Author Archives: Elizabeth Edersheim

The BP Culture’s Role in the Gulf Oil Crisis

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I’ve been watching BP carefully long before anyone heard of a “top kill” or “Lower Marine Riser Package Cap.”

I lived in Cleveland in 1979, when BP was acquiring Standard Oil of Ohio and worried for my friends who worked there. But I got reassurance at the time from Marvin Bower, a founder of McKinsey & Co. He told me BP wanted Standard Oil’s expertise in Alaska, along with their North American distribution system. Marvin emphasized that BP had a very human, non-hierarchical culture, respect for Standard Oil’s people and careful style of doing business. “The executives at British Petroleum,” he said, “are people of integrity.”

Now, 31 years later, in 2010, that culture seems to be lost. Culture is an organization’s operating system, the values that everyone lives by. The operating system helps humans communicate and make decisions. The operating system will not allow communication or decisions that could harm the values or purpose of an organization. It is like a translator.

In the case of BP, the culture didn’t work effectively and now its failure is on full display. It is possible that the error messages were so frequent that everybody chose to ignore them. A good culture would, by default, close all the possible doors to viruses or malware. A good culture or operating system is always going to respect priorities that keep the system working with integrity. Has the culture given way to a voracious need for corporate profits or is the problem simply arrogance? Did management become so cocky that they forgot that drilling in 5000 feet of water means pushing the edge of technology?

BP’s culture allowed extreme shortsightedness in pursuit of profit at the cost of safety or environmental stewardship. As the drill was planned, BP chose a cheaper casing seal, which reportedly contributed to the blow-up. Also, the company intentionally cut corners on procedural and safety. For example, last June, exceptions to BP safety standards were taken to senior executives who approved them. And according to a rig survivor interviewed on “60 Minutes,” BP ordered partners to cut corners because their absurdly ambitious drill schedule was off by several weeks. Hours before the explosion, multiple warnings arose; yet all were ignored. So much for the values of Standard Oil and BP. Incredibly, these penny-pinching moves were made as BP racked up record-breaking profits!

Even worse, the broken values appear to appear to go on, thanks to the company and the government. Consider BP’s attempt to disperse oil with Corexit, the dispersant already banned for 10 years in Europe. It’s highly toxic, but it does get the oil to sink below the surface, where it can’t be seen, thus decreasing the visual horrors as the goo comes ashore. It pushes the oil below the surface into the ocean column where it kills underwater sea life, and breaks it up into such tiny morsels that it can actually be absorbed into the skin of ocean and marsh-dwelling beings. BP snubbed the Environmental Protection Agency’s suggestion to stop using Correxit. In response, the EPA blandly called for a “study” of other dispersants.

This fiasco has become more about public relations than public’s right to know. Rather than releasing realistic figures of the volume of oil flowing into the environment, BP knowingly cited a very conservative estimate. They initially put up a video loop instead of live feed, until Rep. Ed Markey of Massachusetts forced a change. Their website excluded information about damages to fish and wildlife. Remember the Tylenol tampering scandal? James Burke and his team led a company culture that admitted the problem and set out to rectify it without pinching pennies. Along the way, they retained customers’ loyalty. And they did the right thing. That’s an example of a comapny culture leading the way forward and stands in stark contrast to what we see coming from BP today.

In the last couple of days, I called my old friends from Standard Oil of Ohio. One had retired, and lamented that the company’s values had disappeared in the wildcatter ’90s. The other just said, “It isn’t Standard Oil anymore.” How true.

Elizabeth Haas Edersheim founded NYCP, a management effectiveness firm, advises large and small businesses and not-for-profits and has written various management articles and books, including McKinsey’s Marvin Bower, and The Definitive Drucker.

2010 – The CORE Year: Change, Challenge, Opportunity, and Responsibility

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As 2009 comes to an end, the sentiment that most immediately comes to mind is good riddance to what Time magazine dubbed the “decade from hell.”  Many Americans are suffering as a result of bad management, fraud and misguided policy – particularly in the financial sector.But let’s remember that even painful change is the precursor of opportunity.  Rather than wait for a new era, we must take an honest look and find ways to benefit from the incredible opportunities obscured amid the turmoil and wreckage.

Each of us has a rare chance to help define what will be; and the only constraint, beyond our financial situation, is our capacity to imagine. With this perspective, I share my optimism about the year and decade ahead while telling you about an unprecedented project that harnesses the expertise of people like you around the world.

THE CHANGE

Yes, the world has changed dramatically since 2000.  Consider the industries that are now in flux: energy, health care, transportation, technology, and education. Not-for-profits have been decimated, just when the need for social services and support are ramping up. Even individuals with good incomes are less able to give. Throughout all of this, heavily indebted governments are falling behind on critical needs that were already neglected.

Now consider the advantages to the individual.  We have unrivaled global access to information, combined with a transparency that never existed before. We have an ability to make intelligent choices as consumers, investors, entrepreneurs, and global citizens that our parents never even dreamed of.  Ready or not, we are all now self-managers who can be as entrepreneurial in our outlook as we choose.

Our world is connected in ways never before seen.  Even large companies need each other more than ever.  AT&T’s dependence on Apple’s iPhone overshadows its dependency on its own products. The old-line media companies rely on Google for ad revenue. With the technology for borderless commerce, small companies can connect with customers globally without the conventional intermediaries. Governments and regions are reliant on one another for economic stability. We’re seeing the positive and negative of the rise of Chimerica – a term coined by Niall Ferguson to denote the United States and China. America buys Chinese products; China lends us back the money.  That relationship makes a military war unlikely, but a trade war may have already begun.

Finally, the connections among individuals have changed dramatically as well.  As knowledge workers, we are more specialized and thus more reliant on the expertise of others outside our specialty, thus amplifying the need to be part of a whole that is greater than the sum of its parts.  At the same time, as information-empowered people and micro-businesses, we are less dependent on conventional “outside” experts and organizations.

The world today is so different from the one at the beginning of the 21st century that sometimes it is dizzying. And certainly we are prompted to re-visit our assumptions: §  Is Austria, a country I have always thought of as closed-minded, set to be more innovative than America?  They have free day-care for all two-career families.§ Is unemployment really up if I measure it using a global metric? Or should I think of the 16 to 24 year olds in Spain where unemployment for the group nears 43%?§  Will the next generation ever again have the opportunity to earn more than their parents?§ What is too big to fail today?   Might it be every SMALL business?
THE CHALLENGE

Here in America, I think we have a unique challenge relative to a number of other countries that are more accustomed to the dynamics of rapid change and lack a long history of global dominance.  Jim Collins tells the story of a Brazilian friend, who grew up with monthly inflation of 30%.  Some days it was cheaper to take a taxi than a bus because the bus fare was paid up front. What we construe as today’s disruptions and discontinuities, they view as relative stability and opportunity, not chaos.  My friends from China have experienced extreme, rapid change for the past 25 years and find relief when visiting what they view as a slow-moving, unchanging New York City.  Back at home, their GPS is unreliable because streetscapes are changing so quickly.

Not only are we uncomfortable with this ongoing economic roller coaster, we Americans are challenged by the very real threat to our long-standing position as the biggest, most dominant economy on the planet. Russia’s GDP is only 4% of ours, but economists are projecting that China’s will pass ours by 2027, and India’s will pass us by 2031. This new reality brings into question how we think about democracies.  Our democracy gives us freedom of expression and quality of life, but it also lets interest groups delay stem cell research and other innovations for years. Our two-party system has degenerated into partisan agendas that constantly delay vital innovations and entrepreneurial support.  Meanwhile, Korea, China, and India are eclipsing us in energy development, scientific research, and industrial policy.

Are we paranoid enough, visionary enough, and courageous enough to reinvent ourselves and our world?
THE OPPORTUNITY

Whether we are self-managing knowledge workers in a large institution, small business owners/entrepreneurs, or CEOs of our own careers, we all have greater freedom thanks to access to information and the reality of borderless commerce. We can do many things without third-parties, and often without leaving the house. This is both reassuring and daunting, liberating and imprisoning.  Collaboration is the linchpin of our interconnected Lego world. So, let’s stop being spectators to our future and instead create it.

THE RESPONSIBILITY

From my long-time consulting and advisory work to management spanning many countries and the public and private sectors and my more recent work with Peter Drucker, I have become convinced that management effectiveness is the key to a proactive, smooth transition to a sustainable future.

To paraphrase one of my favorite Drucker quotes, our responsibility is to balance change and continuity.  If we have no change, we risk atrophying in our irrelevancy.  If we have too much change, we risk losing ourselves in chaos. The debacle of the last decade was not due to malice.  It was due to people enjoying their greater freedom while failing to step up to their responsibilities individually and collectively.

To meet our responsibilities head on, we need to be skilled at management effectiveness, not constrained by our tunnel-vision focus on ‘efficiency’, or quarterly profits. Management effectiveness means having the perspective and judgment to be more right than wrong, to leverage the power of people and their creativity throughout the repeating cycle of vision, execution, and outcome.Management effectiveness requires synthesizing information from all sources, challenging and enhancing conventional wisdom, learning from mistakes, and balancing multiple, often competing, objectives in a manner that enhances individuals and society.

To paraphrase Spiderman’s uncle Ben, with great freedom comes great responsibility.
LOOKING FORWARD
I’m excited about a project that took up much of my time in 2009. It’s a pragmatic tool for helping promote management effectiveness — the Elemental Table of Management.   My team will continue to tap many of you for advice. When this project is fully operating, we hope to have positive impact on a hundred million managers in profit and service industries around the world. 
We are targeting to have a beta version up by the end of February, and a pilot running by the end of March.   We look forward to engaging with you in the testing, refinement, and launching of this effectiveness tool.


As Coleridge wrote, “Wisdom is common sense to an uncommon degree.”  Cheers to a wiser 2010 for all of us.

THE DRUCKER FORUM: Three Messages for Managers

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8:51 AM Wednesday December 9, 2009
by Elizabeth Haas Edersheim
(Originally posted: HBR Blog)

I recently returned from the Peter Drucker Global Forum Vienna, Austria, an event held as part of the centennial celebration of Peter Drucker’s birth. Having studied and written about Drucker extensively, spent years infusing his thinking into my own management consulting work, and befriended him late in his life, I take three messages from the centennial celebrations.

1. Drucker’s work is widely accepted as foundational in creating a theory of management as the foundation of a functioning society, despite not being widely taught in business schools. Leading scholars consistently see him as a source of insight and inspiration, many of whom credit Peter Drucker not only as the creator of the discipline of management but as the basis for their own work. Stephen Covey, author of The 7 Habits of Highly Effective People, said, “I can find everything I’ve written in Peter’s work, 25 years before I thought of it.” Professor Hideyuki Inoue of Keio University said, “Everything we know about knowledge worker productivity is built on the foundation Peter Drucker wrote about 50 years ago.” Phillip Kotler, Distinguished Professor of International Marketing at the Kellogg School said, “If I am the father of marketing, Peter Drucker is the grandfather.” Jim Collins was so bold as to state, “Peter Drucker contributed more to the triumph of freedom and free society over totalitarianism, as anyone in the 20th century, including, perhaps, Winston Churchill.” Jim went on to explain that Drucker used his pen to, “rewire the brains of those who wield the swords.” In fact, Churchill insisted that all his officers carry Drucker’s book, The End of Economic Man, in their backpacks so they could remember why they were fighting the war.

2. Drucker created a new mindset in the practitioners who studied him, not only improving their skills but changing their lives. For example, Timotheus Sattelberger, currently a member of the board of Deutsche Telekom, found himself in a job where his values were at odds with the Chairman’s, and he was miserable. After reading Drucker, he went to his boss and said, “This clown is leaving to find another circus. He will not work in this one anymore.” Sattelberger continued, “It was the best move of my life. I assumed responsibility for my values.” Similarly, Cheol-hui Park, the CEO of Korean startup Park Electronics, talked about how Peter Drucker gave him the courage to move home and create jobs in an emerging company.

3. The third message is becoming more pressing every day: Because the new world is already here, the old world must vanish. Nearly every speaker at the centennial events around the world echoed that message. The old world was described as Cartesian, as a reduction of society to economics, as scattershot tools and frameworks that have dominated the past half-century. We are in a new world. Craig Wynett, Chief Innovation Officer at Procter and Gamble emphasized the power and importance of creativity in this world when he spoke in Vienna at the Centennial celebration. He said we talk about innovation, but creativity is that weird guy that we sometimes talk to in the gym. We need to challenge our assumptions about creativity and contributions, CK Prahalad emphasized a second change in this world issuing a call for “a new social compact of business.”

Drucker advocated a social compact by focusing on being effective managers. “Management Effectiveness” means having the perspective and judgment to do the right things, about leveraging the power of people and their creativity in doing so throughout the repeating cycle of vision, execution, and outcome. Far from blind execution of orders, effectiveness requires synthesizing information and stepping up to challenge conventional wisdom. Effectiveness is the wholeness of the decisions – it’s synthesizing and balancing multiple, often competing, objectives in a manner that enhances individuals and society with no negative impact. Effectiveness also means the ability to make mistakes and learn from them.

That is our challenge as practitioners and as academics. It is a new world.

Elizabeth Haas Edersheim conducts case-study-based research on critical leadership issues — often in collaboration with corporations and speaks frequently at management events.

THE DEFINITIVE DRUCKER

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By Elizabeth Edersheim 
When the Leader to Leader Institute asked me to blog about my book, The Definitive Drucker, which was published three years ago, I thought, what would Peter Drucker have asked me about what I learned? I realized he’d have asked, what happened that was unexpected? And what did you learn?
The first unexpected result: The nature of the U.S. response to the book. I received numerous e-mails from readers in the United States, saying that the book changed their perspectives and practices. These came from doctors, lawyers, small-business owners, and executives with no business training, who happened to pick-up the book. The gratitude these letters expressed was overwhelming. One business owner wrote, “I run a wedding dress shop and never thought a management book could help me. I started reading it in a bookstore, and couldn’t put it down. Your book has changed how I make decisions and serve customers.” Many of the notes emphasized the universality of Peter Drucker, asserting that everyone can use his insights and thoughts.

The second unexpected result: I saw for myself that business frameworks, practices, and language are a great equalizer in a world divided into diverse religions, cultures, nations, political views, and peoples—and that Drucker’s thinking applies across the globe. The book has been translated into 32 languages and has taken me on an eye-opening global journey. I’ve visited seven countries in the last 12 months and corresponded with editors and readers in nine others. In Saudi Arabia, where women are forbidden to drive, a female business owner wrote to me with her thoughts on Drucker. In Japan, entrepreneurs are fascinated with Drucker, and a society has formed to study and promote his philosophies and practices. In China, one of the most respected CEOs, Zhang Ruimin, quotes Drucker religiously at Haier’s Saturday morning management meetings. The winners of Drucker innovation awards in Korea are global leaders and enduring benchmarks. What’s the strong attraction to Drucker in Vietnam, China, Korea, and Japan? Possibly the emphasis on people in Drucker’s philosophy, which mirrors the local cultures in some respects.

The third unexpected result is Drucker’s ability to stand the test of time. Though my book is admittedly only three years old, it draws on work, writing, and relationships from throughout Drucker’s career. Every company, Drucker complimented has done well. Every controversy and caveat Drucker raised has visibly elevated its ugly head. And the book’s observations about companies have held up despite the fundamental shifts we’ve seen in the past three years:

For example:

  • Medtronic continues to be innovative despite all the healthcare debates and their impact on private companies in that sector.
  • P&G is the success story of the decade, with Lafley named CEO of the year by Fortune, Forbes, Business Week, and Leader-to-Leader. Of course, P&G has faced day-to-day challenges in the current recession. For example, they had to decided to compete with private label products, introducing Tide Basic without bells and whistles. It is a dangerous strategy but one that might be the right response to the new realities. The recession changed the market, and management listened to their customers. They didn’t insist that every Tide customer needed to pay 30 percent more for Tide’s high-quality features.
  • JetBlue, which we highlighted as a star player, hit a bump in the road. Their performance fell off during winter storms. They had grown beyond their system’s capabilities. They stepped back and fixed the system, and are doing well again.
  • Peter Drucker had predicted that GE’s Finance group would get in trouble, and said they should sell NBC. He praised Immelt for jumping into green energy before anyone else.
  • The Myelin Repair Foundation is in the process of commercializing new drugs ahead of schedule and is moving ahead to address new challenges with new collaborations. It continues to be an amazing story.

Looking back and re-reading the book, there are many other companies built on Drucker that can be written about, such as Haier, Yuhan, Kimberly-Clark, Park Electronics, and FirstService.

Knowing Peter Drucker and writing about his ideas changed the way I listen and think. I’m hearing more and asking more, with a new appreciation for helping others think. I am very grateful for the time I have spent with Peter Drucker, his family, and his disciples. It was and continues to be a great opportunity.

INDIA ON THE MOVE – BACK TO SCHOOL

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by Elizabeth Haas Edersheim  September 2009

As the school year gets going and I have a chance to gather my thoughts from a trip to Asia, I wanted to share with you the incredible effort I saw in India around education reform focused on bringing post high-school graduates into the 21st century knowledge economy. It is quite a contrast to Bob Herbert’s comments on the status of the United States’ education reform, “In educating its citizens, we are now moving decidedly in the wrong direction”

Like the U.S., India faces a daunting education challenge—they need to make enormous improvements, immediately, in educating and training a very large and diverse population, with many of its people economically disadvantaged or living at a subsistence level. India has stepped up to the task, setting up a National Skill Council (NSC) to work with the Confederation of Indian Industry. They are rapidly innovating the entire concept of vocational and, in some sense management school, and revamping the country’s institutions, curriculum, and faculty.

India’s National Skill Council and the Confederation of Indian Industry believe that Polytechs—post-secondary vocational schools—are critical to the country’s future. By 2022, the government wants to train 500 million people to master a variety of skill—some entirely new—for the industries of tomorrow. Many of those people have only high school educations today.

They highlighted two primary challenges: (1) revamp a severely outdated curriculum and align it with the needs of industry, and (2) upgrade the faculty, ensuring that they have the knowledge to teach the skills of tomorrow and motivating them to continuously innovate.

Against these challenges, India is putting together two initiatives, both of them examples of the new Public-Private Partnerships.

Partnership 1 – The Indian government is moving the management of Polytechs to the private sector. Its rationale: industry knows exactly what they need, and knows how to manage a large institution. A radical change in governance is necessary to move forward.

The preliminary plan is that the private enterprise that takes charge of the contract will have no financial obligations but will need to make a number of commitments, including:

  • Involve senior management directly in the curriculum and teaching; every member of the senior team must commit 1-1/2 to 2 hours a month to lecture in the classroom
  • Modify curriculums to better support their own needs of tomorrow
  • Offer their own employees the opportunity to become students during 2% of their working hours every year
  • Create tighter links between faculty and industry – e.g., offer faculty training opportunities inside the company

This private sector engagement and commitment is expected to fundamentally shift the dynamics of Polytech education to the needs of tomorrow.

Partnership 2 –The government also announced a program for setting up new Polytechs—not in rural areas but in industrial centers. The government will provide land and set up residence halls so students can be brought to the industrial center from the countryside to go to school. Multiple companies located in the area will be engaged in the Polytech—setting the curriculum, training their current and future employees, and building state-of-the-art facilities.

Will these two initiatives meet all the educational needs of every citizen of India? Of course not.  But they are bold efforts that will carry substantial educational and economic benefit to many, with the further benefit of fueling India’s burgeoning knowledge industries and boosting its international competitiveness. And they are going forward NOW.

We can all take a lesson from India. Washington and our local districts recognize the challenge. But are we just doing more of the same and not stepping back and asking what we need to do for tomorrow? Finding the solutions will require creativity and involvement of more than government. Our challenge—to be focused on what 21st century students and their future employers really need, and more cognizant of every person’s need for lifelong learning.

©Elizabeth Edersheim

 

ADJUSTING MY LENS

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by Elizabeth Haas Edersheim July 31, 2009

Last week I had the opportunity to participate in the Student Leadership Summit, the inaugural event of the Frances Hesselbein Global Academy for Student Leadership and Civic Engagement, at the University of Pittsburgh.

The academy’s mission is to inspire, develop, and reward accomplished student leaders to meet the challenges of tomorrow. We spent four days engaged in intense learning, discussion, and fun with 44 leaders of tomorrow—4 of whom are my mentees. The summit began with “The Wizard of Oz of Leadership” and took these up-and-coming leaders through love, a lion, learning, innovation, tennis-racket propellers, inspiration, communication, respect, inclusion, a scarecrow, values, service, a courageous MIT engineer, passion, ethics, understanding cultures, a tin man, a gigantic light bulb, listening, the color line, confronting challenges, growing talent, creating opportunities, living, loving, and leading.[1] They came away understanding that—like the scarecrow, tin man, and cowardly lion—they already have the courage, heart, and mind to be leaders; they just need to see that it is all there inside them. The summit was fantastic.  I learned so much about the difference in perspective that young leaders bring to the table, and walked away with a new sense of hopefulness.  Some observations:

1.       The leaders of tomorrow emphasize collaboration in problem-solving, seeking ways to share what they have and meet the needs of the many rather than commanding scarce resources to benefit the few.  The members of the crucible generation, as Warren Bennis calls them, really do have a more collaborative and less competitive orientation then we ever did.  The differences came through every day as we watched them work.  The most telling moment was the Ugli Orange Exercise:  In essence, two competing pharmaceutical companies want the 4,000 Ugli Oranges right now.  One company needs them to fight a new and deadly prenatal disease, the other to resolve a deadly gas leak.  Participants are divided into teams of four, two representing each company. The speaker who presented this exercise has been using it for 20+ years.  For 20 minutes the two companies typically argue over whose needs are more important and arrive at no solution or action plan.  At the summit, all 11 teams rapidly discovered that one company needed the juice and the other the rind, and worked out a viable plan for moving forward.  Some went so far as to plant the seeds for the next year’s crop!  This has never happened before.  In 1994 no team found a solution.  At another group last year, out of 14 teams, 2 found solutions.  This year at the summit, every team tried to figure out how everyone could be satisfied rather than how to win a fight.  “What part of the orange do you need?” was the first question asked by one of my mentees.  The question belies a collaborative mindset that asks different questions and seeks fundamentally different types of answers.

2.       Despite perceived progress, the color line, with all its ramifications, is still an      active force limiting the participation and potential of millions in our society.  In another exercise, everyone in the room answered a survey featuring questions about isolation in everyday situations and scored their answers.  One of the questions was “Can I swear, or dress in secondhand clothes, or not answer letters without having people attribute those choices to the bad morals, the poverty, or the illiteracy of my race?”  At the end of the exercise, we lined up in order of our scores.  The predominance of black faces among those feeling most isolated was shocking.  It really brought home to me how far we still have to go toward achieving an inclusive society – even here, among the nation’s most engaged, highest-achieving students. The recent arrest of Henry Louis Gates, Jr., in Cambridge has once again brought this concern into the headlines. The presence of the Obamas in the White House – although inspiring and empowering for many – has not even begun to resolve the issue of how we diminish the defining quality of race in American society, how we bring people of color to the table as full participants.  One of the leaders of the future spoke about how many people asked her if they could touch or feel her hair.  There has been progress, but no magic; much more must be done.

3.       The power of a fresh, independent perspective cannot be underestimated.  On our third day, each group of four went to a not-for-profit organization in Pittsburgh to help address an issue facing the organization.  Their reports back to the group were astounding.  My group went to help the Ladies Hospital Aid Society (LHAS) think through how to revitalize their donor base.  My team’s first question about achieving that goal was, What is the constraint?  They felt that one significant constraint might be the name of the organization.  This created a lively discussion with the president and two board members.  Finally one board member said that when she has to tell people what LHAS stands for, she often bites her tongue.  It is not a name she is proud of, but she had assumed that, as the historical identity of the organization, the name could not be changed.  A young man on my team was quick to challenge this boundary condition, pointing out that the organization’s name had originally been the Hebrew Ladies Hospital Aid Society and could potentially be changed again.  I was reminded of why McKinsey hires very smart people with little or no business experience—because their lack of preconceptions enables them to push the envelope and cast a wider net in seeking solutions to problems.  My team discussed the need for diversity in the images of the organization and on its website, pushing LHAS to redefine its image to draw in more potential donors.  Now the board is engaged in reading the Harvard Business School case about the Girl Scouts.  The boldness the students showed in their recommendations was surprising, as was the rare opportunity for senior executives to listen to the leaders of tomorrow and discuss solutions with them.

4.       The older generation has a significant contribution to make—in mentoring.  Jim Collins, the dinner speaker on the final day of the summit, talked about how each of us needs a personal board of directors.  That is particularly true for the crucible generation, even though its members scored higher on every academic test than we did and have been developed and programmed to succeed throughout their young lives. They are emotionally young. They have grown up with more supervision than we had, and less freedom to experiment. They are operating in a very uncertain world, where the norm is relentless challenge and unclear expectations.  After working hard practicing and performing all their lives, these young people are now faced with the task of deciding how to change the world and making those sweeping changes happen.  They do need mentors and people to think with—people who believe in them.  When I came home, the first thing I did was call two young people I have worked with recently; I listened to their thoughts and encouraged their ambitions.  I hope to be in touch with each of my mentees for a long time to come.  Each of them is a fantastic person with a tremendous amount to teach me.  To quote Peter Drucker,  “Knowledge work requires continuous learning on the part of the knowledge worker, but equally continuous teaching on the part of the knowledge worker.”

5.       The leaders of tomorrow define success in terms of making a difference by serving others.  Our final exercise was for each leader of the future to define a mountain they want to move, the barriers to moving it, and a plan for how they will get started.  To a person, their goals are geared to making this a better world (rather than individual enrichment or achievement) and are all about service.  For example, Michael, a graduate student in pharmacy, wants everyone to have available comprehensive information about regulated and unregulated drugs and foods that impact their bodies.  He doesn’t want to be a pharmacist – he wants to help people improve their health.  Alyssa, an aspiring orthodontist, wants to serve children who might not otherwise be served and help them feel better about themselves.  Celeste, a student of Sport Science, wants to help other people accomplish things they never dreamed they could have.  Minh, an aspiring ophthalmologist, wants to break down walls and be available to patients where and how they need their doctors. Although it is possible that this youthful idealism will devolve into relentless self-interest, as happened with so many of the baby boomers, the strong emphasis on practical service to others makes me hopeful.

6.  Including and respecting young leaders is an essential step to helping them grow and develop. Including people in the group while acknowledging each one’s unique contributions and needs is an enormous part of leadership development—and that is the unique genius of Frances Hesselbein. Frances Hesselbein graciously introduces people to each other so they can make connections, broaden their view of the world, adjust their lens, and grow as leaders.  She introduced Tamara Woodbury—a colleague from the Girl Scouts of America whose interest in leadership and organization development was pushing her toward business school—to Peter Drucker, who insisted that business school would be a colossal waste of her time and offered her a different perspective on social enterprises.  As a result, Tamara came to change her focus and redirect her impact.  As Jim Collins says, “If you are a plant, Frances is the ultimate ultraviolet light—she helps each of us see things differently.  For me, the opportunity to talk with military leaders about leadership was a new and eye-opening experience. I learned about President Clinton’s courage in inviting and addressing contrary opinions, about the thinking behind his decision to send troops to  Bosnia when only 36 percent of Americans approved of it, because it was the morally right thing to do for millions of innocents.  And then when General Randy Fulhart offered to give me some feedback on my writing, a wide smile went across my face…that hasn’t left.

This summit adjusted all of our lenses.  Thank you, Frances.

As described by Charles J. O’Connor III, Retired Air Force Colonel, Senior Vice President, Fidelity Investments.

Elizabeth Haas Edersheim conducts case-study-based research on critical leadership issues — often in collaboration with corporations and speaks frequently at management events. 

©Elizabeth Edersheim

CREATING WEALTH-PRODUCING INNOVATION — OUR URGENT NEED FOR PROACTIVE AND PRODUCTIVE PUBLIC-PRIVATE PARTNERSHIPS

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By Elizabeth Haas Edersheim
June 24, 2009

 

In 1964, Peter Drucker wrote,
“The first indicator of the need for major innovation is one with which economists have been familiar for well over a century: Declining productivity.”

 

We constantly assume that the private sector is the engine of innovation. But we need to rethink even that. Many of the requirements of innovation — the patience to wait for results, the willingness to take significant risks — are difficult for companies to meet. Companies systematically under-invest in R&D, especially for exploratory research and technology development. Start-ups systematically focus on very narrow segments.

 

2008 global productivity growth was the worst it has been for 20 years, and 2009 does not look much better. Despite large investments in innovation during the past decade, this effort has failed to deliver beyond a few high profile internet areas — Google, Facebook. This failure may be contributing to our economic difficulties.

 

Innovation, as defined by Drucker, is new wealth-producing capacity. With that definition, gene therapy, alternative energy, biotech, micromachines, etc., have not yet delivered.

 

It is an opportune time for public-private partnerships. They can make a difference in the speed and scale of innovation and the patience of startups.

 

The public sector — governments and not-for-profits — needs to help support long-term investment by large and small companies alike. Then it needs to accelerate adoption of innovations. When public-private partnerships are disciplined, they can create a new community of businesses and institutions, and foster many wealth-producing innovations.

 

For purposes of conversation, let’s focus on the most productive of government roles in fostering wealth-producing innovations via public-private partnerships.
Role 1: Assumption Busting. The first step in any meaningful innovation is to abandon assumptions. The government’s regulatory power enables it to radically alter conventionally held assumptions about the nature of competition in an industry.

 

Some cite government regulation as the most important factor in America’s success in information technology. The trustbusters made AT&T lease its lines to others and eventually broke up the giant. Later they forced IBM to separate its hardware and software businesses. In both industries, these actions challenged assumptions about the level of investment and integration required to compete. It also fostered innovation by replacing stodgy monoliths with smaller, specialized companies that joined forces with other, similar companies with complementary capabilities. The result — tremendous innovation and the emergence of new standards to support the collaborations.

 

Governments can also protect outdated assumptions, often with disastrous results. As Drucker said, the worst thing a government can do is hinder the movement of capital and people to new products, technological solutions, and modes of competition. A stark example of this is the U.S. government’s role in the terminal illness of the U.S. automobile industry with its support of mediocre mileage standards, work-arounds, and low gas prices.

 

Similarly, in Japan, the government’s failure to force new assumptions and passive acceptance of the status quo may have contributed to the country’s lost decade.

 

Role 2: Spotlighting An Opportunity. Governments can greatly increase the likelihood of an innovation’s success through strong public policy signals. And they can coax results with money. For example, NASA in the U.S. created decades of innovations, not only through funding but by sustained attention to the aerospace industry and its innovations.

 

China now is trying to shine a light on the electric car, as the Chinese market gears up. The Economist predicts that, in 40 years, China will have as many cars as the whole world does now. The government’s vision is for the Chinese auto market to bypass internal combustion engines for new buyers and go directly to the electric car as soon as possible.

 

China’s Ministry of Industry and Information Technology and the government of Wuhan are working with Nissan in Shanghai on a pilot electric-vehicle program.  Nissan is expected to provide free electric vehicles to Wuhan and to help develop a network of vehicle-charging stations. The ministry is also working on new facilities for their electric vehicles, joining forces with Beijing and BYD, the battery company that acquired a car company from the state. Beyond the auto companies, the ministry is working with a myriad other companies including grid intelligence companies, fueling, and network companies.

 

Role 3: Facilitating the Growth of Cutting-Edge Capabilities To Support Innovations. This role focuses on underlying capabilities needed for innovation vs. directly on the innovation. As an example, let’s look at the state of Maine’s boat building industry.

 

In April 2007, a delegation of boat builders from Maine headed to Shanghai for the China International Boat Show, where they were treated by the national government as honored guests. Maine’s success in international boat building was made possible largely by public-sector efforts to build the state’s competency through a series of deliberate steps. It is an example of how government can fund collaborations across institutions to build competencies not achievable by any one company.

 

Maine’s boat building industry was flat from 1980 to 1994 with the closure of a local naval base and declining productivity threatening to kill it entirely. Recognizing that the future of the state’s boatbuilding industry rested on its ability to harness innovation capabilities in composites and nanotechnology to compete globally, several different types of institutions formed an alliance to create an advanced engineered-wood composite center — a university, workforce training centers, private companies, trade associations, economic development agencies, and investment organizations.

 

Government investments made participation in the center possible for many of these institutions — and paid for the trip to China. As a result of this coalition, Maine’s boatbuilding industry has more than doubled in the last 10 years and is at the cutting edge of innovation — taking a 400-year coastal heritage of skilled craftsmanship to a new level.
Role 4: Supporting Entrepreneurs And New Businesses To Build Innovation Communities. Government regulations, tax policy, and economic incentives are all tools that can be employed to help form innovation communities often dominated by the small businesses that create the most jobs and get the most patents per capita.

 

In my visit to Korea, a newspaper reported that young Koreans do not want to take the risks involved in starting businesses, or even work for small businesses. When I spoke with some entrepeneurs, they indicated that it was virtually impossible to hire talented people unless they were brought from the U.S.. People are afraid of small companies and are used to the security, as well as the health insurance and pension benefits, associated with the larger companies.

 

Government action can reverse such a trend, helping communities embrace start-ups with bankruptcy laws and small business loans, and creating community awards and recognition for businesses that contribute substantially to innovation communities.

 

The United States’ Small Business Administration (SBA) understands the importance of entrepreneurs and a continuing pipeline of new businesses. Its goals align with this critical need:

 

–         Continue to get loans out to small businesses
–         Revitalizing the agency itself, which was reduced and lost its focus over the last eight years
–         Making the SBA the strongest possible voice for small business in the U.S.

 

Certainly other public sector and non-profit entities can also play these four roles very successfully, with similar impact on the speed and scale of innovation. For example,The William J. Clinton Foundation supports a number of public-private partnerships. One worth following is the Clinton Climate Initiative, dedicated to environmental innovation. The Climate Initiative was launched in May 2006, when the former president’s advisor, Ira Magaziner, met with Ken Livingstone, then-mayor of London. Ken knew that the Clinton Foundation had joined forces with 60 different African countries to get a low-cost drug for HIV/AIDS brought to market, which none of them could have done independently. Ken suggested that the foundation undertake a similar project with large cities — which are huge contributors to greenhouse gas emissions — to advance some innovative-driven climate initiatives.

 

One such initiative is Clinton Climate Initiative’s C-40 project, which brings 40 cities together creating new economies-of-scale in demand for energy-efficient technologies — from the 367 million people that live in those cities — and linking demand with sources of supply. The C-40 project is a catalyst in accelerating market development for such innovations as clean-technology vehicles, energy-efficient lighting, chillers, solar control window films, and “cool” roofing that will help to lower the costs of building retrofits. These beneficial technologies all face a fundamental barrier to adoption: No customer is big enough to justify investing in cost-efficient scale production, and no company is ready to bet that future demand will approach that scale.

 

The Climate Initiative works with vendors to determine the volume necessary to fundamentally change their economics, using economic and life-cycle modeling to understand and think creatively about when and how a new technology can become attractive. The foundation then works with the C-40 cities and gains commitments to deliver that volume. They have broken through barriers that only a public-private partnership could. Hybrid buses, which first appeared in a few cities with big public subsidies, have been updated with newer technology and purchased for use in locations that manufacturers would not have approached for years. Already, many cities in India and Brazil are the world’s largest users of hybrid buses.

 

When I asked Magaziner to describe his biggest barrier, he responded that he is pushing everyone’s comfort zones. People can’t sit around waiting for the usual lag time from the usual circumstances – excessively long government time lines when it comes to ordering equipment from private suppliers, the hesitancy of entrepreneurs to push the envelope farther than they ever have, and so on. He’s right. Usual just doesn’t cut it under unusual situations like today’s productivity performance. Public-private partnerships can be significantly more agile than the usual contracts between state agencies and corporations. They are the right vehicle to speed the delivery and elevate the scale of innovations in the face of our critical needs.

 

©

Elizabeth Edersheim

 

WORKING TOGETHER TO HEAL

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Accelerating Medical Progress Through A More Collaborative Research

by Elizabeth Haas Edersheim

April 30, 2009

In 2005, as we were working together on his biography, The Definitive Drucker, Peter told me to keep an eye on a most innovative collaboration that we both admired—The Myelin Repair Foundation.

Despair: MS Research in 2005

MS was no closer to a cure than in 1975; the conventional academic research model had stalled completely. To push for more effective research with substantive near-term results, businessman Scott Johnson—head of a start-up, a former senior executive at FMC, and a Multiple Sclerosis (MS) sufferer himself—spearheaded a new, more collaborative research model targeted at myelin repair. Does he think MRF will provide him with a cure? “I don’t think so, but it will help other, more recently diagnosed individuals and next-generation sufferers.” Noting that MS often runs in families, Scott continued, “I don’t want anyone to have to experience what I have for the last 30 years; that is why it matters to me.”

 

The Launch of The Myelin Repair Foundation

The Myelin Repair Foundation’s (MRF) research program was launched in late 2004 with the goal of licensing its first target for commercial development in 2009—10 to 15 years sooner than most thought possible. With an organizational design modeled on the Manhattan Project, MRF seeks to break down the traditional barriers of secrecy in academic research and to expedite breakthroughs in drug discovery.   Their objective is to accelerate medical research dramatically and potentially stop this heretofore “incurable” degenerative disease that runs in families. The underlying idea was that the best scientists could make more and better progress if they worked together in collaboration rather than separately in competition, and if they focused on a very clear and specific research objective.

The shocking story of medical research including publicly funded efforts, is that the very labs that are supposed to work for the common good are often more interested in doing their own thing. They don’t want to cooperate with others, whom they may perceive as competitors, because they fear losing their exclusivity, their competitive edge, and ultimately their funding. Maddened by this inefficiency, Scott Johnson created MRF to pioneer a new model for medical research. In essence, MRF is a virtual research lab that links together institutions with diverse specialized expertise and focuses the world’s greatest MS researchers on solving a very well-defined problem: to find a way to repair myelin and thus reverse the progress of the disease. The foundation simply ignored counterproductive research practices and conventions, abandoning the notion that a research institution has to do everything itself, echoing ideas Drucker wrote about in The Post-Capitalist Society.

To establish this unprecedented “horizontal” collaboration, Scott Johnson brought together five leading neuroscientists from high-powered research universities—McGill, Stanford, Case, Northwestern, and the University of Chicago—former competitors in the race for new myelin discoveries. He provided robust financial incentives and communications infrastructure for these five universities to break from conventional practices and collaboratively participate in the effort. Johnson also committed funding for the principal investigators and created a working culture that facilitated the collaboration of the scientists.

Johnson’s new model, the Accelerated Research Concept (ARC), goes beyond the virtual research lab, with a multitude of formal and informal connections among the scientists which include quarterly meetings, collective planning, and cross-university telephone conferences and e-mails, sometimes daily.

MRF manages for results and bridges the academic and the commercial, working across organizations, institutions, and disciplines to create a powerful focus and success rate. The process has built trust between the former competitors and a shared emotional commitment to the results. They have vastly accelerated the progress of MS research.

For more information on the MRF organizational model, see The Definitive Drucker (New York: McGraw-Hill, 2007) and visit their website http://www.myelinrepair.org/

What is Myelin?

Multiple Sclerosis (MS) attacks myelin, a fat and protein compound wrapped around axons, the fibers that sprout out of nerve cells and carry nerve signals. Think of myelin as a form of insulation. As the myelin insulation is eaten away, scar tissue forms in its place, and nerve signals are slowed, distorted, or halted. These splutters and failures create the symptoms of MS.  Johnson believes that repairing myelin will address these symptoms, much as insulin does for diabetes.

 

What the Myelin Repair Foundation Accomplished in 4-1/2 Years

Nothing illustrates the power of collaboration like results. As of April 2009, The Myelin Repair Foundation, and its scientists and partners, have:

  • Been awarded one patent, with eight more patent applications pending—at approximately one-quarter the cost per patent of academic institutions
  • Published more than 50 articles in scientific publications, with an unprecedented number of them co-authored by scientists from multiple institutions
  • Identified more than 40 discoveries—targets, pathways, and tools, including a battery of measuring tags to assess precisely the state of a patient’s myelin and the progress of re-myelination.  This tool should greatly accelerate the validation of clinical testing
  • Remained ahead of schedule in achieving the goal of having a myelin repair target licensed by a pharmaceutical company within the foundation’s first 5 years
  • Defined the next round of targets and launched the research to achieve them
  • Set up a Drug Discovery Advisory Group to spearhead the foundation’s collaboration with the commercial world. This group helps outline the strategy for the next set of milestones, e.g., determining whether the academic myelin repair solution can be converted into a therapeutic for patients, devising a systematic flow stream to validate that targets are reproducible with industrial rigor
  • Initiated a target validation process with Contract Research Organization partners. MRF’s goal is to complete this validation process for two of its programs by late summer this year.

If you want to assist an organization that is curing disease, relieving human suffering, and changing the conduct of medical research in the process, consider supporting the Myelin Repair Foundation.

 

The Challenges Facing the Myelin Repair Foundation in 2009

Having achieved so much, MRF must build on its success and push its research results through the pharmaceutical development pipeline and out to MS patients. In so doing, MRF expects to benefit financially from the commercialization of new therapies. By reaping these rewards, MRF can become a sustainable social business (to use the term coined by Peter Drucker). Meeting the goal of sustainability could take 3 to 5 more years and poses two substantial challenges for MRF today:

Challenge #1: Motivate pharmaceutical companies to work on drug discovery based on MRF’s research—to spur them to invest in targets for MS that did not exist 5 years ago. By intensifying its collaboration with pharmaceutical companies, MRF is bridging “the valley of death.”  There is an enormous gap that prevents discoveries made in academic labs from being commercialized by private pharmaceutical companies. MRF and its academic labs are in conversation with multiple players regarding drug development and are seeking to establish at least two sound research partnerships with pharmaceutical companies this year. These partnerships will bring pharmaceutical investment into MRF and get the foundation’s scientists in touch with the industry’s drug development infrastructure. If their joint research proves successful, MRF’s efforts will have a real therapeutic impact on patients, and will be the foundation will gain an ongoing revenue stream. Commercial success is by no means guaranteed, and the time required to achieve it is not predictable. MRF is bringing the academic and commercial worlds together in a way that nobody else has.

Challenge #2: Attract the short-term funding needed to complete the journey to a commercial solution and fund a second round of MRF research. Although MRF will become self-sustaining as its research solutions are commercialized, the foundation faces an immediate need to raise funds to continue its efforts in the interim. These are challenging times for development and fundraising; many philanthropies have been crippled by the current economic crisis. Scott Johnson has responded by intensifying his own effort. He‘s literally in 6-1/2 days a week burning the midnight oil.

MRF has secured a $10 million pledge—$5 million for 2009 and $5 million for 2010—contingent on MRF finding matching funds. Scott is bringing to this fundraising effort the same creativity that has marked the foundation’s efforts since its inception.

* * *

Imagine a world in which accelerated scientific discoveries are rapidly streamed into the drug pipeline and delivered to patients who can’t afford to wait. It begins with collaboration.

Does a relative have MS? You may also be at risk. 

Although environmental factors may play a central role in triggering MS, the disease clearly has a genetic component. In the general population, the incidence of MS is about 1 in 1,000. The identical twin of a person with MS has a 1 in 3 chance of getting it; a sibling, about 1 in 25. The child of a person with MS has a 1 in 40 chance of getting it. A niece or nephew of a person with MS has a 1 in 60 chance of being diagnosed with MSMark.

Many believe that possibly 100 genes may be involved with MS, but only a handful has been identified to date. MS is NOT considered a hereditary disease, in which there is a 100% chance that a family member will get the disease if he or she has the gene. However, family members of MS patients do have a “genetic predisposition” or increased likelihood (1 to 3 percent) of getting the disease. MRF reports that in several of its supporter families, siblings have been diagnosed, and one individual’s father and grandfather both had MS. MRF believes that early diagnosis and myelin repair therapeutics are the best ways to stop the disease’s progression.

THE AUTO INDUSTRY TODAY: An Opportunity Inside a Responsibility, Wrapped In a Disaster

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While the collapse of the U.S. auto industry is a disaster of global proportions, it is a great opportunity for companies and countries.

It is an opportunity to redefine the rules and make them global, reset the boundaries and work with energy and alternative transportation companies, and redesign the ground transportation system, rethinking everything from the fuel stations on the street corner to the size of parking spaces at the train station.

There exist today the cost-effective technology and widespread public concern to make it possible to develop cars that are low-cost, energy-efficient, and practical for everyday use—to make real progress on environmental issues while contributing to global prosperity rather than dampening it.

The automobile makers and governments around the world have a unique chance to create an effective model for trans-national-industrial partnerships.This type of collaboration is uncharted. Rather than operating on their own, Toyota, Honda, Tata, Tesla, Geely, Ford, and General Motors could find common ground with Exxon, CSX, Aichi Kokuki, Indianrail, and academics to design a standard for energy-efficient and environmentally sound transportation. Imagine the global automotive industry embracing this standard rapidly without putting consumers through years of confusion and skepticism—will it be hydrogen, solar, hybrid? Will I be able to refuel on the highway? It would be like skipping over eight-track tape music players, cassettes, and CDs, and going right to MP3 players.

Imagine governments collaborating to fund global development of that new transportation standard while individually investing in the local infrastructure—for example, modified fueling stations in a format common around the world. At the same time governments can create financial incentives for consumers to replace conventional vehicles with the new green cars. Imagine 400 million of the world’s 800 million vehicles being replaced with green cars by 2025. It is possible, if we respond to the decline of GM and its American counterparts as the very real opportunity it is.

Handling the current crisis means rethinking the way industry operates and becoming collaborative, innovative, and strategic—thinking big with a long time horizon. Autoworkers and taxpayers would agree that we haven’t gotten very far in the past two decades by being insular, conventional, and tactical.

Auto manufacturers are expected to sell 9 million vehicles in the U.S. this year, down 50 percent from 2007. The Big Three have about 44 percent of that market, an all-time low. Yes, GM has updated many of its plants and made them more flexible, but it has a long way to go to match Hyundai’s Alabama plant. Yes, Ford’s cars were recently ranked third in reliability by Consumer Reports, the first time in over 5 years that a U.S. company made the top three, but their website section on quality doesn’t even discuss the reliability of the engine.

GM is now asking for help one nation at a time. Toyota views itself as a Japanese company and is seeking support solely from Japan’s government. Consumers are also insular. In Korea, 95 percent of the cars purchased are domestic. In America, where the auto industry drives about 1 in 10 jobs in the U.S., consumers view this as a “Detroit problem.”

As GM goes, so goes Chrysler, and possibly Ford. By the playbook of traditional strategy, the day GM declares bankruptcy, Toyota, Honda, and the others will unload the docks and cut prices on their vehicles by $3,000 to $8,000, offering unprecedented discounts. They may have more than 1 million vehicles on docks already—enough to boost their combined market share more than 10 percent, sending U.S. companies’ share to a new low that may make the Big Three unsustainable no matter what kind of bailout Washington offers.

Even if global competitors step up and do what is right—give The Big Three some breathing room so that they can recover—will the American companies and unions learn from this disaster and re-engineer the entire business? They better. If not, they will die a slow and painful death that all of us will feel.

Institutional courage, bold thought, respectful collaboration, and a collective belief in tomorrow are required.

UNCONVENTIONAL SOLUTIONS FOR UNCONVENTIONAL TIMES

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In identifying and designing solutions to help turn around the U.S.’s rapidly degrading situation, the Obama Administration would benefit from the Drucker approach. Peter Drucker, known as the father of modern management, suggested that when we focus on investing in problems, we miss opportunities. The Obama administration needs to follow Drucker by first defining the results we want and then work back from there to identify programs that will work.

We have an opportunity to create vibrant communities of people with the skills and the infrastructure they need to thrive in the 21st century. That is the result we want. Achieving it will involve finding unconventional solutions for these unconventional times. Here are four ways to start.

1.        Revitalizing the Flow of Credit.
Goal: Unfreeze the loan system to create many new jobs.
What to do: Collaborate with community banks that can channel federal investment to small businesses – the entrepreneurs and community-based enterprises that create more than 70 percent of the new jobs in our country. This is the most efficient investment we can make, and the businesses that will benefit are those that reside in our communities. It is a great form of public-private collaboration that really works. These small businesses employ local people and serve them as customers; they are the building blocks of vibrant communities. The community banks, unlike the large commercial banks, are focused on helping our economic engine thrive. Note to Congress: Their chairmen don’t travel on private jets. Often they walk.

 

2.        Investing in Undervalued Homes.
Goal: Keep people in their homes and avoid mortgage defaults, rather than having families displaced and creating a large stock of vacant housing that depresses everyone’s housing prices.
What to do: Support and provide financing to entrepreneurs, venture capitalists, and community-based public-private collaborations that will buy the foreclosures, thereby limiting the supply of housing available on the market. The entrepreneurs can employ construction workers to fix-up the homes, then rent them to people who might eventually own them via a rent-to-buy program. They can hold on to the houses and manage the market supply over the next five years, so that the market is not flooded. With inherent demand and population growth, the houses will gradually increase in value. A house that sold for $500,000 three years ago may be worth $250,000 today and may sell for only $125,000 at auction after foreclosure. In five years, that house might possibly sell for $250,000 again.

 

3.        Restoring the Health of the Stock Market.
Goal: Increase medium- and long-term investment in the market, rather than quick speculation, to increase available capital.
What to do: Enact a rule that new investments made in the stock market over the next 18 months and held for at least five years are exempt from capital gains tax. Help people think about investing. Let people choose which companies they believe in and want to hold onto for some time. The program should bring substantial new capital into the stock market, and as the market improves, the taxable gains that result will more than pay for this real stimulus.

 

4.        Building skills for the 21st century.
Goal: Re-engage and open doors for the new unemployed, including many white-collar workers over age 40.
What to do:
  • Pay degreed people to go back to school and encourage colleges to offer programs in green architecture, web skills, biotechnology technician training, community banking, teaching for tomorrow, and other skills geared to the 21st century.  Pay people while they are attending school and reimburse them the tuition for classes they complete. Encourage life-long learners for the world of tomorrow.
  • Help them determine how to apply their skills to benefit their communities, and create a Volunteer Corps focused on community-based efforts. Volunteers could help many people navigate the system and attain new mortgages, health care, health insurance, etc. Other volunteers could contribute to education, health care support, child-care, green community projects, coaching for owners and employees of local companies, and advising small businesses and entrepreneurs. And the Volunteer Corps need not be strictly “volunteers”; participants could be paid in lieu of collecting unemployment.

Only when we let go of the past can we embrace, imagine, and build tomorrow.

©Elizabeth Edersheim