BusinessWeek

The Financial Crisis: What Drucker Would Have Said

Articles — Fri, 26 Sep 2008 09:09:00 -0400

Peter Drucker didn't have a whole lot of nice things to say about those on Wall Street, at one point likening them to "Balkan peasants stealing each other's sheep."

Given the magnitude of the latest crisis to grip Fannie Mae, Freddie Mac, American International Group, Lehman Brothers, and their friends, one can only imagine what kind of acid analogy he might have used today.

Or perhaps he would have simply said, "I told you so." After all, so much of the trouble that has befallen these giants of the investment banking, mortgage, and insurance sectors--and that threatens to "undermine the financial security of all," as President George… more

Put a Cap on CEO Pay

Articles — Fri, 12 Sep 2008 10:09:00 -0400

For a guy whose astute counsel helped to make so many CEOs rich, Peter Drucker had an intense loathing of exorbitant executive salaries.

He hated high CEO pay on every level: what it said about the individual as a leader, how it undermined the smooth functioning of the organization, and the way it tore at the fabric of society as a whole.

Drucker's strong feelings on the subject—he once termed sky-high CEO compensation "a serious disaster"—are well worth revisiting in light of the news that the men who sat atop Fannie Mae and Freddie Mac (BusinessWeek, 9/10/08) could be eligible for as much as $24 million… more

Organizations Need Structure and Flexibility

Articles — Fri, 29 Aug 2008 08:50:00 -0400

There is certainly no shortage of management lessons to be gleaned from Michael Phelps's record-shattering performance at the Beijing Olympics--the importance of setting firm objectives and staying sharply focused perhaps chief among them.

Nevertheless, I suspect that Peter Drucker would have been more intrigued by the blows suffered in the boxing ring than by the gold gathered in the swimming pool. It was there, in the square circle, that the U.S. turned in its worst-ever showing, winning but a single bronze medal and sending disheartened fans scurrying to figure out what went wrong.

Interestingly, the answer appears to have relatively little to do with the fighters' athletic prowess… more

Maya MacGuineas in BusinessWeek | 'Why Their Economic Plans Don't Add Up'

Communications — Fri, 08 Aug 2008 10:30:00 -0400

New America in the News:
And "there is no question that the proposals of either candidate would dramatically worsen the fiscal situation," adds Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget, a project of the New America Foundation, a think tank. LINK

What Drucker Would Say About Mervyns

Articles — Thu, 07 Aug 2008 09:21:00 -0400

Mervyns portrayed itself as a victim of the crummy economy and a miserable retail environment last week as it filed for Chapter 11 bankruptcy protection. But in truth, a key part of the department store chain went bankrupt long ago. It's what Peter Drucker called the "theory of the business."

Every organization rests upon a set of such premises--fundamental notions about customers and competitors, about technology, about a company's own strengths and weaknesses. When an enterprise fails, Drucker explained, it is often because "the assumptions on which the organization has been built and is being run no longer fit reality."

As obvious as this may seem, it… more

When 2008 Feels Like 1968

Articles — Thu, 17 Jul 2008 14:36:00 -0400

It's been a bummer of a summer, hasn't it?

At the gas station the other night, I found myself staring in disbelief—as I have for weeks—while the numbers on the pump kept spiraling higher and higher. The total: $67.83 to fill my Passat. I hopped back in my car and flipped on the radio, figuring a little music might take my mind off the lightness of my wallet, but the news came on instead: Fannie Mae (FNM) and Freddie Mac (FRE) were reeling. Nervous depositors had stormed IndyMac Bancorp, looking to pull their money. General Motors (GM) was poised for another round of cuts.

Sigh. You… more

Len Nichols in BusinessWeek | 'Wal-Mart, Your Friendly Drugstore'

Communications — Thu, 05 Jun 2008 14:30:00 -0400

New America in the News:
..."People are worried because health-care costs are growing faster than the average American's income, and it's only going to get more intense as boomers retire at an increasing pace," says Len Nichols, health-care economist at The New America Foundation, a nonprofit public policy institute in Washington...LINK

New America's Wireless Future Program Event with Larry Page in BusinessWeek | "Google's White-Space Fixation"

Communications — Fri, 23 May 2008 07:22:00 -0400

New America in the News:

Google co-founder Larry Page made a rare trip to Washington this week. No, he wasn't lobbying for net neutrality or being grilled about Internet censorship in China. It was all about the white spaces -- and Google's growing fixation with wireless communications.

With opposition mounting, Page came to bolster Google's push to gain public access to these white spaces, slivers of wireless spectrum between the broadcast channels used by TV stations. . .

During his May 22 speech to the New America Foundation, a think tank where Google CEO Eric Schmidt is chairman-elect, Page used a wireless microphone to downplay interference concerns. "I don't think there's any technical credence to this at all," he said.

Page also argued that unlicensed white spaces offer a way for the U.S. to catch up with the rest of the world in broadband access. For the second year running, the U.S. ranked 15th among the 30 members of the Organization for Economic Cooperation & Development in terms of broadband availability, a recent survey found [BusinessWeek.com, 5/22/08]. Today, 10% of Americans still don't have access to DSL or cable broadband, according to consultancy Parks Associates.

Google and others also see white spaces as a way to reignite interest in municipal Wi-Fi networks, many of which are struggling or even being turned off due to financial and service-quality problems. Because the white-space spectrum is more robust, networks using those frequencies would require a fourth to a fifth as many Wi-Fi transmitters to cover an area, according to Michael Calabrese, vice-president of the New America Foundation. Thus, network construction would cost less, while the wireless connections would be speedier.

Should white spaces be approved for unlicensed use, Page hinted, Google might even build some networks for cities with its own funds. "We have money to invest," he said. "We'd probably do it if we could do it on a reasonable scale." Google currently operates a Wi-Fi network in Mountain View, Calif., used by 40,000 people. . .

For the full article, click here.

Eric Schmidt in BusinessWeek's Profile of Cyberlawyer Tim Wu

Communications — Thu, 08 Nov 2007 12:13:00 -0500

New America in the News:

The following article is a positive and well-deserved profile of Tim Wu -- quoting Chris Sacca of Google -- that plays off the impact of his New America paper on wireless net neutrality. Google CEO Eric Schmidt is on New America's Leadership Council.

"Tim Wu, Freedom Fighter: His wireless-phone manifesto was the inspiration for Google's new mobile-software strategy, which includes the Open Handset Alliance."

On Nov. 5, Google (GOOG) unveiled what many in the phone business had long awaited. CEO Eric Schmidt explained how the search giant was ready to create new software for mobile phones that would shake up the telecom status quo. A Google-led "Open Handset Alliance" would provide consumers an alternative to the big cellular carriers and give them new choices among mobile phones and the types of nifty services that run on them, from e-mail to Google Maps.

Google's brain trust was again trying to change the rules of the game. Behind the scenes, they owe a sizable debt to a man nearly unknown outside the geeky confines of cyberlaw. He is Tim Wu, a Columbia Law School professor who provided the intellectual framework that inspired Google's mobile phone strategy. One of the school's edgier profs, Wu attends the artfest Burning Man, and admits to having hacked his iPhone to make it work on the T-Mobile (DT) network.

Now, Wu's offbeat ideas are entering the mainstream. In February, he published a paper in the International Journal of Communication proposing a radical new vision of freedom for the U.S. wireless industry. He argued that the Federal Communications Commission should mandate that providers allow consumers to use any cell phone with any wireless operator, and install any programs they want on their phones as long as they were not illegal or harmful. "It would make a huge difference in the wireless industry," says Wu. "It will blow open the wireless market." ...

For the complete article, please follow this link.

Drucker's Lessons for China

adminn — Fri, 17 Aug 2007 06:55:00 -0400

The most dangerous thing being produced in China is neither lead paint-laden toy cars nor magnet-spewing Polly Pocket dolls and Batman action figures. Rather, it is a booming capitalist culture that, far too often, places value over values.

This reality was brought home again this week, as Mattel announced its second big recall of Chinese-made merchandise in a fortnight. The news, coming on the heels of Chinese food, drugs, and other items being recalled or fingered as potentially hazardous, resulted in a renewed round of pleas in Washington for heightened vigilance by the Consumer Product Safety Commission.… more