Extractive summaries curated from TOP TEN BUSINESS MAGAZINES to promote informed decision making
Week 203 | July 30-August 05, 2021
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The Roaring 2020s: A Booming Decade May Follow Covid-19
By Rich Karlgaard | Forbes Magazine | July 13, 2021
Will a boom follow Covid-19? A century ago the 1920s saw creative energies explode after the tragedies of the Spanish Flu and World War I. In big cities such as New York, London, Shanghai, Sydney and Tokyo, economic growth was palpable. New technologies such as cars and radios became common. So did a risk-on optimism. The author thinks the 2020s will similarly roar. Four reasons behind this optimism are:
- Accelerated digital productivity. The pandemic forced rapid business change. Covid-19 forced companies to become smarter, faster, nimbler. The alternative was failure. No company can revert to slower, dumber and stuck. From a business perspective, the 2020s will be the Agile Decade.
- Scalable AI. There’s now a convergence of digital technologies—cheap cloud computing, ubiquitous mobile computing (billions of sensors and phones) and faster communications such as 5G—simultaneously reaching maturity. Enter AI—the 2020s will be the decade of enterprise AI. One more step is needed. Previously, deploying AI always meant hard, labor-intensive, expensive work. But what if AI was easy to deploy and use? What if anyone who can use a spreadsheet could also predict supply chain risks in India or maintenance costs for an Indonesian trucking fleet? That is happening. To adopt Apple’s famous 1980s slogan “a computer for the rest of us,” AI for the rest of us will shape the 2020s.
- Capital surplus. The world is awash in capital, making it historically easy for entrepreneurs to get funds for innovative startups. While there’s plenty of hype around cryptocurrencies, meme stocks and SPACs, make no mistake. Global capital knows well that digital technology acceleration and AI are game-changers. These will disrupt business models and markets, and power enormous fortunes.
- Physical world revolutions. Digital technologies are evolving fast. But in the physical realm, progress is always slower—limited by physics and other forces. Yet here, too, progress is accelerating. Drone cameras raise agricultural yields. Gene sequencing plus AI will create personalized medical treatments.
2 key takeaways from the article
- Will a boom follow Covid-19? There are four reasons behind yes: accelerated digital productivity, scalable AI, capital surplus, and physical world revolutions.
- Don’t expect the 2020s to be all good news. But it will be thrilling.
Topics: Productivity, COVID-19, Technology
Unrest and economic underperformance haunt the emerging world
The Economist | July 31, 2021
In the early 2000s the economists buzzed with talk of “catch-up”: the idea that poorer countries could prosper by absorbing foreign technology, investing in manufacturing, and opening up their economies to trade, as a handful of East Asian tiger economies, had done a generation earlier. Wall Street coined the term BRICS to celebrate Brazil, Russia, India, and China—the world economy’s new superstars.
For a while, catch-up worked. The proportion of countries where the level of economic output per head was growing faster than in America rose from 34% in the 1980s to 82% in the 2000s. The implications were momentous. Poverty fell. Multinational companies pivoted away from the boring old West. In geopolitics, catch-up promised a new multipolar world in which power was more evenly distributed.
This golden age now looks as if it has come to a premature end. In the 2010s the share of countries catching up fell to 59%. China has defied many doomsayers and there have been quieter Asian success stories such as Vietnam, the Philippines, and Malaysia. But Brazil and Russia have let down the BRICS and, as a whole, Latin America, the Middle East, and sub-Saharan Africa are falling further behind the rich world. Even emerging Asia is catching up more slowly than it was.
Bad luck has played a part. The commodity boom of the 2000s fizzled out, global trade stagnated after the financial crisis, and bouts of exchange-rate turbulence caused turmoil. But so has complacency as countries have come to think that fast growth was preordained. In many places, basic services such as education and health care have been neglected. Crippling problems have been left unfixed, including South Africa’s idle power plants, India’s rotten banks, and Russia’s corruption. Instead of defending liberal institutions, such as central banks and the courts, politicians have used them for their own gain.
What happens next? One risk is an emerging-market economic crisis as interest rates in America rise. Long-running political crises are a bigger worry. Even if emerging economies avoid chaos, the legacy of covid-19 and rising protectionism could condemn them to a long period of slower growth.
3 key takeaways from the article
- At the start of the century, developing economies were a source of unbounded optimism and fierce ambition. Today they are not.
- Waves of unrest and authoritarianism in these economies partly reflect covid-19, which has exposed and exploited vulnerabilities, from rotten bureaucracies to frayed social safety-nets.
- The despair and chaos threaten to exacerbate a profound economic problem: many poor and middle-income countries are losing the knack of catching up with the richest ones.
Topics: Global Economy, Emerging Economies, COVID-19
Rise of Digital Yuan Brings New Challenges for China Tech Giants
Bloomberg Businessweek | July 27, 2021
For the past decade, private companies in China have led the way in the digitization of money, with Tencent Holdings Ltd. and Ant Group Co. setting up enormous private payment networks and cryptocurrency-mining operations providing the fuel for the global Bitcoin boom. Their emergence was a break from Chinese financial history, which has been marked by aggressive centralized control. Things may now be reverting to the norm.
This spring, Chinese regulators took their strongest actions yet to cut down on cryptocurrency mining, the bookkeeping system that’s the foundation of Bitcoin and other blockchain-based currencies, sending some of the biggest players fleeing to Canada, Russia, and other countries. In April 2020, China also began testing its own electronic currency—the e-CNY, or digital yuan—a project that could put the government in more direct competition both with cryptocurrencies and with corporate payments systems. The rollout of the digital currency corresponds with a broader push to exert control over tech companies by, for instance, forcing payment businesses to submit to traditional banking regulations. The digital currency could also afford the government a level of surveillance that isn’t possible with cash or independent digital currencies.
Many Chinese are satisfied with the existing payment products and see little advantage to switching to a government-run replica. China will probably have an even harder time persuading the rest of the world to use the e-CNY, if it even wants that. The country is testing cross-border e-CNY payments with Hong Kong, Thailand, and the United Arab Emirates. These efforts have drawn criticism from the Biden administration, which suspects digital yuan could kick off a long-term bid to undermine the dollar as the global reserve currency. But state-backed research groups have also proposed issuing digital yuan for countries engaged in China’s “Belt and Road” initiative, through which the country is expanding its global influence by building infrastructure abroad.
3 key takeaways from the article
- For the past decade, private companies in China have led the way in the digitization of money. But recently the government is reasserting control over financial innovation.
- The rollout of the digital currency by China corresponds with a broader push to exert control over tech companies and could also afford the government a level of surveillance that isn’t possible with cash or independent digital currencies.
- The country is testing cross-border e-CNY payments with a few of the countries and the proposal of issuing digital yuan for countries engaged in China’s “Belt and Road” initiative is also on the table.
Topics: Crypto-currency, China, Global Financial System
Entrepreneurs Are Well Placed To Tap Into Opportunities Presented By The UAE’s Food Security Agenda: Insights From A Dubai Chamber Analysis
By Meha Merani | Entrepreneur | March 7, 2021
The UAE ranks first in the MENA region and 18th globally for the attractiveness investment environment in the F&B sector. The UAE recorded 6% growth in sales of fresh food products in 2020, which reached $7.9 billion. The sale of fresh food items in the UAE is expected to grow at a CAGR of 5.2% in the 2018-2023 period. The value of online food and beverage sales in the UAE is projected to reach US$619 million by 2025. Dubai’s F&B manufacturing contributes 13% of the manufacturing value add and 17% of the manufacturing output with increasing demand for processed cereals, meat, fruits, and vegetables. The upward trend is crucially supported by the nation’s advanced technology infrastructure, world-class logistics facilities, high internet penetration rate, and high disposable income.
The majority of food consumed in the Gulf is imported, nevertheless, the UAE’s shelves remained well-stocked despite global supply-chain challenges. This is largely because of the National Food Security 2051 that it crafted a few years ago. Key pillars of the strategy include facilitating global agri-business trade and diversifying international food sources, enhancing sustainable technology-enabled domestic food supply across the value chain, and enhancing capacity to respond to food security risks and crises. Looking ahead, the Dubai Industrial Strategy 2030 –which is aimed at transforming the economy to a knowledge-based economy by having an innovative and sustainable industrial sector in the Emirate– will be central to increasing the output of F&B manufacturing, strengthening resilience and advancing food security.
And startups are very much on UAE’s agenda [as] it is looking to localize some of the production capabilities. Harsh environment and scarcity of water are the testing grounds for innovative companies and innovative solutions to come and showcase their solutions in this region. High-potential food product categories where the UAE can expand trade with other markets, include grains, vegetables and fruits, vertical crops, and healthy and halal food products
In line with Dubai’s aspiration to become halal food hub, the potential market for entrepreneurs and manufacturers of halal food is also huge, with global halal food expenditure forecast to reach $1.38 trillion by 2024. Meanwhile, healthy and organic food products sales witnessed strong growth in 2020 and creating additional new business opportunities in the F&B market.
3 key takeaways from the article
- The UAE ranks first in the MENA region and 18th globally for the attractiveness investment environment in the F&B sector.
- The race to solve food security in the UAE, as well as the wider Middle East and North Africa (MENA) region, presents a significant opportunity for startups and small businesses.
- This signaled major demand for innovation in food manufacturing, agriculture, and halal food, for the post-pandemic future.
Topics: Food & Beverages, Food Security, UAE
What’s So Special About Founders?
By Thomas Stackpole | Harvard Business Review | From the Magazine (July–August 2021)
What sets founders apart? Is it vision, drive, or insight that helps them turn industries upside down and conjure billions of dollars? Is it how they run meetings or make decisions? Is it because they eat vegan, take cold showers, and meditate? Founders occupy a cultural space that combines celebrity, guru, futurist eccentric, and occasionally comic book villain. And why not? Jeff Bezos changed both how we shop and how the internet operates, for instance. If you could figure out just what differentiates them from the rest of us, you could become—or at least invest in—the next superstar founder. Five new books seek to understand the people behind successful start-ups and how much their imprint matters.
In Amazon Unbound: Jeff Bezos and the Invention of a Global Empire, provides explanations of Amazon’s evolution from mere success to inescapable part of everyday life. What we can draw from the book is Bezos’s now-legendary 14 leadership principles (including “customer obsession,” “bias for action,” “disagree and commit”), which inform decision-making at Amazon, are cited as instrumental in the development of Alexa, Amazon Web Services, Prime, and Prime Video.
The Cult of We: WeWork and the Great Startup Delusion, give a lesson in how far a person can get by convincingly playing the part. Deeply reported and compellingly written, it shows that an aura of founder magic allowed a mundane venture—renting office space—to be pitched as world changing.
Tencent: The Extraordinary Story of a Chinese Internet Enterprise, argues that Pony Ma focuses on strategic growth and iteration have made Tencent adept at exploiting emerging opportunities. The guiding principles the author of the book identifies (product minimalism, user-driven strategy, rapid testing) aren’t necessarily novel—Tencent just seems to execute them better than its rivals do.
Can we reliably predict who will be a Bezos or a Ma and who will be a Neumann? Maybe. That’s one of the animating questions of Super Founders: What Data Reveals About Billion-Dollar Startups. The book reminds us not to confuse correlation with causation. It’s impossible to know whose billion-dollar idea didn’t get funding just because the person didn’t fit the part.
The New Builders: Face to Face with the True Future of Business, is perhaps meant as a corrective. The authors argue that while tech stars hog the spotlight, small-business entrepreneurs—especially Black, brown, female, and older founders—make up a significant portion of the U.S. economy and run companies that operate in and benefit their communities.
3 key takeaways from the article
- What sets founders apart? Is it vision, drive, or insight that helps them turn industries upside down and conjure billions of dollars?
- Five new books seek to understand the people behind successful start-ups and how much their imprint matters. What matters include: customer obsession, bias for action, disagree and commit, an aura of founder magic, product minimalism, user-driven strategy, and rapid testing.
- Many of these are not necessarily novel—but some execute them better than their rivals do.
Topic: Entrepreneurship, Founders, Business
Future proof: Solving the ‘adaptability paradox’ for the long term
From Brassey et al., | McKinsey & Company | August 2, 2021
Shutdowns and supply-chain hacks. Hybrid work, remote shopping, settling up via blockchain. The past year has made it abundantly clear, if it wasn’t already, that a volatile and complex world is serving up change at an accelerating pace. Individuals and organizations need to be ready. That doesn’t mean reacting to the next challenge that comes our way but rather being prepared to meet it when it arrives. There’s one tool above all others that can help leaders do that: adaptability.
Adaptability is the ability to learn flexibly and efficiently and to apply that knowledge across situations. It’s not so much a skill as a meta-skill—learning how to learn and being conscious of when to put that learner’s mind into action. By becoming aware of and open to change now, we can maintain control over uncertainty before pressures build to the point where altering course is much more difficult, or even futile.
The authors’ research shows that adaptability is the critical success factor during periods of transformation and systemic change. It allows us to be faster and better at learning, and it orients us toward the opportunities ahead, not just the challenges.
Yet the same conditions that make adapting so important can also trigger fear, making us default to familiar patterns or whatever solutions worked the last time. We call this the “adaptability paradox”: when we most need to learn and change, we stick with what we know, often in a way that stifles learning and innovation. Even positive events, such as receiving a promotion or beginning a new workstream, can turn negative unless we can maintain a learning mindset while under pressure.
To avoid this trap, leaders must work on transforming their relationship with change and uncertainty by building adaptability as an evergreen skill that benefits themselves and their organizations at a deeper level. This is not a natural skill—even for the most successful among us—but it can be nurtured. Five steps that leaders can take to become more adaptable are emphasizing both well-being and purpose, practicing an adaptive mindset, building deeper human connections, and making it safe to learn.
3 key takeaways from the article
- Shutdowns and supply-chain hacks. Hybrid work, remote shopping, settling up via blockchain. The past year has made it abundantly clear, if it wasn’t already, that a volatile and complex world is serving up change at an accelerating pace.
- There’s one tool above all others that can help leaders do that: adaptability. Adaptability is the ability to learn flexibly and efficiently and to apply that knowledge across situations.
- Five steps that leaders can take to become more adaptable are emphasizing both well-being and purpose, practicing an adaptive mindset, building deeper human connections, and making it safe to learn.
Topics: Leadership, Adaptability, Personal Development
Fast-Track Data Monetization With Strategic Data Assets
By Wixom et al., | MIT Sloan Management Review | July 29, 2021
For years, using more data to make better decisions has been the holy grail for global companies, and most of them aim to treat data as a strategic asset. But new research from the MIT Center for Information Systems Research (CISR) has found that future-ready companies have greater ambition regarding their data. These organizations strive to maximize their data monetization outcomes by pervasively improving processes to do things better, cheaper, and faster; wrapping products with analytics features and experiences; and selling new, innovative information solutions.
To monetize data, companies must first transform it so that it can be reused and recombined to enable new value creation. The easier the reuse and recombination, the higher the data’s liquidity, which the authors define as “the ease of data asset reuse and recombination.”
Data liquidity is a continuum, not a binary condition. It is a function of the ability to convert data for use, which means that a particular data asset may be more liquid or less liquid than another. Many companies’ data has low liquidity — it may be trapped in local business processes, locked in closed platforms, or replicated in multiple locations, for example — or it may be inaccessible simply because it’s incomplete, inaccurate, or poorly classified or defined.
It’s crucial to recognize that data does not have to be treated like traditional company assets. Heavy equipment, office furniture, land, and even cash will deteriorate or be depleted over time. Data is different and can be reused and recombined freely without degradation. Data assets are born to be liquid, but while data is inherently reusable and can be recombined, the organization must deliberately activate these characteristics.
There is, of course, a cost to liquidity, so the organization also must deliberately select which data assets to liquify. A good place to start is with strategic data assets — data that holds potential for future value creation and appropriation. Only some data assets, then, are strategic. These strategic assets have myriad possible uses across the enterprise; some uses are known, and others will emerge over time.
To advance from simply using data to building liquid strategic data assets, companies need to decontextualize data from a designated purpose and prepare each asset to become accurate, complete, current, standardized, searchable, and understandable across the enterprise. This process may entail implementing practices such as master data management, metadata management, data integration, data quality management, and taxonomy/ontology development. The five data monetization capabilities MIT CISR identified in its research — this data asset capability combined with data platform, data science, customer understanding, and acceptable data use capabilities — can drive an increase in data’s liquidity.
2 key takeaways from the article
- As companies transform into future-ready entities, they need to recognize their strategic digital initiatives not simply as ways to exploit digital possibilities, but also as opportunities for reshaping their data into highly liquid strategic data assets.
- Organizations strive to maximize their data monetization outcomes by pervasively improving processes to do things better, cheaper, and faster; wrapping products with analytics features and experiences; and selling new, innovative information solutions.
Topic: Technology, Data, Business Model
5 Common Urges Among Entrepreneurs That You Must Fight Against to Be Successful
By Hilel Fuld | Inc Magazine | July 28, 2021
One of many reasons most entrepreneurs fail is that in order to build a large sustainable business, you have to fight natural human urges along the way. Five common urges that every entrepreneur needs to learn how to fight:
You want to run with your idea immediately. An idea is just a microscopic part of building a profitable venture. If you have an idea, that’s great. Now, take a breather and do research about who else had a similar idea. Who else is aiming for the same target audience as you? Who else is trying to solve the same problem as you? All those companies are your competitors.
You don’t want to accept that you have direct competitors. Competitive analysis is critical, and in doing it, you want to stay clear of confirmation bias. Doing so-called research with a specific goal in mind is about as useless as not doing research at all. Fight the urge to be biased and conduct your research objectively.
You raise money as soon as you can. The earlier you go to investors, the riskier it is for them, which means the less attractive the terms of the investment are for you. If you can wait until you have a true product-market fit, then wait.
You don’t want to tell anyone your idea. This is a fundamental mistake. Facebook wasn’t first to social media, Apple wasn’t first to make personal computers, and being first has no real significance? What’s important is that you out-execute your competition. By talking to people about your product, you are able to collect user feedback, get the opinion of people smarter than yourself, and iterate on your product as necessary.
You’re tempted to take the first acquisition offer you receive. It is easier said than done to reject an acquisition offer. Having said that, if you truly believe in your product and its feasibility, perhaps it might be worth waiting until the company is a bit more mature before selling it.
2 key takeaways from the article
- One of many reasons most entrepreneurs fail is that in order to build a large sustainable business, you have to fight natural human urges along the way.
- Five common urges that every entrepreneur needs to learn how to fight are: you want to run with your idea immediately, you don’t want to accept that you have direct competitors, you raise money as soon as you can, you don’t want to tell anyone your idea and you’re tempted to take the first acquisition offer you receive.
Topics: Entrepreneurship, Startup