jerryking + business   96

Black Folk's Guide to Making Big Money in America
A primer on personal finance, business and real estate. It is truly comprehensive and a must read for anyone serious about improving their financial situation.
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First, Trower-Subira emphasizes the central importance of home ownership as a source of equity capital. He decried the usage of earned income and accumulated home equity to fuel (conspicuous) consumption binges. Trower-Subira got it right when he said that real estate should be the base asset for African Americans from which to build wealth. As long as you borrow against your home to acquire other, income producing assets, you are doing yourself a favor by pursuing homeownership.

Second, he stressed the importance of financial assets in building wealth. Trower-Subira puts forth a brilliant explanation of the types of assets that produce income and that African Americans in particular should endeavor to pursue (real estate is just one of several).

Third, Trower-Subira emphasizes the importance of continuing education combined with an asset-based approach to wealth building. Trower-Subira wrote in the context of his day, but now the game has shifted somewhat. That is not to say that the problems of his day are no more; indeed, many of the problems of his day still relentlessly follow the African American community, and in too many instances, the problem have actually gotten worse. Although we are presented with new opportunities, we also face new challenges- on top of the same old challenges that we have yet to vanquish.
'80s  advice  African-Americans  Amazon  books  business  home_ownership  mindsets  personal_finance  primers  real_estate  self-help  wealth_creation 
april 2019 by jerryking
How Nature Scales Up
June 23, 2017 | WSJ | By Charles C. Mann

Review of SCALE By Geoffrey West; Penguin Press, 479 pages, $30
books  book_reviews  physicists  scaling  growth  innovation  sustainability  cities  economics  business  linearity  efficiencies  economies_of_scale  sublinearity  massive_data_sets  natural_selection 
june 2017 by jerryking
Review: How Laws of Physics Govern Growth in Business and in Cities
MAY 26, 2017 | The New York Times | By JONATHAN A. KNEE

Book review of “Scale: The Universal Laws of Growth, Innovation, Sustainability and the Pace of Life in Organisms, Cities, Economies, and Companies” (Penguin), by Geoffrey West, a theoretical physicist.....Mr. West’s core argument is that the basic mathematical laws of physics governing growth in the physical world apply equally to biological, political and corporate organisms.....The central observation of “Scale” is that a wide variety of complex systems respond similarly to increases in size. Mr. West demonstrates that these similarities reflect the structural nature of the networks that undergird these systems. The book identifies three core common characteristics of the hierarchal networks that deliver energy to these organisms — whether the diverse circulatory systems that power all forms of animal life or the water and electrical networks that power cities. First, the networks are “space filling” — that is, they service the entire organism. Second, the terminal units are largely identical, whether they are the capillaries in our bodies or the faucets and electrical outlets in our homes. Third, a kind of natural selection process operates within these networks so that they are optimized......These shared network qualities explain why when an organism doubles in size, an astonishing range of characteristics, from food consumption to general metabolic rate, grow something less than twice as fast — they scale “sublinearly.” What’s more, “Scale” shows why the precise mathematical factor by which these efficiencies manifest themselves almost always relate to “the magic No. 4.”

Mr. West also provides an elegant explanation of why living organisms have a natural limit to growth and life span following a predictable curve, as an increasing proportion of energy consumed is required for maintenance and less is available to fuel further expansion.

....Despite his reliance on the analysis of huge troves of data to develop and support his theories, in the concluding chapters, Mr. West makes a compelling argument against the “arrogance and narcissism” reflected in the growing fetishization of “big data” in itself. “Data for data’s sake,” he argues, “or the mindless gathering of big data, without any conceptual framework for organizing and understanding it, may actually be bad or even dangerous.”
books  book_reviews  physicists  scaling  growth  Jonathan_Knee  innovation  sustainability  cities  economics  business  linearity  efficiencies  economies_of_scale  sublinearity  massive_data_sets  natural_selection  physical_world  selection_processes 
may 2017 by jerryking
Where Have All the Black-Owned Businesses Gone? - The Atlantic
BRIAN S. FELDMAN MAY 1, 2017

The last 30 years also have brought the wholesale collapse of black-owned independent businesses and financial institutions that once anchored black communities across the country. In 1985, 60 black-owned banks were providing financial services to their communities; today, just 23 remain. In 11 states where black-owned banks had headquarters in 1994, not a single one is still in business. Of the 50 black-owned insurance companies that operated during the 1980s, today just two remain.

Over the same period, tens of thousands of black-owned retail establishments and local service companies also have disappeared, having gone out of business or been acquired by larger companies. Reflecting these developments, working-age black Americans have become far less likely to be their own boss than in the 1990s. The per-capita number of black employers, for example, declined by some 12 percent just between 1997 and 2014.......the decline in entrepreneurship and business ownership among black Americans also is cause for concern. ...market concentration has played a role in suppressing opportunity and in displacing local economies. ...........The role of market concentration in inhibiting black-owned businesses is also troubling because of the critical role that such enterprises have played in organizing and financing the struggle for civil rights in America......The decline of black-owned independent businesses traces back to many causes, but a major one that has been little noted was the decline in the enforcement of anti-monopoly and fair-trade laws beginning in the late 1970s......Bob Dickerson, the CEO of the Birmingham Business Resource Center in Alabama, says, “Had our institutions and businesses been maintained, had that money been plowed back into our communities, it could have meant a world of difference.”

The role of market concentration in driving down the number of black-owned independent businesses becomes all the more concerning when one considers some mostly forgotten history. In principles, people, and tactics, the fight for black civil rights, going back to before the Civil War, was often deeply intertwined and aligned with America’s anti-monopoly traditions......The story of how the struggle for civil rights intertwined and intersected historically with the struggle against monopoly provides a lesson for the future. It suggests a need to recognize how political independence connects with economic independence in the struggle for social justice. Without freedom from domination in one sphere, there is no freedom in the other.
black-owned  African-Americans  business  segregation  New_Deal  Jim_Crow  market_concentration  fair-trade  anti-monopoly  enforcement  market_power  corporate_concentration  antitrust  anticompetitive_behaviour  collapse-anxiety 
may 2017 by jerryking
Trump offering a timely cautionary tale on trying to run government as a business
Mar. 31, 2017 | The Globe and Mail | ADAM RADWANSKI.

.The enduring appeal of this hoariest of political clichés – some variation of making government run more like a business – is such that it surely seemed to Mr. Trump’s admirers like confirmation of the real-world expertise he seduced them with on the campaign trail....Mr. Trump is already providing cautionary tales. A management style that encourages factions in his employ to compete against each other for his attention is a proven recipe for chaos in government. His blustery approach to negotiations has yet to show many signs of working with foreign leaders. Most consequentially, so far, a lack of attention to detail, which could be overcome when delegating to underlings at his companies, proved devastating in the first legislative test of his administration – the President unable to sell fellow Republicans on his health-care plan, in part because he did not know details about the bill.......The more time one spends in or around governments, the more obvious it is why attempts to bring a Wall Street or Bay Street mentality to them can end badly.

Ethical scrutiny, for all that entrepreneurs-turned-politicians paint capital cities as swamps, is greater than in the corporate world. And because governments get more attention for failures than quiet successes, tolerance for risk is often lower.

Healthy tension with career civil servants can turn unhealthy if politicians and their staffs do not make honest efforts to understand and engage bureaucrats. And the overarching reality is that, in government, goals and outcomes are more complex, abstract and intuitive than when they can be measured by profit margins.

Business titans can triumph in politics – a Michael Bloomberg in New York, a Danny Williams in Newfoundland. And public-sector culture is often stagnant, and benefits from outside eyes. But the disruptors’ success usually involves a willingness to admit (privately) what they do not know about government, and trust people who understand it better.
Donald_Trump  delusions  business_interests  national_interests  humility  clichés  political_clichés  bureaucrats  government  business  public_sector  pro-business  cautionary_tales 
april 2017 by jerryking
The Unexotic Underclass | The MIT Entrepreneurship Review
By C.Z. Nnaemeka in Analysis, Featured, Start-up Advice | 132 comments
May 19, 2013
poverty  business  entrepreneurship  start_ups  underclass 
january 2017 by jerryking
MBA Mondays: Turning Your Team
August 12, 2013 | – AVC | Fred Wilson.

A serial entrepreneur I know tells me "you will turn your team three times on the way from startup to a business of scale." What he means is that the initial team will depart, replaced by another team, which in turn will be replaced by yet another team....Companies scale and the team needs to scale with it. That often means turning the team.

The "turning your team" thing probably makes sense to most people. But executing it is where things get tricky and hard. How are you going to push out the person who built the first product almost all by themselves? How are you going to push out the person who brought in the first customer? How are you going to tell the person who managed your first user community so deftly that their services are no longer needed by your company?

And when do you need to do this and in what order? It's not like you tell your entire senior team to leave on the same day. So the execution of all of this is hard and getting the timing right is harder.
advice  business  scaling  teams  start_ups  Fred_Wilson  turning_your_team  turnarounds  execution  judgment  serial_entrepreneur  think_threes 
october 2016 by jerryking
In business and government, think differently - The Globe and Mail
MICHAEL SABIA
Contributed to The Globe and Mail
Published Saturday, May. 16 2015

here’s the paradox. At a time when creativity is relentlessly driving change in so much of our world, many would limit governments to managing their way through, rather than working with others to solve problems.

It started in the 1980s and ’90s, when we decided governments needed to become “more like businesses,” adopting the metrics – and vocabulary – of corporations. Citizens became “clients.” Compliance replaced creativity.

The job of government was defined in terms of its “efficiency,” and the emphasis was placed on the minimal “must do” instead of the aspirational “can be.”

Of course, governments have to demonstrate good stewardship of public resources. But if all they do is count change, it limits their ability to effect change. The fact is when big problems arise – whether it’s a financial crisis like 2008 or a tragedy like Lac-Mégantic – people’s first instinct is to look to government for a solution.

Yet opinion researchers tell us that people are increasingly disappointed with our collective response to the issues that matter most: income inequality, health care for the elderly, climate change and so on....It’s about different government. This is about government moving away from a manager’s obsession with doing things better to a leader’s focus on doing better things. Think of fostering innovation, being open to new ideas, encouraging experimentation, rewarding risk-taking. And, frankly, accepting failure as a condition precedent to success.
Michael_Sabia  CDPQ  thinking  CEOs  innovation  leadership  experimentation  risk-taking  failure  trial_&_error  government  public_sector  open_source  disappointment  business  stewardship  compliance  replaced  creativity  efficiencies  effectiveness  think_differently 
may 2015 by jerryking
Powerful Thoughts From Paul Graham — Ross Hudgens
21. Empathy is probably the single most important difference between a good hacker and a great one. Some hackers are quite smart, but practically solipsists when it comes to empathy. It’s hard for such people to design great software, because they can’t see things from the user’s point of view.

25. In a field like physics, if we disagree with past generations it’s because we’re right and they’re wrong. But this becomes rapidly less true as you move away from the certainty of the hard sciences. By the time you get to social questions, many changes are just fashion.

34. Whatever the reason, there seems a clear correlation between intelligence and willingness to consider shocking ideas. This isn’t just because smart people actively work to find holes in conventional thinking. Conventions also have less hold over them to start with. You can see that in the way they dress.

43. E.B. White was amused to learn from a farmer friend that many electrified fences don’t have any current running through them. The cows apparently learn to stay away from them, and after that you don’t need the current. | If you’re a hacker who has thought of one day starting a startup, there are probably two things keeping you from doing it. One is that you don’t know anything about business. The other is that you’re afraid of competition. Neither of these fences have any current in them.

50. But since for most of the world’s history the main route to wealth was to steal it, we tend to be suspicious of rich people.

59. “A lot of the (people applying to be graduate students at MIT) seem smart,” he said. “What I can’t tell is whether they have any kind of taste.” Taste. You don’t hear that word much now. And yet we still need the underlying concept, whatever we call it. What my friend meant was that he wanted students who were not just good technicians, but who could use their technical knowledge to design beautiful things.

64. Good design resembles nature. It’s not so much that resembling nature is intrinsically good as that nature has had a long time to work on the problem. So it’s a good sign when your answer resembles nature’s.

70. You’re most likely to get good design if the intended users include the designer himself. When you design something for a group that doesn’t include you, it tends to be for people you consider less sophisticated than you, not more sophisticated. And looking down on the user, however benevolently, always seems to corrupt the designer. [Good design therefore requires personal risk? having skin in the game?]

76. “Of all tyrannies, a tyranny exercised for the good of its victims may be the most oppressive.” – C.S. Lewis
biomimicry  business  inspiration  productivity  quotes  start_ups  Paul_Graham  Y_Combinator  via:hotchkiss  empathy  design  UX  hackers  personal_risk  PhDs  aesthetics  dangerous_ideas  smart_people  the_single_most_important 
november 2014 by jerryking
For Those Who Want to Lead, Read - John Coleman -
August 15, 2012 | Harvard Business Review |by John Coleman.
reading  leadership  business 
august 2012 by jerryking
Thinking Small
Aug 1, 2004 | Inc.com | John Grossmann.

Alan G. Robinson and Dean M. Schroeder "Ideas Are Free: How the Idea Revolution Is Liberating People and Transforming Organizations".
Her six-show-room chain thrives on new ideas. Fishbein collects them in three-ring binders. Since 1995, she's filled four such binders -- at 10 to 20 ideas per page and 200-plus pages per binder, that's more than 10,000 ideas. And the best ones, she says, often turn out to be those that at first appeared simple, even mundane. "The point," she says, "is not the big hit but incremental improvements all the time."

What about the killer app, the bold, outside-the-box brainstorm that is supposed to transform organizations? If you really care about making ideas work for you, forget such ambitious notions, say Alan G. Robinson and Dean M. Schroeder in their new book Ideas Are Free: How the Idea Revolution Is Liberating People and Transforming Organizations. Rather than big, competition-leapfrogging advances, the authors argue that one of the keys to business success is the constant implementation of small ideas -- just like the steady stream of employee suggestions Fishbein collects in her binders. Why singles instead of home runs? The competition inevitably copies or counters your home runs, rendering those gains ephemeral. But after studying idea-generation tactics at 150 companies in 17 countries, Robinson and Schroeder concluded that small ideas, especially those particular to processes or systems, improve companies in almost Darwinian fashion with ongoing small adaptations that are often impossible to copy.
business  innovation  idea_generation  execution  small_business  slight_edge  ideas  process_improvements  books  minnovation  breakthroughs  incrementalism  marginal_improvements  adaptability  leapfrogging  Darwinian 
july 2012 by jerryking
Can You Say What Your Strategy Is?
April 2008 | HBR | by David J. Collis and Michael G. Rukstad
business  strategy  HBR  Wal-Mart  Edward_Jones 
june 2012 by jerryking
Get Creative!
AUGUST 1, 2005| Business Week | by Bruce Nussbaum
business  creativity  design  innovation  howto 
april 2012 by jerryking
Ray Dalio: Man and machine
Mar 10th 2012 | The Economist |
The economic ideas of the world’s most successful hedge-fund boss.

Mr Dalio says his ideas are entirely the product of his own reflections on his life as a trader and his study of economic history. He has read little academic economics (though his work has echoes of Hyman Minsky, an American economist, and of best-selling recent work on downturns by Carmen Reinhart and Kenneth Rogoff) but has conducted in-depth analysis of past periods of economic upheaval, such as the Depression in America, post-war Britain and the hyperinflation of the Weimar Republic. He has even simulated being an investor in markets in those periods by reading daily papers from these eras, receiving data and “trading” as if in real time.
Bridgewater  Ray_Dalio  hedge_funds  finance  economics  debt  business 
march 2012 by jerryking
Al Gore and David Blood: A Manifesto for Sustainable Capitalism - WSJ.com
DECEMBER 14, 2011 | WSJ | By AL GORE AND DAVID BLOOD.

A Manifesto for Sustainable Capitalism
How businesses can embrace environmental, social and governance metrics.
capitalism  business  economy  future 
february 2012 by jerryking
Exporting I.P.
May 14, 2007 | The New Yorker | James Surowiecki.
business  copyright  economics  trade  intellectual_property  free-trade 
october 2011 by jerryking
A Paler Shade of White
October 22, 2007 | The New Yorker| by Sasha Frere-Jones
indie  music  blues  soul  music_industry  race  culture  racism  business  hip_hop 
august 2011 by jerryking
Finding a Post-Crash Economic Model - WSJ.com
NOVEMBER 30, 2010

Economists' Grail: A Post-Crash Model
By MARK WHITEHOUSE
business  economics  economy  models  psychology 
july 2011 by jerryking
Internet businesses: Another digital gold rush
Internet companies are booming again. Does that mean it is time to buy or to sell?
bubbles  Web_2.0  business  finance 
may 2011 by jerryking
The Gig Economy
January 12, 2009 | The Daily Beast | by Tina Brown. No one I
know has a job anymore. They've got Gigs.

Gigs: a bunch of free-floating projects, consultancies, and part-time
bits and pieces they try and stitch together to make what they refer to
wryly as “the Nut”—the sum that allows them to hang on to the apartment,
the health-care policy, the baby sitter, and the school fees.
freelancing  economy  jobs  trends  future  business  Tina_Brown 
october 2010 by jerryking
In New York, a Business Course Geared to Artists
June 18, 2010 | NYTimes.com | By KATE TAYLOR. 2
city-financed courses devised to help artists help themselves. The group
attending the 5-week program includes painters, sculptors,
photographers, filmmakers, creative writers, actors, directors, dancers,
singers, and musicians...Group sessions cover subjects like
intellectual property and Internet marketing. Plus, each artist gets a
20-minute meeting with a New York Foundation for the Arts staff member
or an outside adviser to review his or her business plan. At the end of
the course, the students can apply for subsidized studio or rehearsal
space at the Brooklyn Army Terminal, courtesy of Chashama, an
organization that transforms vacant properties into art spaces.
artists  artisan_hobbies_&_crafts  creative_class  New_York_City  business 
june 2010 by jerryking
why most artist’s blogs fail
June 14, 2010 | gapingvoid | Hugh MacLeod.But the reality is,
most people are not reading your blog because they have an inherent love
for purple dogs and green sofas. They’re reading your blog because THE
PERSON YOU ARE inspires them. They’re not reading your blog because
they’re thinking of buying your paintings, they’re reading your blog
because the way you approach your work inspires them. It sets an example
for them. It stands for something that resonates with them. IT LEADS
THEM TO SOMEWHERE THAT THEY ALSO WANT TO GO.

And if your blog can do that, suddenly your readers are associating
purple dogs and green sofas with something that ACTUALLY matters to
them. And then, and only then, do they pull their credit cards out.
Ker-chiing.
failure  blogging  art  blog  humour  marketing  business  inspiration  social_media  authenticity 
june 2010 by jerryking
The Indispensible Ideas of 2009 - Harvard Business Review
2009 was a year of unprecedented change. The global economic
crisis caused us to reevaluate every aspect of business, from strategy
to innovation to managing resources. Throughout all of this, Harvard
Business Press remained a trusted source for the best ideas and advice
on weathering tough economic times.
booklists  business  HBR  indispensable  books 
february 2010 by jerryking
One Page Proposal
Understand the value chain of the industry or sector.

Title
Sub title
Objectives/Secondary Objectives
Rationale
Financial Conditions
Status
Action Sought
business  marketing  proposals  web_video  memoranda  templates  pitches 
january 2010 by jerryking
UNEASY ENGAGEMENT: China’s Export of Labor Faces Scorn
China, famous for its export of cheap goods, is increasingly
known for shipping out cheap labor. These global migrants often work in
factories or on Chinese-run construction and engineering projects,
though the range of jobs is astonishing: from planting flowers in the
Netherlands to doing secretarial tasks in Singapore to herding cows in
Mongolia — even delivering newspapers in the Middle East.

But a backlash against them has grown. Across Asia and Africa, episodes
of protest and violence against Chinese workers have flared. Vietnam and
India are among the nations that have moved to impose new labor rules
for foreign companies and restrict the number of Chinese workers allowed
to enter, straining relations with Beijing.
globalization  China  labour  business  Vietnam  Africa  migrants  backlash  Chinese 
december 2009 by jerryking
Gain: AIGA Journal of Business and Design — AIGA | the professional association for design
Gain: AIGA Journal of Business and Design is dedicated to
stimulating thinking at the intersection of design and business. Through
rigorous case studies and thoughtful interviews, the journal
demonstrates how the process of design can be used to solve business
problems, foster innovation, build meaningful customer relationships and
differentiate products from competitors.
journal  design  resources  blog  magazines  business  aiga 
december 2009 by jerryking
Find Your Business Life Cycle: The Seven Stages of Business Life
By Darrell Zahorsky, About.com. 1. Seed Stage; 2. Start-Up
Stage; 3. Growth Stage; 4. Established Stage; 5. Expansion Stage: 6.
Decline Stage; 7. Exit Stage:
life_cycle  business  growth  decline  stages_of_life 
october 2009 by jerryking
How Long Does It Take To Build A Technology Empire? - Venture Capital Dispatch - WSJ
August 25, 2009 | Wall Street Journal | By Scott Austin. How Long Does It Take To Build A Technology Empire?
business  technology  entrepreneurship  VC  growth  finance  research  start_ups 
september 2009 by jerryking
The Three Sexy Skills of Data Geeks : Dataspora Blog
Hal Varian, Google’s Chief Economist, was interviewed a few
months ago, and said the following in the McKinsey Quarterly:
“The sexy job in the next ten years will be statisticians… The ability
to take data—to be able to understand it, to process it, to extract
value from it, to visualize it, to communicate it—that’s going to be a
hugely important skill.” Put All Three Skills Together: Sexy. Thus with
the Age of Data upon us, those who can model, munge (data wrangling, sometimes referred to as data munging, is the process of transforming and mapping data from one "raw" data form into another format with the intent of making it more appropriate and valuable for a variety of downstream purposes such as analytics) , and visually
communicate data — call us statisticians or data geeks — are a hot
commodity.
data_wrangling  statistics  visualization  data  analytics  career  business  Information_Rules  Hal_Varian  data_scientists 
july 2009 by jerryking
Garage :: Perfecting Your Pitch
2006 | Garage Ventures | Guy Kawasaki. The purpose of your
pitch is to sell, not to teach. Your job is to excite, not to educate.

Pitching is about understanding what your customer (the investor) is
most interested in, and developing a dialog that enables you to connect
with the head, the heart, and the gut of the investor.
Communicating_&_Connecting  funding  entrepreneur  business  tips  VC  entrepreneurship  pitches  investors 
may 2009 by jerryking
Why 'Social Enterprise' Rarely Works - WSJ.com
JUNE 1, 2007 | Wall Street Journal | by BEN CASSELMAN
business  nonprofit  TBL 
may 2009 by jerryking
The 100 Best Business Books of All Time: More on The 100 Best Archives
May. 14, 2009 | The Globe & Mail | by Harvey Schachter.
Reviews "The 100 Best Business Books Of All Time", by Jack Covert and
Todd Sattersten, Portfolio, 33 pages, $28.50. Selection criteria start
with the quality of the idea. Is there something new? Does the idea
support or contradict what we intrinsically know about business? The
second factor was the applicability of the idea for someone in business
today.
booklists  business  book_reviews  Harvey_Schachter  best_of  books  Joseph_Pine  James_Gilmore  experience_economy 
may 2009 by jerryking
Free Agent Jungle
solo but not alone. community and networking events for free agents, freelancers, consultants
freelancing  networking  business  collaboration  solo 
may 2009 by jerryking
Best Life Magazine Not a Businessman--a Business, Man
By: Anthony DeCurtis; Photographs: Nino Munoz; Clothing by: Tom Ford
Mar 9, 2009 - 4:29:57 AM
business  inspiration  hip_hop 
may 2009 by jerryking
How to be wise before the event
March 9 2009 | Financial Times | By Stefan Stern.

Restraint is back in fashion in these recessionary times. People have lost their appetite for risk.

But hang on a minute. No risk will mean no reward. You need new markets and customers to grow, and that means taking steps into the unknown. I doubt that anyone will be suggesting, in this newspaper’s new series of articles on the future of capitalism, that risk-taking should be abolished.

Bad risk-management helped get us into the current mess. It is vital that we learn the right lessons about risk from the crisis. What are they?

The new edition of Harvard Business Review contains a lucid piece of analysis from René Stulz, professor of banking and monetary economics at Ohio State University’s Fisher College of Business. While his principal focus is on the financial sector, the diagnosis will be helpful to managers in any business or organisation.

Prof Stulz describes six ways in which risk has been mismanaged. First, there has been too much reliance on historical data among today’s decision-makers. Extrapolating from the past can provide, at best, only partial guidance for the future. Financial innovation has created a new world. No wonder some managers were unprepared for the calamitous fall in asset prices and demand. This collapse was unimaginable to anyone basing their thinking on post-war performance alone.

Second, narrow daily measures – in banking these are known as “value at risk” measures – have underestimated the risks that are being run. The assumption behind a daily measure of risk is that action can be taken quickly (through an asset sale) to remove that risk. But, as the current crisis has shown, such rapid moves become impossible when markets seize up.

Third, knowable risks have been overlooked. Managers who work in silos may appreciate the risks that they personally are exposed to. But they may not see how risks being run elsewhere in the business could affect them too. Someone – a chief risk officer? – needs to track them all.

Fourth, concealed risks have been overlooked. Incentives have proved to be particularly dangerous in this regard. Some traders and lenders may have enjoyed taking risky decisions that in the short term appeared to be delivering well for them and their organisations. But they had no incentive to report any downside risk. And unreported risks tend to expand.

Fifth, there has been a failure to communicate effectively. It is dangerous, Prof Stulz says, when risk managers are so expert in their field that they lose the ability to explain in simple terms what they are doing. The board may develop a false sense of security by failing to appreciate the complexity of the risks being managed.

Last, risks have not been managed in real time. Organisations have to be able to monitor fast-changing markets and where necessary respond to them without delay.

Prof Stulz offers a useful technical analysis. But a true understanding of risk also requires a maturity of outlook, an ability to see the big picture, and deep experience. This last is a rare commodity: impossible to fake and acquired only over time.

In a new McKinsey publication called What Matters, the 90-year-old investment manager and author Peter Bernstein offers some sober insights. “What is risk management all about anyway?” he writes. “We use the words as though everybody understands what we are talking about. But life is not that simple. Risk means more things can happen than will happen – which is a fancy way of saying we do not know what is going to happen.”

Mr Bernstein’s central point – not revolutionary, but unarguable – is that downside risks must be assessed rigorously. Someone old enough to remember the Wall Street crash is probably worth listening to right now.[JCK: elder wisdom]

“Nothing is 100 per cent sure,” Mr Bernstein says. “While a 95 per cent probability is statistically significant, that still leaves us in the dark about the remaining 5 per cent; we may decide to accept that uncertainty and bet on the 95 per cent sure thing, but there is still a possibility of being wrong.

“The crucial question to ask is, ‘What would be the consequence if that 5 per cent chance comes to pass?’ ”

Welcome to the less exciting but more soundly based era of calculated risks. For the foreseeable future, business leaders will be trying to be wise before rather than after the event.
beforemath  business  communicating_risks  downside_risks  elder_wisdom  false_sense_of_security  fast-changing  hidden  management  McKinsey  overreliance  Peter_Bernstein  recessions  real-time  risks  risk-assessment  risk-management  Stefan_Stern  the_big_picture  VaR  what_really_matters  wisdom 
may 2009 by jerryking
10 Things to Be Clear About Before You Start a Company - ReadWriteStart
May 6, 2009 9:45 PM | ReadWriteStart | Bernard Lunn

For the introduction and table of contents...

1. Is this your first venture?
2. Are you really an entrepreneur?
3. Does your venture involve something you understand really well?
4. Can your mother understand the value proposition?
5. Can you see the right wave?
6. What does your startup want to be when it grows up?
7. Starting a company is hard and uncertain.
8. Get a partner or fly solo?
9. Would you refuse a well-paying job to do this?
10. Can you raise appropriate financing?
business  entrepreneurship  tips  company  entrepreneur  career  preparation  start_ups 
may 2009 by jerryking
Calculated Leaps of Faith - Associations Now Magazine - Publications and Resources - ASAE & The Center for Association Leadership
October 2006 | ASSOCIATIONS NOW | By: Angela Hickman Brady

An organization's capacity for risk taking may determine whether it
succeeds or fails. Part game of chance, part discipline, the willingness
to shake off the status quo can change your association for the better.
innovation  change  strategy  business  associations  CARP  leaps_of_faith  planning  organizational_capacity  risk-taking 
may 2009 by jerryking
I Want You to Apologize
Tuesday April 7, 2009 | HarvardBusiness.org | - Peter Bregman -
business  empathy  psychology  apologies  atonement 
april 2009 by jerryking
Cultivating Local Needs For Business Profit - Search Engine Guide Blog
March 27, 2009 blog post by Miriam Ellis

observation is the key skill you need to succeed with a local-focused
business, and with the promotional tools the web provides, there has
never been a better time to begin cultivating local needs for the
benefit of your community and your business.
local  business  observations  opportunities 
april 2009 by jerryking
How to Build a Next-Gen Business Now -
September 24, 2008| HarvardBusiness.org |Umair Haque
business  strategy  innovation  future  umairhaque 
march 2009 by jerryking
Seth's Blog: Pivots for change
Seth itemizes the pivot points in business life that are available to all of us.
business  strategy  marketing  creativity  change  Seth_Godin  innovation  pivots 
march 2009 by jerryking
Farming in the Sky | Popular Science
09.04.2008 | Popular Science | by Cliff Kuang. Blog post which looks at pursuing farming and agriculture in skyscrapers.
business  food  environment  agriculture  farming  Cliff_Kuang  urban  skyscrapers 
february 2009 by jerryking
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