagining their future. However, I believe that we are now faced with the need for real reinvention of our high resource-impact business models, and that those leadership businesses that rethink their future will benefit in the next wave of change.
Starting with need for change, in a world of $100 a barrel oil, business models assuming an implicit abundance of free resources cannot by definition be sustainable. The stress on the natural capital in our world, the impacts on ecosystems such as forests, reefs and fisheries are producing major changes in costs and supply of materials for all businesses.
Infinite high resource intensity growth is simply not possible, and we are already living off our future capital. It may be gradual but most businesses will have to adjust to a very different reality.
That reality will still be a a version of capitalism, and needs to be a positive vision rather than a doom-laden return to the stone age, but it needs to rethink the point of the system.
Instead of the goal of maximum linear growth in GDP, we should be thinking of maximum wellbeing for minimal planetary input. That starts to challenge business to go beyond efficiency gains, useful though they are, and really redesign their business models.
So, for example, we as retailers are examining how we might shift from selling items such as a power drill to selling the use of it, perhaps through leasing or fractional ownership. The other possibility is for us to redesign products in a cradle to cradle context, so that we run the whole recycling loop, making our value-add from controlling the component materials in the product rather than a one-time fire and forget sale.
The wellbeing challenge also forces us to think about our total impact as a business rather than the narrow shareholder value lens, since businesses that do not create broader social value will again not survive the longer term.
This is easy to say, but extremely difficult to make real, for two reasons. Firstly, it is very hard when you are inside one paradigm, to really visualise a different one. For example, asking someone in an agrarian society to imagine a mass industrialised world, or another extreme, asking the slave owners of the 18th century to imagine a world of free labour being better for economy and society in the long run. So we will have to work at this, with initiatives such as Business in the Community's vision for a sustainable future offering practical tool kits to get started.
The second challenge is that businesses get comfortable with success and tend to treat new developments with suspicion, creating a sort of tissue rejection. Because of this, we need to work with the commercial grain of the organisation to make change happen, rather than leave it to a specialist CSR department. Unless the commercial teams embrace this change and see it as creating opportunity, it will not succeed.
The unlock is to see this crisis as creating opportunity for the leaders of change, and harnessing all our human ingenuity. For us at Kingfisher/B&Q, the sustainability challenge started back in the late 80s when we started thinking about the sources of wood in our garden furniture. That question lead to our founding involvement in the Forestry Stewardship Council, and then took us on similar journeys on topics as diverse as peat-free compost, cleaner paint and now into helping our customers "ecovate" their homes. Along the way we are proud to have developed some key partnerships to drive our thinking, notably with WWF/Bioregional on One Planet Living as well as the Cambridge Programme for Sustainability Leadership.
All these initiatives and links came from us facing into a future challenge and working out what opportunities it created. I remain an optimist since I believe we have not really started the task of reimagining our future and not yet really harnessed the talent in the organisation.
One last suggestion is that each organisation needs to find it's own distinctive contribution to this revolution. Whilst everyone will look at cutting emissions, reducing waste, etc, what are the real priorities where you uniquely can make a difference?
For our part we will be focusing on four big themes as well as doing the day job of improving our business models resource impacts. Firstly, timber, where we have become the first UK retailer to have 100% responsibly sourced wood products, but where globally more needs to be done, notably on illegal timber.
Secondly, energy efficiency - both in our business but also to help our customers create more energy efficient homes.
Thirdly, community - as we operate over 800 stores in neighbourhoods around the world, we are in many communities with 80% of our customers coming from less than 20 minutes away. Along with the wellbeing of our customers and colleagues, communities will be central to our future.
Finally, cradle to cradle product design - radically rethinking our ranges to create a different lifecycle of product use and different business models for creating value. The challenges in our future are enormous but the opportunities for the leaders are even greater.
Ian Cheshire is CEO of Kingfisher
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Why Some Companies Successfully Innovate and Others Do Not
Based on recent research, this is an interesting assessment of the organizational behaviors that accelerate or impede innovation. As described by Christine Crandell in Business Week:
"The recession is over. But its end did not herald a return to business as usual. High rates of new product failure—once considered an inevitable cost of doing business—are now unacceptable. Today's thinner revenue streams, narrower margins, heightened competition, and more limited resources have, if anything, increased the already high levels of stress among corporate survivors and raised the performance bar set by business executives. That has prompted changes in the ways companies invest, manage, and innovate—changes designed to minimize risk.
In a survey commissioned for our company, involving more than 280 product executives in 17 different industries, we found common patterns among the study's top performers. Among the good management habits of innovative, high-performance companies:
• Balance. Investments in breakthrough advancements were offset with spending on incremental innovations. While the rewards of home-run products are potentially very high, their associated risks are even higher. Winning companies don't bet all their chips on blue-sky projects.
• Prioritize. Focus on product development projects that align with both market needs and the company's overall business strategy. Struggling to satisfy customer desires is only beneficial when it advances your company's longer-range objectives.
• Analyze. Overcome the largest risk in product innovation—products that customers won't buy—by analyzing customer feedback quickly to ensure delivery of products the market is actually asking for. If a product idea is going to fail, or meet only 80 percent of customer expectations, it is a huge advantage to find that out as soon as possible, drop the idea, and move on to other, more appealing projects.
• Automate. Top performers delivered products on time by using technology to manage requirements, administer workflow, and prioritize development. Too many companies rely on slower, less reliable manual processes.
There was also a flip side to the study's findings: challenges that consistently elude companies that are still struggling. Chief among them:
• Not listening. Failure to hear and consider the expressed needs of customers. Those diverse voices must be considered, reconciled, and balanced to develop a truly successful product.
• Not collaborating. Failing to share information and collaborate with customers, partners, suppliers, and other key stakeholders in exploring new ideas. For struggling companies, fewer than half their product ideas came from these sources.
• Misalignment. Too often senior management and product-line staff fail to communicate, which often results in their spending time and money on the wrong product priorities.
• Uncertainty. The lack of clear decision-making and confusion over product-line ownership leads to decisions based on internal politics, subjectivity, personal influence, and debate skills rather than product merits.
• Paperwork. Paper-based methods and other traditional innovation management processes slow down the development life cycle, especially for complex products.
• Poor execution. Struggling companies have trouble planning the resources needed to match market opportunities, difficulty managing multiple teams and regions, and a hard time managing the risks associated with new and existing products.
There are concrete steps that struggling companies can take to redirect themselves along the road to success, as well as steps that currently high-performing companies can take to reach even higher levels. Key among them: collaborate closely with key stakeholders, harness the wisdom of crowds, clearly define and convey product requirements, leverage outside help, and automate the innovation process.
"The recession is over. But its end did not herald a return to business as usual. High rates of new product failure—once considered an inevitable cost of doing business—are now unacceptable. Today's thinner revenue streams, narrower margins, heightened competition, and more limited resources have, if anything, increased the already high levels of stress among corporate survivors and raised the performance bar set by business executives. That has prompted changes in the ways companies invest, manage, and innovate—changes designed to minimize risk.
In a survey commissioned for our company, involving more than 280 product executives in 17 different industries, we found common patterns among the study's top performers. Among the good management habits of innovative, high-performance companies:
• Balance. Investments in breakthrough advancements were offset with spending on incremental innovations. While the rewards of home-run products are potentially very high, their associated risks are even higher. Winning companies don't bet all their chips on blue-sky projects.
• Prioritize. Focus on product development projects that align with both market needs and the company's overall business strategy. Struggling to satisfy customer desires is only beneficial when it advances your company's longer-range objectives.
• Analyze. Overcome the largest risk in product innovation—products that customers won't buy—by analyzing customer feedback quickly to ensure delivery of products the market is actually asking for. If a product idea is going to fail, or meet only 80 percent of customer expectations, it is a huge advantage to find that out as soon as possible, drop the idea, and move on to other, more appealing projects.
• Automate. Top performers delivered products on time by using technology to manage requirements, administer workflow, and prioritize development. Too many companies rely on slower, less reliable manual processes.
There was also a flip side to the study's findings: challenges that consistently elude companies that are still struggling. Chief among them:
• Not listening. Failure to hear and consider the expressed needs of customers. Those diverse voices must be considered, reconciled, and balanced to develop a truly successful product.
• Not collaborating. Failing to share information and collaborate with customers, partners, suppliers, and other key stakeholders in exploring new ideas. For struggling companies, fewer than half their product ideas came from these sources.
• Misalignment. Too often senior management and product-line staff fail to communicate, which often results in their spending time and money on the wrong product priorities.
• Uncertainty. The lack of clear decision-making and confusion over product-line ownership leads to decisions based on internal politics, subjectivity, personal influence, and debate skills rather than product merits.
• Paperwork. Paper-based methods and other traditional innovation management processes slow down the development life cycle, especially for complex products.
• Poor execution. Struggling companies have trouble planning the resources needed to match market opportunities, difficulty managing multiple teams and regions, and a hard time managing the risks associated with new and existing products.
There are concrete steps that struggling companies can take to redirect themselves along the road to success, as well as steps that currently high-performing companies can take to reach even higher levels. Key among them: collaborate closely with key stakeholders, harness the wisdom of crowds, clearly define and convey product requirements, leverage outside help, and automate the innovation process.
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Google Launches Group Texting App: Knife to the Heart or Two-Edged Sword?
This could be the proverbial two-edged sword; on the one hand, Google gets first mover advantage on an app that can work across all platforms. With its financial heft and scale, that is significant. However, the app, called Disco, could provide advertisers with precisely the tidal wave of abusive or simply annoying ad overkill that leads to greater enhancement of privacy laws or, perhaps worse from the commercial perspective, rejection of this latest round of mobile-denominated communication in which so many are investing.
Shirley Brady reports in Brand Channel:
"After denying rumors at South by Southwest that it's launching a social network, Google is developing a social app. Disco, a group texting app, isnow available as a free app from the iTunes store.
Developed by Max Levchin, the Silicon Valley entrepreneur who sold Slide to Google in August for $182 million, the social messenger's FAQ describes the service:
"You can easily invite groups of friends, family, co-workers and more to chat in real time via group text messaging. Create or join unlimited groups to touch base with everyone! Use it to coordinate weekend get-togethers, after school practice schedules, details for surprise parties or simply driving directions to local events! Whether you are on the go or hanging out at home, it's time to get instant feedback from a group of your pals without the hassle of a laptop!"
Still in beta, it promises it will work with smartphones from "every major US cell service provider." Check out the screenshots below.
TechCrunch, which broke the news, calls it "barebones," but "simple" to use and "nice." Its interface is certainly clean, if a bit basic.
Shirley Brady reports in Brand Channel:
"After denying rumors at South by Southwest that it's launching a social network, Google is developing a social app. Disco, a group texting app, isnow available as a free app from the iTunes store.
Developed by Max Levchin, the Silicon Valley entrepreneur who sold Slide to Google in August for $182 million, the social messenger's FAQ describes the service:
"You can easily invite groups of friends, family, co-workers and more to chat in real time via group text messaging. Create or join unlimited groups to touch base with everyone! Use it to coordinate weekend get-togethers, after school practice schedules, details for surprise parties or simply driving directions to local events! Whether you are on the go or hanging out at home, it's time to get instant feedback from a group of your pals without the hassle of a laptop!"
Still in beta, it promises it will work with smartphones from "every major US cell service provider." Check out the screenshots below.
TechCrunch, which broke the news, calls it "barebones," but "simple" to use and "nice." Its interface is certainly clean, if a bit basic.
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What's Behind the Decline in European and American Living Standards?
The Economist is a thoughtful, but reliably status-quo oriented journal. That makes this essay rather breathtaking:
"Are you better off than you were two years ago? Although the economic recovery in the developed world is almost two years old, the average Westerner would probably answer “No”.
The authorities have applied shock and awe in the form of fiscal and monetary stimulus. They have prevented the complete collapse of the financial sector—bankers’ pay has certainly held up just fine. The corporate sector is also doing well. Even if banks are excluded, the profits of S&P 500 companies were up by 18.7% last year, says Morgan Stanley.
But the benefits of recovery seem to have been distributed almost entirely to the owners of capital rather than workers. In America total real wages have risen by $168 billion since the recovery began, but that has been far outstripped by a $528 billion jump in profits. Dhaval Joshi of BCA Research reckons that this is the first time profits have outperformed wages in absolute terms in 50 years.
In Germany profits have increased by €113 billion ($159 billion) since the start of the recovery, and employee pay has risen by just €36 billion. Things look even worse for workers in Britain, where profits have risen by £14 billion ($22.7 billion) but aggregate real wages have fallen by £2 billion. A study by the Institute for Fiscal Studies, a think-tank, found that the median British household had suffered the biggest three-year fall in real living standards since the early 1980s.
Are these trends a belated vindication of Karl Marx? The bearded wonder wrote in “Das Kapital” that: “It follows therefore that in proportion as capital accumulates, the situation of the worker, be his payment high or low, must grow worse.” But Marx also predicted a decline in profit margins in capitalism’s dying throes, suggesting some confusion in his analysis.
A more positive view of this divergence between capital and wages is that developed economies had become too dependent on consumption and had to switch to an export- and investment-led model. That was the view of Mervyn King, the governor of the Bank of England, when he said in January that “the squeeze in living standards is the inevitable price to pay for the financial crisis and subsequent rebalancing of the world and UK economies.”
That reasoning might work for Britain and America. But it is hard to apply to Germany, where unit labour costs have been held down for a decade and where, if the economy does need to be rebalanced, it is arguably in favour of consumption.
There is also a longer-term trend to explain. Wages still account for a much greater slice of income than profits, but labour’s share has been in decline across the OECD since 1980. The gap has been particularly marked in America: productivity rose by 83% between 1973 and 2007, but male median real wages rose by just 5%.
The decline in labour’s share has also been accompanied by an increased inequality of incomes, something that economists have struggled for years to explain. Mean wages, which include the earnings of chief executives and sports stars, have risen much faster than the median. This premium for “talent” may reflect globalisation as the elite are able to move to the countries where their skills are most appreciated. Or it may reflect changes in technology, which have generated outsize rewards for those people most able to take advantage of them.
An alternative explanation has been to blame the decline in trade-union membership. In the 1960s and 1970s powerful unions in manufacturing industries like cars were able to demand higher wages. But high-paying blue-collar jobs have been in decline since then. John Van Reenen, the director of the Centre for Economic Performance at the London School of Economics, reckons that privatisation has also led to a decline in labour’s share of the cake. Managers of newly privatised industries tend to lay off workers as their focus shifts from empire-building to profit maximisation.
One factor that should perhaps get more emphasis is the role of the financial sector. Central banks have repeatedly cut or held down interest rates over the past 25 years in an attempt to boost bank profits and prop up asset prices. With this subsidy in place, is it surprising that earnings in finance have outpaced wages for other technologically skilled jobs?
Attempts to remove that subsidy are met by threats from international banks to move elsewhere. This is a little reminiscent of the protection rackets run by the gangsters in Mario Puzo’s “The Godfather”. It is as if the finance sector is saying: “Nice economy you got there. Shame if anything should happen to it.”
"Are you better off than you were two years ago? Although the economic recovery in the developed world is almost two years old, the average Westerner would probably answer “No”.
The authorities have applied shock and awe in the form of fiscal and monetary stimulus. They have prevented the complete collapse of the financial sector—bankers’ pay has certainly held up just fine. The corporate sector is also doing well. Even if banks are excluded, the profits of S&P 500 companies were up by 18.7% last year, says Morgan Stanley.
But the benefits of recovery seem to have been distributed almost entirely to the owners of capital rather than workers. In America total real wages have risen by $168 billion since the recovery began, but that has been far outstripped by a $528 billion jump in profits. Dhaval Joshi of BCA Research reckons that this is the first time profits have outperformed wages in absolute terms in 50 years.
In Germany profits have increased by €113 billion ($159 billion) since the start of the recovery, and employee pay has risen by just €36 billion. Things look even worse for workers in Britain, where profits have risen by £14 billion ($22.7 billion) but aggregate real wages have fallen by £2 billion. A study by the Institute for Fiscal Studies, a think-tank, found that the median British household had suffered the biggest three-year fall in real living standards since the early 1980s.
Are these trends a belated vindication of Karl Marx? The bearded wonder wrote in “Das Kapital” that: “It follows therefore that in proportion as capital accumulates, the situation of the worker, be his payment high or low, must grow worse.” But Marx also predicted a decline in profit margins in capitalism’s dying throes, suggesting some confusion in his analysis.
A more positive view of this divergence between capital and wages is that developed economies had become too dependent on consumption and had to switch to an export- and investment-led model. That was the view of Mervyn King, the governor of the Bank of England, when he said in January that “the squeeze in living standards is the inevitable price to pay for the financial crisis and subsequent rebalancing of the world and UK economies.”
That reasoning might work for Britain and America. But it is hard to apply to Germany, where unit labour costs have been held down for a decade and where, if the economy does need to be rebalanced, it is arguably in favour of consumption.
There is also a longer-term trend to explain. Wages still account for a much greater slice of income than profits, but labour’s share has been in decline across the OECD since 1980. The gap has been particularly marked in America: productivity rose by 83% between 1973 and 2007, but male median real wages rose by just 5%.
The decline in labour’s share has also been accompanied by an increased inequality of incomes, something that economists have struggled for years to explain. Mean wages, which include the earnings of chief executives and sports stars, have risen much faster than the median. This premium for “talent” may reflect globalisation as the elite are able to move to the countries where their skills are most appreciated. Or it may reflect changes in technology, which have generated outsize rewards for those people most able to take advantage of them.
An alternative explanation has been to blame the decline in trade-union membership. In the 1960s and 1970s powerful unions in manufacturing industries like cars were able to demand higher wages. But high-paying blue-collar jobs have been in decline since then. John Van Reenen, the director of the Centre for Economic Performance at the London School of Economics, reckons that privatisation has also led to a decline in labour’s share of the cake. Managers of newly privatised industries tend to lay off workers as their focus shifts from empire-building to profit maximisation.
One factor that should perhaps get more emphasis is the role of the financial sector. Central banks have repeatedly cut or held down interest rates over the past 25 years in an attempt to boost bank profits and prop up asset prices. With this subsidy in place, is it surprising that earnings in finance have outpaced wages for other technologically skilled jobs?
Attempts to remove that subsidy are met by threats from international banks to move elsewhere. This is a little reminiscent of the protection rackets run by the gangsters in Mario Puzo’s “The Godfather”. It is as if the finance sector is saying: “Nice economy you got there. Shame if anything should happen to it.”
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Cell Phone Sleuth: Mobile Providers Tracking Cell Owners Movements; Data Are Stored
This is hardly a surprise, but the breadth of the practice may be shocking to some. And yes, governments are very interested in this data and use it frequently. This story is about Deutsche Telekom, but the practice appears to be nearly universal. Is this bad or good? Depends on your attitudes about privacy, but for those who think they live a libertarian life, think again.
Noam Cohen has the story in the New York Times:
"A favorite pastime of Internet users is to share their location: services like Google Latitude can inform friends when you are nearby; another, Foursquare, has turned reporting these updates into a game.
Malte Spitz was surprised by how much detail Deutsche Telekom had about his whereabouts.
But as a German Green party politician, Malte Spitz, recently learned, we are already continually being tracked whether we volunteer to be or not. Cellphone companies do not typically divulge how much information they collect, so Mr. Spitz went to court to find out exactly what his cellphone company, Deutsche Telekom, knew about his whereabouts.
The results were astounding. In a six-month period — from Aug 31, 2009, to Feb. 28, 2010, Deutsche Telekom had recorded and saved his longitude and latitude coordinates more than 35,000 times. It traced him from a train on the way to Erlangen at the start through to that last night, when he was home in Berlin.
Mr. Spitz has provided a rare glimpse — an unprecedented one, privacy experts say — of what is being collected as we walk around with our phones. Unlike many online services and Web sites that must send “cookies” to a user’s computer to try to link its traffic to a specific person, cellphone companies simply have to sit back and hit “record.”
“We are all walking around with little tags, and our tag has a phone number associated with it, who we called and what we do with the phone,” said Sarah E. Williams, an expert on graphic information at Columbia University’s architecture school. “We don’t even know we are giving up that data.”
Tracking a customer’s whereabouts is part and parcel of what phone companies do for a living. Every seven seconds or so, the phone company of someone with a working cellphone is determining the nearest tower, so as to most efficiently route calls. And for billing reasons, they track where the call is coming from and how long it has lasted.
“At any given instant, a cell company has to know where you are; it is constantly registering with the tower with the strongest signal,” said Matthew Blaze, a professor of computer and information science at the University of Pennsylvania who has testified before Congress on the issue.
Mr. Spitz’s information, Mr. Blaze pointed out, was not based on those frequent updates, but on how often Mr. Spitz checked his e-mail.
Mr. Spitz, a privacy advocate, decided to be extremely open with his personal information. Late last month, he released all the location information in a publicly accessible Google Document, and worked with a prominent German newspaper, Die Zeit, to map those coordinates over time.
“This is really the most compelling visualization in a public forum I have ever seen,” said Mr. Blaze, adding that it “shows how strong a picture even a fairly low-resolution location can give.”
In an interview from Berlin, Mr. Spitz explained his reasons: “It was an important point to show this is not some kind of a game. I thought about it, if it is a good idea to publish all the data — I also could say, O.K., I will only publish it for five, 10 days maybe. But then I said no, I really want to publish the whole six months.”
In the United States, telecommunication companies do not have to report precisely what material they collect, said Kevin Bankston, a lawyer at the Electronic Frontier Foundation, who specializes in privacy. He added that based on court cases he could say that “they store more of it and it is becoming more precise.”
“Phones have become a necessary part of modern life,” he said, objecting to the idea that “you have to hand over your personal privacy to be part of the 21st century.”
In the United States, there are law enforcement and safety reasons for cellphone companies being encouraged to keep track of its customers. Both the F.B.I. and the Drug Enforcement Administration have used cellphone records to identify suspects and make arrests.
If the information is valuable to law enforcement, it could be lucrative for marketers. The major American cellphone providers declined to explain what exactly they collect and what they use it for.
Verizon, for example, declined to elaborate other than to point to its privacy policy, which includes: “Information such as call records, service usage, traffic data,” the statement in part reads, may be used for “marketing to you based on your use of the products and services you already have, subject to any restrictions required by law.”
AT&T, for example, works with a company, Sense Networks, that uses anonymous location information “to better understand aggregate human activity.” One product, CitySense, makes recommendations about local nightlife to customers who choose to participate based on their cellphone usage. (Many smartphone apps already on the market are based on location but that’s with the consent of the user and through GPS, not the cellphone company’s records.)
Because of Germany’s history, courts place a greater emphasis on personal privacy. Mr. Spitz first went to court to get his entire file in 2009 but Deutsche Telekom objected.
For six months, he said, there was a “Ping Pong game” of lawyers’ letters back and forth until, separately, the Constitutional Court there decided that the existing rules governing data retention, beyond those required for billing and logistics, were illegal. Soon thereafter, the two sides reached a settlement: “I only get the information that is related to me, and I don’t get all the information like who am I calling, who sent me a SMS and so on,” Mr. Spitz said, referring to text messages.
Even so, 35,831 pieces of information were sent to him by Deutsche Telekom as an encrypted file, to protect his privacy during its transmission.
Deutsche Telekom, which owns T-Mobile, Mr. Spitz’s carrier, wrote in an e-mail that it stored six months’ of data, as required by the law, and that after the court ruling it “immediately ceased” storing data.
And a year after the court ruling outlawing this kind of data retention, there is a movement to try to get a new, more limited law passed. Mr. Spitz, at 26 a member of the Green Party’s executive board, says he released that material to influence that debate.
“I want to show the political message that this kind of data retention is really, really big and you can really look into the life of people for six months and see what they are doing where they are.”
While the potential for abuse is easy to imagine, in Mr. Spitz’s case, there was not much revealed.
“I really spend most of the time in my own neighborhood, which was quite funny for me,” he said. “I am not really walking that much around.”
Any embarrassing details? “The data shows that I am flying sometimes,” he said, rather than taking a more fuel-efficient train. “Something not that popular for a Green politician.”
Noam Cohen has the story in the New York Times:
"A favorite pastime of Internet users is to share their location: services like Google Latitude can inform friends when you are nearby; another, Foursquare, has turned reporting these updates into a game.
Malte Spitz was surprised by how much detail Deutsche Telekom had about his whereabouts.
But as a German Green party politician, Malte Spitz, recently learned, we are already continually being tracked whether we volunteer to be or not. Cellphone companies do not typically divulge how much information they collect, so Mr. Spitz went to court to find out exactly what his cellphone company, Deutsche Telekom, knew about his whereabouts.
The results were astounding. In a six-month period — from Aug 31, 2009, to Feb. 28, 2010, Deutsche Telekom had recorded and saved his longitude and latitude coordinates more than 35,000 times. It traced him from a train on the way to Erlangen at the start through to that last night, when he was home in Berlin.
Mr. Spitz has provided a rare glimpse — an unprecedented one, privacy experts say — of what is being collected as we walk around with our phones. Unlike many online services and Web sites that must send “cookies” to a user’s computer to try to link its traffic to a specific person, cellphone companies simply have to sit back and hit “record.”
“We are all walking around with little tags, and our tag has a phone number associated with it, who we called and what we do with the phone,” said Sarah E. Williams, an expert on graphic information at Columbia University’s architecture school. “We don’t even know we are giving up that data.”
Tracking a customer’s whereabouts is part and parcel of what phone companies do for a living. Every seven seconds or so, the phone company of someone with a working cellphone is determining the nearest tower, so as to most efficiently route calls. And for billing reasons, they track where the call is coming from and how long it has lasted.
“At any given instant, a cell company has to know where you are; it is constantly registering with the tower with the strongest signal,” said Matthew Blaze, a professor of computer and information science at the University of Pennsylvania who has testified before Congress on the issue.
Mr. Spitz’s information, Mr. Blaze pointed out, was not based on those frequent updates, but on how often Mr. Spitz checked his e-mail.
Mr. Spitz, a privacy advocate, decided to be extremely open with his personal information. Late last month, he released all the location information in a publicly accessible Google Document, and worked with a prominent German newspaper, Die Zeit, to map those coordinates over time.
“This is really the most compelling visualization in a public forum I have ever seen,” said Mr. Blaze, adding that it “shows how strong a picture even a fairly low-resolution location can give.”
In an interview from Berlin, Mr. Spitz explained his reasons: “It was an important point to show this is not some kind of a game. I thought about it, if it is a good idea to publish all the data — I also could say, O.K., I will only publish it for five, 10 days maybe. But then I said no, I really want to publish the whole six months.”
In the United States, telecommunication companies do not have to report precisely what material they collect, said Kevin Bankston, a lawyer at the Electronic Frontier Foundation, who specializes in privacy. He added that based on court cases he could say that “they store more of it and it is becoming more precise.”
“Phones have become a necessary part of modern life,” he said, objecting to the idea that “you have to hand over your personal privacy to be part of the 21st century.”
In the United States, there are law enforcement and safety reasons for cellphone companies being encouraged to keep track of its customers. Both the F.B.I. and the Drug Enforcement Administration have used cellphone records to identify suspects and make arrests.
If the information is valuable to law enforcement, it could be lucrative for marketers. The major American cellphone providers declined to explain what exactly they collect and what they use it for.
Verizon, for example, declined to elaborate other than to point to its privacy policy, which includes: “Information such as call records, service usage, traffic data,” the statement in part reads, may be used for “marketing to you based on your use of the products and services you already have, subject to any restrictions required by law.”
AT&T, for example, works with a company, Sense Networks, that uses anonymous location information “to better understand aggregate human activity.” One product, CitySense, makes recommendations about local nightlife to customers who choose to participate based on their cellphone usage. (Many smartphone apps already on the market are based on location but that’s with the consent of the user and through GPS, not the cellphone company’s records.)
Because of Germany’s history, courts place a greater emphasis on personal privacy. Mr. Spitz first went to court to get his entire file in 2009 but Deutsche Telekom objected.
For six months, he said, there was a “Ping Pong game” of lawyers’ letters back and forth until, separately, the Constitutional Court there decided that the existing rules governing data retention, beyond those required for billing and logistics, were illegal. Soon thereafter, the two sides reached a settlement: “I only get the information that is related to me, and I don’t get all the information like who am I calling, who sent me a SMS and so on,” Mr. Spitz said, referring to text messages.
Even so, 35,831 pieces of information were sent to him by Deutsche Telekom as an encrypted file, to protect his privacy during its transmission.
Deutsche Telekom, which owns T-Mobile, Mr. Spitz’s carrier, wrote in an e-mail that it stored six months’ of data, as required by the law, and that after the court ruling it “immediately ceased” storing data.
And a year after the court ruling outlawing this kind of data retention, there is a movement to try to get a new, more limited law passed. Mr. Spitz, at 26 a member of the Green Party’s executive board, says he released that material to influence that debate.
“I want to show the political message that this kind of data retention is really, really big and you can really look into the life of people for six months and see what they are doing where they are.”
While the potential for abuse is easy to imagine, in Mr. Spitz’s case, there was not much revealed.
“I really spend most of the time in my own neighborhood, which was quite funny for me,” he said. “I am not really walking that much around.”
Any embarrassing details? “The data shows that I am flying sometimes,” he said, rather than taking a more fuel-efficient train. “Something not that popular for a Green politician.”
Save And Share :
Mar 25, 2011
Spotting False Gurus: A Handy Guide As Tech Stocks Sky Rocket and New Age Proclamations Abound
Good advice from The Master, Greg Satell at Digital Tonto:
"Let me give you some advice…
In the fast moving, hypercompetitive inflection point that is business today, only the strong will survive. You need to get with the program or get eaten alive.
There are a lot of metaphor mixing, self proclaimed gurus out there to guide your way. You can do yourself a world of good by listening to what they have to say and then doing the opposite.
Here are six ways to spot them:
I’m So Beautiful!
As my good friend Cheryl Andonian points out, most false gurus are self appointed. They describe themselves as with terms such as “visionary,” “expert” and “thought leader” on their LinkedIn profiles.
I had one guy come to my site, make a grossly misinformed comment and then direct me to his “award winning site.” I went there and found that he has a preference for fluorescent pink fonts and no comments or retweets. He also writes books that he describes as “best selling” and “award winning.” (They’re not.)
In his description of himself, he said that he “gets up some people’s nose.” No kidding!
Everything Has Changed!
At the dawn of the internet age, the popular TV show 60 Minutes had a new media guru on who said something to the effect of “I’m in the business of putting you out of business.”
I don’t know what ever happened to the guy nor do I remember his name, but 60 minutes is still a top 20 show and the owner, CBS, made over $200 million in net income and $13 billion in revenues last year, at the height of the crises.
False gurus also have the annoying habit of asserting that everybody is coming around to their way of thinking, except for the ones who haven’t “gotten it yet.” They say things like, “it’s all about the conversation” as if nobody has anything better to do than interact with every brand they are considering.
As Neicole Crepeau points out in a very well documented article, the vast majority of consumers do not want to have a conversation with a business (I guess they have friends).
Checking Facts is a Waste of Time
Once an ego gets big enough, facts seem to become irrelevant. Why do the hard work of research if you already know everything?
Chris Brogan and Julien Smith, in their book Trust Agents, tell us to “stop doing your own books and research.” That’s for little people, I guess. Being a guru is about getting the message out there. Presumably, it doesn’t matter what the message is as long as you find your “tribe.”
When I first started blogging, I noticed a post by Erik Qualman taking Boeing to task for an ad campaign that didn’t make sense to him. He didn’t know what the brief was, nor was he privy to the results, but nevertheless just assumed that Boeing was in error.
Qualman, who has never managed a brand himself, would tell them how to do it right, because, in his words, they “just weren’t cutting it.”
My Experience is Global
Probably the most irksome habit of false gurus is confusing the anecdotal with the universal. I guess if you don’t check facts, then first hand experience is all you have to go on.
Unfortunately, a world of six billion people tends to be a messy place. As I wrote in my response to Qualman, once you get out into the world a little bit, you start to realize that local environments differ widely (to be fair, Qualman was very gracious in his response to me).
People in different places value different things. In some places life is dear, in others it is cheap. Some people value their health, others money, still others status. Everybody wants something, but it’s usually something different.
If you have a story, tell it to your mother. Don’t assume that your story is my story or that it has some kind of cosmic significance.
I’ve Done Nothing, but Know Everything
Another thing that caught my eye in Trust Agents was that Brogan took great pride in the fact that he could work out of a coffee shop. I admit, it sounds nice. Unless, of course, you have a business to run, staff to manage and train or any real responsibility to solve problems of any significance.
Interestingly, Brogan and Smith do give very good blogging tips in their book, a subject in which they clearly do have experience and expertise. Unfortunately, knowledge in one area doesn’t automatically transfer to others.
I must admit, though, Brogan, Smith and Qualman are small beer when compared to the biggest sham artists of all: Al Ries and Jack Trout, who describe themselves on their web sites respectively as “legendary marketing strategist” and the “world’s foremost marketing strategist.”
They have written a host of best selling books, get astronomical speaking fees and according their web sites, have been profiled in every major media outlet imaginable. The only thing they haven’t done is actually build or manage a brand.
I guess that actually making a contribution, like checking facts, is a waste of time for self professed marketing geniuses.
It’s all so Simple!
Why does anybody listen to false gurus? Because they promise a simpler, easier way of doing things. I guess things are simple if you don’t have to check facts, manage staff, deal with real world problems or fight off vigorous competition trying to thwart you at every step.
Why go through mountains of data, perform statistical regressions, design mind numbing logical algorithms or lay awake nights trying worrying about how to make the payroll if you can earn a living telling people to ignore life’s cumbersome realities? False gurus are, in effect, cargo cult marketers for whom ideas transcend facts.
Being good at anything isn’t easy. It takes years of hard work, stupid mistakes and all of the trials and tribulations that come with the constant struggle to get better at what you do. That’s why there are so few really competent people. It’s not easy, but very, very hard.
With that said, if you still aren’t convinced and would like to know a simple, easy way to get rich in online media, just send $10.00 to www.digitaltonto.com.
($9.99 for those who are wearing a “I LOVE TONTO” t-shirt – this week only!)
"Let me give you some advice…
In the fast moving, hypercompetitive inflection point that is business today, only the strong will survive. You need to get with the program or get eaten alive.
There are a lot of metaphor mixing, self proclaimed gurus out there to guide your way. You can do yourself a world of good by listening to what they have to say and then doing the opposite.
Here are six ways to spot them:
I’m So Beautiful!
As my good friend Cheryl Andonian points out, most false gurus are self appointed. They describe themselves as with terms such as “visionary,” “expert” and “thought leader” on their LinkedIn profiles.
I had one guy come to my site, make a grossly misinformed comment and then direct me to his “award winning site.” I went there and found that he has a preference for fluorescent pink fonts and no comments or retweets. He also writes books that he describes as “best selling” and “award winning.” (They’re not.)
In his description of himself, he said that he “gets up some people’s nose.” No kidding!
Everything Has Changed!
At the dawn of the internet age, the popular TV show 60 Minutes had a new media guru on who said something to the effect of “I’m in the business of putting you out of business.”
I don’t know what ever happened to the guy nor do I remember his name, but 60 minutes is still a top 20 show and the owner, CBS, made over $200 million in net income and $13 billion in revenues last year, at the height of the crises.
False gurus also have the annoying habit of asserting that everybody is coming around to their way of thinking, except for the ones who haven’t “gotten it yet.” They say things like, “it’s all about the conversation” as if nobody has anything better to do than interact with every brand they are considering.
As Neicole Crepeau points out in a very well documented article, the vast majority of consumers do not want to have a conversation with a business (I guess they have friends).
Checking Facts is a Waste of Time
Once an ego gets big enough, facts seem to become irrelevant. Why do the hard work of research if you already know everything?
Chris Brogan and Julien Smith, in their book Trust Agents, tell us to “stop doing your own books and research.” That’s for little people, I guess. Being a guru is about getting the message out there. Presumably, it doesn’t matter what the message is as long as you find your “tribe.”
When I first started blogging, I noticed a post by Erik Qualman taking Boeing to task for an ad campaign that didn’t make sense to him. He didn’t know what the brief was, nor was he privy to the results, but nevertheless just assumed that Boeing was in error.
Qualman, who has never managed a brand himself, would tell them how to do it right, because, in his words, they “just weren’t cutting it.”
My Experience is Global
Probably the most irksome habit of false gurus is confusing the anecdotal with the universal. I guess if you don’t check facts, then first hand experience is all you have to go on.
Unfortunately, a world of six billion people tends to be a messy place. As I wrote in my response to Qualman, once you get out into the world a little bit, you start to realize that local environments differ widely (to be fair, Qualman was very gracious in his response to me).
People in different places value different things. In some places life is dear, in others it is cheap. Some people value their health, others money, still others status. Everybody wants something, but it’s usually something different.
If you have a story, tell it to your mother. Don’t assume that your story is my story or that it has some kind of cosmic significance.
I’ve Done Nothing, but Know Everything
Another thing that caught my eye in Trust Agents was that Brogan took great pride in the fact that he could work out of a coffee shop. I admit, it sounds nice. Unless, of course, you have a business to run, staff to manage and train or any real responsibility to solve problems of any significance.
Interestingly, Brogan and Smith do give very good blogging tips in their book, a subject in which they clearly do have experience and expertise. Unfortunately, knowledge in one area doesn’t automatically transfer to others.
I must admit, though, Brogan, Smith and Qualman are small beer when compared to the biggest sham artists of all: Al Ries and Jack Trout, who describe themselves on their web sites respectively as “legendary marketing strategist” and the “world’s foremost marketing strategist.”
They have written a host of best selling books, get astronomical speaking fees and according their web sites, have been profiled in every major media outlet imaginable. The only thing they haven’t done is actually build or manage a brand.
I guess that actually making a contribution, like checking facts, is a waste of time for self professed marketing geniuses.
It’s all so Simple!
Why does anybody listen to false gurus? Because they promise a simpler, easier way of doing things. I guess things are simple if you don’t have to check facts, manage staff, deal with real world problems or fight off vigorous competition trying to thwart you at every step.
Why go through mountains of data, perform statistical regressions, design mind numbing logical algorithms or lay awake nights trying worrying about how to make the payroll if you can earn a living telling people to ignore life’s cumbersome realities? False gurus are, in effect, cargo cult marketers for whom ideas transcend facts.
Being good at anything isn’t easy. It takes years of hard work, stupid mistakes and all of the trials and tribulations that come with the constant struggle to get better at what you do. That’s why there are so few really competent people. It’s not easy, but very, very hard.
With that said, if you still aren’t convinced and would like to know a simple, easy way to get rich in online media, just send $10.00 to www.digitaltonto.com.
($9.99 for those who are wearing a “I LOVE TONTO” t-shirt – this week only!)
Save And Share :
Measuring Brand Impact: Social Influence Marketing (SIM) Scores
A measure that is comprehensive and perceptive. This could be important.
Carol Phillips reports in Brand Amplitude"
"On January 21st, all hell broke loose for Toyota. Its sticking accelerator pedal recall was the most challenging crisis the company had ever faced. In fact, a few industry insiders even wondered whether the mighty Toyota brand could survive, as six million cars were recalled worldwide. The crisis is going to change Toyota forever and it may take years to recover lost market share.
Around the same time, something rather dramatic happened to another company, but this time by its own choosing. For the first time in 23 years, PepsiCo decided not to advertise its flagship Pepsi brand on the Super Bowl. With Coca-Cola sponsoring the Winter Olympics, Pepsi launched a year-round "movement," Refresh Everything, to donate money to charities based on consumer voting. For the traditional marketer, this was indeed a bold and risky move.
What do Toyota and Pepsi have in common? They both are in business situations that demand new ways of measuring their brand health -- measurements they haven't had before. And that's where the SIM Score -- monitoring how a brand ranks in Social Influence Marketing -- comes in.
Why the SIM Score matters beyond the social web
In July 2009 Razorfish introduced the SIM (Social Influence Marketing) Score and, at the time, felt that it was an accurate measure of how people perceive your brand in the social web in one moment of time. But since then, through our experiences in deploying the SIM Score and the even more explosive growth of social media (now it transcends all media and all platforms including mobile and gaming devices), we have come to believe that the SIM Score can and should be used as a broader measure of a brand's health, not just as a measure of the strength of a brand in the social Web.
At the root of this thinking is the belief that we now live in a world where brands are shaped in real-time -- more by how consumers talk about them versus anything the brands may do to market themselves or that we as an agency may help them do. This does not mean brand-building is dead. You shouldn't fire your marketing department or your marketing agency. In fact, please don't.Nor does it mean brand equity has no meaning. But whether your brand is worth $83 billion (as Apple is, according to the fifth annual BrandZ Top 100 ranking by Millward Brown Optimor) or $10 billion cannot be revealed through annual, laborious and expensive brand tracking studies. You need to be tracking your SIM Score every day, every week and every month of every year. Brand health, measured using a SIM Score, is dynamic, because it constantly captures the consumer conversations of your brand relative to its competitors and determines whether they are helping or hurting your brand. The SIM Score tells you whether your brand is healthy, based on actions that you, your competitors or your customers are making every day.
With 50 million tweets being published every 24 hours and millions and millions of consumer conversations taking place across social platforms and company websites via desktop computers, laptops and mobile devices, your brand health is a reflection of how consumers are talking about you in real-time everywhere.
But it also means that the SIM Score must be further optimized to address this new responsibility. Thus, watch for announcements as we work with additional analytic partners to refine the SIM Score methodology.
We will be focusing on four areas:
•better automated sentiment analysis
•manual analysis of conversations via sampling
•a sharper mechanism for applying influence weight-age
•a tighter formula to give additional weight-age to positive mentions
However, in the meantime, let us show you how the SIM Score is already being used as a broader brand health metric by taking you back to the Toyota and Pepsi examples.
Toyota: SIM score numbers result in shocking short-term findings
When the Toyota recall crisis first broke, we uncovered something extremely surprising. In the first two weeks, the Toyota SIM Score, as illustrated at right, instead of dropping dramatically, actually increased. In some bizarre way, the crisis at first actually helped Toyota.
This happened for two reasons. First, as Edmunds.com later pointed out, the crisis made many prospective buyers believe they could get a bargain on a Toyota. They felt the cars would be fixed and there'd be a special discount on them because of the bad publicity. Second, at first it wasn't clear how big a deal the crisis was and Toyota brand advocates came to the automaker's defense. As a result, not just negative -- but also neutral and positive -- conversations about Toyota increased as the advocates spoke about their experiences with the cars and their safety -- all helping to prop up the Toyota brand. In fact, Toyota saw a sharp increase in the number of fans on its Facebook page during this period too.
Without the SIM Score, one would never have uncovered these findings -- findings that, as we'll explain later in this article, warranted a unique response strategy. Did Toyota know this was happening? Did it respond to these findings? It is hard to tell from the outside. But one thing is certain; if we were in Toyota's shoes at the time, we'd have discounted the cars just as the crisis broke (without waiting to see sales drop first) and would have actively started explaining the situation to the brand advocates of Toyota across the social web and especially on the brand's Facebook page. Those brand advocates needed the right information quickly as they were becoming Toyota's new sales force.
Unfortunately, the SIM Score uptick was short-term for Toyota. After those first two weeks, its score started dropping precipitously, partly because the advocates felt betrayed by the brand too -- not to mention the fact that the full extent of the crisis slowly came to light.
Arguably, Toyota's fate will be decided by whether it can stop its SIM Score from dropping the way it has been lately. In other words, Toyota needs to improve its brand health by finding ways to get consumers talking positively about the brand again and building trust with those brand advocates first and foremost. Discounting cars and running advertising campaigns touting their safety message will not be enough. They will need to focus on learning how they can build trust and figure out what it takes to inspire their advocates once again. In a sense, it is like a marriage that's spiraling downward and needs counseling. We'll be watching the SIM Score to see whether they are able to save the marriage with their advocates or not.
Pepsi: Strategic choice or blunder? Let the SIM score decide
The Cola Wars are probably among the most fascinating and historic rivalries in consumer marketing. The choices made by Coke and Pepsi in the last few months epitomize how daring their brand marketers feel they need to be.
Pepsi, as mentioned earlier, chose not to advertise on the Super Bowl, which would have given it instant, and momentary, visibility with 100 million- plus U.S. TV viewers. Coke, for its part, chose to sponsor the Winter Olympics and had its logo plastered everywhere from billboards to advertise- ments and t-shirts, potentially reaching even more U.S. TV viewers (the estimate over the course of the Vancouver Games was 190 million). Which approach resulted in a higher SIM Score?
The chart below captures the story. The Pepsi "Refresh Everything" movement helped its SIM Score significantly around the time of the program's December 13th launch and through the course of it opening up for suggested charities submissions on February 7th. In real terms, that translated into 1 billion media impressions, includ- ing 44 million on blogs, 70 million tweets and 300,000 new Facebook fans. (It is worth pointing out that a recent study by a social media vendor puts the value of Facebook fan to a company at $3.60 annually.)
However, those gains were halted when the Winter Olympics began on February 10th and Coke re- turned to its earlier SIM Score numbers. The scores have since leveled off, leading one to believe that at least so far, the Pepsi "Refresh Everything" initiative only gave the brand a short-term SIM Score bump that was halted by the Winter Olympics.
What does this tell us? That by not advertising in the Super Bowl and launching "Refresh Everything," Pepsi was able to gain on Coca-Cola, gains that were only reversed at the time of the Winter Olympics. Would the Super Bowl advertisements have resulted in similar gains? Probably not, and an analysis of the previous year's SIM Score numbers would answers that question.
Does this mean "Refresh Everything" was a good idea? It certainly improved the overall health of the brand in the short-term. But what excites us is how the SIM Score, tracked through the course of the year, can give these two brands a stronger measure of the impact of their marketing choices over a period of time, more so than any other metric we know of (other than sales, of course). This longer-term application of the SIM Score is an evolution in our thinking about its value.
If the gains are significant as the year progresses, it'll be the proof that Pepsi made a smart choice by not advertising in the Super Bowl and launching the social media-driven cause marketing effort instead. It will also show that making the switch from a campaign-oriented mentality to a longer term movement has paid rich dividends. And when those numbers are examined, we'll also need to correlate them to overall market share metrics to see if brand health translated into sales.
Integrating the SIM Score into your business
No more can one ignore the conversations taking place in the social Web. In fact, they're so significant in volume, that today they don't just represent a slice of your customer base -- but increasingly are the voices of your entire customer base. Businesses must take actions and create experiences for their consumers that ignite their social influencers to change their impression of the brand, share their perceptions with the world, and directly influence sales, too.
One good example of this is what Citibank, Microsoft and Morningstar chose to do in January. Realizing that trust in big brands had dropped significantly due to the financial crisis, they needed to find a new way to connect with consumers about the issue of money and serve their needs more directly. By launching Bundle Corporation, a new company to help people view spending habits of others around the country and then talk about them, these three corporations created a new experience for consumers -- an experience that was useful, helped people manage their spending -- and have some fun with it too. The fact that this cool new product is associated with the three large corporations can only serve to improve their SIM Scores in time as they benefit from the halo effect.
How brands will make multi-million dollar decisions because of it
The SIM Score, which measures a company's brand health in the social Web, is increasingly a reflection of the overall health of the brand -- as long as you accept the fundamental premise that a brand today is shaped as much by how consumers talk about it as by anything that the brand may do itself.
As a marketer, your challenge today is to manage your SIM Score effectively and to launch campaigns, marketing programs, innovative products and services that help you improve your SIM Score versus your competitors that then result in sales upticks. Yes, you need to create social experiences for your consumers that provide value, encourage them to advocate for your brand and appear responsive to them in real-time. Because one thing is certain: If you aren't seeing the SIM Score correlations, as a leading indicator to market share today, you definitely will in the near future.
Carol Phillips reports in Brand Amplitude"
"On January 21st, all hell broke loose for Toyota. Its sticking accelerator pedal recall was the most challenging crisis the company had ever faced. In fact, a few industry insiders even wondered whether the mighty Toyota brand could survive, as six million cars were recalled worldwide. The crisis is going to change Toyota forever and it may take years to recover lost market share.
Around the same time, something rather dramatic happened to another company, but this time by its own choosing. For the first time in 23 years, PepsiCo decided not to advertise its flagship Pepsi brand on the Super Bowl. With Coca-Cola sponsoring the Winter Olympics, Pepsi launched a year-round "movement," Refresh Everything, to donate money to charities based on consumer voting. For the traditional marketer, this was indeed a bold and risky move.
What do Toyota and Pepsi have in common? They both are in business situations that demand new ways of measuring their brand health -- measurements they haven't had before. And that's where the SIM Score -- monitoring how a brand ranks in Social Influence Marketing -- comes in.
Why the SIM Score matters beyond the social web
In July 2009 Razorfish introduced the SIM (Social Influence Marketing) Score and, at the time, felt that it was an accurate measure of how people perceive your brand in the social web in one moment of time. But since then, through our experiences in deploying the SIM Score and the even more explosive growth of social media (now it transcends all media and all platforms including mobile and gaming devices), we have come to believe that the SIM Score can and should be used as a broader measure of a brand's health, not just as a measure of the strength of a brand in the social Web.
At the root of this thinking is the belief that we now live in a world where brands are shaped in real-time -- more by how consumers talk about them versus anything the brands may do to market themselves or that we as an agency may help them do. This does not mean brand-building is dead. You shouldn't fire your marketing department or your marketing agency. In fact, please don't.Nor does it mean brand equity has no meaning. But whether your brand is worth $83 billion (as Apple is, according to the fifth annual BrandZ Top 100 ranking by Millward Brown Optimor) or $10 billion cannot be revealed through annual, laborious and expensive brand tracking studies. You need to be tracking your SIM Score every day, every week and every month of every year. Brand health, measured using a SIM Score, is dynamic, because it constantly captures the consumer conversations of your brand relative to its competitors and determines whether they are helping or hurting your brand. The SIM Score tells you whether your brand is healthy, based on actions that you, your competitors or your customers are making every day.
With 50 million tweets being published every 24 hours and millions and millions of consumer conversations taking place across social platforms and company websites via desktop computers, laptops and mobile devices, your brand health is a reflection of how consumers are talking about you in real-time everywhere.
But it also means that the SIM Score must be further optimized to address this new responsibility. Thus, watch for announcements as we work with additional analytic partners to refine the SIM Score methodology.
We will be focusing on four areas:
•better automated sentiment analysis
•manual analysis of conversations via sampling
•a sharper mechanism for applying influence weight-age
•a tighter formula to give additional weight-age to positive mentions
However, in the meantime, let us show you how the SIM Score is already being used as a broader brand health metric by taking you back to the Toyota and Pepsi examples.
Toyota: SIM score numbers result in shocking short-term findings
When the Toyota recall crisis first broke, we uncovered something extremely surprising. In the first two weeks, the Toyota SIM Score, as illustrated at right, instead of dropping dramatically, actually increased. In some bizarre way, the crisis at first actually helped Toyota.
This happened for two reasons. First, as Edmunds.com later pointed out, the crisis made many prospective buyers believe they could get a bargain on a Toyota. They felt the cars would be fixed and there'd be a special discount on them because of the bad publicity. Second, at first it wasn't clear how big a deal the crisis was and Toyota brand advocates came to the automaker's defense. As a result, not just negative -- but also neutral and positive -- conversations about Toyota increased as the advocates spoke about their experiences with the cars and their safety -- all helping to prop up the Toyota brand. In fact, Toyota saw a sharp increase in the number of fans on its Facebook page during this period too.
Without the SIM Score, one would never have uncovered these findings -- findings that, as we'll explain later in this article, warranted a unique response strategy. Did Toyota know this was happening? Did it respond to these findings? It is hard to tell from the outside. But one thing is certain; if we were in Toyota's shoes at the time, we'd have discounted the cars just as the crisis broke (without waiting to see sales drop first) and would have actively started explaining the situation to the brand advocates of Toyota across the social web and especially on the brand's Facebook page. Those brand advocates needed the right information quickly as they were becoming Toyota's new sales force.
Unfortunately, the SIM Score uptick was short-term for Toyota. After those first two weeks, its score started dropping precipitously, partly because the advocates felt betrayed by the brand too -- not to mention the fact that the full extent of the crisis slowly came to light.
Arguably, Toyota's fate will be decided by whether it can stop its SIM Score from dropping the way it has been lately. In other words, Toyota needs to improve its brand health by finding ways to get consumers talking positively about the brand again and building trust with those brand advocates first and foremost. Discounting cars and running advertising campaigns touting their safety message will not be enough. They will need to focus on learning how they can build trust and figure out what it takes to inspire their advocates once again. In a sense, it is like a marriage that's spiraling downward and needs counseling. We'll be watching the SIM Score to see whether they are able to save the marriage with their advocates or not.
Pepsi: Strategic choice or blunder? Let the SIM score decide
The Cola Wars are probably among the most fascinating and historic rivalries in consumer marketing. The choices made by Coke and Pepsi in the last few months epitomize how daring their brand marketers feel they need to be.
Pepsi, as mentioned earlier, chose not to advertise on the Super Bowl, which would have given it instant, and momentary, visibility with 100 million- plus U.S. TV viewers. Coke, for its part, chose to sponsor the Winter Olympics and had its logo plastered everywhere from billboards to advertise- ments and t-shirts, potentially reaching even more U.S. TV viewers (the estimate over the course of the Vancouver Games was 190 million). Which approach resulted in a higher SIM Score?
The chart below captures the story. The Pepsi "Refresh Everything" movement helped its SIM Score significantly around the time of the program's December 13th launch and through the course of it opening up for suggested charities submissions on February 7th. In real terms, that translated into 1 billion media impressions, includ- ing 44 million on blogs, 70 million tweets and 300,000 new Facebook fans. (It is worth pointing out that a recent study by a social media vendor puts the value of Facebook fan to a company at $3.60 annually.)
However, those gains were halted when the Winter Olympics began on February 10th and Coke re- turned to its earlier SIM Score numbers. The scores have since leveled off, leading one to believe that at least so far, the Pepsi "Refresh Everything" initiative only gave the brand a short-term SIM Score bump that was halted by the Winter Olympics.
What does this tell us? That by not advertising in the Super Bowl and launching "Refresh Everything," Pepsi was able to gain on Coca-Cola, gains that were only reversed at the time of the Winter Olympics. Would the Super Bowl advertisements have resulted in similar gains? Probably not, and an analysis of the previous year's SIM Score numbers would answers that question.
Does this mean "Refresh Everything" was a good idea? It certainly improved the overall health of the brand in the short-term. But what excites us is how the SIM Score, tracked through the course of the year, can give these two brands a stronger measure of the impact of their marketing choices over a period of time, more so than any other metric we know of (other than sales, of course). This longer-term application of the SIM Score is an evolution in our thinking about its value.
If the gains are significant as the year progresses, it'll be the proof that Pepsi made a smart choice by not advertising in the Super Bowl and launching the social media-driven cause marketing effort instead. It will also show that making the switch from a campaign-oriented mentality to a longer term movement has paid rich dividends. And when those numbers are examined, we'll also need to correlate them to overall market share metrics to see if brand health translated into sales.
Integrating the SIM Score into your business
No more can one ignore the conversations taking place in the social Web. In fact, they're so significant in volume, that today they don't just represent a slice of your customer base -- but increasingly are the voices of your entire customer base. Businesses must take actions and create experiences for their consumers that ignite their social influencers to change their impression of the brand, share their perceptions with the world, and directly influence sales, too.
One good example of this is what Citibank, Microsoft and Morningstar chose to do in January. Realizing that trust in big brands had dropped significantly due to the financial crisis, they needed to find a new way to connect with consumers about the issue of money and serve their needs more directly. By launching Bundle Corporation, a new company to help people view spending habits of others around the country and then talk about them, these three corporations created a new experience for consumers -- an experience that was useful, helped people manage their spending -- and have some fun with it too. The fact that this cool new product is associated with the three large corporations can only serve to improve their SIM Scores in time as they benefit from the halo effect.
How brands will make multi-million dollar decisions because of it
The SIM Score, which measures a company's brand health in the social Web, is increasingly a reflection of the overall health of the brand -- as long as you accept the fundamental premise that a brand today is shaped as much by how consumers talk about it as by anything that the brand may do itself.
As a marketer, your challenge today is to manage your SIM Score effectively and to launch campaigns, marketing programs, innovative products and services that help you improve your SIM Score versus your competitors that then result in sales upticks. Yes, you need to create social experiences for your consumers that provide value, encourage them to advocate for your brand and appear responsive to them in real-time. Because one thing is certain: If you aren't seeing the SIM Score correlations, as a leading indicator to market share today, you definitely will in the near future.
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Robot Anxiety: Smart Machines and Your Job
Smart networks might be more of an issue than specific machines, but with all the predicting programs can do, why shouldnt out-thinking us be on the horizon?
Jessica Stillman expounds in BNet:
"Recently, I’ve noticed a trend in the blogosphere. From this post at Business Insider outlining nine jobs that will soon be done by robots (watch out, pharmacists) to this one from blogging economist Tyler Cowen musing on how chess has been changed by computers, there’s a lot of robot anxiety out there. Of course, the victory on Jeopardy of IBM’s Watson has many people, including the Harvard Business Review, wondering when machines will replace more than just travel agents and bank tellers.
But are our fears justified?
To find out I asked a friend who recently finished a PhD in robotics for his insider’s take on the subject. He started by explaining how the technology is progressing and what our smart machines are — and are not — capable of:
It’s important to note that what Watson did is sort of low-hanging fruit in the “AI” world. Yes, Watson is able to amass facts and make some connections between them, but it’s still mostly raw information. It’s important to note what Watson did NOT do: see or hear. Watson is a data machine — a glorified computer. It doesn’t really interact with the world.
People find it hard to understand that what is so easy for us is so hard for computers — seeing, hearing, spatial reasoning, language, etc. This is because the brain devotes the vast majority of energy to these tasks. Evolution has developed them over eons to be really fast, accurate, and unconscious. If they were not, we would not survive. By contrast, building this form of intelligence into machines is very hard. This is where the automation revolution is really going — interaction with the real world.
So what does that mean for work? Paul Krugman recently penned a much discussed op-ed arguing that the divide between what robots will and will not be able to accomplish soon ignores the human divide between white and blue collar jobs. Instead, Krugman claims routine is the hallmark of a soon to be extinct profession:
Any routine task — a category that includes many white-collar, nonmanual jobs — is in the firing line. Conversely, jobs that can’t be carried out by following explicit rules — a category that includes many kinds of manual labor, from truck drivers to janitors — will tend to grow even in the face of technological progress.
When it came to dividing the doomed professions from the saved, does my friend agree with Krugman? While there was plenty of overlap in their opinions, my friend’s description of which professions are likely to be taken over by robots in the foreseeable future took a technologist’s-eye view, which focused on the nuts and bolts of building robots, rather than an economist’s theoretical lens, with interesting results:
The jobs that will go first are the least connected to the physical world. Lawyers and accountants are good examples. Certainly, this will not put all lawyers and accountants out of business any time soon. But there will be decreased demand for their services as computers do more and more of the easy work, and eventually more of the hard work.
We are fast approaching, however, the time when machines can interact reasonably well in the real world. They will only get better and more efficient. This will be true for tasks like: driving, flying, manufacturing, mining, stocking, shipping, construction. Jobs that will be “safe” will fall into creative or human service categories: writers, engineers, artists, waiters, actors, nannies, teachers, etc.
I suppose we can all breathe easier knowing our lives will not soon resemble an episode of Battlestar Galactica, but on the other hand, my friend’s final verdict on the changes soon to be wrought by robotics wasn’t exactly soothing either. “It’ll be huge,” he said.
Krugman agrees with that assessment at least and is pushing stronger labor unions and healthcare reform as bulwarks for the middle class to defend its prosperity against the rise of robots. What adjustments do you think society needs to make to ensure wealth is shared broadly in an age of increasing automation?
Jessica Stillman expounds in BNet:
"Recently, I’ve noticed a trend in the blogosphere. From this post at Business Insider outlining nine jobs that will soon be done by robots (watch out, pharmacists) to this one from blogging economist Tyler Cowen musing on how chess has been changed by computers, there’s a lot of robot anxiety out there. Of course, the victory on Jeopardy of IBM’s Watson has many people, including the Harvard Business Review, wondering when machines will replace more than just travel agents and bank tellers.
But are our fears justified?
To find out I asked a friend who recently finished a PhD in robotics for his insider’s take on the subject. He started by explaining how the technology is progressing and what our smart machines are — and are not — capable of:
It’s important to note that what Watson did is sort of low-hanging fruit in the “AI” world. Yes, Watson is able to amass facts and make some connections between them, but it’s still mostly raw information. It’s important to note what Watson did NOT do: see or hear. Watson is a data machine — a glorified computer. It doesn’t really interact with the world.
People find it hard to understand that what is so easy for us is so hard for computers — seeing, hearing, spatial reasoning, language, etc. This is because the brain devotes the vast majority of energy to these tasks. Evolution has developed them over eons to be really fast, accurate, and unconscious. If they were not, we would not survive. By contrast, building this form of intelligence into machines is very hard. This is where the automation revolution is really going — interaction with the real world.
So what does that mean for work? Paul Krugman recently penned a much discussed op-ed arguing that the divide between what robots will and will not be able to accomplish soon ignores the human divide between white and blue collar jobs. Instead, Krugman claims routine is the hallmark of a soon to be extinct profession:
Any routine task — a category that includes many white-collar, nonmanual jobs — is in the firing line. Conversely, jobs that can’t be carried out by following explicit rules — a category that includes many kinds of manual labor, from truck drivers to janitors — will tend to grow even in the face of technological progress.
When it came to dividing the doomed professions from the saved, does my friend agree with Krugman? While there was plenty of overlap in their opinions, my friend’s description of which professions are likely to be taken over by robots in the foreseeable future took a technologist’s-eye view, which focused on the nuts and bolts of building robots, rather than an economist’s theoretical lens, with interesting results:
The jobs that will go first are the least connected to the physical world. Lawyers and accountants are good examples. Certainly, this will not put all lawyers and accountants out of business any time soon. But there will be decreased demand for their services as computers do more and more of the easy work, and eventually more of the hard work.
We are fast approaching, however, the time when machines can interact reasonably well in the real world. They will only get better and more efficient. This will be true for tasks like: driving, flying, manufacturing, mining, stocking, shipping, construction. Jobs that will be “safe” will fall into creative or human service categories: writers, engineers, artists, waiters, actors, nannies, teachers, etc.
I suppose we can all breathe easier knowing our lives will not soon resemble an episode of Battlestar Galactica, but on the other hand, my friend’s final verdict on the changes soon to be wrought by robotics wasn’t exactly soothing either. “It’ll be huge,” he said.
Krugman agrees with that assessment at least and is pushing stronger labor unions and healthcare reform as bulwarks for the middle class to defend its prosperity against the rise of robots. What adjustments do you think society needs to make to ensure wealth is shared broadly in an age of increasing automation?
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Chimera: What the Arab Revolts May Mean for Iran, Israel and Turkey
Be careful what you wish for:
This was written by Stepen Larrabee in Project Syndicate:
The dramatic revolts in Tunisia, Egypt, and Libya have acted as a catalyst for a broader Arab awakening that has fundamentally shaken the Middle East’s political order, which has been in place since the late 1970’s. While it is too early to predict the final outcomes, several important regional implications are already beginning to emerge.
First, the revolts are a double-edged sword for Iran. The Iranian regime may benefit from the ouster or weakening of pro-Western Arab leaders and regimes in Egypt, Jordan, and Saudi Arabia, but Iran’s initial encouragement of the democratic uprisings in Tunisia and Egypt came with a sting in the tail. Iranian officials had to shift gears quickly once their own population began to call for the same democratic rights, suggesting that Iran could face stronger pressures for democracy and political change over the medium and long run.
Second, the upheavals threaten to leave Israel more isolated. With Mubarak gone, Israel has lost its most important regional partner. Indeed, given the serious deterioration in Israel’s relations with Turkey, Mubarak’s departure has deprived it of its two most demonstrable allies in the region. While Egypt’s interim military regime has pledged to adhere to the 1979 peace agreement, a new, more democratic government could adopt a different attitude.
Third, the pressures for democratic change have significantly bolstered Turkey’s regional influence. While the United States and the European Union initially hedged their bets, Turkish Prime Minister Recep Tayyip Erdoğan sided squarely with the demonstrations for democracy in Tahrir Square – a move that enhanced Turkey’s prestige among the democratic opposition in Egypt and elsewhere in the region.
Many Arabs regard the brand of moderate Islam espoused by Turkey’s ruling Justice and Development Party (AKP) as a possible model for the Middle East. Many Turks have begun to see things the same way. In a recent interview, Erdoğan noted that Turkey could be a “source of inspiration” for countries in the Middle East, because it has shown that Islam and democracy can coexist harmoniously.
At first glance, the Turkish model – with its emphasis on secularism and democracy – has obvious appeal in a region burdened by corrupt, autocratic, incompetent, and inefficient governments. But Turkey’s historical experience and political evolution differ in important ways from Arab countries’. As a result, its model cannot easily be transplanted.
Turkish Islam is more moderate and pluralistic than elsewhere in the Middle East, and, since at least the late Ottoman period, Turkey has sought to fuse Islam and Westernization. This differentiates Turkey from most other Muslim countries in the Middle East, and has enabled it to avoid the sharp dichotomies, ruptures, and violence that have characterized political modernization elsewhere in the region.
The rise of the AKP’s moderate brand of Islam was largely in response to internal factors, particularly the cumulative effects of several decades of democratization and socioeconomic transformation, which gave rise to a new entrepreneurial class in Anatolia that was economically liberal but socially and politically conservative. This class, one of the AKP’s main pillars of electoral support, does not exist elsewhere in the Middle East.
Moreover, the Turkish model owes much to the leadership of Kemal Ataturk, founder of the Turkish Republic. Ataturk, a committed Westernizer and political visionary, transformed the multinational Ottoman empire into a modern state based on Turkish nationalism.
But, in transforming Turkey, Ataturk did not begin entirely from scratch. The process of Westernization and modernization had begun in the late nineteenth century under the Ottomans during the period of the Tanzimat. While the Kemalists sought a radical break with the Ottoman past, there were important elements of continuity between their Westernization efforts and those undertaken in the late Ottoman period. Both were elitist and state-driven.
These important pre-conditions do not exist in the Arab Middle East. Most countries in the region lack strong independent political institutions and traditions on which to build a democratic political order. They also lack a vibrant civil society.
Ultimately, the Arab countries do not have the benefit of Turkey’s tradition of moderate Islam or its history of successfully fusing Islam and Westernization. As a result, the collapse of the old power structures in many Middle East countries is likely to be accompanied by considerable political turmoil and violence
This was written by Stepen Larrabee in Project Syndicate:
The dramatic revolts in Tunisia, Egypt, and Libya have acted as a catalyst for a broader Arab awakening that has fundamentally shaken the Middle East’s political order, which has been in place since the late 1970’s. While it is too early to predict the final outcomes, several important regional implications are already beginning to emerge.
First, the revolts are a double-edged sword for Iran. The Iranian regime may benefit from the ouster or weakening of pro-Western Arab leaders and regimes in Egypt, Jordan, and Saudi Arabia, but Iran’s initial encouragement of the democratic uprisings in Tunisia and Egypt came with a sting in the tail. Iranian officials had to shift gears quickly once their own population began to call for the same democratic rights, suggesting that Iran could face stronger pressures for democracy and political change over the medium and long run.
Second, the upheavals threaten to leave Israel more isolated. With Mubarak gone, Israel has lost its most important regional partner. Indeed, given the serious deterioration in Israel’s relations with Turkey, Mubarak’s departure has deprived it of its two most demonstrable allies in the region. While Egypt’s interim military regime has pledged to adhere to the 1979 peace agreement, a new, more democratic government could adopt a different attitude.
Third, the pressures for democratic change have significantly bolstered Turkey’s regional influence. While the United States and the European Union initially hedged their bets, Turkish Prime Minister Recep Tayyip Erdoğan sided squarely with the demonstrations for democracy in Tahrir Square – a move that enhanced Turkey’s prestige among the democratic opposition in Egypt and elsewhere in the region.
Many Arabs regard the brand of moderate Islam espoused by Turkey’s ruling Justice and Development Party (AKP) as a possible model for the Middle East. Many Turks have begun to see things the same way. In a recent interview, Erdoğan noted that Turkey could be a “source of inspiration” for countries in the Middle East, because it has shown that Islam and democracy can coexist harmoniously.
At first glance, the Turkish model – with its emphasis on secularism and democracy – has obvious appeal in a region burdened by corrupt, autocratic, incompetent, and inefficient governments. But Turkey’s historical experience and political evolution differ in important ways from Arab countries’. As a result, its model cannot easily be transplanted.
Turkish Islam is more moderate and pluralistic than elsewhere in the Middle East, and, since at least the late Ottoman period, Turkey has sought to fuse Islam and Westernization. This differentiates Turkey from most other Muslim countries in the Middle East, and has enabled it to avoid the sharp dichotomies, ruptures, and violence that have characterized political modernization elsewhere in the region.
The rise of the AKP’s moderate brand of Islam was largely in response to internal factors, particularly the cumulative effects of several decades of democratization and socioeconomic transformation, which gave rise to a new entrepreneurial class in Anatolia that was economically liberal but socially and politically conservative. This class, one of the AKP’s main pillars of electoral support, does not exist elsewhere in the Middle East.
Moreover, the Turkish model owes much to the leadership of Kemal Ataturk, founder of the Turkish Republic. Ataturk, a committed Westernizer and political visionary, transformed the multinational Ottoman empire into a modern state based on Turkish nationalism.
But, in transforming Turkey, Ataturk did not begin entirely from scratch. The process of Westernization and modernization had begun in the late nineteenth century under the Ottomans during the period of the Tanzimat. While the Kemalists sought a radical break with the Ottoman past, there were important elements of continuity between their Westernization efforts and those undertaken in the late Ottoman period. Both were elitist and state-driven.
These important pre-conditions do not exist in the Arab Middle East. Most countries in the region lack strong independent political institutions and traditions on which to build a democratic political order. They also lack a vibrant civil society.
Ultimately, the Arab countries do not have the benefit of Turkey’s tradition of moderate Islam or its history of successfully fusing Islam and Westernization. As a result, the collapse of the old power structures in many Middle East countries is likely to be accompanied by considerable political turmoil and violence
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Money Enhances Memory - But Only for Boring Material
Could explain high cost of law school...
Hat tip to Dan Pink:
Money enhances memory consolidation - But only for boring material.
Murayama K, Kuhbandner C.
Department of Psychology, University of Munich, Leopoldstrasse 13, 80802 Munich, Germany.
Abstract
Money's ability to enhance memory has received increased attention in recent research. However, previous studies have not directly addressed the time-dependent nature of monetary effects on memory, which are suggested to exist by research in cognitive neuroscience, and the possible detrimental effects of monetary rewards on learning interesting material, as indicated by studies in motivational psychology. By utilizing a trivia question paradigm, the current study incorporated these perspectives and examined the effect of monetary rewards on immediate and delayed memory performance for answers to uninteresting and interesting questions. Results showed that monetary rewards promote memory performance only after a delay. In addition, the memory enhancement effect of monetary rewards was only observed for uninteresting questions. These results are consistent with both the hippocampus-dependent memory consolidation model of reward learning and previous findings documenting the ineffectiveness of monetary rewards on tasks that have intrinsic value.
Hat tip to Dan Pink:
Money enhances memory consolidation - But only for boring material.
Murayama K, Kuhbandner C.
Department of Psychology, University of Munich, Leopoldstrasse 13, 80802 Munich, Germany.
Abstract
Money's ability to enhance memory has received increased attention in recent research. However, previous studies have not directly addressed the time-dependent nature of monetary effects on memory, which are suggested to exist by research in cognitive neuroscience, and the possible detrimental effects of monetary rewards on learning interesting material, as indicated by studies in motivational psychology. By utilizing a trivia question paradigm, the current study incorporated these perspectives and examined the effect of monetary rewards on immediate and delayed memory performance for answers to uninteresting and interesting questions. Results showed that monetary rewards promote memory performance only after a delay. In addition, the memory enhancement effect of monetary rewards was only observed for uninteresting questions. These results are consistent with both the hippocampus-dependent memory consolidation model of reward learning and previous findings documenting the ineffectiveness of monetary rewards on tasks that have intrinsic value.
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Portuguese Crisis Shakes Europe: Country With Poorest Economy - and Weakest Educational System
"You eat what you know," is a crude statement but accurately reflects the linkage between educational attainment and income. Greece and now Portugal are the two countries whose economic travails have most tested the concept of Europe as a union. They are also the countries with the weakest educational systems. And now they are caught in the death spiral brought about by budget cuts that will further weaken those already poor systems. Failure to invest - and to value education properly - when times were better is exacerbating the countries' problems now. Other nations - like the US and UK - may want to take heed as they contemplate gutting their once proud schools and universities.
Charles Forelle reports in the Wall Street Journal:
"Isabel Fernandes, a cheery 22-year-old with a constellation of stars tattooed around her right eye, isn't sure how many times she repeated fifth grade. Two, she says with a laugh. Or maybe three. She redid seventh grade as well. She quit school with an eighth-grade education at age 20.
Ms. Fernandes lives in a poor suburb near the airport. She doesn't work. Employers, she says, "are asking for higher education." Even cleaning jobs are hard to find.
Portugal is the poorest country in Western Europe. It is also the least educated, and that has emerged as a painful liability in its gathering economic crisis.
Wednesday night, the economic crisis became a political crisis. Portugal's parliament rejected Prime Minister José Sócrates's plan for spending cuts and tax increases. Mr. Sócrates handed in his resignation. He will hang on as a caretaker until a new government is formed.
Without the budget cuts, Portugal is almost certain to need an international bailout. It will run out of money this year without fresh cash, and markets are charging punitive rates for borrowing. Two firms downgraded Portugal's credit rating Thursday.
Its dire situation thrust a possible Portuguese rescue onto the agenda of European Union leaders who gathered in Brussels Thursday for a previously scheduled meeting, where they were agreeing on a new bailout fund. Portugal would be the third country in the euro zone to require a bailout, after Greece and Ireland.
The state of Portuguese education says a lot about why a rescue is likely to be needed, and why one would be costly and difficult. Put simply, Portugal must generate enough long-term economic growth to pay off its large debts. An unskilled work force makes that hard.
Cheap rote labor that once sustained Portugal's textile industry has vanished to Asia. The former Eastern Bloc countries that joined the European Union en masse in 2004 offer lower wages and workers with more schooling. They have sucked skilled jobs away.
Just 28% of the Portuguese population between 25 and 64 has completed high school. The figure is 85% in Germany, 91% in the Czech Republic and 89% in the U.S.
"I don't see how it is going to grow without educating its work force," says Pedro Carneiro, an economist at University College London who left Portugal to do his postgraduate studies in the U.S.
The education woes in Portugal show the extent of Europe's challenge as it tries to right itself amid the sovereign-debt crisis.
Rapid and painful budget-cutting, which is being enforced across the Continent, is the first step. But the second is far harder and will take far longer. The 17 countries linked via the euro have vastly differing levels of economic performance. Unless the gulf is narrowed, the pressures that caused the weaker among them to pile up huge volumes of debt, and have trouble repaying it, will doubtless re-emerge.
Better schooling in Portugal won't come quickly. Sharp cuts in its education spending make the task harder. And even if there are improvements, reaping their benefits could take years.
Greece and Ireland, the two EU countries that got bailouts, reached the brink relatively rapidly: Greece came undone after revelations it had grossly underestimated the government's parlous fiscal state; Ireland self-immolated in an orgy of property speculation.
Portugal's crisis, by contrast, has come to a boil slowly. For a decade, Portugal's growth trailed the euro-zone average. Traditional industries like cork harvesting and shoe stitching couldn't energize the entire country. The tech boom of the mid-2000s largely passed Portugal by.
The Portuguese spent nonetheless. The economy—government and private sector together—has run cumulative deficits with the rest of the world of more than €130 billion over the past decade. The state hasn't had a balanced budget, let alone a surplus, for more than 30 years.
The result is a pile of debt. The government's debt, some of which is held domestically, will approach 90% of gross domestic product this year. The entire economy, including both the public and private sectors, owes foreigners an amount equal to more than two years' of economic output.
Before his failure this week, Prime Minister Sócrates had pushed some budget cuts through parliament under pressure from other euro-zone countries. But in an interview before Wednesday's political crisis, Mr. Sócrates made clear that investment in education was a priority, despite the costs. Appeasing financial markets was important, he said, but the country shouldn't "lose the strategy and vision."
There is substantial evidence from elsewhere that education confers broad economic benefits. Ireland was one of the EU's poorest countries a generation ago. But it threw EU subsidy money into technical education and remade itself as a destination for high-tech labor, made doubly attractive by low corporate taxes. Ireland is now, even after a brutal banking crisis, among the richest nations in Europe.
"They had an educated-enough work force that they could move into a technology industry, and they rose out of nowhere," says Eric Hanushek, a Stanford University professor.
Prof. Hanushek and a professor from the University of Munich have linked GDP growth with population-wide performance on standardized tests. They calculate that Portugal's long-term rate of economic growth would be 1.5 percentage points higher if the country had the same test scores as super-educated Finland.
Education long was an afterthought here. "The southern countries like Portugal and Spain and the south of France and Italy, we have always had some problems related with education," says António Nóvoa, a historian who is rector of the University of Lisbon. "That's been like that since the 16th century."
The repressive dictatorship that ruled Portugal from 1926 to 1974 had the idea "that people should not have ambition to be something different than what they were," Mr. Nóvoa says. The result was widespread illiteracy and little formal schooling; just three years were compulsory. Huge leaps have been made since the 1970s, he says, but "it is not easy to change a history of five centuries."
Portugal has just begun phasing in 12 years of required schooling; now, Portuguese can leave school after ninth grade. Many do. The government says it is racing ahead with reforms. Mr. Sócrates points to an initiative that gives students laptops and to a far-reaching project to rebuild dilapidated schoolhouses. Results last year show students improving on standardized tests.
But it is a long road. "We have accumulated years and years of ignorant people," says Belmiro de Azevedo, a billionaire industrialist.
He described the system as calcified. The central administration wields tight control. Curricula are simultaneously undemanding and rigid. Dropout rates are high. Schools struggle to accommodate an influx of immigrants from Portugal's former colonies in Africa, such as Angola and Guinea-Bissau.
A push to evaluate teachers triggered searing strikes and demonstrations in 2008, souring relations between powerful teachers' unions and the government. The political life of education ministers is measured in months: since the dictatorship ended in 1974, there have been 27.
To the system's critics, a fight that has developed over quasi-private schools is emblematic of what's wrong. With budgets tight, the government has imposed deep cuts on schools that are at the margin of the state's control—no matter that some are among the best.
The highway north of Lisbon rises gently out of the Tagus River's estuary and cuts through valleys of pine and scrub and fields stained yellow by sweet clover. About 30 miles up, in the municipality of Torres Vedras, the population is spread thinly in tiny towns that dot roads meandering toward the ocean.
In one town, A Dos Cunhados, the local school isn't run or owned by the government. It is managed by the Catholic Church, in an arrangement that dates to the end of the dictatorship, when the new Portuguese state found it didn't have enough facilities.
At the school, Externato de Penafirme, as at 90 others with what are called "association contracts," the state pays a management fee to a private entity, which broadly follows the state curriculum but hires its own teachers.
The deputy principal, Carlos Silva, once taught chemistry in the public school system. He was shuffled through four schools in four years. Frustrated, he quit and enrolled in a seminary. Afterward, as a priest, he asked his bishop about returning to the classroom, and was assigned to Externato de Penafirme.
Instead of being given teachers off a master list, Father Silva and other administrators of these quasi-private schools select their own. They adjust the curriculum, adding, for instance, more religious instruction. They set up teams of teachers responsible for students and try to rope back those prone to dropping out.
"We make an enormous effort to take them all to the end," says a school administrator, José Mendes. Penafirme's test scores put it in the top 15% of secondary schools nationwide. It is the best in Torres Vedras.
To their advocates, the privately run schools inject a needed dose of new thinking. "We have to keep a diversified system," says Eduardo Marçal Grilo, a former education minister. If there's a public and a private school in the same place, he says, "let's see what is the best, and if the best is private, the state can close the public and support the private."
But in November, the priests of Penafirme got a shock. Facing money problems—the government's education budget is declining 11% this year—the education ministry said it would cut the sum it pays association-contract schools to €80,000 per class, from €114,000 on average. Father Silva says it spends €85,000 per class on salary and benefits alone.
To the current education minister, Isabel Alçada, directing scarce funds to private entities like Penafirme while regular public schools have grave needs "is not just." What was once a program meant to fill gaps has turned into "competition," she complains, in which private operators set up bus routes to lure students.
Faced with the cuts, students and parents organized. In December, 4,000 people held hands in a big ring around the Penafirme campus. The pictures hit television. A Facebook group sprang up. In January, students walked out of dozens of the privately run schools for three days. To dramatize a claim the cuts would mean the death of their schools, students and parents from 55 schools ferried mock coffins to Lisbon and put them on the median strip outside Ms. Alçada's ministry.
Last month, the education ministry eased somewhat, agreeing to restore part of the lost funding for this semester.
Paulo Gonçalves, a Hewlett-Packard Co. corporate salesman who is president of the Penafirme parents' association, says the détente was a victory, but more money is needed to keep quality high enough to prepare students for college. "If you earn a degree in Portugal, you earn more or less double those who don't," he says. "This is what I teach my kids."
It's particularly true with unemployment over 11%. "With the crisis, we have to go to university," says Sophie Alves, a Penafirme senior who plans to study occupational therapy in college. With only a high-school diploma, "you can do nothing, just serve tables."
With even less than that, prospects are bleaker still. Ms. Fernandes, the 22-year-old with an eighth-grade education, comes often to a school in Apelacão, where a tiny nonprofit called Project Leadership tries to coax young people back to class or help them get jobs.
Serafim Gomes, also 22, was there on a recent afternoon. He left school in eighth grade with the dream of becoming a professional soccer player. It didn't pan out. Now he occasionally waits tables and hopes for better employment.
Marco Monteiro, who is 16, was recently kicked out of his regular school. Bad behavior, he says. He hoped to go back—"I don't have enough school to find work," he says—and then maybe get a job in the mall. Project Leadership's director, António Embaló, complimented him on his mechanical skills.
Might he consider college, perhaps studying engineering?
"It's never crossed my mind," Mr. Monteiro says. "I don't know anyone who went."
Charles Forelle reports in the Wall Street Journal:
"Isabel Fernandes, a cheery 22-year-old with a constellation of stars tattooed around her right eye, isn't sure how many times she repeated fifth grade. Two, she says with a laugh. Or maybe three. She redid seventh grade as well. She quit school with an eighth-grade education at age 20.
Ms. Fernandes lives in a poor suburb near the airport. She doesn't work. Employers, she says, "are asking for higher education." Even cleaning jobs are hard to find.
Portugal is the poorest country in Western Europe. It is also the least educated, and that has emerged as a painful liability in its gathering economic crisis.
Wednesday night, the economic crisis became a political crisis. Portugal's parliament rejected Prime Minister José Sócrates's plan for spending cuts and tax increases. Mr. Sócrates handed in his resignation. He will hang on as a caretaker until a new government is formed.
Without the budget cuts, Portugal is almost certain to need an international bailout. It will run out of money this year without fresh cash, and markets are charging punitive rates for borrowing. Two firms downgraded Portugal's credit rating Thursday.
Its dire situation thrust a possible Portuguese rescue onto the agenda of European Union leaders who gathered in Brussels Thursday for a previously scheduled meeting, where they were agreeing on a new bailout fund. Portugal would be the third country in the euro zone to require a bailout, after Greece and Ireland.
The state of Portuguese education says a lot about why a rescue is likely to be needed, and why one would be costly and difficult. Put simply, Portugal must generate enough long-term economic growth to pay off its large debts. An unskilled work force makes that hard.
Cheap rote labor that once sustained Portugal's textile industry has vanished to Asia. The former Eastern Bloc countries that joined the European Union en masse in 2004 offer lower wages and workers with more schooling. They have sucked skilled jobs away.
Just 28% of the Portuguese population between 25 and 64 has completed high school. The figure is 85% in Germany, 91% in the Czech Republic and 89% in the U.S.
"I don't see how it is going to grow without educating its work force," says Pedro Carneiro, an economist at University College London who left Portugal to do his postgraduate studies in the U.S.
The education woes in Portugal show the extent of Europe's challenge as it tries to right itself amid the sovereign-debt crisis.
Rapid and painful budget-cutting, which is being enforced across the Continent, is the first step. But the second is far harder and will take far longer. The 17 countries linked via the euro have vastly differing levels of economic performance. Unless the gulf is narrowed, the pressures that caused the weaker among them to pile up huge volumes of debt, and have trouble repaying it, will doubtless re-emerge.
Better schooling in Portugal won't come quickly. Sharp cuts in its education spending make the task harder. And even if there are improvements, reaping their benefits could take years.
Greece and Ireland, the two EU countries that got bailouts, reached the brink relatively rapidly: Greece came undone after revelations it had grossly underestimated the government's parlous fiscal state; Ireland self-immolated in an orgy of property speculation.
Portugal's crisis, by contrast, has come to a boil slowly. For a decade, Portugal's growth trailed the euro-zone average. Traditional industries like cork harvesting and shoe stitching couldn't energize the entire country. The tech boom of the mid-2000s largely passed Portugal by.
The Portuguese spent nonetheless. The economy—government and private sector together—has run cumulative deficits with the rest of the world of more than €130 billion over the past decade. The state hasn't had a balanced budget, let alone a surplus, for more than 30 years.
The result is a pile of debt. The government's debt, some of which is held domestically, will approach 90% of gross domestic product this year. The entire economy, including both the public and private sectors, owes foreigners an amount equal to more than two years' of economic output.
Before his failure this week, Prime Minister Sócrates had pushed some budget cuts through parliament under pressure from other euro-zone countries. But in an interview before Wednesday's political crisis, Mr. Sócrates made clear that investment in education was a priority, despite the costs. Appeasing financial markets was important, he said, but the country shouldn't "lose the strategy and vision."
There is substantial evidence from elsewhere that education confers broad economic benefits. Ireland was one of the EU's poorest countries a generation ago. But it threw EU subsidy money into technical education and remade itself as a destination for high-tech labor, made doubly attractive by low corporate taxes. Ireland is now, even after a brutal banking crisis, among the richest nations in Europe.
"They had an educated-enough work force that they could move into a technology industry, and they rose out of nowhere," says Eric Hanushek, a Stanford University professor.
Prof. Hanushek and a professor from the University of Munich have linked GDP growth with population-wide performance on standardized tests. They calculate that Portugal's long-term rate of economic growth would be 1.5 percentage points higher if the country had the same test scores as super-educated Finland.
Education long was an afterthought here. "The southern countries like Portugal and Spain and the south of France and Italy, we have always had some problems related with education," says António Nóvoa, a historian who is rector of the University of Lisbon. "That's been like that since the 16th century."
The repressive dictatorship that ruled Portugal from 1926 to 1974 had the idea "that people should not have ambition to be something different than what they were," Mr. Nóvoa says. The result was widespread illiteracy and little formal schooling; just three years were compulsory. Huge leaps have been made since the 1970s, he says, but "it is not easy to change a history of five centuries."
Portugal has just begun phasing in 12 years of required schooling; now, Portuguese can leave school after ninth grade. Many do. The government says it is racing ahead with reforms. Mr. Sócrates points to an initiative that gives students laptops and to a far-reaching project to rebuild dilapidated schoolhouses. Results last year show students improving on standardized tests.
But it is a long road. "We have accumulated years and years of ignorant people," says Belmiro de Azevedo, a billionaire industrialist.
He described the system as calcified. The central administration wields tight control. Curricula are simultaneously undemanding and rigid. Dropout rates are high. Schools struggle to accommodate an influx of immigrants from Portugal's former colonies in Africa, such as Angola and Guinea-Bissau.
A push to evaluate teachers triggered searing strikes and demonstrations in 2008, souring relations between powerful teachers' unions and the government. The political life of education ministers is measured in months: since the dictatorship ended in 1974, there have been 27.
To the system's critics, a fight that has developed over quasi-private schools is emblematic of what's wrong. With budgets tight, the government has imposed deep cuts on schools that are at the margin of the state's control—no matter that some are among the best.
The highway north of Lisbon rises gently out of the Tagus River's estuary and cuts through valleys of pine and scrub and fields stained yellow by sweet clover. About 30 miles up, in the municipality of Torres Vedras, the population is spread thinly in tiny towns that dot roads meandering toward the ocean.
In one town, A Dos Cunhados, the local school isn't run or owned by the government. It is managed by the Catholic Church, in an arrangement that dates to the end of the dictatorship, when the new Portuguese state found it didn't have enough facilities.
At the school, Externato de Penafirme, as at 90 others with what are called "association contracts," the state pays a management fee to a private entity, which broadly follows the state curriculum but hires its own teachers.
The deputy principal, Carlos Silva, once taught chemistry in the public school system. He was shuffled through four schools in four years. Frustrated, he quit and enrolled in a seminary. Afterward, as a priest, he asked his bishop about returning to the classroom, and was assigned to Externato de Penafirme.
Instead of being given teachers off a master list, Father Silva and other administrators of these quasi-private schools select their own. They adjust the curriculum, adding, for instance, more religious instruction. They set up teams of teachers responsible for students and try to rope back those prone to dropping out.
"We make an enormous effort to take them all to the end," says a school administrator, José Mendes. Penafirme's test scores put it in the top 15% of secondary schools nationwide. It is the best in Torres Vedras.
To their advocates, the privately run schools inject a needed dose of new thinking. "We have to keep a diversified system," says Eduardo Marçal Grilo, a former education minister. If there's a public and a private school in the same place, he says, "let's see what is the best, and if the best is private, the state can close the public and support the private."
But in November, the priests of Penafirme got a shock. Facing money problems—the government's education budget is declining 11% this year—the education ministry said it would cut the sum it pays association-contract schools to €80,000 per class, from €114,000 on average. Father Silva says it spends €85,000 per class on salary and benefits alone.
To the current education minister, Isabel Alçada, directing scarce funds to private entities like Penafirme while regular public schools have grave needs "is not just." What was once a program meant to fill gaps has turned into "competition," she complains, in which private operators set up bus routes to lure students.
Faced with the cuts, students and parents organized. In December, 4,000 people held hands in a big ring around the Penafirme campus. The pictures hit television. A Facebook group sprang up. In January, students walked out of dozens of the privately run schools for three days. To dramatize a claim the cuts would mean the death of their schools, students and parents from 55 schools ferried mock coffins to Lisbon and put them on the median strip outside Ms. Alçada's ministry.
Last month, the education ministry eased somewhat, agreeing to restore part of the lost funding for this semester.
Paulo Gonçalves, a Hewlett-Packard Co. corporate salesman who is president of the Penafirme parents' association, says the détente was a victory, but more money is needed to keep quality high enough to prepare students for college. "If you earn a degree in Portugal, you earn more or less double those who don't," he says. "This is what I teach my kids."
It's particularly true with unemployment over 11%. "With the crisis, we have to go to university," says Sophie Alves, a Penafirme senior who plans to study occupational therapy in college. With only a high-school diploma, "you can do nothing, just serve tables."
With even less than that, prospects are bleaker still. Ms. Fernandes, the 22-year-old with an eighth-grade education, comes often to a school in Apelacão, where a tiny nonprofit called Project Leadership tries to coax young people back to class or help them get jobs.
Serafim Gomes, also 22, was there on a recent afternoon. He left school in eighth grade with the dream of becoming a professional soccer player. It didn't pan out. Now he occasionally waits tables and hopes for better employment.
Marco Monteiro, who is 16, was recently kicked out of his regular school. Bad behavior, he says. He hoped to go back—"I don't have enough school to find work," he says—and then maybe get a job in the mall. Project Leadership's director, António Embaló, complimented him on his mechanical skills.
Might he consider college, perhaps studying engineering?
"It's never crossed my mind," Mr. Monteiro says. "I don't know anyone who went."
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Why Mentoring Helps Men More Than Women
Inherent advantage is at the heart of this new research study's explanatory data.
Kimberly Weisul explains in BNet:
"The biggest companies are awash in mentoring programs aimed at helping high-potential employees, particularly women, succeed. A good mentor is supposed to provide career advice, give feedback on how to improve performance, help provide access to important networks and show mentees how to navigate corporate politics.
But research from the non-profit group Catalyst shows that while both men and women gain by having a mentor, men benefit more. Part of this may be due to the people that men choose as mentors and part of it may be because of what those mentors actually do.
The study on mentoring and high-potential MBA grads suggests that the most effective mentors go well beyond the typical description of mentoring, morphing into ‘sponsors’ who actively lobby to get ‘their’ high-potential people promoted or slotted into high-visibility positions. It’s interesting that many corporate mentoring programs actively try to discourage this, choosing mentors that work in different departments or lines of business that are far removed from their mentees.
Who Benefits from Mentoring?
Having a mentor, especially one at the CEO or senior executive level, led both men and women to get more promotions and more pay. But it didn’t do much to narrow the gap between men and women on either of these measures.
Men who had a mentor were 93 percent more likely than men without a mentor to get their first post-MBA job at mid-manager level or above.
Women with a mentor were 56 percent more likely than women without a mentor to get their first post-MBA job at mid-management or above.
Having a mentor raised a man’s salary (again, in his first post-MBA job) by $9,260.
Having a mentor raised a woman’s salary in her first post-MBA job by only $661.
Part of the reason for these discrepancies may be that men’s mentors tend to be male, and therefore higher up the corporate ladder, than women’s mentors, who are more likely to be female.
Some 62 percent of men had a mentor at the CEO or senior executive level, compared to 52 percent of women. Men’s mentors were more senior than women’s even after controlling for the job level of the mentee.
High-potential men were more likely than high-potential women to choose male mentors. Some 91 percent of men had male mentors, but only 9 percent of female mentors had male mentors.
Some 65 percent of high-women women had male mentors, and 35 percent of high-potential women had female mentors.
The mentors’ gender didn’t by itself mean the mentee was any more or less likely to get promoted or to get raises. But both men and women with high-level mentors got more promotions and more raises than men or women with lower-level mentors.
And if you don’t believe in a wage gap between men and women, consider this:
For men, each promotion from their 2008 job during the years tracked by the study amounted to an extra 21 percent in compensation.
For women, each promotion from their 2008 job amounted to only an extra 2 percent in compensation.
Kimberly Weisul explains in BNet:
"The biggest companies are awash in mentoring programs aimed at helping high-potential employees, particularly women, succeed. A good mentor is supposed to provide career advice, give feedback on how to improve performance, help provide access to important networks and show mentees how to navigate corporate politics.
But research from the non-profit group Catalyst shows that while both men and women gain by having a mentor, men benefit more. Part of this may be due to the people that men choose as mentors and part of it may be because of what those mentors actually do.
The study on mentoring and high-potential MBA grads suggests that the most effective mentors go well beyond the typical description of mentoring, morphing into ‘sponsors’ who actively lobby to get ‘their’ high-potential people promoted or slotted into high-visibility positions. It’s interesting that many corporate mentoring programs actively try to discourage this, choosing mentors that work in different departments or lines of business that are far removed from their mentees.
Who Benefits from Mentoring?
Having a mentor, especially one at the CEO or senior executive level, led both men and women to get more promotions and more pay. But it didn’t do much to narrow the gap between men and women on either of these measures.
Men who had a mentor were 93 percent more likely than men without a mentor to get their first post-MBA job at mid-manager level or above.
Women with a mentor were 56 percent more likely than women without a mentor to get their first post-MBA job at mid-management or above.
Having a mentor raised a man’s salary (again, in his first post-MBA job) by $9,260.
Having a mentor raised a woman’s salary in her first post-MBA job by only $661.
Part of the reason for these discrepancies may be that men’s mentors tend to be male, and therefore higher up the corporate ladder, than women’s mentors, who are more likely to be female.
Some 62 percent of men had a mentor at the CEO or senior executive level, compared to 52 percent of women. Men’s mentors were more senior than women’s even after controlling for the job level of the mentee.
High-potential men were more likely than high-potential women to choose male mentors. Some 91 percent of men had male mentors, but only 9 percent of female mentors had male mentors.
Some 65 percent of high-women women had male mentors, and 35 percent of high-potential women had female mentors.
The mentors’ gender didn’t by itself mean the mentee was any more or less likely to get promoted or to get raises. But both men and women with high-level mentors got more promotions and more raises than men or women with lower-level mentors.
And if you don’t believe in a wage gap between men and women, consider this:
For men, each promotion from their 2008 job during the years tracked by the study amounted to an extra 21 percent in compensation.
For women, each promotion from their 2008 job amounted to only an extra 2 percent in compensation.
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Building the American Idol Brand: Facebook Birthday Greetings From Finalists?
Has it come to this? Well, why not? Everyone involved in social media is attempting to monetize it so this seems like a logical, if potentially annoying new scheme. Given the shows somewhat fading popularity (from its peak, not against other shows) and Facebook's desire to attach a price tag to almost anything, this could either revive both or hurt them. Idol, arguably, has more to lose as Facebook can justifiably claim this is one of many experiments. However, the intersection of Art and Commerce does appear to be getting gridlocked.
Andrew Adam Newman warbles in the New York Times:
"For “American Idol,” having more than five million followers on Facebook is encouraging, but there is something besides devotion the show wants from Facebook users: cash.
Beginning Friday, Facebook users will be encouraged to spend $1 to send each other video messages recorded by the 10 finalists on the show. The videos, through a partnership with an application called Cameo Stars, will feature the contestants sending birthday wishes or a poke, a common Facebook greeting.
Cameo Stars films subjects in front of a green screen and does not embed videos in a player, meaning contestants appear to be speaking directly from profile pages of Facebook users.
“For this particular product, there is a feeling that it’s customized for you because it’s being delivered to you on your own page and because a character is walking toward you and talking toward the camera,” said Olivier Delfosse, vice president for interactive at FremantleMedia Enterprises, which co-produces American Idol in the United States with 19 Productions.
Mr. Delfosse said that when evaluating licensing deals for FremantleMedia, which also produces or co-produces shows including “The X Factor,” Family Feud” and “The Price is Right,” he applied two criteria.
“The first is generally to increase the equity of the brand and build up the brand and the other is to develop compelling products that we can sell and sell,” said Mr. Delfosse. The new Facebook video project “checks both of those boxes,” he said.
When it was introduced on Facebook in August 2010, Cameo Stars seemed like a fairly straightforward marriage between the cultural obsession with celebrities and the exploding market for virtual goods.
The proposition, after all, was to pay as much as $3 to send Facebook friends recorded video greetings from celebrities, like birthday wishes from Kim Kardashian or congratulations for a well-played game from quarterback Drew Brees, who along with other celebrities including Carmen Electra and Dale Earnhardt Jr., receive commissions for purchased messages.
But now Cameo Stars is also increasingly pursuing marketing deals. For the coming film “Kung Fu Panda 2,” for example, Facebook users have been able to send free messages from the animated character featured in the movie. And in a coming campaign for the clothing brand Under Armour, the mixed martial arts champion Georges St-Pierre, a pitchman for the brand, will also be featured in free-to-send videos.
Daren Hornig, chief executive of Cameo Stars, described the deal with “American Idol” as “a partnership approach” where neither entity pays the other but both derive revenue. For now, they will share revenue from the videos from the contestants, though both entities declined to reveal precisely how it will be split.
What both hope will happen soon is that a third party will be brought into the deal, perhaps an existing advertiser for the show, willing to finance the videos so Facebook users can send them at no cost. That way the videos have the potential to be shared more while the advertiser, though not referred to directly by the contestants, will be prominently featured on the Cameo Stars page when users send the videos.
“The ideal situation would be to get a sponsor involved,” Mr. Hornig said. “It would take away the friction of the purchase and increase the possibility” of the video becoming viral.
Mr. Delfosse, of FremantleMedia, said they were racing against the clock.
“A brand-funded model is definitely one we’re seriously considering and some of that is just timing and getting a sponsor on board in the right time frame,” Mr. Delfosse said.
In the meantime, consumers have shown little resistance to spending money on virtual goods, whether for cattle to play FarmVille on Facebook or for Smurfberries for the iPhone app called Smurf’s Village. Worldwide spending on virtual goods grew from $2.1 billion in 2007 to $7.3 billion in 2010 and by 2014 will more than double again, according to In-Stat, a market research firm.
Dharmesh Shah, co founder of HubSpot, an online marketing and Web analytics firm, said that what should impress marketers about Cameo Stars was that it positioned content from brands, which generally was relegated to ads on the right side of pages on Facebook, front and center on users’ walls, where they interact with friends.
“A lot of Facebook users are becoming kind of immune to what’s in the right margin and are mentally blocking out ads because they are not central to the Facebook experience,” Mr. Shah said in a phone interview. “But this works particularly well in terms of getting engagement.”
Mr. Shah was less impressed that, after more than seven months on Facebook, the number of monthly active users of Cameo Stars numbers 5,776, according to the Facebook page for the application as of Wednesday.
“That’s not that many users for what is designed to be a mainstream consumer Facebook app,” Mr. Shah added in an e-mail. “From what I’ve seen, novel concepts like this either hit escape velocity quickly — and get spectacularly viral — or they don’t. It doesn’t seem like this one has.”
But with its legions of Facebook followers, of course, the “American Idol” promotion could raise the profile of Cameo Stars, too.
There is a sweepstakes tied to the promotion, in fact, for a pair of tickets to the season finale of the show, and Facebook users will increase their entries for the contest every time they purchase one of the Cameo Stars videos.
Mr. Hornig, of Cameo Stars, said that he had never expected it to explode overnight, but rather to build steadily.
“Once people see what we have and start to really understand the power and the reach of bringing this content and these celebrities to life on Facebook, the light bulbs really start going off,” Mr. Hornig said.
Andrew Adam Newman warbles in the New York Times:
"For “American Idol,” having more than five million followers on Facebook is encouraging, but there is something besides devotion the show wants from Facebook users: cash.
Beginning Friday, Facebook users will be encouraged to spend $1 to send each other video messages recorded by the 10 finalists on the show. The videos, through a partnership with an application called Cameo Stars, will feature the contestants sending birthday wishes or a poke, a common Facebook greeting.
Cameo Stars films subjects in front of a green screen and does not embed videos in a player, meaning contestants appear to be speaking directly from profile pages of Facebook users.
“For this particular product, there is a feeling that it’s customized for you because it’s being delivered to you on your own page and because a character is walking toward you and talking toward the camera,” said Olivier Delfosse, vice president for interactive at FremantleMedia Enterprises, which co-produces American Idol in the United States with 19 Productions.
Mr. Delfosse said that when evaluating licensing deals for FremantleMedia, which also produces or co-produces shows including “The X Factor,” Family Feud” and “The Price is Right,” he applied two criteria.
“The first is generally to increase the equity of the brand and build up the brand and the other is to develop compelling products that we can sell and sell,” said Mr. Delfosse. The new Facebook video project “checks both of those boxes,” he said.
When it was introduced on Facebook in August 2010, Cameo Stars seemed like a fairly straightforward marriage between the cultural obsession with celebrities and the exploding market for virtual goods.
The proposition, after all, was to pay as much as $3 to send Facebook friends recorded video greetings from celebrities, like birthday wishes from Kim Kardashian or congratulations for a well-played game from quarterback Drew Brees, who along with other celebrities including Carmen Electra and Dale Earnhardt Jr., receive commissions for purchased messages.
But now Cameo Stars is also increasingly pursuing marketing deals. For the coming film “Kung Fu Panda 2,” for example, Facebook users have been able to send free messages from the animated character featured in the movie. And in a coming campaign for the clothing brand Under Armour, the mixed martial arts champion Georges St-Pierre, a pitchman for the brand, will also be featured in free-to-send videos.
Daren Hornig, chief executive of Cameo Stars, described the deal with “American Idol” as “a partnership approach” where neither entity pays the other but both derive revenue. For now, they will share revenue from the videos from the contestants, though both entities declined to reveal precisely how it will be split.
What both hope will happen soon is that a third party will be brought into the deal, perhaps an existing advertiser for the show, willing to finance the videos so Facebook users can send them at no cost. That way the videos have the potential to be shared more while the advertiser, though not referred to directly by the contestants, will be prominently featured on the Cameo Stars page when users send the videos.
“The ideal situation would be to get a sponsor involved,” Mr. Hornig said. “It would take away the friction of the purchase and increase the possibility” of the video becoming viral.
Mr. Delfosse, of FremantleMedia, said they were racing against the clock.
“A brand-funded model is definitely one we’re seriously considering and some of that is just timing and getting a sponsor on board in the right time frame,” Mr. Delfosse said.
In the meantime, consumers have shown little resistance to spending money on virtual goods, whether for cattle to play FarmVille on Facebook or for Smurfberries for the iPhone app called Smurf’s Village. Worldwide spending on virtual goods grew from $2.1 billion in 2007 to $7.3 billion in 2010 and by 2014 will more than double again, according to In-Stat, a market research firm.
Dharmesh Shah, co founder of HubSpot, an online marketing and Web analytics firm, said that what should impress marketers about Cameo Stars was that it positioned content from brands, which generally was relegated to ads on the right side of pages on Facebook, front and center on users’ walls, where they interact with friends.
“A lot of Facebook users are becoming kind of immune to what’s in the right margin and are mentally blocking out ads because they are not central to the Facebook experience,” Mr. Shah said in a phone interview. “But this works particularly well in terms of getting engagement.”
Mr. Shah was less impressed that, after more than seven months on Facebook, the number of monthly active users of Cameo Stars numbers 5,776, according to the Facebook page for the application as of Wednesday.
“That’s not that many users for what is designed to be a mainstream consumer Facebook app,” Mr. Shah added in an e-mail. “From what I’ve seen, novel concepts like this either hit escape velocity quickly — and get spectacularly viral — or they don’t. It doesn’t seem like this one has.”
But with its legions of Facebook followers, of course, the “American Idol” promotion could raise the profile of Cameo Stars, too.
There is a sweepstakes tied to the promotion, in fact, for a pair of tickets to the season finale of the show, and Facebook users will increase their entries for the contest every time they purchase one of the Cameo Stars videos.
Mr. Hornig, of Cameo Stars, said that he had never expected it to explode overnight, but rather to build steadily.
“Once people see what we have and start to really understand the power and the reach of bringing this content and these celebrities to life on Facebook, the light bulbs really start going off,” Mr. Hornig said.
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