Extractive summaries of and key takeaways from the articles curated from TOP TEN BUSINESS MAGAZINES to promote informed business decision-making | Week 261|September 8-15, 2022
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Shaping Section : Ideas and forces shaping economies and industries
The dollar is as strong as ever. Isn’t it?
The Economist | September 8, 2022
The most important currency in the world is on a roll. The dollar has climbed by around 20% over the past year against a basket of global currencies and is at its highest level in 20 years. One euro is worth less than a dollar, and other pretenders to the dollar’s throne as the world’s reserve currency, such as the yen, yuan or even crypto, have slumped. Even as America has used its financial clout to squeeze Russia, others have rushed to the dollar-based financial system as a safe haven. This cyclical strength of the dollar dominates the global financial landscape.
The dollar’s run reflects several forces. Even as Europe and China face a downturn, America’s economy is proving remarkably resilient, with job growth and profits still strong. Inflation is high and the Federal Reserve is raising rates faster and higher than other big central banks. Energy crises are terms-of-trade shocks that favour energy exporters and punish the currencies of importers. Thanks to the shale revolution America became a net energy exporter in 2019 for the first time since 1952. None of these dynamics looks likely to abate soon.
The endurance of this global dollar-based system, in spite of the resentments it arouses, is testament to America’s staying power. Nonetheless, even as the greenback soars, two technological developments bear close attention.
First, new state-run digital currency and payments systems are, at last, gaining traction. China’s e-yuan
now has 260m users and the technology involved might eventually allow China to run its own global
payments network while maintaining capital controls, which it regards as necessary to maintain stability. That could make it all but immune to American sanctions. Elsewhere, state payments systems are exhibiting powerful network effects. India’s UPI system is vast and Brazil’s payments system, Pix, has been used by 126m people. Today these payments networks are domestic; tomorrow they could facilitate cross-border transactions as alternatives to the dollar-based system.
Second, if you look beyond the scams and bubbles in cryptocurrencies, decentralised finance technologies continue to improve. Developers are pushing through an upgrade to the Ethereum blockchain, on which most DeFi applications are based. On September 15th it will switch to a new mechanism for making collective decisions known as proof-of-stake that is far less energy intensive. It could pave the way for Ethereum to become more efficient at handling high transaction volumes—and a more credible global rival to traditional finance.
3 key takeaways from the article
- The most important currency in the world is on a roll. The dollar has climbed by around 20% over the past year against a basket of global currencies, and is at its highest level in 20 years.
- The cyclical strength of the dollar dominates the global financial landscape. But look closer and technological shifts that could eventually challenge it are gathering momentum.
- Two technological developments bear close attention. First, new state-run digital currency and payments systems are, at last, gaining traction. China’s e-yuan now has 260m users, India’s UPI system is vast and Brazil’s payments system, Pix, has been used by 126m people. Today these payments networks are domestic; tomorrow they could facilitate cross-border transactions as alternatives to the dollar-based system.
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Topics: Global Finance, US Dollar, Technology
How to win in the Gulf’s dynamic consumer and retail sectors
By Abdellah Iftahy et. al., | McKinsey & Company | September 7, 2022
In this age of uncertainty, when mounting headwinds threaten to slow down global economic growth, a new type of consumer is emerging in the Gulf region: one who is more price sensitive, digitally savvy, and socially responsible. These shifts in consumer behavior started during the peak pandemic months, as McKinsey’s latest Middle East Consumer Sentiment Survey shows, and are expected to continue driving spending decisions for the remainder of 2022 and beyond.
These changes should serve as a wake-up call to consumer companies in the Gulf region. Prior to the pandemic, retailers and consumer-packaged-goods (CPG) manufacturers in the region were riding a growth wave fueled by a strong economy, robust tourism, and ample government infrastructure spending, so there was little impetus to take risks and experiment with new products and services. In addition, because well-established Gulf companies enjoyed brand loyalty from their customer base, they didn’t feel the need to make big investments in advertising and marketing. Gulf consumer companies have therefore been slower than their US or European counterparts to adapt to transformative trends like digitization and sustainability.
But the landscape has changed. To attract and retain consumers in this dynamic environment, retailers and CPG manufacturers would do well to refocus their strategic priorities and put consumer data at the heart of every business decision. The authors believe this requires a two-pronged approach. First, the Gulf consumer industry can expand into new products and businesses that are better aligned with evolving customer needs. Second, incumbent retailers and CPG manufacturers should develop personalized marketing initiatives. Gulf companies that choose not to pursue these new strategic priorities likely won’t remain competitive for long.
It is easy to adopt a wait-and-see approach in times of uncertainty. But given how fast consumer behaviors and expectations are changing, doing nothing can be riskier than making big moves. Companies that act now to develop capabilities to grow into new adjacencies, business building, and personalization will be well positioned to remain resilient and productive, even in the face of a potential economic downturn.
3 key takeaways from the article
- In this age of uncertainty, when mounting headwinds threaten to slow down global economic growth, a new type of consumer is emerging in the Gulf region: one who is more price sensitive, digitally savvy, and socially responsible.
- These changes should serve as a wake-up call to consumer companies in the Gulf region.
- To attract and retain consumers in this dynamic environment, retailers and consumer-packaged-goods (CPG) manufacturers would do well to refocus their strategic priorities and put consumer data at the heart of every business decision. This requires a two-pronged approach. First, the Gulf consumer industry can expand into new products and businesses that are better aligned with evolving customer needs. Second, incumbent retailers and CPG manufacturers should develop personalized marketing initiatives.
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Topics: Middle East, Consumer Markets, Consumers, Package Goods Companies, Retailing
Leading & Managing Section
Emotions Aren’t the Enemy of Good Decision-Making
By Cheryl Strauss Einhorn | Harvard Business Review | September 09, 2022
When we’re faced with difficult and complex decisions, we typically experience difficult and complex emotions. Many of us don’t want to sit with these uncomfortable feelings, so we try to get the decision-making over with. But this often leads to poor decisions. We may not truly solve the problem at hand, and we often end up feeling worse. It’s an unproductive feedback loop that bookends our decisions with negative feelings. These emotional bookends, however, can be your secret weapon in making better decisions. The process is as simple as taking the time to identify 1) the emotions you feel as you face your decision, and 2) the emotions you want to feel as you’re looking at your decision in the rearview mirror. What do you see? How is your life better for a satisfying decision outcome? This four-step exercise allows our thinking, or “wizard brain,” to check and channel our emotional, or “lizard brain,” so that we don’t make reactive choices. Here’s how it works.
- Identify the decision you need to make. When we’re trying to solve a thorny problem, we often have to sort through a lot of conflicting information — in addition to our feelings. So the first thing to do is to identify what decision you need to make.
- Identify how you feel about the decision you have to make. Consider your emotions as you contemplate making a big decision. What is the dominant emotion you are feeling? Is it fear? Anxiety? A sense of being overwhelmed or perhaps excitement at the opportunity ahead? Are your feelings based on previous experiences or other sources of information? Naming our feelings can help create a little space between our emotions and our actions. Gaining that distance allows us to examine the emotion, and to acknowledge feeling it, without letting the emotion drive the decision, replacing our conscious thought and agency.
- Visualize your success and how it feels. Imagine that you’ve made a successful decision. How do you feel now? Do you feel a sense of accomplishment or relief? Do you have a clearer direction for the future? Have you furthered your career, or perhaps strengthened your relationships?
- Apply the emotional bookends. Now that you’ve examined your initial decision and the emotional bookends for it, consider: Have you correctly identified the decision you are making?
2 key takeaways from the article
- When we’re faced with difficult and complex decisions, we typically experience difficult and complex emotions. Many of us don’t want to sit with these uncomfortable feelings, so we try to get the decision-making over with. But this often leads to poor decisions. We may not truly solve the problem at hand, and we often end up feeling worse. It’s an unproductive feedback loop that bookends our decisions with negative feelings. These emotional bookends, however, can be your secret weapon in making better decisions.
- Four-step exercise allows our thinking, or “wizard brain,” to check and channel our emotional, or “lizard brain,” so that we don’t make reactive choices. These steps are: identify the decision you need to make, identify how you feel about the decision you have to make, visualize your success and how it feels, and apply the emotional bookends.
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Topics: Decision-making; Emotions, Problem Solving
Can Design Thinking Succeed in Your Organization?
By David Dunne et al., | MIT Sloan Management Review | September 06, 2022
Design thinking offers a way to explore uncharted territory, uncover options, and solve complex business problems. But as much as leaders need new approaches to create competitive advantage, inspire innovation, and discover new paths for growth, they often don’t get the results they expect. To get the benefits of design thinking, leaders need to know when to apply it, and they have to prepare both their employees and managers to do so.
Design thinking is a discipline that emerged in the last half century or so from studies of innovation processes, problem-solving, and creativity. It takes an iterative, experimental approach to problem-solving that involves gaining a deep understanding of customer needs; defining a problem area; ideating new solutions; and then prototyping, testing, and refining them.
Many organizations that turn to design thinking have innovation in mind. Some look to it to devise new business models, products, or services. Others use it to identify pain points in the user experience and tweak their existing offerings. It is well positioned to mitigate the sources of cognitive bias that prevent people from accurately describing what they want, and to help people visualize previously unimagined solutions to problems. Some organizations adopt design thinking to change their culture.
Designers’ methods are appealing in these situations precisely because they demand that people think outside the boundaries of business as usual. The authors, based on their study, found eight important differences between how designers and business managers think, work, and define their purpose – the way designers do will determine whether design thinking can succeed. These are design thinkers will go for: users first instead of shareholders; problem-solving through cross-functional teams instead of managing departments; flexible, informal, flat instead of formal, hierarchical structure, deductive, inductive, abductive thought process of instead of deductive, inductive; knowledge generation through stories (qualitative) instead of numbers (quantitative); create opportunities, stimulate creativity instead of limiting the options; failure is to be welcomed as a chance to learn instead of avoiding it; and workflow is designed to explore future value instead of exploiting existing values.
Leaders can determine the extent to which the dimensions of design thinking are already understood and practiced within the organization by surveying both managers and employees against the eight dimensions described earlier. Business leaders can uncover any disconnects between them that would threaten the success of a design thinking program.
3 key takeaways from the article
- Design thinking offers a way to explore uncharted territory, uncover options, and solve complex business problems. To get the benefits of design thinking, leaders need to know when to apply it, and they have to prepare both their employees and managers to do so.
- Eight important differences which differentiate how designers think, work, and define their purpose differently than business managers are: They are users focused; problem-solving through cross-functional teams; work with flexible, informal, flat structure; use deductive, inductive, abductive thought process; knowledge generation through stories (qualitative); create opportunities, stimulate creativity; failure is to be welcomed as a chance to learn; and workflow is designed to explore future value.
- Leaders can determine the extent to which the dimensions of design thinking are already understood and practiced within the organization by surveying both managers and employees against the eight dimensions.
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Topics: Leadership, Design-Thinking, Decision-making
Entrepreneurship Section
The Steve Jobs Archive: 3 Key Lessons From the Inspirational Writings of Apple’s Co-Founder
By Ben Sherry | Inc Magazine | September 9, 2022
More than a decade after his death, Steve Jobs is still inspiring entrepreneurs around the world. His close friends and family members had recently launched the Steve Jobs Archive, an online collection of inspirational writings from Jobs. Three key lessons for life and business from the Archive are:
- Be grateful for those around you. In an email Jobs sent to himself in September of 2010, a year before his death, he acknowledged his dependence on those around him, writing that he didn’t grow his own food, make his own clothing, or invent most of the technology he worked with in his life. “I love and admire my species, living and dead, and am totally dependent on them for my life and well being,” the founder wrote. The founder reportedly would sometimes take credit for ideas that he hadn’t originated, which led to conflict with people like Ive. The email serves a reminder from Jobs to himself, and now the rest of us, to stay humble, and to remember that no person can thrive without the help of countless others, both friends and strangers.
- Make mistakes, then keep working. In a 1984 interview Jobs said that your personal aesthetics get more refined as you make mistakes, so giving yourself the space to make lots of mistakes is necessary to make something truly great. Jobs added that it doesn’t take any more energy or money to make something great. “All it takes is a little more time–not that much more–and a willingness to do so: a willingness to persevere until it’s really great.” The lesson? Be patient. It may not seem like you’re making progress, but every mistake and setback will give you a deeper understanding of what makes your business unique.
- Don’t lose your beginner mentality. During his 2005 commencement address at Stanford University, Jobs told the graduating class that one of the most creative periods of his life began in 1985 when he was fired by Apple. Jobs said that he didn’t see it then, but getting fired was the best thing that could’ve happened to him. Said Jobs, “the heaviness of being successful was replaced by the lightness of being a beginner again, less sure about everything.” Losing the company he founded kicked Jobs out of a comfortable routine, and forced him to rethink the industry he’d revolutionized. By approaching problems from the perspective of a beginner, you can think up solutions that diverge from the previously agreed-upon way of doing things.
2 key takeaways from the article
- More than a decade after his death, Steve Jobs is still inspiring entrepreneurs around the world. His close friends and family members had recently launched the Steve Jobs Archive, an online collection of inspirational writings from Jobs.
- Three key lessons for life and business from the Archive are: be grateful for those around you, make mistakes, then keep working, and don’t lose the beginners’ mentality.
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Topics: Decision-making; Entrepreneurship, Leadership
3 Ways TikTok Can Help Your Business Grow
By Ken Wisnefski | Entrepreneur Magazine | September 15, 2022
TikTok has taken over traditional forms of social media and has created a new wave of creativity among people of all ages looking to have fun, entertain, get more likes and connect with others. While TikTok is mainly used as a fun application to show trends, it also can be an extremely effective marketing tool – if you know how to use it! Three ideas are:
- Reach a large and diverse audience. TikTok has users from all across the world of all different ages. There are countless opportunities to reach each niche audience within the TikTok population. If you’re looking to reach international markets, then TikTok is an effective platform for connecting with new audiences in other countries.
- Showcase your products authentically. Something that makes TikTok unique is that it is authenticity-driven. TikTok users want to be entertained or informed, not sold to. Connecting the viewer to the product with a relatable story or fun trend would be more effective in gaining community members and potential customers. It is easy for businesses to create content in short, digestible clips that grab viewers’ attention while showcasing what their brand has to offer. Creating trend-driven organic content, using popular hashtags and incorporating TikTok influencers into promotional campaigns are all good strategies for success on TikTok.
- Bring additional traffic to your site. TikTok provides an additional platform to bring your brand exposure and direct them back to your company website. TikTok is a foundation of growth for individuals and businesses to expand their reach into new markets. Creating content that draws in the viewer is a great way to bring people in, get them to click on your TikTok profile, and then direct them to your other social media platforms or your company’s website. Many creators even include their storefront, making the app an exceptional resource for small businesses that regularly would not be able to reach such a large audience.
3 key takeaways from the article
- TikTok has taken over traditional forms of social media and has created a new wave of creativity among people of all ages looking to have fun, entertain, get more likes and connect with others.
- While TikTok is mainly used as a fun application to show trends, it also can be an extremely effective marketing tool – if you know how to use it!
- Three ways TikTok can help your business grow are: reach a large and diverse audience, showcase your products authentically, and bring additional traffic to your site.
Listen to the Extractive Summary of the Article
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Topics: Business, Startup, Social Media, Tiktok
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