Informed i’s Weekly Business Insights

Few places illustrate the challenges of adapting to climate change as clearly as the world’s most populous country. India was hot even before people started to cook the planet, not to mention vulnerable to floods and droughts. Now all these ills are getting worse. Minimum temperatures last summer were the highest since 1901, giving heat-sapped Indians little respite even at night. During the monsoon in 2024, floods destroyed villages and brought towns to a standstill. In the dry season several big cities nearly ran out of water, including Bangalore, the thriving technology capital.

India is not yet rich, but is already shelling out a fortune to adapt to climate change: 5.6% of GDP in 2021, up from 3.7% in 2015. Vast though these sums may be, they barely match the scale of the problem.

The keys to faster adaptation are information, incentives and effective government. Better information allows more rational decision-making. For example, in parts of Kerala where heavy rains cause deadly mudslides, researchers have developed a cheap early-warning system using microdata. Each farmer measures the rainfall on his land and feeds the information into a local database far more granular than the national weather service can provide. From this, an NGO works out which villages are so sodden as to be perilously unstable, allowing precise and timely evacuation warnings.

Simple ideas, widely disseminated, can make a difference. In the crowded slums of Mumbai, which can be five degrees hotter than the fancier neighbourhoods nearby, NGOs have found that teaching people to plant shade-giving trees on wasteland can reduce heat stress and give children a cooler place to study. In the long run, better schooling would help, too. 

On incentives, India has great scope for improvement. It is the most water-stressed country in Asia, yet hardly anyone pays a sensible price for the stuff.  The result is reckless waste, as farmers switch too slowly to drip irrigation and cities fail to capture rainfall efficiently.

A hint of how sharper incentives would help can be gleaned from the behaviour of big private companies, which are typically charged much more than other customers for water. An entire ecosystem of firms has popped up to offer them smarter sensors, analytical tools to improve water efficiency, filters that can clean toxic wastewater, and so on. If water were properly priced for everyone, far more Indian ingenuity would be applied to conserving it.

India has lots of energetic green NGOs and innovative local fixes. Many cities have water kiosks to cool gasping passers-by; a nifty scheme in Bangalore channels urban wastewater to replenish rural aquifers, thus helping farmers feed the city. But only the government has the power to set broad incentives, and India’s lacks urgency (as do others). Neither the ruling Bharatiya Janata Party nor its main rivals talk much about the climate, and no one wants to pick a fight with farmers over water. At the state and local level, authority is often confused.

What will really matter in the long run? That’s the question MIT tackles each year as it compiles this annual list. We can’t see the future, but we expect these technologies to affect our world in a big way, for decades to come.

1. Vera C. Rubin Observatory.  A powerful new telescope will come online this year in a remote region of Chile and begin a decade-long survey of the southern sky. Inside is the largest digital camera ever made for astronomy, which will snap photos continuously for years to help astronomers study dark matter, explore the Milky Way, and untangle other cosmic unknowns.
2. Generative AI search.  Generative search promises to make finding what you’re looking for simple and quick. When you type in a query, an AI model summarizes information from many online sources to return a unique answer. On your device, it can comb through documents, photos, and videos, recognizing objects and people to help you find them faster. This may signal the end of traditional search engines and the rise of personal AI assistants.
3. Small language models.  Large language models can do amazing things because they’re crammed with hundreds of billions—even trillions—of parameters (the values that determine their behavior) and were trained on most of the internet’s data. But cheaper and less power-hungry small language models can now stand with the heavyweights across a range of specific tasks. Move over dinosaurs. The future belongs to smaller, nimbler beasts.
4. Cattle burping remedies.  Cow burps are one of the largest sources of agricultural emissions—and one of the trickiest ones to solve. A food supplement that significantly reduces the amount of methane that cattle belch is now available in dozens of countries. Other products, which might prove even more effective, are likely on the way.
5. Robotaxis.  Robotaxis have completed years of beta testing, and they are now finally becoming available to the public. In more than a dozen cities worldwide, riders can summon one whenever they want. Now, the biggest players are ramping up for intense competition as they expand into new cities under regulators’ watchful eyes.
6. Cleaner jet fuel.  New fuels made from used cooking oil, industrial waste, or even gasses in the air could help power planes without fossil fuels. These alternative jet fuels have been in development for years, but now they’re becoming a big business, with factories springing up to produce them and new government mandates requiring their use.
7. Fast-learning robots.  Thanks to today’s generative AI boom, robots are now learning new tasks faster than ever. Today’s automatons are not one-trick ponies—we’re getting closer to general-purpose robots that could be dropped into new environments and tackle a variety of tasks on our behalf, almost instantly.
8. Long-acting HIV prevention meds.  A trial of a new HIV prevention medicine found that 100% of treated women and girls were protected from acquiring HIV infections. And it only needs to be injected once every six months. The drug could help us end AIDS once and for all—if we can ensure access for those who need it.
9. Green steel.  Making steel is one of the largest industrial sources of carbon dioxide, emitting more carbon than all of India (the world’s third largest emitter) and far more than air travel. The first industrial green-steel plant, which uses hydrogen made with renewable power, is being built by Stegra, a $7 billion startup that is scheduled to begin operations next year in northern Sweden.
10. Stem-cell therapies that work.  Stem cells from human embryos will cure disease. That’s the big promise scientists made decades ago. And now it’s finally coming true. Experimental transplants of lab-made cells seem to be helping treat two very different conditions—epilepsy and type 1 diabetes.

Unexpected crises, volatility, and a generally accelerated pace of change have increasingly become the norm. But it doesn’t feel normal. For many, it feels stressful and exhausting.  To successfully move their business strategies forward in this environment, 21st-century leaders need an engaged and innovative workforce that can change course quickly, effectively, and fluidly. Employees must be open to developing new capabilities, adopting new norms, and reconsidering long-held mindsets and behaviors. Leaders must be willing to do the same.

Achieving such resilience and adaptability at individual and organizational levels is easier said than done, however. Human beings have a natural affinity for order, predictability, and control. They will do everything they can to avoid chaos, uncertainty, and volatility. Research shows that when the path forward is unclear, and time and performance pressures are the same (or increasing), teams and individuals often default to what they already know—regardless of whether that approach is appropriate for the given situation.

In some cases, leaders will even advocate that employees and teams “just keep going” in the face of uncertainty—not making an important distinction between times when resilience is needed, times when adaptability is needed, and the interdependence of both.

Leaders and organizations need to be both resilient and adaptable to realize growth, innovation, and organizational health. To be resilient and adaptable, leaders and employees need a mix of skills. Resilience requires—among other things—the ability to view change as a challenge or an opportunity to bounce forward, regulate thoughts and emotions, take lessons from prior experiences, and execute on change. Adaptability requires, among other things, the ability to approach uncertainty with an open, learning mindset and to think flexibly and creatively about problems as they arise. When leaders and employees have both sets of skills, they can better discern when a focus on resilience will be enough, when an adaptive response is required, and how to integrate the two into their strategies, operations, and decision-making.

The authors’ research and experience working with senior leaders in organizations across multiple industries and geographies point to four actions leaders can take to establish and support the presence of both resilience and adaptability in themselves and their workforces, thereby increasing the odds that they will successfully weather even the most extreme periods of volatility. Leaders should do the following:  Set a compass or North Star to help people move in a common direction.  Build a psychologically safe community, not just a workforce.  Ensure that they, themselves, are demonstrating resilience and adaptability and serving as role models for others.  And encourage employees to learn and build these skills in groups.

Artificial intelligence has created a striking paradox. Consider that in a 2023 Gartner survey, 79% of corporate strategists said that the use of AI, automation, and analytics would be critical to their success over the next two years. But only 20% of them reported using AI in their daily activities.

AI’s success hinges not only on its capabilities, which are becoming more advanced every day, but on people’s willingness to harness them. And as the Gartner findings suggest, AI is not getting great traction with users.  Unfortunately, most people are pessimistic about how it will shape the future.  With such cynicism about AI, getting workers to willingly, eagerly, and thoroughly experiment with it is a daunting task.  The following five reasons behind such resistance.

1. People Believe AI Is Too Opaque.  The machine-learning algorithms underlying many AI tools are inscrutable “black boxes” to users. Their impenetrability frustrates people’s basic desire for knowledge and understanding, especially when their outcomes are uncertain or unexpected.  People tend to think that humans’ decision-making is less of a black box than algorithms’, but that belief is unfounded. Explanations of how AI tools work can increase their acceptance, but not all explanations are effective.  The style of explanations plays a crucial role too.  Essentially, the most convincing explanations are those that articulate the reasons behind the decision made as well as why alternatives were dismissed.  The complexity of an explanation relative to the task’s also matters.
2. People Believe AI Is Emotionless.  Though consumers tend to ascribe some human capabilities to AI tools, they don’t think that machines can experience emotions and therefore are skeptical that AI can accomplish subjective tasks that seem to require emotional capabilities.  Organizations can address this hurdle by framing tasks in objective terms—by focusing on their quantifiable and measurable aspects.
3. People Believe AI Is Too Inflexible.  People generally hold the view that mistakes help humans learn and grow, instead of interpreting errors as a sign of unchangeable defects. But they frequently think AI tools are rigid and not adept at adjusting and evolving—a belief that may stem from past experiences of machines as static devices that carry out limited functions.  Studies have indicated, however, that consumer use of AI output rises when people are told that AI has the capacity for adaptive learning.
4. People Believe AI Is Too Autonomous.  AI tools that can perform tasks without active human input often feel threatening to people. From early on in life humans strive to manage their surroundings to achieve their goals. So they’re naturally reluctant to adopt innovations that seem to reduce their control over a situation.  To increase utilization of AI systems, companies can restore consumers’ sense of agency by having people provide input to the systems (thereby creating what are known as “human-in-the-loop systems”).
5. People Would Rather Have Human Interaction.  Cultural context is most likely an important factor in anti-AI tendencies.

Rather than leaping straight into solution mode, tread carefully. Every AI system, use case, pilot, and full-scale deployment will encounter different barriers. It’s your job as a leader to recognize them and help your customers and employees overcome them.

When ChatGPT debuted in late 2022, it took the world by storm. Users were stunned by the app’s ability to give helpful, human-like responses to their input. Overnight, generative AI (GenAI) went mainstream.  Two years later, the era of GenAI agents has arrived. These supportive sidekicks are increasingly capable of performing tasks and making decisions autonomously. Nearly every week, a new agent seems to hit the market, with recent debuts from Microsoft, Salesforce, ServiceNow, and Priceline. Gartner says these agents should see rapid adoption, likely making up a third of all GenAI interactions by 2028.  All of these raise the question: How can we ensure they are secure?

Since of the vulnerabilities can be addressed with a thoughtful, identity-based approach.  Four key considerations for secure AI integration

1. User authentication. Before an agent can display a user’s chat history or customize its replies based on their age, it needs to know who they are. This will require some form of identification, which can be done with secure authentication.
2. Secure APIs. AI agents need to interact with other applications via APIs to take actions on a user’s behalf. As GenAI apps integrate with more products, calling APIs on behalf of end users — and doing so securely — will become critical.
3. Async authentication. To complete complex tasks or waiting for certain conditions to be met — like booking airfare only when it drops below $200 — AI agents need extra time. That means running in the background for minutes, hours, or even days, with humans acting as supervisors who approve or reject actions only when notified by the chatbot, helping prevent excessive agency.
4. Access controls. Most GenAI apps use a process called Retrieval Augmented Generation (RAG) to enhance the output of LLMs with knowledge from external resources, such as company databases or APIs. To avoid sensitive information disclosure, the retrieved content should only be data that the user can access. With proper authorization and access controls, you can prevent users from getting and sharing data they shouldn’t.

To fully take advantage of GenAI’s potential, organizations must securely integrate GenAI into their applications and keep all four of these requirements in mind. However, finding ways to protect against these unique risks we’re seeing shouldn’t get in the way of innovation and deploying these GenAI agents even faster.

For decades, General Electric was the go-to name in appliances, reigning supreme from the 1960s through the 1990s. But under the leadership of CEO Jack Welch, GE’s focus on financial performance often came at the expense of its workforce, earning Welch the nickname “Neutron Jack” for his reputation of cutting jobs while keeping the buildings intact. Market share plummeted, with employment dropping from a peak of 21,000 in 1971 to just 9,500 by 1995.

By 2008, a struggling GE attempted to sell its appliance division but found no buyers. The division became one of the worst-performing units within GE, leading to failed spin-off attempts and ongoing negotiations with labor unions. Finally, in 2016, a shocking turn—Haier, the world’s largest appliance manufacturer headquartered in China, acquired GE Appliances. What followed was nothing short of astonishing. Market share, which had languished around a mere two percent for the previous four years, skyrocketed to 20 percent. Haier had achieved what GE could not: a resounding success in the appliance market.

The source of Haier’s boom lies in an approach known as rendanheyi, a Chinese business philosophy – aligns the purpose of employees to the purpose of the business. The drivers of this approach include: 

Customer engagement.  Literally, rendanheyi translates to “employees and customers become one.” Everything starts with the customer. By reorganizing its operations into micro-enterprises—product-focused teams that encompass sales, marketing, design, manufacturing, and purchasing—Haier ensured that every employee was functionally connected to customer needs. The concept of “zero distance” to the customer became central, enabling front-line employees to access specific customer data and respond quickly to feedback.

Economic compensation.  Haier took a novel approach to compensation by linking it to the performance of these micro-enterprises. Leaders signed contracts based on agreed-upon performance metrics, so that every department—whether marketing, sales, design, or operations—worked toward the same goals, breaking down silos that previously hindered performance.  What’s more, the approach fostered a sense of psychological ownership among employees. They were no longer merely cogs in a machine, but stakeholders in the success of their company. This empowered workforce translated to higher morale and greater productivity, creating a symbiotic cycle of performance and engagement.

Transparency and understanding of the economics.  Each employee team developed strategic value metrics, allowing for real-time assessments of performance against market averages. Weekly forecasting became a collaborative effort, where insights from every level informed strategic decisions. This approach reinforces the notion that great strategy relies on great information, allowing Haier to stay ahead of market trends and adapt swiftly to changing consumer preferences.  By fostering a culture of open communication and shared goals, Haier encouraged employees to take initiative and contribute ideas.

Employee participation.  Haier relies on employee involvement in important improvement initiatives. For example, when the refridgerator micro-enterprise learned that customers struggled to keep fruits and vegetables fresh, they collaborated with a research institute to develop high-humidity storage technology. This solution went from concept to market in just 11 months—an impressive feat compared to the years it would have taken under GE.

If you’re the leader of a team that includes remote and in-office workers, 2025 is the year to focus on new management strategies and skills that will foster stronger communication, camaraderie, and culture. This might mean engaging in more intentional discussions about hybrid work policies, shifting employee measurement standards, or giving teams more autonomy over their in-office and remote schedules. It should also mean discussing boundaries and ensuring that your organization’s managers at all levels have the tools they need to lead hybrid teams successfully.

To help you do just that and start the new year off right, MIT SMR gathered some of the best advice from hybrid work experts who have shared their insights with MIT SMR over the past year. Consider this a concise guide to help you build a stronger hybrid team in 2025.

1. Communicate hybrid work policies transparently.  Humans are perfectly capable of making informed choices about the organizations they want to work at. But to be informed, people need clear and unambiguous information about what the terms of the agreement are.
2. Measure success based on outcomes, not activity or inputs.  Employees are most productive and engaged when they’re given the flexibility and trust to manage their schedules and are judged based on the outcomes they’ve committed to. Companies can also leverage the entrepreneurial spirit and youthful energy of Gen Z by reframing goals for the company as challenges that they can help solve. Clarify the end goal, but leave gray space in how goals will be achieved. Then publicly and authentically reward progress toward those goals.
3. Let business units and teams, not CEOs, determine in-person schedules.  The patterns of what interactions work best in person vary across both organizations and functions. Every business function likely has its own key times when being in the same room is more meaningful.
4. Discuss boundaries around communication outside of work hours.  When you have conversations with employees about boundaries, consider your role as both someone who can be interrupted and be the interrupter. Get curious. Ask your team members about their working hours and when, if at all, they consider it appropriate, necessary, or reasonable for you to contact them outside of that period. Likewise, explicitly set expectations for gaining access to your personal time and attention.
5. Make time for personal connection at the start of virtual meetings.  If you get down to business right at the start of a meeting, you obliterate your opportunity to nurture your most important assets: human relationships. The first five minutes of every virtual meeting — whether one-on-ones, team meetings, sales meetings, or client meetings — must be devoted to personal connection. And five minutes is only a guide.
6. Seek support for leaders of hybrid teams.  “Senior leaders in the organization need to find a way to provide some support to their managers. They’re the ones that are burned out. If you’re not providing your managers [with] any kind of training or any kind of guidance in how to lead distributed teams, you end up with people sitting at polar extremes.
7. Understand the realities of return-to-office mandates.

Leadership today isn’t what it used to be. Gone are the days when a title or a corner office automatically commanded respect. Today, business leaders need more than authority, they need relevance. But being a relevant leader is not just about adopting new behaviors; it’s about unlearning bad habits. Especially those that do more harm than good.  Relevant leaders share something in common. It’s not their technical skills, their titles nor their accolades. It’s about embodying core traits such as responsibility, presence, emotional intelligence, courage, empathy, and wisdom.  Here are six behaviors you must unlearn that once felt relevant and now may be holding you back.

1. Stop Controlling Everything.  Unlearn controlling everything and instead focus on earned responsibility. Reflect on why you earned your leadership role in the first place and ensure your actions reflect that earned trust. Letting go and delegating more doesn’t mean you’ve lost control. It signifies confidence in the people around you and your own self-trust. Allowing your team autonomy shows that you trust their expertise, which leads to better results and a more motivated workforce.
2. Transactional Leadership.  Transactional leadership is career suicide because you make it about yourself. Being consultative makes it about others.  Being present means knowing what your team members expect from you—not just in terms of tasks but also in emotional support. A truly present leader doesn’t just see numbers; they see individuals. Understanding people’s motivations and struggles fosters open communication and trust.
3. Always Needing to Lead.  Leadership success is no longer measured by money or power, it is about your ability to influence the advancement of others. The smartest or loudest person in the room does not mean they are the most insightful. The best leaders are also the best followers.  In 2025 leadership requires emotional intelligence to recognize when to step back and empower someone else to lead. This is about humility and adaptability; knowing when to listen and learn from those you manage creates an environment of mutual respect.
4. Playing It Safe.  Fear of backlash can tempt leaders to avoid tough decisions. Yet, the courage to act with integrity—even when it’s risky or unpopular—is where true respect is earned. Leaders have become wired to play not to lose, rather than play to win. Playing it safe becomes a selfish act rather than one that has the best interest of others in mind.
5. Separating Work and Emotion.  For years, we were taught that leaders can’t be emotional, or they would not be respected. They would be perceived as being too soft and couldn’t make difficult decisions. But in 2025, leading without emotion means leading without connection. Successful leaders today recognize that empathy—the ability to understand and share the feelings of others—is a superpower. 
6. Holding On to Bad Habits.  Perhaps the most critical behavior to unlearn bad habits is the belief that you cannot or do not need to change. Leadership wisdom involves recognizing that clinging to outdated habits limits your growth. It’s about constantly auditing yourself, understanding your blind spots, and evolving.

Across the world, there is an alarming long-term trend: Companies are struggling to survive.  An Eearnest & Young report in 2023 shows that, in fact, the average lifespan of an American S&P 500 company used to be 67 — now it’s only 15 years. The report suggests that even some of the most well-prepared companies are not guaranteed to last, and that is worrying. These figures made us wonder how one can build a business that lasts well beyond a century.

As part of a centennial company that was passed to the author as the fourth-generation heir in 1993, the Kowloon Motor Bus Company (KMB), founded by his grandfather in 1921, will officially be 104 years old in 2025. In the current climate and having survived the Japanese occupation during World War 2, the global financial crisis and more recently, the 2020 pandemic that shook the world, I am proud that we have reached such a milestone. From his personal experience and further research, he has identified the key qualities to help businesses last a century and beyond.

1. Adapt or die.  The famous words of Charles Darwin, written in The Origin of Species in 1859, ring true even here in the business world. Staying relevant within an ever-changing world requires companies to adapt to customers’ needs and market requirements through thorough analysis, teamwork and rational thinking.  Over more than a century now, KMB has consistently used this adaptation rule to evolve itself with the times.
2. Balance innovation with stability.  In business, innovation usually means risk-taking and sometimes requires one to venture into the unknown. Without innovation, you lose your competitive edge in the market. But too much innovation, and you risk spreading yourself too thin and potentially losing to your competitors. So, how can innovation be part of your 100-year plan? The trick is to balance innovative ideas with the smooth running of the business at hand.  A thorough, data-based risk analysis should be deployed as a core strategy where innovative measures are considered. The culture of the company should be innovation-led but in a steady manner so that good ideas are in constant supply and in use wherever possible. A good leadership strategy within the company should also include a collaborative approach when approaching innovative ideas. You should work internally with your team, as well as use external resources and customer insights to ensure you are continuously, consistently improving. And with intent — never innovate for innovation’s sake.
3. Be socially responsible.  Business is all about people, be that your own team members, your customers or the wider community the company engages with. Having clear social goals within a company makes up its raison d’être, clearly signaling that the organization is here to stay long-term and to serve the people around it, not just its shareholders.  There is logic to embracing social responsibility within a company, too, so that customers are happy to pay a premium for the goods and services of a company that’s perceived to be doing good to society. This point aside, customers are also seeking companies that are accredited for being socially responsible.