Extractive summaries of the articles curated from TOP TEN BUSINESS MAGAZINES to promote informed business decision making | Week 223 |December 17-23, 2021
The new normal is already here. Get used to it
The Economist | December 18, 2021
Is it nearly over? In 2021 people have been yearning for something like stability. Even those who accepted that they would never get their old lives back hoped for a new normal. Yet as 2022 draws near, it is time to face the world’s predictable unpredictability. The pattern for the rest of the 2020s is not the familiar routine of the pre-covid years, but the turmoil and bewilderment of the pandemic era. The new normal is already here.
Flying did not return to normal after 9/11, nor did it establish a new routine. Instead, everything was permanently up for revision. The world is similarly unpredictable today and the pandemic is part of the reason. Covid has helped bring about today’s unpredictable world indirectly, by accelerating change that was incipient. For instance, the pandemic has shown how industries can be suddenly upended by technological shifts. Remote shopping, working from home and the Zoom boom were once the future. In the time of covid they rapidly became as much of a chore as picking up the groceries or the daily commute.
The pandemic may also have ended the era of low global inflation that began in the 1990s and was ingrained by economic weakness after the financial crisis of 2007-09. And a return to the comfortable macroeconomic orthodoxies of the 1990s is one of the least likely. Further, the pandemic has also soured relations between the world’s two great powers i.e., America and China.
The desire to return to a more stable, predictable world is too nostalgic. It is worth notching up some of the benefits that come with today’s predictable unpredictability. Many people like to work from home. Remote services can be cheaper and more accessible. The rapid dissemination of technology could bring unimagined advances in medicine and the mitigation of global warming. Even so, beneath it lies the unsettling idea that once a system has crossed some threshold, every nudge tends to shift it further from the old equilibrium. Many of the institutions and attitudes that brought stability in the old world look ill-suited to the new. The pandemic is like a doorway. Once you pass through, there is no going back.
3 key takeaways from the article
- Covid has helped bring about today’s unpredictable world indirectly, by accelerating change that was incipient.
- The desire to return to a more stable, predictable world is too nostalgic. Despite some of the benefits that come with today’s predictable unpredictability beneath it lies the unsettling idea that once a system has crossed some threshold, every nudge tends to shift it further from the old equilibrium.
- Many of the institutions and attitudes that brought stability in the old world look ill-suited to the new. The pandemic is like a doorway. Once you pass through, there is no going back.
Topics: COVID-19, Global Economy, Disruption
As Lockdowns Make Vision Worse, Big Tech Eyes an Opportunity
By Alex Webb | Bloomberg Businessweek | December 15, 2021
The pandemic has taken a terrible toll on our eyesight. But what’s a bummer for you millions like you who use corrective vision is a big opportunity for the tech industry, which has its eye on those precious inches around the bridge of your nose. The Silicon Valley companies working on smart glasses are betting it will be easier to persuade people who already sport specs to try out their vision of the future. If you wear glasses, you’re a pretty good candidate for whatever whiz-bang products the likes of Apple, Amazon, and Facebook—er, Meta Platforms Inc.—are planning for a category that Verified Market Research predicts will more than triple in value by 2028, to $29 billion.
Meta in particular has started talking up the so-called metaverse. Its Oculus VR unit already makes virtual-reality goggles that immerse you in a computer-generated world. Next up is augmented reality, a more complex technology that superimposes information and graphics on your field of view. But as more models hit stores in the next few years, they’re likely to be exorbitantly expensive. Sure, some early adopters will splash that sort of cash, but most consumers—with scant understanding of this new product category—will want to try it before they buy. A frequently overlooked challenge for smart glasses, then, is distribution. Amazon.com Inc., of course, has unequaled reach with consumers. Nevertheless, other tech giants have also deep distribution networks e.g., Apple Inc.’s 500-plus stores worldwide.
Meta, by contrast, is a laggard in this respect as there are no Facebook or Meta retail outlets where would-be shoppers can sample company gear. But Meta does have one weapon that could catapult it to the head of the pack. In September, Facebook released Ray‑Ban Stories: glasses with built-in cameras and headphones that let you make calls, listen to tunes, and shoot photos and videos. But far more consequential is the relationship with the eyewear maker’s parent, EssilorLuxottica SA. Its 8,000 locations make Apple’s outlets look pretty skimpy, and its share of the global eyewear market is orders of magnitude bigger than that of its nearest rival—a big advantage in eyewear sales, which rely heavily on brick-and-mortar stores.
3 key takeaways from the article
- The pandemic has taken a terrible toll on our eyesight. And here is a big opportunity for the tech industry, which has its eye on those precious inches around the bridge of your nose.
- The Silicon Valley companies i.e., Apple, Amazon, and Facebook or Meta Platforms Inc. working on smart glasses are betting it will be easier to persuade people who already sport specs to try out their vision of the future – a category that Verified Market Research predicts will more than triple in value by 2028, to $29 billion.
- But the fate of this new race would probably be decided in brick-and-mortar shops where the early adopters could try these glasses. And Meta Platform Inc. has an edge in this race.
Topics: Technology, Competition, Smart glasses
Zimbabwe’s climate migration is a sign of what’s to come
By Andrew Mambondiyani | MIT Technology Review | December 17, 2021
Mutero, a farmer in eastern Zimbabwe, is just one of the 86 million people in sub-Saharan Africa who the World Bank estimates will migrate domestically by 2050 because of climate change—the largest number predicted in any of six major regions the organization studied for a new report.
In Zimbabwe, farmers who have tried to stay put and adapt by harvesting rainwater or changing what they grow have found their efforts woefully inadequate in the face of new weather extremes. Droughts have already forced tens of thousands from the country’s lowlands to the Eastern Highlands. But their desperate moves are creating new competition for water in the region, and tensions may soon boil over. Fears are growing that resources will soon run out as more people come to the area. This may also cause conflict between the locals and the settlers.
Zimbabwe has endured droughts for the past three decades. But they’re happening more often and becoming more severe as a result of climate change. Up to 70% of people in Zimbabwe make a living from agriculture or related rural economic activities, and millions of subsistence farmers there depend entirely on rain to water their crops. Over the last 40 years, average temperatures have risen by 1 °C , while annual rainfall has decreased by 20 to 30%.
At the height of the most recent drought, which lasted from 2018 to 2020, only about half as much rain fell in Zimbabwe as usual. Crops were scorched and pastures dried up. People and livestock crowded around hand-pumped boreholes to find water, but the wells soon went dry. Some people in the driest areas had so little to eat they survived on the leaves and white, powdery fruit of baobab trees. More rain fell during the last growing season, but many farmers still feel uneasy about the future.
3 key takeaways from the article
- In its new report World Bank estimates that around 86 million people in sub-Saharan Africa will migrate domestically by 2050 because of climate change—the largest number predicted in any of six major regions the organization studied in this report.
- In Zimbabwe, farmers who have tried to stay in their areas tried to adapt by harvesting rainwater or changing what they grow have found their efforts woefully inadequate in the face of new weather extremes. Droughts have already forced tens of thousands from the country’s lowlands to the Eastern Highlands.
- Such desperate moves are creating new competition for water in the region, and tensions may soon boil over. Fears are growing that resources will soon run out as more people come to the area.
Topics: Environment, Global Temperature, Zimbabwe, Agriculture
Entering a Market Where There’s Little Demand for Your Product
By Lele Sang and Karl Ulrich | Harvard Business Review | December 17, 2021
When it comes to choosing new markets to enter, the safe bet is to focus on regions with visible, existing demand for your products or services. Clearly, this strategy can be effective. But there is also a downside: when the potential of a market is no longer a secret, stiff competition is inevitable. That’s why some companies choose to take a different approach to international expansion. They launch their businesses successfully in a new market that has almost no evident demand — and if done right, this can be a highly effective approach to sidestep competition and establish a strong market position early. Based on their research, the authors suggest three strategies:
- Start Small. Without clear evidence of strong market potential, companies must make educated guesses abound how demand is likely to change over time. For example, a political shift or technological innovation might suggest that a certain economy or sector is likely to grow. Depending on an organization’s level of confidence in these assumptions, it may make sense to test out a market with a small initial investment before making a larger commitment. Taking baby steps makes it possible to validate a new market, learn about its idiosyncrasies, and adjust accordingly…without going bankrupt in the process.
- Introduce New Product Categories. While it’s often easier to sell a product if your customers are already familiar with similar products, there’s a lot to be gained if your company manages to be the one to introduce people to an entirely new category of products. That means first understanding the local market and then developing a novel value proposition that will resonate with local customers.
- Pivot to Meet Existing Demand. Of course, not all pioneers benefit from favorable market shifts or a warm response to a novel type of product. LinkedIn, for example, encountered scarce demand when it first entered China. The company initially offered the same professional networking site as it did in other countries — but despite its success elsewhere, the majority of Chinese users found the entire idea of the site strange and unappealing. In response, LinkedIn shifted the focus of its China operations from the site’s primary social function to its recruiting features. Chinese customers were familiar with other job-hunting sites, and LinkedIn’s global network of top companies and recruiters offered an advantage that competitors couldn’t match.
3 key takeaways from the article
- Entering a new market without existing demand is risky. That risk deters many (global) companies, who would rather pursue markets with greater certainty and a higher chance of immediate returns. But with a bit of patience and creativity, it is possible to venture into an untapped market and find — or create — substantial, sustainable demand.
- A seemingly demand-less market may have more potential than meets the eye.
- Three strategies could be just dip a toe in with a small exploratory investment, leverage your brand’s unique features to establish an entirely new product category, or pivot your own business to more effectively meet the needs of local customers.
Topics: Strategy, International Business, Business Model, Marketing
When bigger isn’t always better
By Jamie Koenig et al., | McKinsey & Company | December 17, 2021
Separations are back in the business pages, as large conglomerates in healthcare, consumer electronics, logistics, and other sectors announce their intentions to spin off business units or explore avenues for doing so. Despite all the new ink being spilled on this trend, in many ways it’s just another chapter in the long-running story about diversification strategies: a company matures, prompting executives to look outside the core business for ways to grow. As revenues increase, so do costs and complexity. Some operational and other synergies may materialize—but eventually executives and boards realize how difficult it is to add value to businesses that have little or no direct connection to the company’s core business.
The realization may come when a business unit’s performance is lagging behind that of its peers with no clear path to catch up. Or a review of the company’s portfolio may reveal that some business units’ cost structures are not comparable with peers. Or executives may recognize that the company lacks sufficient management capabilities to grow all the businesses in its portfolio. When these signals appear, companies acknowledge that they are no longer the best owner of an asset, and spin-offs ensue—especially in an environment like the one we’re experiencing now, when business models are being tested by a crisis and new strategies are needed, market valuations are high, and financial engineers are hard at work. Three fundamental reasons why we’re seeing more large companies pursuing spin-offs.
- Improve the operating model: A group structure often imposes operating requirements on all the business units in a company’s portfolio. But different drug and device divisions for instance, have different needs, so the teams managing these common compliance, procurement, and sales functions would likely struggle to cater to each unit’s unique circumstances and priorities. A breakup would allow for a more tailored operating model.
- Improve management focus and strategy: Experience shows that senior leaders in conglomerates tend to overinvest attention and organizational resources in high-growth parts of their business and underinvest in lower-growth or more mature parts of the organization. The opposite can happen, too. Even if management is appropriately tending to all parts of the business, analysts and investors with limited time to evaluate companies may struggle to understand what’s driving growth in disparate parts of a diversified business.
- Improve capital management. A group structure can also make it more difficult for executives to determine how to balance investments in high-risk, high-reward opportunities versus low-risk, low-reward ones. Divesting noncore business units can help address these concerns.
2 key takeaways from the article
- Separations are back in the business pages, as large conglomerates in healthcare, consumer electronics, logistics, and other sectors announce their intentions to spin off business units or explore avenues for doing so.
- There are fundamental reasons why we’re seeing more large companies pursuing spin-offs—specifically because such deals can help to improve the operating model, management focus and strategy, and capital management for both the parent company and the divested business unit.
Topics: Technology, Divestment, Business Model, Conglomerate
Four Strategies For Clearing Your Plate To Make Room For Your True Passions
By Mark O’Donnell | Forbes Magazine | December 17, 2021
Work-from-home conditions and the broader economic situation have left many business leaders more stressed-out than ever. One explanation is leaders tend to ‘should’ on themselves to no end. All such expectations leaders hold for themselves can trap them in a cycle of justifying overworking even if it makes them unhappy and, quite frankly, not very productive. Getting rid of the tasks you hate and just doing what you love might sound irresponsible, selfish or even impossible. But with the right approach, it’s none of those things. Actually, it can give you the energy you need to be a better leader. The right approach is called delegation, and it’s a strategy that can help you focus your work on your passions, drive your business to success and be less stressed out in the process. While no two people are alike, the following four tactics can help you master the art of delegation:
- Map and categorize your responsibilities. When trying to identify responsibilities best left to others, it’s important first to identify the things you’re best at and interested in. Start by creating a visual representation. Map out your responsibilities, then sort each task into one of four categories: those you’re best at and enjoy, those you’re decent at and like, those you’re good at but would rather not do, and those you’re neither good at nor enjoy. Once the tasks are categorized, reciprocate the tasks in the last two groupings with employees who might find more enjoyment in these tasks. This will help you to make room on their plates as well.
- Schedule one or two great delegations per quarter. Not every business will have the budget or luxury to staff a large enough team to take on the tasks in the third and fourth categories. But just offloading a couple per quarter can offer huge relief for anyone feeling overstressed or overworked.
- Recognize the difference between delegation and abdication. Don’t let go of responsibilities until you’re certain the other person understands the task at hand. You want team members to perform the same if not better than you with any delegated activity.
- Establish a stringent timeline. Letting go can be difficult for leaders, even if you’re trying to let go of tasks you don’t enjoy. But do it. And do this with deadlines. A deadline can be the motivating force you need to move from push to shove.
3 key takeaways from the article
- Work-from-home conditions and the broader economic situation have left many business leaders more stressed-out than ever. One explanation is leaders tend to ‘should’ on themselves to no end.
- All such expectations leaders hold for themselves can trap them in a cycle of justifying overworking even if it makes them unhappy and, quite frankly, not very productive. Effective delegation as a strategy that can help you focus your work on your passions.
- Four tactics can help you master the art of delegation: map and categorize your responsibilities, schedule one or two great delegations per quarter, Recognize the difference between delegation and abdication, and establish a stringent timeline.
Topics: Delegation, Leadership, Effectiveness
How to get succession right
By David Ewing | Fortune Magazine | December 13, 2021
There is often meticulous planning at every stage of a business, from product launches to acquisitions, whereas planning the future leadership of the business often gets forgotten about. Whether the CEO is stepping down in six months or six years, having a plan in place gives the business direction beyond the CEO, encourages fresh ideas, and promotes the progression of other staff in the business. Without a defined plan, the departure of a leader can cause disruption and impact the stability of the business. Three considerations could be:
- Easing the transition. There is no one route when it comes to managing change in leadership. Some CEOs may be exiting the business completely, perhaps due to retirement or for a new role, while others may wish to step down from their managerial duties but stay a part of the business as a non-executive director for example. If the CEO is going to stay part of the business, the transition from being in the driver’s seat to becoming a passenger can be hard. It will take time to get the dynamic right. Departing leaders need to make sure that they don’t still try to lead from behind, but channel their support through the new CEO and executive team.
- Impact on culture. Culture is stereotypically set from the top down, so it’s often the role of the CEO to cultivate and preserve the company culture as the business grows. A change in leadership is a unique change and it can impact culture in two ways: Either the existing CEO chooses someone whose values mirror their own to ensure continuity in culture when they depart, or it can be a catalyst that helps to improve and adapt the business culture to the world around it.
- Leadership progression. In a world where attracting and retaining talent is becoming increasingly difficult, the pool of candidates may be limited. In order to retain the best people, there needs to be a clear route for progression. Individuals need to know there is a path for them to reach the top, even if it’s a few years away. Therefore, having conversations with individuals who have been selected as potential candidates early can prevent them from seeking leadership roles elsewhere.
3 key takeaways from the article
- There is often meticulous planning at every stage of a business, from product launches to acquisitions, whereas planning the future leadership of the business often gets forgotten about.
- Whether the CEO is stepping down in six months or six years, having a plan in place gives the business direction beyond the CEO, encourages fresh ideas, and promotes the progression of other staff in the business.
- Three considerations could be: departing leaders need to make sure that they don’t still try to lead from, behind, existing CEO chooses someone whose values mirror their own or who can improve, and the targeted individuals need to know there is a path for them to reach the top.
Topics: Succession, Leadership, Culture, Organizational Performance
Moving Beyond Trust: Making Customers Trust, Love, and Respect a Brand
By Andreas B. Eisingerich et al., | MIT Sloan Management Review | December 13, 2021
Rapid digital acceleration, coupled with the global pandemic, has dramatically shifted customer expectations and needs in recent years. This dizzying array of shifts has left companies, executives, and marketers searching for insights as to how brands can withstand and thrive through periods of uncertainty. What North Star concept can marketers follow to navigate these challenging times? The authors, based on their research, identified one such North Star for marketers — brand admiration.
Data shows that trust is declining across the globe, and customers may lack trust in certain social institutions or societal leaders. But when it comes to brands, some evoke feelings of love, trust, and respect: Customers have come to admire these brands and view them as essential and indispensable to their lives.
Brand choices are largely driven by customers’ perceptions of what brands do for them (that is, their benefits). Benefits refer not to what features the product offers or has but rather how it helps customers meet their needs, wants, and goals. Customers fundamentally want three types of benefits in brands. They want benefits that enable, entice, and enrich them – 3 E’s.
- Benefits that enable customers empower them in their daily lives. They help customers e.g., conserving resources (time and monetary, psychological, and physical), and/or solve problems (physical, social, emotional, and cognitive) in ways that are economically feasible, reliable, efficient, and convenient.
- Benefits that entice please customers by stimulating their minds, senses, and hearts. They replace work with play, displeasure with gratification, boredom with excitement, and sadness with feelings of warmth. The levers brands can use to entice customers include: by stimulating cognitive and sensory experiences, by building warm and authentic connections.
- Benefits that enrich customers affect their sense of who they are as people. Customers want to feel that they are good people who do good things in the world. They want to act in ways that are consistent with their beliefs, values, and hopes. They want to feel like they’re part of a group in which others accept and respect them, yet they also want to show how they are unique and different. The approaches that can help brands affirm and enrich customer identity include: offering opportunities for self-expression, enriching by self-expansion, and Enriching by self-transcending benefits.
3 key takeaways from the article
- Rapid digital acceleration, coupled with the global pandemic, has dramatically shifted customer expectations and needs in recent years. Such dizzying array of shifts has left companies, executives, and marketers searching for insights as to how brands can withstand and thrive through periods of uncertainty. What North Star concept can marketers follow to navigate these challenging times?
- One such North Star for marketers could be brand admiration — a brand that evokes feelings of love, trust, and respect
- When brands enable, entice, and enrich customers, brand admiration and the subsequent pro-brand behaviors are all maximized.
Topics: Marketing, Brand Loyalty, Uncertainty
5 Tips on How to Successfully Pitch Your Business Idea to Investors
By Brandon Ivan Pena | Inc Magazine | December 14, 2021
After you decide on your business concept, if you don’t have the money to get your business off the ground, you will need to pitch your idea to potential investors. This may seem like an unnerving task but the following five tips to share on how to successfully pitch your business idea to your potential investors can help:
- You need to be knowledgeable. With your business idea in mind, it’s time to sit down and learn. You need a thorough understanding of the industry you want to be part of. If you don’t know what you’re talking about, no one will want to invest in your idea. You need to become an expert in the subject and be confident in what you are pitching.
- Describe your product and services. Try not to focus on the idea of your business too much. Rather talk about the product and services the business will provide. Investors are likely thinking about how they will profit from investing in your product and that’s what you want to focus on to get them to invest with you.
- Discuss how you intend to attract customers. Regardless of how good your business idea is, investors won’t support you if you don’t have a compelling way of making your business desirable to the public. Come up with a marketing strategy for your product and sell it to your investors. If they want your product they’re more likely to invest in it. This business idea is your passion, but for investors it’s about how they’ll benefit from your idea. Keep that in mind when creating your pitch.
- Prepare a compelling visual presentation. Humans are visual creatures. So don’t just tell your investors what your business is or how they’ll profit from it, show them. There are many tools to create a visual aid to go with your pitch. Show them your profit projections with charts and graphs and create your logo. Make it interesting and professional, but also have fun with it.
- Manage your time well. You should not spend too much time pitching your idea. Thirty minutes should be more than enough time for the pitch. Before asking for a meeting with potential investors, condense your information to fit in that time frame; be brief, but comprehensive. You also need to practice your pitch and time yourself. The goal is to reach a point where you are comfortable and don’t seem rushed to get the information out.
2 key takeaways from the article
- After you decide on your business concept, if you don’t have the money to get your business off the ground, you will need to pitch your idea to potential investors.
- This may seem like an unnerving task but the following five tips on how to successfully pitch your business idea to your potential investors can help: you need to be knowledgeable, describe your product and services, discuss how you intend to attract customers, prepare a compelling visual presentation, and manage your time well.
Topic: Entrepreneurship, Startup, Equity Investors
7 Tips for Using Your LinkedIn Profile as Your Personal Branding Website
By Naomi Garrick | Entrepreneur Magazine | December 20, 2021
Having 800 million members in more than 200 countries and territories worldwide, LinkedIn has become home for decision-makers, corporate executives, entrepreneurs and employers to connect, collaborate, recruit and share their thought leadership in a particular industry or area of expertise. But did you know that typically when someone does an online search for an individual, their LinkedIn profile shows up as the first online link in those search results or the top five links on the first page of those results? Seven ways you can start using your LinkedIn profile page like your own personal brand website to enhance your personal brand are:
- Update your stuff. Your existing content on your page should be an accurate representation of your brand today, and not three years ago. For instance, update your headline statement. Do not just include your job title — tell people what you do, how do you do it and for whom.
- Add a welcome video or voice recording introduction. This allows someone to virtually meet you, get a feel about your personality and learn about what to expect on your page.
- Utilize featured posts. When you start sharing content on LinkedIn, you can turn your posts into “featured” posts, which enables specific posts to show up on your profile page.
- Show your value in the “about” section. Don’t just list your expertise and credentials in this section. Use the “about” section for potential viewers to learn more about who you are. Showcase how you add value and how you help your ideal audience.
- Maximize your experience. LinkedIn allows you to add supporting media files to your experience such as video, images, podcast episodes — you can add anything that can provide social proof of the work that you have done during your experience.
- Create a newsletter. You can create your own subscription-based newsletter on the platform. Choose your area of focus and start creating a weekly or monthly newsletter to share with your existing followers and subscribers. This also helps you to gain thought leadership and be discovered by other members on the platform.
- Ask for recommendations. Start reaching out to past clients who had a great experience working with you and request a recommendation. You should also give recommendations too — it is, after all, a community.
3 key takeaways from the article
- Having 800 million members in more than 200 countries and territories worldwide, LinkedIn has become home for decision-makers, corporate executives, entrepreneurs and employers to connect, collaborate, recruit and share their thought leadership in a particular industry or area of expertise.
- Typically when someone does an online search for an individual, their LinkedIn profile shows up as the first online link in those search results or the top five links.
- Seven ways you can start using your LinkedIn profile page to enhance your personal brand are: update your stuff, add a welcome video or voice recording introduction, utilize featured posts, show your value in the “about” section, maximize your experience, create a newsletter, and ask for recommendations.
Topics: Personal Development, Branding, Marketing