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Best content from the best source handpicked by Shyam. The source include The Harvard University, MIT, Mckinsey & Co, Wharton, Stanford,and other top educational institutions. domains include Cybersecurity, Machine learning, Deep Learning, Bigdata, Education, Information Technology, Management, others.

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    How to give your kids everything but a sense of entitlement

    Kids who understand gratitude have better grades and are less likely to get depressed. This was the conclusion of a recent story in the Wall Street Journal that struck a chord with both my husband and me.

    Both of us hail from immigrant families who arrived to the US in the 1970s. Both of us grew up poor. When I was a kid, everything we owned was either a hand-me-down or picked up from the curb. My husband and I share stories of being shaped as latch-key kids with no toys and high-water jeans.

    I hesitated starting a toy-review blog because I knew my kids would be testing and playing with most of the toys. New toys. Lots of them. I feared too many toys would make them ungrateful or, as others might say, “spoiled.” The idea of spoiling kids is incongruous to the parent I want to be. And yet, I still give them toys because I love them (the toys and the kids) so much.

    So parents like me face this dilemma: We want to give our children everything we didn’t have. But we don’t want them to forget where they came from either. The truth is, though, that I learned gratitude because it was forced on me: My parents simply didn’t have material things to give me so I learned to be thankful for the little we had. So by giving my kids what I never had—toys, snow boots, fashionable jeans—would they be destined to become ungrateful?

    The question has consumed me for much of the last year, and so, the Wall Street Journal article was timely. It encourages families to make their children do chores and express thanks for their meals and other gestures. But I have young kids and those tactics felt too abstract.

    And so, I turned to the best tools I have to make my kids understand: toys. Kids do not know how big or little your paycheck is. Kids do not understand what income tax or health insurance deductibles are either. However, they do know how much a Nintendo DS game cartridge costs. They know how much a Wii costs. Or a slice of pizza or a bottle of Gatorade. This is their vocabulary—their understanding of values in our material world. We can work with that. And to get our kids to understand the meaning of gratitude, we must.

    If kids cut the veggies, they will eat them

    The two areas I wanted to most impart gratitude: food and play. With food, my kids were horribly picky and wasteful. It was getting out of hand and so I sought help from Susan Roberts, a pediatric occupational therapist and author of My Kid Eats Everything. She told me kids eat horrible diets today because they are just being “fed.”

    “It is such a passive process now,” she says. In the past, until about the mid-20th century, kids joined families in the kitchen, helping to prepare food, setting the table, clearing the table, and washing the dishes. Among the, as Roberts terms them, “multi-causal factors that have contributed to the decline in children being involved in meal preparation and clean up” are: changes in agriculture making it easier for restaurants to sell food cheaply, the increase in convenience stores, and more women at work. 
    “People eat out much more often,” she said, so kids are not eating what’s available, they are ordering what they want. Roberts actually tells families that even if they go out to restaurants, the parents should still order the food for the child. “We have to put the parents back in charge of food. Right now, it’s the children who are in charge so of course, they’re going to eat gummy bears and goldfish crackers.” Long ago, Roberts reminds, children even caught their family’s food.

    Two products that helped me involve my kids in cooking: doodle by Stitch aprons and Curious Chef knives. These are not play kitchen toys.  The doodle (the brand is lowercase) aprons are $24 adjustable aprons made to fit children. Children can write on them, wash them, and then re-use them. Meanwhile, the knife ($3.99) by Curious Chef is also a great tool. Made of nylon, you can literally clench the blade and not get hurt—but it still can cut cheese, meat, celery, etc.

    For my eldest son, a 9-year-old, we laid out a mission: to grill our July 4th barbecue cheeseburgers. As we began our very first step—buying food–I suddenly understood how this could work. In the butcher shop, my son asked me where the “round circle” hamburgers were. He had no idea what ground beef really looked like or how it was made. I was ashamed. And then I showed him.

    At home, he donned his personalized apron and got to work, cracking eggs and kneading the meat with his bare hands. I thought he would be grossed out but he was beaming with pride. He formed and grilled the patties, sliced the tomatoes, and babysat his burgers, feeling scared occasionally from the heat on the grill. I don’t think I have ever seen my son eat a burger so fast in his life. He watched all of us eat ours, too. He was so grateful, he even washed the dishes.

    Lego lessons on money

    Teaching my children to be grateful for their toys was very challenging because they just have so many.  So I decided to challenge them with the one they love the most: Legos.

    I had noticed that my children were expecting me to buy them one set after another. They are often gorgeous and elaborate, ranging from remote- controlled passenger trains to majestic models of famous buildings like the Burj Khalifa and the Eiffel Tower. This year, Lego launched a Disney Princess line with a set that resembles Cinderella’s castle at Disney theme parks. 
    Even the smallest details of a set, like wine goblets, roast chickens, antennae, almost always connect with a signature, satisfactory Lego snap. Kids like mine are infatuated with those details and, thus, with Lego overall. The problematic part I noticed was that when my kids tried to make something using solely their own creativity, they became quickly dissatisfied with their attempt and then they would start asking me to buy them more sets.

    My first instinct was to swear off Lego, but I have always resolved to be fair and honest with my kids. To pretend to not be able to afford certain things is not a good lesson either and hardly will teach them gratitude. I decided to make them more grateful for their current collection and get them to see them as a strategic investment.

    As with our our July 4th cheeseburgers, I brought my children in on the buying process. I decided to physically bring them to an actual brick-and-mortar Lego store and teach them how to shop smart. Now that I shop for everything online, I forget what kind of impact shopping with the kids can have. Kids can never grow up to be good consumers unless I teach them how to recognize value and quality and there is no better medium for teaching kids this than with the subject in which they have the most expertise: toys.

    Once at the Lego store, we headed to the Pick A Brick Wall. They watched other children dumping handfuls of bricks into containers that customers could buy for a fixed price ($7.99 for the small and $14.99 for the large).  My kids were about to do the same but I asked them to be more mindful about what they wanted to make and how many bricks they could actually fit into the container. This was incredibly difficult for them.

    Just like a kid in a candy store, the Pick A Brick Wall can be overwhelming. You can easily get greedy and forget why you are there, that is, to get a lot of bricks and to get the ones you really want. The space within the container is finite and so was our time. I gave the kids two options: get the small container and not be questioned about its contents or the bigger container but only if they followed my lesson on being resourceful. 
    I would pay for only one option. They chose the latter. So to gain the most value for our money, I asked them to snap a row of same-color bricks together and then carefully place them into the container. It was a time-consuming process, best done sitting on the floor of the store.

    Once they started, though, it was so obvious to my children that they could put a lot more bricks and pieces in with this method. The store employees smiled and said that they have never seen anyone do that before. Passerby parents asked their kids to do the same; none of them would. My kids started to become embarrassed but I reminded them of that other option—a smaller container and fewer Legos.

    After all that hard work of stacking as many as 270 (1×4) bricks into that one container, they poured in their favorite pieces into the many gaps between the stacks. These were tiny translucent studs that they use as “treasures” when they play. Since then, my kids have become more enthusiastic about building and take better care of the bricks they own.

    Now, they always go to their favorite bricks first, the ones they worked so hard to get. At least for their beloved Lego bricks, they certainly are grateful.  I also constantly remind them that the minute they stop showing gratitude for their toys is the minute I start packing them up to send away to relatives or for donation. Or sometimes, while they are off at school, I will just pack up the toys and games that haven’t been touched and, months later, mysteriously bring them out again.

    As parents, despite wanting to give our kids everything, one of the greatest gifts we can give is to literally give less, to force decision-making and awareness among all their choices. We need to have more faith in them and let them be challenged. It’s not easy to watch your kids struggle—but in the end, it does breed gratitude.  And there is no question that these lessons are most effective if you start early and consistently through every child’s primary occupation: play.

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    Ultrasound directed to the human brain can boost sensory performance

    William Tyler of Virginia TechWhales, bats, and even praying mantises use ultrasound as a sensory guidance system — and now a new study has found that ultrasound can modulate brain activity to heighten sensory perception in humans.
    Virginia Tech Carilion Research Institute scientists have demonstrated that ultrasound directed to a specific region of the brain can boost performance in sensory discrimination. The study, published online Jan. 12 in Nature Neuroscience, provides the first demonstration that low-intensity, transcranial-focused ultrasound can modulate human brain activity to enhance perception.
    “Ultrasound has great potential for bringing unprecedented resolution to the growing trend of mapping the human brain’s connectivity,” said William “Jamie” Tyler, an assistant professor at the Virginia Tech Carilion Research Institute, who led the study. “So we decided to look at the effects of ultrasound on the region of the brain responsible for processing tactile sensory inputs.”
    The scientists delivered focused ultrasound to an area of the cerebral cortex that processes sensory information received from the hand. To stimulate the median nerve — a major nerve that runs down the arm and the only one that passes through the carpal tunnel — they placed a small electrode on the wrist of human volunteers and recorded their brain responses using electroencephalography, or EEG. Then, just before stimulating the nerve, they began delivering ultrasound to the targeted brain region.
    The scientists found that the ultrasound both decreased the EEG signal and weakened the brain waves responsible for encoding tactile stimulation.
    The scientists then administered two classic neurological tests: the two-point discrimination test, which measures a subject’s ability to distinguish whether two nearby objects touching the skin are truly two distinct points, rather than one; and the frequency discrimination task, a test that measures sensitivity to the frequency of a chain of air puffs.
    What the scientists found was unexpected.
    The subjects receiving ultrasound showed significant improvements in their ability to distinguish pins at closer distances and to discriminate small frequency differences between successive air puffs.
    “Our observations surprised us,” said Tyler. “Even though the brain waves associated with the tactile stimulation had weakened, people actually got better at detecting differences in sensations.”
    Why would suppression of brain responses to sensory stimulation heighten perception? Tyler speculates that the ultrasound affected an important neurological balance.
    “It seems paradoxical, but we suspect that the particular ultrasound waveform we used in the study alters the balance of synaptic inhibition and excitation between neighboring neurons within the cerebral cortex,” Tyler said. “We believe focused ultrasound changed the balance of ongoing excitation and inhibition processing sensory stimuli in the brain region targeted and that this shift prevented the spatial spread of excitation in response to stimuli resulting in a functional improvement in perception.”
    To understand how well they could pinpoint the effect, the research team moved the acoustic beam one centimeter in either direction of the original site of brain stimulation – and the effect disappeared.
    “That means we can use ultrasound to target an area of the brain as small as the size of an M&M,” Tyler said. “This finding represents a new way of noninvasively modulating human brain activity with a better spatial resolution than anything currently available.”
    Based on the findings of the current study and an earlier one, the researchers concluded that ultrasound has a greater spatial resolution than two other leading noninvasive brain stimulation technologies — transcranial magnetic stimulation, which uses magnets to activate the brain, and transcranial direct current stimulation, which uses weak electrical currents delivered directly to the brain through electrodes placed on the head.
    “Gaining a better understanding of how pulsed ultrasound affects the balance of synaptic inhibition and excitation in targeted brain regions — as well as how it influences the activity of local circuits versus long-range connections — will help us make more precise maps of the richly interconnected synaptic circuits in the human brain,” said Wynn Legon, the study’s first author and a postdoctoral scholar at the Virginia Tech Carilion Research Institute. “We hope to continue to extend the capabilities of ultrasound for noninvasively tweaking brain circuits to help us understand how the human brain works.”
    “The work by Jamie Tyler and his colleagues is at the forefront of the coming tsunami of developing new safe yet effective noninvasive ways to modulate the flow of information in cellular circuits within the living human brain,” said Michael Friedlander, executive director of the Virginia Tech Carilion Research Institute and a neuroscientist who specializes in brain plasticity. 
    “This approach is providing the technology and proof of principle for precise activation of neural circuits for a range of important uses, including potential treatments for neurodegenerative disorders, psychiatric diseases, and behavioral disorders. Moreover, it arms the neuroscientific community with a powerful new tool to explore the function of the healthy human brain, helping us understand cognition, decision-making, and thought.
     This is just the type of breakthrough called for in President Obama’s BRAIN Initiative to enable dramatic new approaches for exploring the functional circuitry of the living human brain and for treating Alzheimer’s disease and other disorders.”
    A team of Virginia Tech Carilion Research Institute scientists — including Tomokazu Sato, Alexander Opitz, Aaron Barbour, and Amanda Williams, along with Virginia Tech graduate student Jerel Mueller of Raleigh, N.C. — joined Tyler and Legon in conducting the research.
    In addition to his position at the institute, Tyler is an assistant professor of biomedical engineering and sciences at the Virginia Tech-Wake Forest University School of Biomedical Engineering and Sciences. In 2012, he shared a Technological Innovation Award from the McKnight Endowment for Neuroscience to work on developing ultrasound as a noninvasive tool for modulating brain activity.
    “In neuroscience, it’s easy to disrupt things,” said Tyler. “We can distract you, make you feel numb, trick you with optical illusions. It’s easy to make things worse, but it’s hard to make them better. These findings make us believe we’re on the right path.”

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    Tom Eigelsbach originally shared:
    Behold, the Moon as you've never seen it before

    The Moon is tidally locked to Earth, forever hiding one of its faces from those of us kicking it planetside. Owing to a phenomenon known as libration, it's actually possible to spot as much as 59% of the Moon's surface. But the remaining 41% – the so-called "far side," was for many years a complete mystery. But this video, created from images returned by NASA's Lunar Reconnaissance Orbiter, offers us an entirely different view of the Moon – one that brings its enigmatic far-side into clear (and, contrary to its "dark-side" misnomer, clearly illuminated) view:  Rotating Moon from LRO

    The time-lapse video starts with the standard Earth view of the Moon. Quickly, though, Mare Orientale, a large crater with a dark center that is difficult to see from the Earth, rotates into view just below the equator. From an entire lunar month condensed into 24 seconds, the video clearly shows that the Earth side of the Moon contains an abundance of dark lunar maria, while the lunar far side is dominated by bright lunar highlands. Two new missions are scheduled to begin exploring the Moon within the year, the first of which is NASA's Lunar Atmosphere and Dust Environment Explorer (LADEE). LADEE, which launched just over a week ago, is scheduled to begin orbiting the Moon in October and will explore the thin and unusual atmosphere of the Moon. In a few months, the Chinese Chang'e 3 is scheduled to launch, a mission that includes a soft lander that will dispatch a robotic rover.

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    Why Hanuman smeared himself with vermilion

    The scene

    The scene is from an instance when Lord Rama had returned home after killing Ravana. Hanuman was still living with Lord Rama in Ayodhya.

    Change is needed

    On a particular Tuesday morning Hanuman felt very hungry. “No, these fruits are tasteless. I have been eating these for a longtime now. I need some cooked food for a change”, thought Hanuman and rushed to meet Sita.

    Sita was going somewhere

    She was about to leave for morning bath. “Alright, Hanuman, I will be back in a minute. You be here.”, Sita said and went for a bath.

    Hanuman is puzzled

    After bath, she applied a vermilion line in the parting of her hair as per normal practice. “Mother, why are you applying red vermilion mark.”, Hanuman asked as a puzzled child would do.

    Why vermilion

    “This vermilion mark increases the lifespan of the Lord”, remarked Sita as she brought an assortment of sweets for Hanuman.

    Vermilion it is

    Hanuman kept on thinking for a longtime. He had never thought about the life-span of Lord Rama on earth. Neither has he done anything to improve that. After thinking various options he applied oil throughout his body and smeared red vermillion from his feet to head profusely. Layers upon layers of vermilion. Bathed in vermilion. Satisfied, he picked up his mace and proceeded to the court of Rama.

    The red Hanuman

    On the Ayodhya roads, people were taken aback. Red Hanuman (sindoor-maya hari). This was the sight to behold. As he entered the royal court, there was stunned silence initially. Then everybody laughed aloud. Even Shri Rama smiled.

    Rama is curious

    “Hanuman, Why did you apply vermilion coat on your entire body today?”, Rama queried.

    An innocent reply of a devotee

    Hanuman folded his hands in utmost devotion and said, “My Lord, Mother Sita puts a small dot of vermilion on her head which increases your life-span. But a small dot can only do so much. Learning about this, I have started to apply full coat of vermilion on my entire body to significantly improve your life-span.”

    God is pleased

    Lord Rama was pleased with the simplicity and deep devotional feeling of Hanuman. He embraced Hanuman, became somewhat red with vermilion and declared, “Today is Tuesday. Whoever applies vermilion and oil on Hanuman on this day will get happiness and all his desires fulfilled.”

    Tuesday becomes auspicious

    From that day the practice of smearing oil and red vermilion on Hanuman started. You might have seen this in temples everywhere, red Hanuman glowing like a just-risen sun ever keen to increase life-span of his Lord.

    Moral of the story

    It simply shows how even a small act done out of pure devotion can endear you to God.

    Pomp and show might not work

    Don't trouble yourself with wealthy decorations and paraphernalia. God always overlook them. He checks your heart and the feeling behind the action that you do.

    What we should do

    So, if we really want to please God, we should do every act with devotion. We might not be even aware what might catch His eyes!

    Share your thoughts

    Share your thoughts and experiences when simple acts might have scored God's grace for you.

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    Social Media Trends that organizations must follow in 2014!

    Social media made a big impact in 2013, especially for businesses that turned to platforms such as Facebook, Twitter, Instagram, and Pinterest to directly engage with customers and boost sales. It has now become more important for organizations to look back at the year that's gone; and determine what has worked and what didn't and make the most of the latest trends in social media to enjoy a fruitful 2014.

    Social marketers should therefore follow the best and most important trends to help their brands connect with consumers and succeed in 2014. Given below is a list of five most important insights that social marketers should look into;

    Clever and smart marketing

    Last year has witnessed a tremendous change in how consumers make purchase decisions which has compelled brands to fight it out with one another like never before. Audience behavior has changed drastically with more emphasis on professional and personal needs. It has become imperative to understand client needs, their preferences and then create products and strategies to engage them. Gathering customer data and using it meaningfully is necessary. Moreover the marketing content used should not be just for promotion but something more useful and informative.

    Analyzing Social data

    Social networking sites include innumerable conversations, interactions and other actions every second which is an opportunity as well as a challenge for organizations. Social marketers can make use of this opportunity and analyze data that can help them strengthen their bond with customers. Such information posted on social media sites act as means to gain meaningful insight into the minds of consumers and assist companies to achieve their goals. Organizations should therefore have a dedicated social analytics team who can effectively monitor the activities going on in social media sites.

    The need for integration in social media

    Social media can no longer exist as separate entity but needs to integrate and coordinate with the rest of the firm's marketing strategy. According to Altimeter, almost 78% of organizations have a dedicated social media team but in spite of this firms lack coordination and integration. Hardly a meager 26% of the firms actually know how to approach social media holistically. In order to get the best outcome, firms must connect social data to other sources of data as for best results.

    Videos are Hot!

    Videos, particularly short videos continue to be hot and much in demand as an important part of social media marketing tool. YouTube is still going strong with no signs of exhaustion with almost 100 hours of video uploaded every hour. Applications such as Vine, with its 6-seconds video capabilities and Instagram, with its 15-seconds video capabilities including filters and integration within Facebook are a boon for brands.

    Relevant, real-time content marketing is the need of the hour

    Last but not the least, it's important to keep in mind that utilization of relevant content and not quantity is the key to a successful social media campaign. Appropriate content can drive traffic; engage audience and attract high-quality leads. Anticipating what topics clients would love to read about, and have content ready for them can be one of the biggest advantages for your organization.
    2014 will certainly be a much more prosperous and exciting year for social media and organizations alike!

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    There are excellent articles on business promotion, marketing, and sales strategies. However when it comes to strategic planning for running an enterprise especially in the small and medium scale sector. The entrepreneurs are often found groping in the dark. The purpose of this article is to uncomplicate this complicated process and present it in an easy to understand “How to” format. This article is positioned for an entrepreneur with some management education or background running an enterprise or managing a startup.

    The best practice is not often the best strategy.

    Strategy is a way of thinking, not a procedural exercise or a set of frameworks. To stimulate that thinking and the dialog that goes along with it, it is essential to design metrics based on sound and practical parameters, and follow a set of action oriented steps aimed at helping executives assess the strength of their strategies. It is imperative to design steps focused on testing the strategy itself (in other words, the output of the strategy-development process), rather than the frameworks, tools, and approaches that generate strategies, for two reasons. First, companies develop strategy in many different ways, often idiosyncratic to their organizations, people, and markets. Second, many strategies emerge over time rather than from a process of deliberate formulation.

    How to go about it?


    1. 1
      Understand strategy and its importance: You need a strategy that beats the market realities. There are certain common denominators for all the companies that operate like customers, suppliers, competitors, and potential entrants (competitive products). Now each of these try to demand and command attention in furtherance of their own cause. All these also can work towards reducing the gap between the capitalinvestment and returns (profit/loss). It is prudent to manage these denominators in a way that reverses the trend and makes returns, a healthy multiple of capital investment.
    2. 2
      Identify the source of advantage and exploit it: There are many sources of advantage for an entrepreneur -- two of the most important being, location and special capability. Now these are scarce commodities and any strategy plan conceived around attributes puts the organization ahead of the rest of the competition and positions you along with the best of the competition, and makes success that much less complicated.
    3. 3
      Position the organization appropriately: Focus on the markets and the marketing factors that synch with the nature, culture, size and technological advantages and constraints. Determine and discriminate between the markets while allocating funds. The strategy should reflect a clear understanding of markets and should result in intelligent defining of the segments that could result in refined resource allocation. This should of course be preceded by microscopic market research at granular level to see direction of trends in those markets.
    4. 4
      Do not follow the trends, but set one: Far too often it has been observed, that the strategies are woven around the existing market trends. This is considered a way of playing safe, but how safe it is, is the question. The word “trend” itself denotes a temporary existence and ease of replaceability (imminence of change). The strategy should be to peep into the future and identify what could be tomorrow’s trend. Identify and formulate the strategy accordingly, or better still plan a strategy that could make you a trend setter.
    5. 5
      Base your team strategy on privileged insights into futures, not on past history: It is a common practice, to collect heaps of information on the history, do some arbitrary interpolation or extrapolation and then base team strategy on this data. This will no doubt allow your team to sustain past commitments without losses -- but if growth is your objective and market leadership the ultimate aim, you'll need to have an insight into the future. A glance into people’s pulse regarding what they have versus new things they would like to have -- gives a fairly accurate insight into the future. It pays to organize frequent market research (controlled advancements are not moved forward randomly). With the availability of so many social media platforms, it is now easier to gauge people’s aspirations by seeing and assessing interests and frustrations in your network.
    6. 6
      Plan to enable success, but respect the glorious uncertainties of the market.An all weather strategy often keeps you always afloat compared to one planned for normal (current) market behavior. Planning for the event of a failure (such as maintaining liquidity by renting or leasing versus owning capital assets) is always better than failing to plan.
      • Uncertainties of the future can be classified into four levels.
        • Level one gives a fairly clear view of the future, and an inkling of what to expect. Level two is a little more hypothetical about the action and outcomes, but rather concrete expectations. Level three works on the law of probability for likelihood of returns. Level four represents total ambiguity (on a hunch for example) about the outcome and delivers shockers.
        • A formulated strategy can reasonably be expected to provide for the first two levels. Strategy for the third and fourth levels depends upon various factors, and should be best left to the ingenuity of the entrepreneur and enterprise.
    7. 7
      Stage your strategy to have a correct balance of commitment and flexibility:Commitment (of resources) and flexibility (variations) are inversely proportionate and more often than not, they are malefic to each other (jumping in contravenes edging in, one toe at a time). It is all about trade-off between the two, and success depends on the timing and intuition. If it is a leap in the dark, how you land your market for your new product depends on your expertise and experience in creating a new markets -- or vice-versa.
    8. 8
      Make your strategy to be understood and "bought into" by your team: Your planning should be done in such a way that it is backed by a strong conviction in the team who must deliver on the plans. This is possible, if you take into confidence the department heads during the planning stage, take their views, and where ever feasible implement them. Ownership at the planning stage naturally ensures ownership and informed support at the implementation stage.
    9. 9
      Translate your strategy into an implementable action plan. First, define clearly what you are moving from and where you are moving to with respect to your company’s business model, organization, and capabilities. Develop a detailed view of the shifts required to make the move, and ensure that processes and mechanisms, for which individual executives must be accountable, are in place to effect the changes. Quite simply, this is an action plan.
    10. 10
      Be sure that everyone knows the timetable for what to do and being proactive, not reactive. Be sure that each major “from–to shift” is matched with the energy and assets to make it happen. Since the totality of a major change often represents a corresponding organizational transformation, make sure you and your senior team:
      • Draw on research and experience offering solid advice on successful change management revealed by the large body of information of actual, successful change.
    11. 11
      Align your strategy to the required resource allocation: That is the final -- but most important point -- don’t forget to make sure your ongoing resource allocation processes are aligned with your strategy so that when you do implement changes, you have the resources to fully take advantage of matching resources to the opportunities in your new niche, product and market.
    Make a draft first and critically evaluate it at every stage, make as many changes as possible every time based on cohort input. Continue to make and edit the draft even after you are satisfied as you must be open and inclusive to get department buy-in to own their project

    Earmark specific time for strategy formulation and do not allow any physical or mental activity to interfere in expediting reaching agreement and acting on the strategy going forward.

    Hold informal one to one meetings with the domain heads, casually discuss the draft and invite their suggestion. People are more forthcoming with their suggestions during the informal meetings than the official conferences.

    Whenever you implement someone’s suggestions, make it a point to tell him that his suggestions have been incorporated. This gives him the satisfaction of being the author, and naturally implies that the person has to take the ownership for successful implementation of the strategy.

    In case you are not in a position to implement the suggestion, please explain to him as to why you could not do it. Give a patient listening to his grouse. Allocate as much time as possible and needed to convince hm. Show how much you value him, his contributions, and the occasions you have implemented his suggestions. The other man will understand and appreciate your gesture of spending so much time with him, and explaining in detail your inability. He may be a little sad but he will still take the responsibility and ownership for successful implementation.

    Try to keep the strategy within your resources right from the first step and do it for every step. It is easy to align the strategy to the resources bottom up than top down.

    Evaluate obsolete, mechanical equipment and its concomitant processes versus new and emerging markets using electronic, Internet age devices; keep an eye on market movers.
    1. Video
    2. Business strategy Prof. Carlo Alberto Carnevale Maffe'. A firm's ability to survive and succeed in an increasingly competitive global arena depends on its ability to understand competitive dynamics and to enact strategic responses.

    High level of secrecy is to be maintained during the formulation of the strategy. You have to ensure that the top managers involved in the exercise also maintain the confidentiality.

    Do not be ambiguous about anything. Every piece of strategy has to be based on sound analytics, market realities.

    Ensure that your employees get the strategy directly from your team. In case of indirect transmission ensure that there is no dilution at any level. Make senior team executives, to give mock presentations before you and the rest of your team, and ensure that their perceptions of the strategy are in synch with those of your whole team's understandings and intentions.

    I I wrote this atilcle for wikiHow Click Here to view this and my other articles on wikihow

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    Five ways to recognize your talent culture.

    I’m not a big fan of New Year’s resolutions. They’re hard to keep, it’s an emotional kick in the teeth when they don’t work out, and they seldom make a lot of sense from a leadership perspective. Sure, it would be great to drive the company to bigger profits, be more innovative, have happier employees and Be a Better Manager, but for most leaders, the world of work is not set up to help reach those goals. Why?

     There are a million reasons: Employees may not really understand your business, competitors are innovating and your company feels a bit too tied to older technologies, your employees may be unhappy – just look at the number of resignations in the past six months. It’s time to tune in.

    Stop a minute and think about that last one: your employees are unhappy. And a big part of your job is keeping employees engaged, productive and happy.

    If you’re a leader, it may be shocking to think that a large percentage of your employees are dissatisfied. But you know it’s true, because talent retention is an issue, hiring is tough, and the corporate culture you and your executive team spent so much time building is falling apart. Conventional tools to sustain and repair culture – office get-togethers, 360 reviews, informal talks, free food, T-shirts – all a flop. You’re in a stall and there’s not much time to recover. This is when you realize you do have a New Year’s resolution: Change the Corporate Culture.

    When culture has been damaged, how can you resolve – and succeed – to repair it? Lead with your emotions. Think about what it means to be happy at work at for people at levels of your organization – from product development to sales to marketing to HR. Talk it over with your leadership team, and come up with an actionable list of five things you can do right now, Q1, to rebuild your company’s culture. Here’s where I’d start.

    Employee Recognition: Look at the mechanisms in place, formal and informal, to support employee recognition. Compensation is one tool, but it may not be the best. I advise companies to align informal recognition closely with your workplace culture.

     If you are leading an innovative startup with a lot of innovative, technical people, rewards may be less about money and more about time to work on side projects in areas that reflect the employees’ interests: social, mobile technology, community engagement. If you have a multigenerational workforce it will be a bit harder to get the mix right, but remember to include all employee recognition with genuine emotion. Make it personal, and make it heartfelt.

    Performance Reviews: Performance reviews are painful. Most managers and employees dread them, but for the majority of companies, reviews are part of the employee recognition system. In many cases they are a broken, toxic and misused tool, and they’re killing corporate culture. So do a health check – step up and put yourself through the same system used to evaluate employees. I’m betting you won’t be happy with what you find. 

    Reviews have two main components: the people involved, and the technology used to gather and process the review content. Tackle the people first. Make sure everyone understands the purpose of reviews and how reviews affect corporate culture. Check in with recently-reviewed employees to ensure the review had the right impact. Consider new systems and technologies which improve the mechanics of the performance review system – a few I’ve check into remove bias and spot inconsistencies before the review ever gets to the employee’s ears, making it easier to trust reviews won’t damage morale and culture.

    Social Connection. There is absolutely nothing more central to a healthy culture than connected leadership. Dedicate a portion of your time to being available to employees, to connecting in semiformal (think stand up meetings) and informal settings (the cafeteria).

     Keep your door open as much as possible, and don’t cast your eyes down every time an employee walks by your door. Think about how it would feel if every time you walked by, people looked away. Engage your emotions when you connect with employees. IF you don’t they’ll know in a heartbeat, and your culture will suffer.

    Set expectations, and expect the best. People need to know where they stand, and they can only do that if they understand what’s expected of them. This goes beyond setting performance goals – it includes when to show up for work, how to behave (no it is not ok to paint your nails at your desk), and how to treat co-workers. 

    Be clear about what your expectations are for the company, too – communicate successes, discuss risks, and share goals big and small. Be honest when things aren’t going the way you want, and share suggestions for improvements. If you lead with your emotions, you’ll communicate that you expect the best not only of employees, but for employees.

    Recharge Your Workplace Culture. To be an emotionally honest and available leader, you’ll need to make time to step away and recharge your batteries. Taking vacations, going to seminars, meeting with peers – all are ways to recharge. Most importantly, recharging is a great way to model healthy behavior. 

    If your employees are continually leaving vacation days on the table at year end you’re not doing it right. Ask HR to run a report of what percentage of employees didn’t use their allocated vacation. It will be a heat map of danger spots in the organization, places where the culture is veering in the wrong direction.

    It’s not a leader’s job to make all employees happy, but it is a leader’s job to build a culture in which employees can be productive, engaged, grow professionally, and work in conditions that support being happy.  To build a supercharged, super-committed, super-performing workforce, build a culture in which you and your leadership team can reach employees on an emotional level. It’s a New Year’s resolution you’ll want to keep.

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    White House Unveils Plan To Save Domestic Helps Of Diplomats

    Washington: In the wake of the worst diplomatic spat with India over the arrest of an Indian diplomat for allegedly underpaying her nanny, the White House has come out with a strategic action plan for human trafficking "victims".

    The plan does not name Devyani Khobragade, India's then consul general in New York, but it does address issues relating to domestic workers brought to the U.S. by foreign diplomats and officials working for international organisations.

    Among other things the five year plan, running into 84 pages, says the State department will "develop procedures for the in-person registration of domestic workers employed by diplomatic personnel in the Washington, DC, area shortly after their arrival in the United States to apprise them further of their rights and available services."

    However, it makes no mention about registration of domestic workers of diplomats inNew York, where the Khobragade incident occurred, or other major cities where foreign consulates are located.

    "Recognizing the vulnerabilities inherent in domestic work and the need to foreclose avenues of exploitation, particularly of those employed by diplomatic personnel," the plan said, the State department "will continue its efforts to educate foreign mission personnel and their domestic workers about U.S. federal, state, and local laws, including protections for domestic workers employed by diplomatic personnel."

    Its "Bureau of Diplomatic Security will continue to educate the nongovernmental community about its ability to identify victims of human trafficking, domestically and overseas, and work on trafficking cases, particularly those related to visa fraud and the foreign diplomatic community."

    The State Department, it said "will continue to address the protection of A-3 and G-5 workers through its regular internal working group meeting on domestic worker issues, where it reviews allegations and cases and discusses strategies and ongoing efforts to prevent abuse and obtain compliance" with the department requirements.

    It will also "develop a Know Your Rights informational video to provide information on protections for certain employment- and education-based non-immigrant visa applicants, including domestic workers."

    U.S. Embassies and Consulates overseas will play the video in waiting rooms as appropriate, in languages spoken by the greatest concentrations of those applicants.

    In a message on the release of the "Federal Strategic Action Plan on Services for Victims of Human Trafficking in the United States 2013-2017", President Barack Obama said: "Human trafficking is a denial of our common humanity and an affront to our ideals as Americans."

    Declaring that his "Administration is committed to combating this modern incarnation of slavery," he wrote: "Survivors of human trafficking have had their lives ripped apart, and they deserve holistic, streamlined, and compassionate assistance as they rebuild their lives and their futures."

    "To those who are suffering and have suffered the horrors of human trafficking, our message remains: We hear you. We insist on your dignity. And we share your belief, that if just given the chance, you can forge a life equal to your talents and worthy of your dreams," Obama wrote.

    Releasing the plan at a White House event Tuesday, Cecilia Muñoz, the Director of the Domestic Policy Council, said the plan was part of the Obama administration's ongoing efforts to carry out his pledge to "do even more to help victims recover and rebuild their lives."

    The plan lays out a five-year path for increased coordination, collaboration, and capacity across the federal government and in partnership with other governmental and nongovernmental entities at all levels, she said.

    It describes the steps that federal agencies will take to ensure that all victims of human trafficking in the United States are identified and have access to the services they need to recover and to rebuild their lives.

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    Case Study: Emotional  Intelligence  for  People-First   Leadership  at  Fed  -  Ex Express

    Integrating emotional intelligence assessment and development into a six-month process for new managers world-wide, the FedEx Express team at their Global Learning Institute is building the skills and expertise for people-first leadership. 
    The program is yielding an 8-11% increase in core leadership competencies, with over half the participants experiencing very large (10-50%) improvements in certain key emotional intelligence skills and leadership outcomes:  72% of the program participants experience very large increases in decision making; 60% in Quality of Life, and 58% show major improvements in Influence.
    By Joshua Freedman and Jimmy Daniel


    fedex-leadershipFedEx Express is the world largest cargo airlines with over 290,000 employees moving seven million packages each day with 600 flights a day.  One of the top 20 Fortune “Most Admired” for a decade,FedEx stands among the world’s successful enterprises.
    While founder Fred Smith was focused on logistics and speed, from the start he believed that people were the key to business, and that leadership is about continuous growth: “Leaders get out in front and stay there by raising the standards by which they judge themselves – and by which they are willing to be judged.”  This vision has translated to the “PSP Philosophy” – People-Service-Profit – which drives FedEx Express today.
    The company sees that the people-side of leadership has grown more complex, and looking to the future, is committed to developing leadership capabilities to manage the changing workforce.  The goal is leaders who are better at influence, make decisions that are both quick and accurate, and are able to build a culture where people feel the dedication and drive for exceptional performance in a way that’s sustainable and creates real value for all stakeholders.
    To measure leadership performance, FedEx Express administers “SFA,” an annual survey where every employee can provide feedback about managers.  SFA themes include respect, fairness, listening, and trust – leadership responsibilities that are all about relationships and emotions.  This commitment to people-first leadership created an interest in “emotional intelligence” as a learnable skillset that would equip managers to deliver the FedEx way.


    Even though the leadership training was state of the art — among the top ten in the world – the FedEx Global Leadership Institute is charged with continuously updating and innovating in keeping with that Fred Smith call for continuously “raising the standards.”  Located near the company’s primary hub in Memphis, TN, the Global Leadership Institute, GLI, serves as the leadership university for FedEx Express.
    In 2005, GLI implemented a new training program for managers to consider the impact they wished to have as leaders – the legacy they were creating.  A core component of the LEGACY course was a module on emotional intelligence using the Six Seconds Emotional Intelligence Assessment, the SEI. LEGACY results were very positive, in part because of the effectiveness of the Six Seconds Model as an actionable process.

    Action-Based Emotional Intelligence

    Where other approaches to emotional intelligence remain quite theoretical, the Six Seconds Model is designed as a process framework for using emotional intelligence on a day-to-day basis.  At a macro-level, the model offers a three-step process with specific learnable, measurable competencies that support the three steps:KCG-model-clear
    Know Yourself – increase self-awareness of emotions and reactions (competencies:  Enhance Emotional Literacy and Recognize Patterns).
    Choose Yourself – shift from unconscious reaction to intentional response (competencies: Apply Consequential Thinking, Navigate Emotions, Engage Intrinsic Motivation, and Exercise Optimism).
    Give Yourself – align the moment-to-moment decisions with a larger sense of purpose (competencies:  Increase Empathy and Pursue Noble Goals).
    Reviewing data from LEGACY in 2009 and 2010, the GLI team identified that a few key EQ competencies were essential to strengthen “bench strength” and build the leaders who will move up the chain.  Without revealing confidential details, the FedEx culture has focused on speed — which is a key part of the company’s success.  As leaders move up in the organization, the need for speed has to be balanced with a more careful, collaborative decision-making process to achieve sustainable success.
    fedex-eqWith this in mind, under the leadership of SVP Shannon Brown, the company wanted a world-class leadership program that would move the company to be one of the top five in the world. With the support of Dennis Reber, Managing Director, and Ray Murphy, Manager, of the Global Leadership Institute, FedEx decided to increase the emotional intelligence focus of the leadership training and deliver a new course called LEAD1 to put EQ into action at the frontlines.  All new FedEx Express managers would receive the program to provide a solid people-first foundation upon which to build their leadership careers.

    Blended Training & Coaching

    A team of eight GLI experts was certified in the Six Seconds Emotional Intelligence Assessment (SEI) through a mix of on-site and virtual training delivered by Six Seconds. Some team members undertook additional trainer-training in Six Seconds’ methodology to ensure that the implementation would go deeply into what drives people performance.
    GLI Senior Management Facilitators Jimmy Daniel and Pamela Williams became certified as a SEI Master Trainer to deliver SEI Certification internally within L&D team in US and globally.
    fedex-lead1-emotional-intelligenceThe FedEx GLI team designed LEAD1 as a five-day course with a six-month follow up coaching process built around the SEI.  Through the in-person training, participants learn about key concepts in FedEx leadership and what it means to lead people.  In an extremely faced-paced, task-focused environment, a common challenge for managers is losing sight of the relational dynamics that ultimately sustain team performance.  To build a team where people give their “discretionary effort,” task-based management is insufficient: people-leadership is required.  
    This means forming a connection between people at an emotional level.  Emotional intelligence provides the insight and skill to allow for this strategic use of feelings.  In LEAD1, the new managers focus on how emotional intelligence will assist them to show up as leaders by managing themselves first, taking charge of their own emotions and behaviors so they can be effective role models and influencers.
    The six month coaching process begins with a one-to-one debrief of the participant’s SEI profile as a framework for goal setting.  The new manager identifies specific competencies to improve, as well as strengths to leverage, and how these can be employed to improve people-leadership.  The coaching process is “specific customized,” meaning that while all participants are working within a shared framework of concepts and goals, each coach and participant work in partnership to develop personalized goals that can be made actionable.  Part of the effectiveness of the coaching is that the coaches all now have several years of experience with emotional intelligence themselves, giving them added insight into what drives people.
    At the end of the coaching process, participants re-take the SEI to clearly identify areas of progress, to set next goals, and provide accountability for the program.
    At present, over 100 facilitators have been, or are being, trained to provide the SEI assessment and coaching, and to run LEAD1 worldwide.


    Initial responses to the program are extremely positive.  LEAD1 trained managers are showing increased ability to push the FedEx strategy and the “People First” leadership philosophy. In the words of a program participant, one of FedEx’s senior widebody captains,
    “I began the week realizing that I was limiting myself with a single leadership style and an emotional intelligence level that was preventing me from reaching my full potential, particularly in stressful situations.
    I learned how to apply different leadership styles to meet specific situations, apply consequential thinking, and continue to improve my emotional intelligence. I am already applying this new found knowledge in my day to day work environment as well as my personal life.”
    fedex-lead1-improveThese insights and skills will shape the culture of FedEx for years to come.  As Shannon Brown, Chief Diversity Officer for FedEx Express, and the senior HR leader for the organization puts it: “At FedEx Express, we’re committed to staying on the leading edge.  For us, that’s always meant bringing out the best in people.  As the business landscape becomes even more complex, we need additional capability. Leveraging the Six Seconds approach to emotional intelligence is helping us build a strategic asset that will let us maintain and strengthen our culture – which is essential to our competitive advantage.”

    Quantitative Results

    Another measure of success is through analysis of the SEI assessments given at the start and end of the six-month program.  Based on comparisons of eight LEAD1 cohorts, 106 individuals (on pre-tests), the group experienced a median increase of 8% to 11% in EQ competencies.  A paired t-test of individuals’ pre-test and post-test comparisons shows P < 0.0001, indicating that statistically, the change is extremely significant.
    In all the competencies of EQ (as measured by the SEI), there were a very substantial number of participants with major increases. In any group, some participants will be more fully engaged in the process; 44% of the participants experienced very large increases (10-50% improvements).  The largest numbers of these were the areas of “Apply Consequential Thinking” with 54% of the participants are in this group of large increases, and “Exercise Optimism” with 57% of the participants improving from 10-50%.
    The SEI measures eight competencies of emotional intelligence as well as six outcomes:  Effectiveness, Influence, Decision-Making, Relationships, Quality of Life, and Health. Statistically, we know that variation in EQ predicts from 55-65% of the variation in these outcomes.[6]  This correlation was confirmed in this sample population, where 59.8% of the variation in outcome scores can be predicted by EQ scores:
    Like the EQ scores, participants’ outcome scores increased significantly.  Group average improvements range from 6-10%:
    Again, the question arises, “What part of the group made serious improvements?”  The largest major improvements were in:
    Decision Making where 72% made major improvements.
    Quality of Life 60% made major improvements.
    Influence 58% made major improvements.

    Qualitative Results

    While the data are impressive, the human stories are compelling.  Behind a 20% increase in relationships, we heard the story of a leader rebuilding trust with her team, or a marriage staying together.  Behind a 15% increase in Quality of Life, we heard the story of someone finding meaning and recommitting to stay sober.  That 10% increase in Decision Making is a story of a new manager finally “getting it” that people are what create value and changing the way he treats people.
    The results of LEAD1 have gone far beyond the workplace.  Participants have shared numerous stories of using the EQ tools to cope with loss, reunite with family members, step up to become better parents, and even make dramatic changes to improve health and wellbeing.  By supporting new managers in this way, FedEx gains by having more competent leaders – and also by showing its people that the company puts its values into action.  In turn, this role models the kind of people-centered leadership that FedEx expects from all managers.

    As a result of initial success, LEAD1 has expanded to FedEx regional globally – Asia-Pacific (APAC), Latin America/Caribbean (LAC) and Europe/Middle East/Africa (EMEA). There are now certified SEI Coaches around the world providing one on one “specific customized” coaching for managers to begin this phase of their careers with the insight and skills for people-first leadership.


    The success of the project at FedEx offers several insights for other companies looking to gain value from emotional intelligence:
    Link to what matters. 
    At FedEx, concepts like “discretionary effort” and the leadership requirements from the annual SFA survey create an internal “case” for emotional intelligence.  The champions of this project have helped leaders see that the learnable skills of emotional intelligence are building blocks to create the kind of people-first leadership the company wants – which, in turn, increases economic value.  This recognition has built support of the initiative at very senior levels.
    Build internal capacity. 
    By developing an internal team of emotional intelligence practitioners, the company has been able to assimilate the concepts and skills of EQ and “translate” them to work within the company culture.  Having a large, strong team of emotional intelligence coaches and trainers means this program can be delivered at a large scale, creating a new “strand of DNA” to support the desired organizational culture.
    Walk the Talk. 
    The company tells supervisors to put people first, so the company puts people first.  By supporting new managers to be good people, and investing in their growth right at the start of their management careers, FedEx senior leadership is providing a powerful role model.

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    What executives should know about open data

    Novel and more accessible forms of information from government and private sources represent a new and rapidly growing piece of the big-data puzzle.

    Not all data that’s valuable is internal and proprietary. 
    New initiatives by governments as diverse as those of the United States, Mexico, and Singapore are opening the spigots of readily usable public data. Corporate information too is becoming more “liquid,” moving across the economy as companies begin sharing data with their business partners and, sometimes, consumers. 
    Also surging is the richness of the information from data aggregators, which are assembling, rendering anonymous, and selling (to interested third parties) a wide range of data flows. Then add huge volumes of data from social-media interactions, available from providers of digital platforms such as Twitter and 
    These new sources of open data represent an expanding trove of largely unexploited value. One everyday illustration of open data at work is a smartphone app that uses real-time data (provided by transit authorities) to tell commuters when the next bus or train will arrive. Using open or pooled data from many sources—all the businesses in a particular sector, for example—often combined with proprietary big data, can help companies develop insights they could not have uncovered with internal data alone.
    Demographic data, financial transactions, health-care benchmarks, and real-time location data are among the myriad new information sources a company can exploit to create novel products and services and to make its operations more effective and efficient. 
    New research from the McKinsey Global Institute, the McKinsey Center for Government, and McKinsey’s Business Technology Office suggests that $3 trillion or more in annual value could arise from the use of open data in applications across seven domains of the global economy (exhibit). About a third of those potential benefits would involve the use of benchmarks to identify areas for improvement.


    Open data can help unlock $3 trillion to $5 trillion in economic value annually across seven sectors.

    Whether or not individual executives at large companies choose to work with open data of various types, the magnitude of the value at stake suggests that some of them will—and that these applications will probably affect a wide range of industries, markets, and customers. 
    Layering open-data mandates into the ongoing development of data and analytics strategies by considering both the use and sharing of more liquid data should therefore become an increasingly important priority for a wide range of companies. Here are a few examples of open data’s potential:
    • Energy exploration. As new technologies have made it possible to drill in a wider range of geological formations, reservoirs have become more complex. That’s raising costs and risks—estimated ratios of prospects to explored targets can be as high as 50 to 1. The sharing of information on drilling permits and on seismic and other data across companies could reduce the number of dry holes and help optimize investments. 
    • While the widespread sharing of seismic data is unlikely, sharing among even a few companies could produce significant new value in the oil and gas industry. 
    • Governments keen on maximizing resource wealth could take the lead in structuring processes for granting permits so that grants of initial drilling licenses would require greater sharing of seismic data. Sharing data on projected costs and development timetables (through third parties) could establish benchmarks that, we estimate, would reduce per-project costs by 15 to 25 percent.
    • Consumer insights. In the consumer-products sector, sharing data among retailers and manufacturers in limited circumstances—avoiding exchanges with direct competitors, for example—could lead to marketing approaches not possible with proprietary data alone. 
    • Take Nectar, a UK-based program for loyalty cards, which can be used at Sainsbury’s for groceries, BP stations for gasoline, and Hertz for car rentals. Sharing aggregated data allows the three companies to gain a broader, more complete perspective on consumer behavior, while safeguarding their competitive positions.
    • Agriculture. San Francisco–based Climate Corporation combined more than 30 years of weather data, 60 years of data on crop yields, and multiple terabytes of information on soil types—all data from public sources. 
    • With that reservoir of historical information and real-time data flows, the company offers fee-based advice to farmers and customized crop-and weather-insurance products based on sophisticated algorithms. The company was recently acquired for about $1 billion by Monsanto.
    Other possibilities abound. Premium pricing for some goods could be facilitated if companies shared detailed information about products, such as the materials they use or the conditions under which they were manufactured (for example, with renewable energy).
     On the flip side, open-data applications may also create new areas of consumer value. In a budding trend known as MyData, organizations share information they have collected about individuals with them, in useful forms. Patients could access targeted medical data from a hospital, for instance, to help them manage their health.
    Powerful as open data can be, many companies have valid concerns. Consider the sharing of data to establish industry benchmarks. Even if a company uses a third party and gets assurances of anonymity, there’s always a risk that its identity might be revealed and that competitors could see how well or poorly it was doing. Shared data also could give away sources of competitive advantage or compromise intellectual property. Similarly, tapping social data could heighten privacy worries among consumers.
    Still, it’s hard to imagine that the open-data wave will slow down. Third-party open-data aggregators will certainly proceed to sell and publish corporate data, such as customer ratings, safety records, defect complaints and recalls, and comparative price data. Open-data initiatives also continue to proliferate in the public sector. In June 2013, G8 governments adopted an Open Data Charter, which establishes the expectation that the default policy should be the open publication of government data. 
    Traditional competitors and entrepreneurial attackers can take advantage of open-data sources such as social-media comments and crowdsourced ideas to come up with new products and services. Open data, in short, seems to be another of the many relentless shifts in the digital landscape to appear unexpectedly, create new opportunities and strategic complexities, and leave established players with no place to hide.

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    Reverse the curse: Maximizing the potential of resource-driven economies
    Rising resource prices and expanded production have raised the number of countries where the resource sector represents a major share of the economy, from 58 in 1995 to 81 in 2011. That number will rise: to meet soaring demand for resources and replace rapidly depleting supply, the world should invest a total of up to $17 trillion in oil and gas and in minerals by 2030, double the historical rate. In 20 years, almost half of the world’s countries could depend on their resource endowments for growth.
    Economies with natural-resource endowments have a huge opportunity to transform their prospects. But history suggests that they could all too easily squander the windfall.
    To date, resource-driven countries have tended to underperform those without significant resources: almost 80 percent of the former have a per-capita income below the global average. Since 1995, more than half of these countries have failed to match the average growth rate of all countries. Only one-third have maintained growth beyond the resource boom. Recent McKinsey research lays out a new model that could help countries capture the coming resource windfall.
    To be included in our roster of resource-driven countries in oil and gas and in minerals, countries had to meet at least one of three criteria: (1) resource exports accounted for 20 percent or more of total exports in 2011; (2) resources on average accounted for more than 20 percent of government revenue from 2006 to 2010; and (3) resource rents were more than 10 percent of GDP in 2010 or the most recent year for which data are available. Also included are countries likely to meet these criteria in the near future.
    Resource-driven countries in the low- and lower-middle-income brackets could capture $1.2 trillion to $3 trillion of the $11 trillion to $17 trillion cumulative global investment in resources to 2030. At the high end of this range, these countries would net almost $170 billion a year, more than three times their development-aid flows in 2011. 
    There is some potential to lift almost half of the world’s poor out of poverty. That would be more than the number of people who left the ranks of the poor as a result of China’s rapid economic development over the past 20 years.
    To capture that investment, these economies should reframe their economic strategies around three key imperatives: effectively developing their resource sector, capturing value from it, and transforming that value into long-term prosperity. 
    The research explores best practices on six fronts: building the resource sector’s institutions and governance, developing infrastructure, ensuring robust fiscal policy and competitiveness, supporting local content, deciding how to spend resource windfalls wisely, and transforming resource wealth into broader economic development (exhibit).


    The McKinsey Global Institute has identified countries performing well across the six areas of the resource value chain.

    1. The resource sector’s institutions and governance

    No single model of state involvement in the sector works best—that depends on the context. Whichever model a country chooses, three guiding principles are vital: a stable regulatory regime with clear rules, the exposure of national operators to competition from private-sector firms, and major efforts to attract and retain world-class talent.

    2. Infrastructure

    Resource-driven countries will together require more than $1.3 trillion of annual total infrastructure investment over the next 17 years—almost four times the 1995–2012 level—to sustain projected economy-wide growth. Given the huge need, these countries should look closely at ways of sharing the cost of resource infrastructure. 
    We estimate that different operators could share nearly 70 percent of the investment in it, industry and other users the remaining 30 percent. Governments need to plan early, rigorously assess the costs and benefits of sharing, and pick the right model to implement it.

    3. Competitiveness and fiscal policy

    Countries have much to gain from doing all they can to ensure that their resource sectors are as globally competitive as possible. Instead of focusing narrowly on fiscal policy, governments should take a broader view, including production costs, country risk, and their countries’ share of the revenue pie. Resource-driven countries could boost the competitiveness of their resource sectors by more than 50 percent.

    4. Local-content development

    Between 40 and 80 percent of the revenue created in oil and gas and in mining pays for goods and services—exceeding, in some cases, tax and royalty payments. More than 90 percent of resource-driven countries regulate the proportion of goods and services supplied locally, but much local-content regulation is badly designed. Governments need to ensure that it doesn’t compromise competitiveness.

    5. Spending the windfall

    History is littered with examples of governments squandering their resource revenues through corruption or simple mismanagement. To avoid such waste, governments should ensure that the spending and benefits are transparent and keep themselves lean.

    6. Economic development

    To overcome the underperformance of the past, governments should remove barriers to productivity across their economies. Even in the past, tension colored the relationship between extractive companies and host governments. As resource production shifts to developing and frontier economies—often with weak infrastructures and unstable political systems—it becomes more and more vital that they adopt a new approach. Operating risks have increased ninefold.
    Essentially, these companies ought to shift from a pure extraction mind-set to a developmental one. They must build a deep understanding of their host countries and rigorously assess their own contribution to broader economic development. Last, they must ensure that their efforts match the priorities of host governments and that any package of initiatives is part of a relationship with them—a relationship that will endure for any project’s lifetime, which can stretch for decades.

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    Universities are still best place to train teachers, report says

    Joy Carter, vice-chancellor of Winchester University, in her office
    Joy Carter, vice-chancellor of Winchester University, says: 'If the quality of teaching plummets any further, we are in trouble as a country'. Photograph: Graham Turner for the Guardian

    For months, university leaders have been moaning about the increasing transfer of control of teacher-training programmes in England from universities to schools.
    While most have insisted their concerns are for the future of English education, their objections have also carried a strong whiff of self-interest: the changes introduced by the government involve increasing the number of training places available in schools through the School Direct programme and cutting those funded through universities, leaving them at the mercy of schools' desires rather than their own strategic planning.
    But now vice-chancellors have evidence to back up their case, with the publication on Monday of an interim report by the British Educational Research Association (Bera) and Royal Society for the Encouragement of the Arts, Manufactures and Commerce on the role of research in teacher education.
    While the policy implications of the findings will only be spelled out in the full report, due out in March, it highlights the fact that in other countries there has been a shift away from school-based training and towards university-based teacher education in institutions with relatively high entrance standards and status. It suggests that the education systems that perform best and have improved most, such as in Finland and Singapore, put particular emphasis on research training for teachers.
    John Furlong, professor of education at Oxford University and chair of the steering group behind the report, says: "There is strong evidence that research is important in the best-quality teacher education programmes around the world in at least four different ways: it underpins the knowledge communicated to teachers; teachers need preliminary research skills in order to be able to start thinking about their own work; it helps explain how people develop professionally; and, built into programmes, it monitors what programmes are doing, making sure they are staying up to date with the latest developments about how professionals learn."
    Chris Husbands, director of the Institute of Education, says the decision to transfer responsibility for teacher training in England away from universities to schools flies in the face of findings on best practice internationally. "In Singapore, the government is clear: the improvements in teacher training since a low point of low morale and shortages in the 1980s have been driven by improving teacher training through the National Institute of Education," he says. "I was in Singapore working for the government a few weeks ago and no one could believe what we are doing in terms of de-regulation."
    Joy Carter, vice-chancellor of the University of Winchester, where 12% of entry for 2013-14 was for initial teacher training, says the potential effect of the changes on teacher quality is particularly worrying given the relatively poor performance of British schoolchildren shown in figurespublished last month by the Organisation for Economic Co-operation and Development, comparing standards in maths, reading and science. "If the quality of teaching plummets any further we are in trouble as a country," she says.
    A spokesman for Universities UK, which represents 132 higher education institutions, more than half of which are involved in teacher training, says it is raising concerns "at the highest levels" about implementation of the School Direct scheme introduced two years ago, and will discuss the implications of the Bera report with its members.
    Analysis by UUK for 2014/15 shows that allocations for postgraduate training in HE institutions have been reduced by more than 18% to 16,342, while School Direct allocations have increased by nearly 60% to 15,254. This means 37% of all initial teacher-training places are now allocated to School Direct, up from 25% last year.
    Drawing on a survey of universities involved in teacher training, the analysis highlights concerns about a potential shortage of trained teachers in some subjects and particular parts of the country. Maths, modern foreign languages, physics and design and technology are way below their recruitment targets this year. But many universities have also expressed concerns about a possible future shortage of English teachers, in which allocations for training places have been slashed. UUK understands that only 14 English trainees have been allocated to the whole of Sheffield. It also reports worries about reduced allocations for primary-school training places at postgraduate level.
    James Noble-Rogers, executive director of the University Council for the Education of Teachers (Ucet), says this is a worry because of increased pupil numbers in primary schools. This bubble will soon hit secondary schools, he warns, while at the same time, fewer people are likely to turn to teaching because of more opportunities in other sectors. "It is a bit reckless for the government to introduce such a huge change when demographics are coming up and we are coming out of recession," he says.
    While Ucet is not opposed to the principle of School Direct, he says, "the problem we are having is that it has been expanded far too quickly".
    Both the Open University and Bath University have recently decided to close their PGCE courses, citing uncertainty caused by the changes as a factor. The concern is that others will follow suit.
    Bob Burgess, vice-chancellor of the University of Leicester and chair of the UUK/Guild HE Teacher Education Advisory Group, says that even if universities do not immediately stop teacher training, they may be forced to cut down in particular subject areas or in training teachers for particular age groups and that could eventually "nibble away" at the whole system of teacher training in universities. "The model clearly assumes that universities will be there so that schools can draw on their expertise," he says. "But you need to have enough money fuelling that."
    Carter says all universities with any form of teacher training are worried about the changes because they make it much harder to plan for future demand. Already, she says, applications to university teacher training are substantially down this year for the first time in decades, which, she suggests, could be the result of over-marketing of School Direct places at the expense of higher education-based courses, combined with applicants being wary of new basic skills tests for trainee teachers.
    An added worry is that the School Direct scheme was less successful than universities in filling the places allocated to it last year.
    "We cannot afford for that to happen again this year," says John Howson, managing director of the research company Data for Education and a former government adviser on teacher supply. "If this is going to be a credible training route for large numbers of teachers then schools have to play their part in filling those places."
    Since there has as yet been no evaluation of the School Direct scheme and little data on its effect on teacher-training numbers, he suggests it is being expanded too rapidly.
    This means, says Burgess, "there is a risk to the future training of teachers, there is a risk in terms of schools having a supply of appropriately trained teachers, and I also think there is a risk to the way teachers are trained. There needs to be a place for universities in that training because universities bestow, in any qualification, a concept of professionalism".
    But an education department spokesperson says: "School Direct is a response to what schools had said they want – a greater role in selecting and recruiting trainees with the potential to be outstanding teachers. The programme is only in its second full year of operating and it is already proving very popular, allowing heads to pick and choose the very brightest graduates and actually raise teaching standards."
    He says that last year, three candidates applied for every School Direct place, compared with 1.8 applicants per place in universities; requests from schools for School Direct places have gone up from 9,600 to 17,700 in the past year and 99% of the overall target for postgraduate places through schools and universities were filled.

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    Resource revolution: Meeting the world’s energy, materials, food, and water needs

    The English thinker Malthus argued in his famous Essay on the principle of population in 1798 that there was no longer sufficient land in the world to feed a rapidly growing world population, threatening poverty and famine. But an agro-industrial revolution soon transformed the economies of Europe and North America, and his fears proved unfounded.

    In more recent years, the conventional wisdom has taken hold that market forces would always come to the rescue. Until ten years ago, this hope was largely fulfilled. During most of the 20th century, resource prices, whether they be food, water, energy or steel, declined despite strong growth in the world’s population and even stronger growth in GDP. This price fall was due to a combination of new low-cost sources of supply and technological innovation.
    But in just the past ten years, demand from emerging markets, particularly in Asia, has erased all the prices declines of the previous 100. A number of factors are conspiring to create a risk that we might be entering a new era of high and volatile prices over the next two decades. Up to three billion people could join the middle class, boosting demand at a time when obtaining new resources could become more difficult and costly. 
    The stress on the resource system is likely to be compounded by increasing links between resources that mean that price shocks in one can swiftly transmit to others. In addition,  environmental deterioration, driven by higher consumption, is making the supply of resources—particularly food—more vulnerable.
    A joint report by the McKinsey Global Institute and McKinsey’s Sustainability & Resource Productivity Practice shows that the resource challenge can be met through a combination of expanding their supply and a step change in the way they are extracted, converted, and used. Resource productivity improvements that use existing technology would satisfy nearly 30 percent of demand in 2030. Fifteen areas, from more energy-efficient buildings to improved irrigation, could deliver 75 percent of the potential for higher resource productivity.
    Meeting the resource supply and productivity challenges will be far from easy—only 20 percent of the potential is readily achievable and 40 percent will be hard to capture. There are many barriers, including the fact that the capital needed each year to create a resource revolution will rise from roughly $2 trillion today to more than $3 trillion. 
    However, the benefits could be as high as $3.7 trillion a year if carbon had a price of $30 per tonne and governments removed substantial resource subsidies and taxes. Even this would not be sufficient to prevent global warming and provide universal access to resources, which could cost in the region of another $350 billion a year.
    Policy makers should consider action on three fronts. They should consider unwinding subsidies that keep prices artificially low and encourage inefficiency; ensure that enough capital is available and that they correct market failures associated with property rights and incentives, for instance; and bolster society’s resilience by creating safety nets to help very poor people deal with change and educating consumers and businesses to heed the reality of future resource constraints.
    This new era presents opportunities and risks for business. Resource-related trends will shape the competitive dynamics of a range of sectors in the two decades ahead. Resource-intensive sectors are exposed to much higher risk of either increased resource prices and/or of restrictions on their licence to operate. These risks will be particularly acute in the fastest-growing markets where constraints on access to resources and accelerating environmental degradation are most acute. Resource-supplying companies may appear to be positioned for an era of windfall profits. 
    However, they face an increasingly complex set of portfolio investment challenges, especially given a rapidly changing technology and regulatory landscape. In general, businesses will need to rethink how resources might shape profitability across their operations, produce new growth opportunities, and pose new challenges for risk management.
    In the 20th century, governments and businesses didn’t have to worry about resource productivity; they were able to focus on capital and labor instead. Over the next 20 years, resources needs to be put at the heart of public policy and business strategy.

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    Urban world: Cities and the rise of the consuming class

    Cities have long been the world’s economic dynamos, but today the speed and scale of their expansion are unprecedented. 
    Urban World: A new iPad app - image3

    Through a combination of consumption and investment in physical capital, growing cities could inject up to $30 trillion a year into the world economy by 2025. Understanding cities and their shifting demographics is critical to reaching urban consumers and to preparing for the challenges that will arise from increasing demand for natural resources (such as water and energy) and for capital to invest in new housing, office buildings, and port capacity.
    A new report from the McKinsey Global Institute, Urban world: Cities and the rise of the consuming class, finds that the 600 cities making the largest contribution to a higher global GDP—the City 600—will generate nearly 65 percent of world economic growth by 2025. However, the most dramatic story within the City 600 involves just over 440 cities in emerging economies; by 2025, the Emerging 440 will account for close to half of overall growth. One billion people will enter the global consuming class by 2025. They will have incomes high enough to classify them as significant consumers of goods and services, and around 600 million of them will live in the Emerging 440.
    The world’s center of economic gravity has changed over past centuries. But since the mid-1980s, the pace of that shift—from the United States and Europe toward Asia— has been increasing dramatically (exhibit). We expect this trend to continue, so executives and policy makers must be prepared to respond.


    By far the most rapid shift in the world's economic center of gravity happened between 2000 and 2010.
     To capture the opportunities that arise from urbanization, businesses will need extensive market intelligence. Many of the Emerging 440 middleweights aren’t widely known outside their own nations. Income and demographic trends vary from country to country and city to city, and the consumption of different products and services starts to rise at different income levels. 
    Armed with detailed information about relevant urban markets, companies need to allocate resources proactively and aggressively to capture the opportunities. Companies that understand and respond to shifting urban marketplaces are likely to experience tremendous benefits. Yet a new McKinsey survey finds that less than 20 percent of executives are making location decisions at the city level.
    Policy makers have a different set of challenges. In the developing world, the task is to manage growth in a way that avoids diseconomies of scale and creates the basis for sustainable economic performance. In the developed world, the goal is to maintain a healthy rate of growth through higher productivity, new business investments, and enhanced links with emerging regions.
    View our slideshow to explore some of the fastest-growing cities in emerging markets and their specific consumer profiles.

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    Life’s Work: Salman Khan

    Photography: Jonathan Sprague
    Salman Khan was working as a hedge fund analyst when he started using online tools to tutor his cousins in math. Nine years later, his nonprofit organization, Khan Academy, draws on the same approach to offer more than 5,000 free, web-based video lessons to millions of students across the globe, disrupting not only schools but also the education industry built around them. 
    HBR: What are the key concepts students should understand in order to be successful in today’s workplace?
    Khan: The one meta-level thing is to take agency over your own learning. In the traditional academic model, you’re passive. You sit in a chair, and the teacher tries to project knowledge at you; some of it sticks, some of it doesn’t. That’s not an effective way to learn. Worse, it creates a mind-set of “you need to teach me,” so when you’re on your own, you think, “I can’t learn.” Anyone in any industry will tell you there’s new stuff to learn every week these days. So you have to say, “What information and people do I have at my disposal? What questions do I need to ask? How do I gauge whether I’ve really understood it?” Khan Academy is designed to give students that agency. If you want to get more tangible, I would say learn how to program a computer, more about the law, and definitely statistics.
    In your book, you talk about curiosity being stamped out of kids. How do you bring it back?
    Curiosity is a hard thing to squash, but the traditional model of education manages pretty well: Listen to lectures, take notes, feed back what you learned, and then forget it all. You’re not allowed to go beyond the curriculum. Khan Academy is all about giving more breathing room. You want to go deep? Go deep. I had this to some degree at the public school I went to in Louisiana, where there were gifted programs. Every day, starting in second grade, they took me out of class for an hour, and I would go to another room, with a mixed age group. The first time I went, I thought it was the biggest racket. I walked up to Miss Rouselle’s desk, and she asked, “What do you like to do?” I was like, I’m seven years old—shouldn’t you be telling me what to do? But I said, “I like to draw. I like puzzles.” She said, “OK, have you used oil paints? Have you done Mind Benders?” Soon I looked forward to that hour more than I did to spending the night at my friend’s house. And I learned more that applies to what I do today than in the five other hours of the day combined.
    That’s what we need to create space for. Historically, it was hard to do in a scalable way. How do you personalize education for 30 kids without breaking the bank? But technology can deliver information at a student’s pace, give practice problems and feedback, and arm teachers with data, so that when students go into a classroom, it’s much more like what I experienced in that gifted program.
    How much of what you’ve learned about effective education applies to the business world?
    The idea that you do K–12, four years of college, maybe some grad school, and then stop learning is a myth. The book applies to lifelong learning: Go at your own pace, master content before moving on, and do it without disrupting your current work and productivity. A lot of corporations, when they do training, mimic the classroom. They create corporate universities; people have to take time off and listen to lectures. But the information and credentials you get coming out of those classes aren’t as useful as other things. At Khan Academy, when we hire, it’s nice if you have a high GPA and an academically rigorous major. But what we really care about is what you’ve made. For engineers, show us software you’ve designed. We also want evidence of how you work with other people, the leadership you exhibit, and what your peers think of you.
    Your findings on the limits of human concentration seem relevant too.
    We think that because this generation has Facebook, Twitter, and mobile phones, they don’t have attention spans. But it’s clear from the studies that we never really had the attention spans the classroom-based lecture model expects of students. Especially with dense subject matter, humans can pay attention for 10 to 15 minutes before they zone out. You zone back in for eight or nine minutes, then you zone out again. The zoning in gets shorter; the zoning out gets longer. By the end of the hour you might have picked up 30% of the material—or you might be lost altogether. That has consequences in a work setting, too. If people are meeting, they don’t need a lecture; if you don’t need them to interact, information should just be in a video or a memo. At Khan Academy, one side effect of that approach is we’ve created a library of videos that provide background on our thinking, so that we can tell a new employee, “Go watch.” We make videos for our board, too, so that everyone can see that historical narrative; then the board meetings are mainly interactive Q&A.
    Should every company use videos instead of memos?
    There’s something you get only from a human voice—little intuitions or parentheticals that people express verbally but for some reason not in a white paper or a memo. It’s incredibly valuable.
    You’ve been called the world’s teacher. How much of that came to you intuitively, and how much did you learn along the way?
    If you’re being talked down to in a classroom, or if a lecture is over your head, you feel belittled. As my wife will tell you, I’m hypersensitive to that. When someone uses an even slightly exasperated tone, my reaction is, “Hey, don’t talk to me that way!” So when I give a talk, 10% or 15% of my brain is thinking, “Sal, are you sounding arrogant? Are you talking down to people, or above them?”
    Also, I’ve always been interested in really understanding things. When you have a strong foundation, everything falls into place a lot easier later on. I don’t say, “Memorize this formula.” I say, “This is how my brain thinks about it.” I try to make my thought process very transparent; if I’m doing calculus or quantitative finance, I’m not afraid to remind myself of some basic arithmetic.
    Your first trial-and-error attempts to teach your cousins remind me of the iterative “lean start-up” model.
    You have to do some planning, but you get real information only when you put something out there, observe people using it, get data, and quickly iterate to throw something else out. One thing in my mind is to not lose that.
    Now that you have more people, and solid funding, why have you stuck with the same model—your voice against a simple digital blackboard?
    When I started making videos, in 2006, I did 10 or 20 as a proof of concept, and, with my MBA hat on, I thought, “I’ll get a bunch of other people to make content, because that’s the only way to address all the topics I want to.” But it was hard to find people to participate, and I realized I could scale up on my own far more than I had assumed. Within two or three months I had done 80 or 90 algebra videos. Then I moved on to geometry and calculus and physics. But I’m clearly not going to be able to cover everything, and people might appreciate a different style. We have a few other folks already doing art history, medicine, and project-based learning videos, and we’ve hired a team to build the tools and platform to allow more people to create content. You’re going to see content in many languages. You’re going to see us going much deeper into interactive experiences.
    When your lessons are criticized, how do you respond?
    You have to figure out what is meaningful and constructive and what isn’t. When someone sends us an e-mail or writes a blog post about something they think is incorrect or unhelpful, and they’re right, we annotate or redo the video. That’s one of the values of this form over a traditional textbook, where you get little or no feedback. When we put content out, 10,000 people look at it within a week. It’s a very fast editorial cycle. We don’t have to wait until the next textbook. We can fix it overnight.
    Khan Academy is clearly disrupting education. Will you kill off some established players?
    Whether or not Khan Academy exists, the world in which a business model is based on charging people for access to information—and not even new information, but 300-year-old science or math—is going away. I think publishers recognize that and see that there are opportunities for them. They already have huge distribution and traction in schools globally. If they turned those schools into registered internet users and customized material for them, the market would value that. It’s not 100% clear how to monetize it, especially since we’re out here saying that access to learning is a human right. But the writing’s on the wall.
    At the same time, there are start-ups trying to imitate your model on a for-profit basis.
    The more dollars thrown at the problem, the better. If a for-profit player gives away part of an education in order to attract customers, that’s a win for everyone.
    Why did you set Khan Academy up as a nonprofit?
    In the for-profit realm, a home run is to scale big, get 100 million users, and go public or get acquired. That would have been good for me individually and for our investors. But it felt a little wrong, because I wanted our content to be accessible to all people, for a long time into the future. Beyond your generation, do you have confidence that a for-profit will stay true to its mission? The institutions that have had global reach over multiple generations have been not-for-profits. That’s a home run in that sector. And maybe Khan Academy can be one of those. In terms of its advantages, we get goodwill. There are 51 people in the organization, plus thousands of volunteers, and we’re attracting some of the best in Silicon Valley: McKinsey folks, people from Google and Facebook, one of the leading quant fund guys, the world’s top Java script programmer. These incredible people come for the mission, not even realizing that we actually pay pretty well. So we’re getting a caliber I don’t think anyone else can.
    What kind of boss are you?
    It’s an exciting and hard challenge: How do you have a flat and nimble structure? How can you be approachable but also have authority? How do you make sure people’s voices are heard while correcting something you feel is going in the wrong direction? Every manager has to plot his own trajectory and be as open to feedback as possible.
    Eventually you’re going to run into another classic management problem: You’re the face of the organization. Can the Academy exist without you?
    Two years ago that would have been impossible. Even now a lot of the press narrative is about me tutoring my cousins and making videos. But that’s starting to change, because people see our interactive platform, which was clearly worked on by people other than me. As we bring other content creators on board, my hope is that I can continue to be a valuable evangelist for what we’re doing. But if, God forbid, I get hit by a bus, Khan Academy should survive. We have a deep bench. I’m the least impressive person in the organization.
    A lot of us dream of leaving our jobs to do something good for the world. How did you decide to take the plunge?
    I really enjoyed my hedge fund job; it was far more thought provoking and intellectual than people might assume. But I also found a lot of satisfaction working with my cousins, writing the software, and making the videos. So in the back of my mind, I thought I would become a portfolio manager, have my own fund, and maybe 15 or 20 years in the future, on my own terms, fund a school. As anyone in investments will tell you, you have bad days, and you think maybe you should do your hobby full-time. 
    But then you remember you don’t own a house, you have a baby on the way, and you haven’t paid off your or your wife’s student loans, so you stop dreaming. I’d been part of the dot-com bubble, and I found it so exhausting emotionally that I told myself entrepreneurship was not for me. So when I started Khan Academy, I said, “This is a hobby. This is a passion. This is fun.” And I protected it that way as it developed. I thank my old boss, because he thought it was valuable for us to have our own lives, and that created a space for Khan Academy to blossom. When I took the plunge, it was significantly de-risked. By 2009, 100,000 people were using the videos, we’d been on CNN and in USA Today, and I was starting to talk to philanthropists. So I sat down with my wife and said, “Let’s give it a year. If I can’t get it off the ground, I can go back to my old job.” Nine months in, things started to happen.
    You’re backed by the likes of Bill Gates and Carlos Slim. What have you learned from them?
    All of them, even though they sit on top of empires, go deep and try to understand things themselves. They’re very hands-on. And they’re incredibly curious. The first time I met Carlos Slim, we sat on a beach for four hours and talked about what civilizations existed during previous interglacial periods. These people are big thinkers. Seeing that has given me the confidence to let my epic juices flow, so to speak—to indulge my science fiction, delusional dreams. You have to, for some of your stuff to become a reality.
    Your wife is a doctor, and you have two young children. How do you balance work and family?
    I set hard lines. Weekends are for my family. I do not touch the computer unless it is an absolute emergency. When I come back on Monday, I’m refreshed and productive. The same goes for evenings. I’ve been up on stage at speaking events and said, “I have to go give my kids a bath now,” and everyone is shocked. But if I can’t have dinner with my kids, give them a bath, and read them a book before bed, something is wrong in my life.

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    The Right Way to Answer “What’s Your Greatest Weakness?”

    Thomas Jefferson once said that “honesty is the first chapter in the book of wisdom”. Though truth-telling abounds in grade school platitudes, it seems scarcer the older we get. But this decline in honesty — let’s call it dishonesty — isn’t necessarily innate. Dishonesty can be taught. In my experience, I’ve noticed that, of all culprits, college career centers are exceptional traffickers of such miseducation. In the process, they’re hurting their brightest students’ chances of making it in the world of startups by convincing them to give dishonest answers to tough interview questions.
    Full disclosure: I work at a startup, and it’s my job to quickly build a team of the right people. Throughout my earlier career in larger companies, honesty and being self-critical have always been obvious qualities to look for in candidates, but it wasn’t until I joined Medallia that I realized their special significance for startups. Brandon Ballinger’s now famous blog post about his experience with Y Combinator’s Paul Graham shows why. To cut a long story short, Graham told Ballinger (to his face) that his startup idea sucked — a tough-love approach Ballinger now extols. Why? Well, in a startup, it’s much more comfortable to be a “team player” than “the bad guy,” as Ballinger describes it. The real hard work in a startup, however, is being able to openly admit that the current strategy is just not working — no matter how uncomfortable it is, or how much has been invested in getting to that point.
    In other words: one of the biggest dangers for a young company is that a roomful of smart people who aren’t being honest could easily be steering their rocket ship into the ground.
    And yet college career centers continue to operate in a 20th century world in which top talent was funneled into careers in mature, staid organizations and industries. These are cultures where people are much more likely to divulge their net worth than a weakness. While a mature organization might have once been able to get by with a “don’t stick your neck out” culture, that attitude is simply lethal to startups.
    Nonetheless, the importance of this simple truth seems to still be elusive for the Office of Career Services at many of the nation’s top colleges and universities. Besides guidance on basic items like resumes, cover letters, how to dress, and how to eat, many of these schools are providing either noadvice or bad advice on how to adequately answer important questions. Take a very common question that I always like to ask, for example:
    What is your greatest weakness?
    Even if you’ve only had just one professional interview in your life, then you’ve probably still been asked some version of this question. Do you remember how you answered? Did you say that you work too hard? That you have perfectionist tendencies? Or that you’re too passionate? Be honest.
    The truth of that matter is that a quick search of career center websites indicates that students are being encouraged to apply this type of spin to their answers. Even for those that advocating for honesty, there’s often still the contradiction that one’s answers must always be positive. The result of which? Answers that focus on lesser skills (but still skills) rather than actual problems or challenges. One school goes as far as to call it an “angelic weakness.” And if you’re pressed to give a real answer about a flaw, nearly every career center in the universe has apparently decided that “public speaking” is an appropriate response.
    Others are more direct at giving the advice that everyone seems familiar with — to make weaknesses into strengths (and vice versa). Northwestern tells grad students, “Turn a negative into a positive.” Boston College advises students to “Turn your weakness into a positive (for example) ‘Because I tend to procrastinate, I have learned to work well under pressure in order to always get work done on time.’”
    This is terrible advice. Responses like these tell me little about how a candidate faces challenges and immediately implies a lack of sincerity. It doesn’t demonstrate to me how they think — beyond their ability to creatively avoid being honest or self-critical. It indicates to me that they’re not willing to stand up and say what’s not working — the opposite of what a startup needs. That’s why my recent interviews with college graduates have all started to follow the same pattern. I start with two sentences: “Forget what your career center has taught you about interviews. I want to have a real conversation with real answers, and I promise to do the same.” The candidates take a minute to evaluate whether I’m somehow tricking them. If they lean into their discomfort and take me at my word, the level of conversation improves dramatically — we have a great time getting to know one another in an authentic way. I’m not really looking to find out whether their organizational skills could use improvement, or that they struggle with presenting to large groups or even leading large teams. I’m trying to find out whether they have self-awareness; whether they are able to be critical; and most importantly, whether they’re able to tell the truth — when it’s difficult.
    For those candidates who don’t buy in, however, I spend the majority of the interview trying to pry off their layers of canned responses. I leave the interview wondering: Who are you? And what’s worse — I’ll never know. Because they’ll never get the job.

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    Managing the Family Business: It Takes a Village

    Is it better to lead a family business with one ultimate leader or a team?John A. Davis, an expert on family business management, kicks off a series of articles with a look at governance models.


    A consistent finding about family business systems—the business, its owners, and the family in control—is that strong, long-term business performance also requires strong performance by the family and by the ownership group. You can't keep a family business performing well over many years just focusing on the business. Family unity, united ownership and ownership support of the business are just too important to ignore or take for granted.
    We also know that strong performance of the business, the ownership group, and the family depends on the effective leadership of each group. This shouldn't be surprising: good performance of any group always depends, to a surprising extent, on capable leaders. If boards of directors of public, anonymously-owned companies didn't believe that leadership mattered so much, they wouldn't pay such huge salaries to their CEOs. (By the way, I don't think they are worth that much, but the point is: having the right leader does matter.)
    Because there is not only a business, but also an ownership group and a family that need capable leadership, a family business system is much more complicated than other kinds of business organizations. Leading these systems is also much more complicated.
    Family business systems have a number of formal leadership roles. The CEO and board chairperson lead the business and usually the shareholder group. Family council leaders, parents, and grandparents are the formal family leaders. These leaders don't make all the important decisions in these systems. Nor do they provide all the guidance. They don't allocate all the resources. But because they have considerable authority, influence, and control over resources, we rely on them to do their part in setting direction and guiding their group.
    Because the performance of people in these roles is so important to the success of the family business system, we need to understand what capable leaders in family business systems actually do. I've spent much of my professional life figuring this out.
    I've gotten to know a number of excellent family business leaders in my long career, along with some weak ones, and a couple of awful ones. To illustrate my profile of a great family business system leader, I'll use one of my favorite examples: Nelson Sirotsky, chairman of Grupo RBS, his family's world-class media company based in Porto Alegre in the south of Brazil.
    I met Nelson and his cousin Marcelo Sirotsky at a seminar I led on family business management in Santiago in 1999. I've worked with their family business system ever since. Nelson, then CEO of RBS and also leader of his family branch, attended the seminar to develop plans for his family business system and to reconsider his own leadership role. As the program unfolded, Nelson came to new understanding. He realized that he needed to give more attention to his family and the owners, in order to keep pace with his tireless focus on the business.
    What Nelson and his family accomplished over the last decade is very impressive. They recently celebrated Nelson's successful and smooth transfer of his CEO role at age 58 to his very capable nephew, Eduardo Melzer, 40. Nelson remains chairman of the board with clear responsibilities. RBS is stable and poised for more great performance. My colleague Vicky Bloch, a superb coach and advisor, helped them throughout this process. But much of this good work stemmed from Nelson understanding his role as a leader of the business, family and ownership group, and from his performing so well as a leader, including through the CEO transition.
    Which brings me to a question I am often asked: "Is it better to have one ultimate leader of the family business system or a team of leaders?"


    There are two basic models. A family business system can either consolidate leadership with one person, or it can choose two or more people to lead different parts of the system. Each model can work well, as long as it's clear and supported by the stakeholders. Both models have some potential weaknesses: unitary leadership can lead to excesses; leadership teams can be slow and hobbled with rivalry.
    But there is no doubt that one model dominates. Having one person serving as the ultimate leader of the business, ownership, and family is the natural choice for most families (and most nonfamily groups) around the world.
    The preference for one leader seems only slightly culturally driven; it's very common in Italy, for example, but only slightly less common in Finland-comparing two European cultures that couldn't be more different.
    One-leader systems are also somewhat more common in younger and less complex family business systems; these systems are either in the founder stage or trying to emulate it. The parent-founder-business leader-controlling owner generally has most of the power in his or her family business system. As family business systems approach or reach the cousin stage, with diversified businesses and big ownership groups, as RBS now has, you find more systems having two or three leaders who lead different parts of the system and collaborate to keep the system united. Sibling systems have the hardest time working out who should have what leadership role and power.
    With those few exceptions, the one-leader model still dominates everywhere and at all stages. Inertia keeps families in business wedded to it, and in some situations there are measurable benefits that tip the scale in favor of unitary leadership.
    So let's take a closer look at this model.


    The person chosen for this role is generally the business leader. In some cases, the family business system leader is the chairman of the family holding company and the clear leader of the family owners. In general, family business system leaders are the individuals with the most resources under their control; typically, they are middle aged or family elders. Effective ones are appreciated for their wisdom but are not necessarily liked by all their relatives. Leaders tell me that they have a gratifying but tough and often thankless job.
    Many successful family business leaders tell me that they spend half of their time working to address family and ownership issues and to maintain unity. If the business leader tries to control too much of the power in the system, he or she will often weaken and destroy it. Even founders seem to understand this. At the founder stage, I often see the wife-mother wielding significant power over the familyand significant influence on her husband the founder, whom she advises.
    That is why an accurate drawing of the one-leader model usually shows that the ultimate leader has strong deputies or allies helping to lead the business, family, and ownership group.
    Recognizing the needs of his family business system 15 years ago, Nelson Sirotsky opted to maintain ultimate control but delegated much of the management of RBS to his star nonfamily EVP, Pedro Parente. Nelson shared leadership of the ownership group with his uncle and then chairman, Jayme Sirotsky (also an exemplary leader). Nelson also supported the family council and its leaders, who did much to organize and unify their large family.
    It takes a strong ego to not only share leadership but also give credit to others as Nelson does. It's fair to say that no major change in the business, family or ownership group could have been made without Nelson's agreement, but also that others' support was needed for major programs or decisions to be approved. There were continuous conversations among the owners and family about important issues and these drove out consensus. Consensus never required unanimity but rather the feeling that the deliberation process was fair, combined with general agreement that the decision was the best possible course of action at any given time, given some reservations.
    Through the last decade, what resulted at RBS was a decisive system with strong support for Nelson, the ultimate leader, by the family and owners. In successful family business systems with unitary leadership, you find that most important decisions are the product of a consensus process like this. The leadership model has now changed since Nelson moved to the chairman role and Eduardo Melzer became CEO: the collaboration between uncle and nephew in leading their family and business is impressive.
    Whether your own system is modeled on unitary or team leadership, you need to design, structure and allocate leadership roles. We'll turn to this in my article next month. 

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    'Kids Are Different: There Are Lots of Different Ways to Educate Them'

    An interview with Glenn Harlan Reynolds about his new book, The New School.

    There are a dizzying number of theories out there about American education. Smaller classrooms are the solution one day, the next, iPads. Glenn Harlan Reynolds of Instapundit takes on these ideas and makes his own predictions in his new book, The New School. I talked with him about his conclusion that the future of American education is rooted in technology, choice, and customization. Here’s a transcript of our conversation, edited and condensed for clarity and length. 

    How did schools get to be like they are now?
    Our models for education, both K-12 and higher ed, were basically imported from Germany in the 19th century. Those 19th-century German models were in many ways not bad models for the United States in the 19th century. But now that we are in 21st-century America, they don’t seem to be working that well. That’s sort of the starting point for my discussion.

    Why do these German models fail us now in the 21st century?

    Well in both cases, as is typical of established models in almost any area, they primarily work for the benefit of the people inside. I quote John Hicks the economist saying, "The best of all monopoly profits is a quiet life." And that is basically what happened here. You have the quasi-monopoly with mostly unionized teachers in K-12 and the tenured professoriate in higher ed. 

    Frankly the administrators on both sides have arranged things, as people naturally tend to do out of human nature, in ways that make their lives as comfortable and pleasant and secure as possible. The problem with that is those are not necessarily the ways that serve the people that the institutions are supposed to serve.

    At the K-12 level, we really still have the 19th-century model. That is relatively easy for the people who are teaching, but it doesn’t necessarily serve children well. It’s not sufficiently customized, and it just doesn’t respond to a lot of the newer things we have learned about how people learn and how to present information. It was designed to teach people how to be punctual and orderly and well-organized and diligent and all the sorts of characteristics that you needed to have a successful Industrial Revolution. 

    We implemented it and we did have a pretty successful Industrial Revolution and the Industrial Revolution made people a lot healthier and wealthier and better off, so that was all great. But the structure of the schools was factory-like. 

    The output of the schools was as close to a standardized product as they could make it. If you were a kid who didn’t fit in very well, if you were a square peg and they wanted you in a round hole, the solution of the traditional schools K-12 was basically to use a bigger hammer. That was hard for a lot of people, and a lot of people didn’t get as much from it as they should have. And it’s no longer necessary.

    On the higher ed level, the problem is a little different. What you have is the cost of the college education increasing at slightly more than double the rate of family income increasing and the difference being made up for with debt, primarily student-loan debt. That doesn’t work once the debt reaches an unsustainable point. 

    We’ve about reached the point where the student loan debt burden is sufficiently high that the increased earnings from going to college often don’t justify taking on the debt. In response to that we are already seeing changes in behavior as people are getting choosier about where to go to college.

    So the pressure on the higher ed system is that it has been built on the expectation of ever-increasing tuition income backed up by government-subsidized student loans. It’s going to have to adapt to a situation in which resources will no longer be increasing and in which consumers are going to be much more skeptical.

    In your book, you predict that there are big and controversial changes coming to education, like homeschooling, charter schools, and online courses. Let’s start with homeschooling: Why is it a good model for the 21st century?

    Well, homeschooling of course isn’t for everyone. It is, however, very useful for a lot of people. The real advantage of homeschooling for people who want to do it is no one cares about your kid as much as you do. And if you’ve got the time and inclination to put that into it, you can get good results. So that is my take on homeschooling.

     And The Atlantic article I quote on it shows another great advantage, which is that if you are in a market like New York, say, where the public schools are lousy and the private schools are ridiculously expensive, then homeschooling provides an opportunity for people who don’t have enough money for private school but value their kids’ education too much to send them to public school to still live in New York as opposed to having to move somewhere else. I think those are all similar problems for people in a lot of different areas.

    How do online courses meet today’s needs?

    My daughter did almost all of her high school on online school. We found that pretty satisfactory because that way we didn’t have to do the homeschooling. She was able to do it selectively. As an example of the kind flexibility that technology brings, her way to do a class was to spend three weeks nonstop on a class.

     She finished a year’s worth of work in one class in three weeks of intensive effort instead of little dribs and drabs along the year the way they do in public school. And that’s something you couldn’t do without a technological platform that lets you move at your own pace.

    What about online schooling at the higher ed level? Do you think it has the potential to replace the traditional college experience?

    In one sense there is nothing potential about it. It is already replacing universities to some degree because there are a nontrivial number of people who have been getting degrees online and have been getting them for a while. How big of a competitive threat it is to the whole system is hard to say.

     I don’t think brick-and-mortar schools are going to go away. But I think for a lot of people, and especially older people, something that is more seamlessly integrated into your life and doesn’t require a 24/7 commitment has a lot to offer.

    One of the rigidities in our higher-education model is the notion that you are basically going to take four years of your life and you are going to go somewhere and you are going to learn everything you need to know. And then you are going to be educated, and with your education tank full you are going to go out and live your life. And these days it doesn’t really work that way. 

    Things change too much. Careers change a lot. There are a lot of older people who really don’t want to go back and spend four years as Joe College and Betty Coed going to classes but need to get an education. And I think the online model has really flowered most in that regard. Now whether it will also start to cut into the traditional 18 to 22 college population, it’s hard to say but if it’s going to be cost-effective, sure it will. 

    If you’re 18 years old and you can go to college online, and also work in a job and also live at home, your net cost of going to college is vastly lower than if you leave home, go somewhere where you really can’t work much, have to pay to live in a dorm, have to buy a meal plan, and have to pay full tuition.

    You also write that school choice and charters will be a part of a modern education model. What is it about school choice works for today’s students and parents?

    School choice is a popular thing and I think it is consistent with the ethos of the 21st century. I mean we live in a time when there are 1,000 different kinds of shampoo: Why would we only have one school? Kids are different; there are lots of different ways to educate them. 

    And vouchers or charter schools I think are likely to continue because what we are seeing already in a lot of big school districts and some not-so-big ones is that they are hemorrhaging students. Their parents don’t think they are doing a good enough job educating their kids, so [parents] are taking those kids out. And they are willing to send their kids to private schools, which costs a lot of money, or to homeschool them, which takes a big investment of time. 

    They are doing that because they care a lot about their kids and they want them to get a good education. But the result of this is public schools are having to lay off teachers and close down schools and the like. With that happening, there is going to be a lot of pressure to find a way to keep these parents happy.

    I think the sort of savior for the public school system is charter schools and things that let people exercise a lot of educational choice while within the public school system because when people stay within the public school system they retain loyalty to it, so they are more likely to support taxes for it and they get counted as enrollees for federal funding and the like.

    What will the downsides of these reforms look like?

    It’s going to be like almost any other system: Life for the producers is going to become less comfortable and probably less lucrative and life for the consumers is going to become a bit easier and cheaper. Net, we will probably be better off as a society, but, as I say in my conclusion, with a quote from Arthur Allen Leff, just because it’s better for society as a whole doesn’t mean some people won’t be lashed by the flailing distribution curve, and that’s certainly right.

    Why haven’t these changes happened yet? And what has to happen for them to occur?

    Well, things change when there is more pressure to change than there is ability to resist the change, and I think we are approaching that point. I quote Herbert Stein, “Something that can’t go on forever, won’t.” I think we are getting pretty close to that. I mean there are really starting to be signs of change and in fact everything is happening faster than expected. I shipped off the manuscript for this book in June and I have been reading stories in the Chronicle of Higher Education and Insider Higher Ed and stuff and it’s like, 

    “Oh no this is happening too soon! This shouldn’t happen until after my book comes out! What if everything I predict happens before January when the book comes out?”

    The thing about this is this kind of change tends to happen kind of like the quote about bankruptcy in The Great Gatsby, you know, very slowly and then all at once. I think that we're coming to the end of the “very slowly” phase and getting to the “all at once.” I think there is going to be fairly dramatic change and a lot of new models. 

    Some of these new models won’t work that well and some of them will, and there will be a period of where are we now? 

    And then it’ll work out.

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    By almost any measure, the world is better than it has ever been. People are living longer, healthier lives. Many nations that were aid recipients are now self-sufficient. You might think that such striking progress would be widely celebrated, but in fact, Melinda and I are struck by how many people think the world is getting worse. The belief that the world can’t solve extreme poverty and disease, isn’t just mistaken. It is harmful. That’s why in this year’s letter we take apart some of the myths that slow down the work. The next time you hear these myths, we hope you will do the same. 
    - Bill Gates

    by Bill Gates
    I’ve heard this myth stated about lots of places, but most often about Africa. A quick Web search will turn up dozens of headlines and book titles such as How Rich Countries Got Rich and Why Poor Countries Stay Poor.

    Thankfully these books are not bestsellers, because the basic premise is false. The fact is, incomes and other measures of human welfare are rising almost everywhere, including in Africa.

    So why is this myth so deeply ingrained?

    I’ll get to Africa in a moment, but first let’s look at the broader trend around the world, going back a half-century. Fifty years ago, the world was divided in three: the United States and our Western allies; the Soviet Union and its allies; and everyone else. I was born in 1955 and grew up learning that the so-called First World was well off or “developed.” Most everyone in the First World went to school, and we lived long lives. We weren't sure what life was like behind the Iron Curtain, but it sounded like a scary place. Then there was the so-called Third World—basically everyone else. As far as we knew, it was filled with people who were poor, didn't go to school much, and died young. Worse, they were trapped in poverty, with no hope of moving up.

    By 2035, there will be almost no poor countries left in the world.
    Bill Gates

    The statistics bear out these impressions. In 1960, almost all of the global economy was in the West. Per capita income in the United States was about $15,000 a year.1 (That’s income per person, so $60,000 a year for a family of four.) Across Asia, Africa, and Latin America, incomes per person were far lower. Brazil: $1,982. China: $928. Botswana: $383. And so on.

    Years later, I would see this disparity myself when I traveled. Melinda and I visited Mexico City in 1987 and were surprised by the poverty we witnessed. There was no running water in most homes, so we saw people trekking long distances by bike or on foot to fill up water jugs. It reminded us of scenes we had seen in rural Africa. The guy who ran Microsoft’s Mexico City office would send his kids back to the United States for checkups to make sure the smog wasn’t making them sick.
    Today, the city is mind-blowingly different. Its air is as clean as Los Angeles’ (which isn’t great, but certainly an improvement from 1987). There are high-rise buildings, new roads, and modern bridges. There are still slums and pockets of poverty, but by and large when I visit there now I think, “Wow, most people who live here are middle-class. What a miracle.”
    Look at the photo of Mexico City from 1986, and compare it to one from 2011.

    You can see a similar transformation in these before-and-after photos of Nairobi and Shanghai.

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