Tag Archives: Business improvement

What if Competition Isn’t As “Natural” As We Think?

By John Favini – “The struggle for life,” Darwin deduced, would naturally select those beings whose hereditary mutations made them most fit to a specific environment. Over successive generations, scientists came to see the driving force behind evolution as perpetual competition between discrete individuals, a biological arms race to eat and reproduce in a world of scarcity.

Fast forward a century and a half, and “survival of the fittest”—the expression social theorist Herbert Spencer coined to sum up Darwin’s thinking—is as much a cultural cliché as it is a scientific theory. Hell, your worst colleague at the office might even offer it as a justification for his one-upmanship. More than just a cliché, though, the supposed naturalness of competition has played a central role in substantiating the laissez-faire variety of capitalism the majority of the American political spectrum has championed for the past four or so decades.

Indeed, any non-market-based solution to social issues usually falls prey to claims of utopianism, of ignoring the fundamental selfishness of the human species. Advocates for welfare programs, for instance, often run up against criticism that their policy proposals fail to understand to importance of “losing,” that they lessen the stakes of the competition innate to human social life.

Similarly, collectively owned spaces or institutions (like communal land trusts or co-ops) are often presumed short-lived or inefficient, doomed to suffer the “tragedy of the commons” as the innate self-interest of each member leads to an overuse of collective resources—a thesis that has been debunked again and again since its first articulation by Garrett Hardin in 1968.

To put it simply, we have let Darwinism set the horizon of possibility for human behavior. Competition has become a supposed basic feature of all life, something immutable, universal, natural.

Yet new research from across various fields of study is throwing the putative scientific basis of this consensus into doubt. Mind you, there have always been people, scientists and otherwise, who conceived of life outside a Darwinian paradigm—the idea of evolutionary biology is and has been a conversation among a mostly white and male global elite. Yet, even within centers of institutional power, like universities in North America, competition’s position as the central force driving evolution has been seriously challenged recently. In fact, criticisms have been mounting at least since biologist Lynn Margulis began publishing in the late ’60s

Put simply, life is beginning to look ever more complex and ever more collaborative. All this has fractured Western biology’s consensus on Darwin. In response to all these new insights, some biologists instinctively defend Darwin, an ingrained impulse from years of championing his work against creationists. Others, like Margulis herself, feel Darwin had something to offer, at least in understanding the animal world, but argue his theories were simplified and elevated to a doctrine in the generations after his passing.

Others are chartering research projects that depart from established Darwinian thinking in fundamental ways—like ornithologist Richard Prum, who recently authored a book on the ways beauty, rather than any utilitarian measure of fitness, shapes evolution. Indeed, alongside the research I have explored here, works by scientists like Carl Woese on horizontal gene transfer and new insights from epigenetics have pushed some to advocate for an as-yet-unseen “Third Way,” a theory for life that is neither creationism nor Neo-Darwinian evolution. more>

Updates from McKinsey

Five ways that ESG creates value
Getting your environmental, social, and governance (ESG) proposition right links to higher value creation.
By Witold Henisz, Tim Koller, and Robin Nuttall – Your business, like every business, is deeply intertwined with environmental, social, and governance (ESG) concerns. It makes sense, therefore, that a strong ESG proposition can create value—and in this article, we provide a framework for understanding the five key ways it can do so.

Just as ESG is an inextricable part of how you do business, its individual elements are themselves intertwined. For example, social criteria overlaps with environmental criteria and governance when companies seek to comply with environmental laws and broader concerns about sustainability. Our focus is mostly on environmental and social criteria, but, as every leader knows, governance can never be hermetically separate. Indeed, excelling in governance calls for mastering not just the letter of laws but also their spirit—such as getting in front of violations before they occur, or ensuring transparency and dialogue with regulators instead of formalistically submitting a report and letting the results speak for themselves.

Thinking and acting on ESG in a proactive way has lately become even more pressing. The US Business Roundtable released a new statement in August 2019 strongly affirming business’s commitment to a broad range of stakeholders, including customers, employees, suppliers, communities, and, of course, shareholders.

Of a piece with that emerging zeitgeist, ESG-oriented investing has experienced a meteoric rise. Global sustainable investment now tops $30 trillion—up 68 percent since 2014 and tenfold since 2004.

The acceleration has been driven by heightened social, governmental, and consumer attention on the broader impact of corporations, as well as by the investors and executives who realize that a strong ESG proposition can safeguard a company’s long-term success. The magnitude of investment flow suggests that ESG is much more than a fad or a feel-good exercise. more>

Updates from Ciena

The next sports phenomenon requires the network
The latest sports craze doesn’t involve a ball or a helmet, it’s esports, and it is filling arenas and drawing millions of online fans. Ciena’s Kevin Sheehan tells the story of his recent experience at ESL One, and how massive online events like these require a network that defeats all challengers.
By Kevin Sheehan – As the gaming industry grows to become a $152 billion-a-year giant, with over 2.5 billion gamers globally, video games have evolved way beyond casual entertainment. We are now talking about esports – competitive multiplayer electronic games played by professional athletes for substantial cash prizes. Tournaments like ESL One attract thousands of spectators, and millions of fans streaming the event live.

ESL One was held at Barclays Center, a massive arena that several NBA and NHL teams call home. The seats were full, and big names sponsored the event. The enthusiastic crowd loudly supported their favorite teams, and also demanded a high degree of interaction with the game and the gamers. They and the millions streaming remotely will make comments on game play, play the game, and interact with each other and the players all in real time.

I was enthralled as I watched eight of the world’s best Counter-Strike Global Offensive teams square off. There was an enormous, high-definition screen above the teams that cycled through each player’s field-of-view on the battlefield, while three announcers (yep 3) rapidly called the play-by-play and provided color commentary.

I wondered, what are the network requirements for ESL to create the robust and secure infrastructure that makes all this possible? In a strange way, the network is on display during this live tournament almost like an NBA superstar’s shooting ability. If an image locked, frames are dropped, or a weapon doesn’t fire on cue, the world will see, and “the network” would be to blame. And don’t forget, there is a lot of money on the line. more>

Related>

Updates from Chicago Booth

The questions that will shape the future of capitalism
Advocates of free markets must engage in the public debate about them
By John Paul Rollert – What is the promise of capitalism?

That may seem like a strange question, and when I ask it of my MBAs, I suspect they regard it as an exercise in the pedagogical pastime Guess What Teacher Is Thinking. Still I ask it, for I hope it prompts my students to think about the kinds of problems capitalism is equipped to solve as well as those that are beyond its compass.

This is hardly a matter of idle speculation, especially for those who have good reason to believe that they will someday enjoy a disproportionate amount of the system’s spoils. Those fortunate individuals sometimes need to be reminded that free markets, however mighty, will not mend their marriage, relieve their cold, or stop their brother-in-law from bragging about his golf game. Indeed, there are plenty of things capitalism can’t do, and reflecting on them is a good way of distinguishing what it can do—and what it should.

Naturally, what capitalism can and should do are not one and the same. The first is a technical matter best left to economists; the second is more of an ideological affair, the province of moral and political philosophy. The distinction is an important one, but it tends to fade whenever one believes that free markets will solve most any problem: moral, social, and political as well as economic. If capitalism can do anything, so the thinking goes, then it should do everything.

Now, with the kind of intellectual prodding the question above intends, almost no one honestly believes that capitalism can, or should, do everything. Yet up until recently, it passed for conventional wisdom, in the United States and throughout most of the developed world, that capitalism could do most things, that the obvious solution to nearly any pressing problem of social organization was freer trade, fewer regulations, and far less government intervention. more>

Related>

Class struggle à la droite

Populism is boosted by economic crises, but its roots are cultural.
By Claus Leggewie – Populism is a method. It works by mobilizing an imaginary homogeneous entity called ‘the people’ against an equally ill-defined and generally despised ‘elite’, thus radically simplifying the political and social field. Such simplifications have served to orchestrate conflicts since the 19th century and in particular during economic and cultural crises—on the left, in terms of a class struggle against the powers that be; on the right, in terms of a confrontation with an ‘other’, be it foreigners or minorities.

Sometimes these two tendencies have gone hand in hand—for instance, when migrant workers have been portrayed as wage-squeezing competitors. In fact, though, a populism that purports to be about solidarity with the ‘common people’ always promotes social disunity.

As a catchphrase in political debates, populism may be useful; a productive analytical concept it however certainly is not. The ‘people’ our modern-day, nationalist populists champion are no longer defined socioeconomically (as in the ‘proletariat’). Rather, the populists employ ethnic constructs (such as Biodeutsche or français de souche), which suggest a homogeneous community with a shared ancestry, a long history and a solid identity.

It is to these ‘people’—not the actual, pluralist demos—that populists ascribe an authority which exceeds that of institutions: ‘The people stand above the law,’ as a slogan of the Austrian ‘Freedom Party’ goes.

In this view, there is no legitimate ‘representation’ through democratic processes. Instead, ‘the people’ form movements which back charismatic leaders and legitimize them retroactively by means of plebiscites. Right-wing movements may be diverse, but what they all have in common is a worldview that is utterly authoritarian (and usually patriarchal and homophobic too).

One’s own nation, ethnically defined, takes center-stage—think ‘America first!’ or La France d’abord! more>

Updates from McKinsey

The drumbeat of digital: How winning teams play
Pace and power go hand in hand for digital leaders, which typically run four times faster and pull critical strategic levers two times harder than other companies do.
By Jacques Bughin, Tanguy Catlin, and Laura LaBerge – Most executives we know have a powerful, intuitive feel for the rhythm of their businesses. They know how hard and fast to pull strategic levers, move their organization, and drive execution to achieve their objectives. Or at least they did. Digitization has intensified the rhythm of competition in many industries, leaving executives adrift, with information-gathering systems that are too slow or disconnected, direction-setting approaches that are too timid, and talent-management norms that are misaligned and incremental.

These leaders know their companies must adjust and accelerate. Digital is putting pressure on profit pools as it transfers an increasing share of value to consumers. Furthermore, those profit pools are bleeding across traditional industry lines as advanced technologies enable companies to forge into adjacencies, changing who in the value chain is making money, what share of the pie they capture, and how. The slow and inefficient are left behind, competing for scraps.

What is unclear to these executives, however, is how much and how fast to adapt their business rhythms. The exhortation to “change at the speed of digital” generates more anxiety than answers. We have recently completed some research that provides clear guidance: digital leaders appear to keep up a drumbeat in their businesses that can be four times faster, and twice as powerful, as those of their peers.

You can’t quicken the pace of an organization by fiat. You have to build it by accelerating the frequency of manageable practices that are integral to achieving key goals, such as serving the customer or driving internal efficiency. These “light-touch” actions are low risk and low investment, but they can provide high-yield returns. We have grouped them into two buckets that can help mold incumbents into digital players.

How often does your organization analyze customer data to look proactively for new ways of delighting your customers?

How frequently do your senior business leaders take time to investigate and understand new digital technologies so that they recognize which ones are truly relevant to their areas of the business?

How quickly and consistently does your company share lessons acquired from test-and-learn experiments performed by those on the front lines? more>

Updates from Ciena

Expanding business models of managed wave services with Adaptive Networks
It goes without saying that no other method of network transport has ever surpassed the speed and performance that is delivered over optical networks. The many innovations in optical communications form the backbone of the robust, reliable, high capacity networks that connect our world. But what is less talked about are the billions in revenues that stem from innovative business and service models delivered over optical networks as managed connectivity services (aka managed wave services). Ciena’s Niloufar Tayebi details what can happen to evolve managed wave services in the era of Adaptive Networks.
By Niloufar Tayebi – Let’s step back in time to take a snap-shot of what service interfaces have previously thrived in managed wave service offers. In a managed wave service, the service provider is able to offer a wide range of client service interfaces: Ethernet, SONET/SDH, DWDM, storage area networking (SAN) interfaces and more.

For these managed wave services, the client is handing off an interface that is required to transport payload connecting two data centers in complete transparency without protocol conversion. This is done by either using a dedicated wavelength over DWDM or through the use of OTN containers (aka ODU).

With the growth of traffic and cost-per-bit declining, client interfaces are now evolving to higher bit rates – as happened with the evolution from SONET/SDH clients to 10Gbps clients – but also expanding in client protocols that supported 10Gbps, such as ODU-2 and 10GE.

One natural path for evolving a managed wave service is to continue the path of offering higher rate, with more emphasis on 100GE and ODU-4 client interfaces. Today it is common to look at a managed wave service and see 100GE and ODU-4 /100Gbps clients supported. With the ongoing reduction of cost-per-bit and higher rate transport, offering managed wave services at higher than 100Gbps client support also makes economic and technical sense.

Ciena’s market intelligence and global consulting teams have been tracking the market size of managed wave services. Their findings show 10GEoDWDM managed wave services are mature services contributing to 60% of managed wave service offers, while 100GEoDWDM managed wave services are the fastest growing wave services at a 30% CAGR. more>

Related>

Updates from Adobe

Keeping It Weird with Jorsh Pena
By Kelly Turner – Looking at Jorsh Peña’s colorful, surreal illustrations is like peeking through a window into your subconscious and discovering a party in full swing. The guests are playful and weird, but also slightly unnerving—things could turn ugly if the music stops for too long.

For Peña, who grew up in Mexicali and now lives in Tijuana (both in northern Mexico), exposing the dark or mysterious side of seemingly simple objects is part of the thrill of illustration. His style is a warm blend of geometry, Mexican culture, and a fascination with the occult.

“I always want to say something with deep meaning, not just a friendly and weird doodle,” he says. “I love that people don’t usually notice the mystic and twisted messages hidden in my illustrations.”

Peña’s journey as an illustrator began 15 years ago while studying marketing and running a clothing brand with friends. Looking for fresh design inspiration, he stumbled upon the now-defunct Illustration blog Mundo, which featured different illustrators and their work.

“I fell in love with that webpage instantly,” says the artist. “I spent endless hours watching all those incredible and different styles of artwork. After that, I felt the need to create something of my own.” more>

Related>

Saving Capitalism from Inequality

Robust middle incomes deliver the demand that businesses need to produce.
By Robert Manduca – After decades of praise heaped on “job creators,” viewers today may find it disorienting to see the consumer—and a middle-income one at that—cast as the hero of the economy, instead of the investor or the entrepreneur.

Yet Fortune, which produced the video in 1956, was hardly an outlier. In the mid-twentieth century, advertising, popular press, and television bombarded Americans with the message that national prosperity depended on their personal spending. As LIFE proclaimed in 1947, “Family Status Must Improve: It Should Buy More For Itself to Better the Living of Others.”

This messaging was not simply an invention of clever marketers; it had behind it the full force of the best-regarded economic theory of the time, the one elaborated in John Maynard Keynes’s The General Theory of Employment, Interest and Money (1936). The key to full employment and economic growth, many at the time believed, was high levels of aggregate demand.

But high demand required mass consumption, which in turn required an equitable distribution of purchasing power. By ensuring sufficient income for less well-off consumers, the government could continually expand the markets for businesses and boost profits as well as wages.

Conversely, Keynes’s theory implied, growing income inequality would lead to lower demand and slower economic growth.

The basic Keynesian logic of demand-driven growth came to be accepted across U.S. society in large part due to significant postwar efforts to explain, communicate, and popularize it. Proponents of Keynesian thinking worked hard to educate the public about the new economic theory and the possibilities of abundance that it foretold. A particularly compelling example is the book Tomorrow Without Fear (1946). more>

Updates from McKinsey

Climate risk and response: Physical hazards and socioeconomic impacts
By Jonathan Woetzel, Dickon Pinner, Hamid Samandari, Hauke Engel, Mekala Krishnan, Brodie Boland, and Carter Powis – After more than 10,000 years of relative stability—the full span of human civilization—the Earth’s climate is changing. As average temperatures rise, climate science finds that acute hazards such as heat waves and floods grow in frequency and severity, and chronic hazards, such as drought and rising sea levels, intensify.

In this report, we focus on understanding the nature and extent of physical risk from a changing climate over the next one to three decades, exploring physical risk as it is the basis of both transition and liability risks.

We estimate inherent physical risk, absent adaptation and mitigation, to dimension the magnitude of the challenge and highlight the case for action. Climate science makes extensive use of scenarios ranging from lower (Representative Concentration Pathway 2.6) to higher (RCP 8.5) CO2 concentrations. We have chosen to focus on RCP 8.5, because the higher-emission scenario it portrays enables us to assess physical risk in the absence of further decarbonization.

In this report, we link climate models with economic projections to examine nine cases that illustrate exposure to climate change extremes and proximity to physical thresholds. A separate geospatial assessment examines six indicators to assess potential socioeconomic impact in 105 countries. We also provide decision makers with a new framework and methodology to estimate risks in their own specific context.

We find that physical risk from a changing climate is already present and growing. Seven characteristics stand out. Physical climate risk is:

Increasing: In each of our nine cases, the level of physical climate risk increases by 2030 and further by 2050. Across our cases, we find increases in socioeconomic impact of between roughly two and 20 times by 2050 versus today’s levels. We also find physical climate risks are increasing across our global country analysis even as some countries find some benefits (such as expected increase in agricultural yields in countries such as Canada).

Spatial: Climate hazards manifest locally. The direct impacts of physical climate risk thus need to be understood in the context of a geographically defined area. There are variations between countries and within countries. more>