In June 2015 Lina Bowden, chair of the Innovation Works Finance Committee (Finance Committee), needed to finalize a plan to raise an additional $1,000,000 of capital. The capital would primarily be used to fund renovations to a building that had become known as Innovation Works, a novel coworking space and social innovation hub located in London, Ontario, Canada. The building was already secured; however, significant renovations were required before all floors could be rented. The Innovation Works project was spearheaded in 2009 by Pillar Nonprofit Network, a member-based organization comprised of nonprofit organizations. Members of the Innovation Works Project Team (Project Team) expressed a strong desire to launch London's first ever community bond to finance the renovations. The Project Team tasked the Finance Committee, lead by Bowden, with the job of providing a recommendation on the viability of the community bond financing strategy. If it was determined that a round of community bond financing was indeed viable, Bowden would need to recommend bond structure details as well as report how much capital would be needed in a second round of financing. If she concluded that community bond financing was not viable, she would need to present a convincing case for pursuing another strategy given the team's strong desire to make a statement in the community.
Case describes the career journey of the owner of two small family businesses, and illustrates the intertwining of crisis planning, retirement planning, and succession planning. The owner loses more than $500,000 in some problematic ventures, but gradually achieves steady profitability. At age 62 he has a heart attack, requiring emergency triple-bypass surgery. His wife, shaken by this close call, asks her husband to retire or at least sell one of their two businesses. However, this owner-manager is in no hurry to relinquish control. Next, a fire destroys his fast-casual restaurant, and the insurance settlement will not fully cover the cost of renovations to restore it to full operation. He considers several options: 1) walk away from it (minimal renovation, covered by insurance) and focus on his granite restoration business; 2) restore and return the restaurant to full operation (drawing on his personal savings) and continue as before. Discussing this case helps students appreciate why family business owners should plan for predictable surprises and how and why to develop a solid management succession plan.
In fall 2018, the 64-year-old owner of a small 5th-generation family business in rural Iowa has not begun succession or retirement planning. His older daughter asks to talk with him about possibly taking over the store someday; Skip defers this talk until after the busy harvest season. A few days later "Big Ag Feeds" (disguised) offers to buy his business; they want an answer by year-end. Skip discusses the offer with his wife. If he accepts it, ownership would transfer to Big Ag in four years, ending the family business legacy. Skip always assumed he would keep the business in the family, yet now he considers this option and three others: 1) Counter-propose to transfer ownership to Big Ag in one year ("clean break" to retirement). 2) Groom his daughter to succeed him as owner/manager; 3) Hire an outside manager to run the store (retain ownership). Seeing that times are changing (huge agribusinesses are replacing small farms, with repercussions for his business; emerging technologies and new government regulations bring other opportunities and threats) Skip believes the next owner/manager will face a tougher road than the rough road he traveled in his career journey.
In January 2016, Silvio ElÃas, co-founder and CEO of Veritas, Catalonia's leading organic supermarket chain, headed to a meeting with the company's board to present the alternative options to enter in Madrid. At that time, Madrid was thriving like no other Spanish region and stood out as an attractive market for expansion. Most of all, operating in the nation's capital accounted for an instrumental step forward on the path to accomplish ElÃas' overriding vision: turning Veritas into Spain's organic food leader. Nonetheless, Spain's organic food retailing landscape was changing very rapidly, with increased, fierce competition from a diverse range of players. Against this competitive backdrop, ElÃas wondered if Veritas should approach Madrid by opening their own stores, following the same strategy it had used to rise as industry leader in Catalonia. Eroski, a conventional supermarket chain, had also reached out to ElÃas to offer Veritas an opportunity to display some of its private label products at Eroski's stores in Madrid as they did in Catalonia. ElÃas needed to make the final decision on his recommendation to the board.
The author-the Chief Economist at the Creative Destruction Lab-argues that recent developments in artificial intelligence constitute advances in prediction. Prediction occurs when you use information that you have to produce information that you do not have. In a wide-ranging interview, he says that importantly, this is all machine learning does. It cannot establish causal relationships and therefore it must be used with care in the face of uncertainty and limited data. As a result, he explains why workers will be making more complex decisions going forward, and why there will always be a role for human judgment in every organization.
If you trace the origin of any creative breakthrough, it is possible to find the point where someone changed the question. The author-who co-wrote The Innovator's DNA with Clayton Christensen-shows that questions can do amazing things: Knock down the walls that have been constraining your thinking; remove one or more of the 'givens' in a line of thinking; and open up space for inquiry that had been closed off by narrow framing. He provides a three-step framework for asking better questions and re-framing issues, showing that if you can properly phrase a question, the answer is the easy part.
Most of the big car manufacturers now have an automatic vehicle ('AV') division and expect to make the technology available to the mass market as early as 2025. And by the year 2045, AV market share is predicted to be as high as 87.2 per cent. The authors share findings from their study of 55 cities worldwide that are taking a holistic approach to implementing multifaceted AV policies-covering everything from traffic rules to land use, ride sharing and taxi reform. They describe the progress made to date and the key challenges that lie ahead as consumers, cities and regions embrace this disruptive technology.
The high degree of change in today's environment demands that organizations adapt their strategy to new situations much more frequently than ever before. Yet in a world of 'transient advantage', too many companies are obsessed with traditional industry analysis and continue to define their most important competitors as the other companies within their industry. In a wide-ranging interview, the author shows that this is a very dangerous way to think about competition right now. In more and more markets, we are seeing industries competing with other industries, business models competing with other business models - even within the same industry - and entirely new categories emerging. She describes the new mindset required to thrive in an age of transient advantage, explaining the roles of 'continuous reconfiguration', healthy disengagement and more.
Managers often express a grave concern about how fast artificial intelligence is unfolding - so fast that they become afraid of committing to any one supplier or standard. But precisely because we are living in a world of accelerated change, it is critical to stay in the know. The author describes some of the key concepts that every manager should be familiar with in the 'second machine age'. In the end, he shows that companies can no longer claim conventional advantages by virtue of being 'vertically integrated'; instead, they will be under tremendous pressure to match smaller players that are able to deliver customized solutions in real time as orders are made. In other words, in the second machine age, big companies need to act small.
The most innovative organizations realize that the best strategy in the world will get you nowhere unless you relentlessly make it happen. They show that the relentless execution of innovation has five key characteristics: clarity, focus, commitment to change, acceptance of failure and close proximity to customers. In the end, they show that getting things done with a relentless can-do attitude demands a degree of bravery that few organizations demonstrate; and that, as indicated by the stories of Amazon, Netflix, Haier and many others, fortune truly does favour the brave.
It is widely accepted that creativity influences critical organizational outcomes. Yet many practitioners struggle to design work routines that foster creativity. In response to this 'knowledge gap', scholars have increasingly studied job design factors that enhance or hamper creativity. The authors focus on one under-explored job design factor that may influence creativity: task switching. They show that, by forcing individuals to temporarily put tasks aside, a 'continual-switch' approach elevates creative performance by alleviating the tendency to cognitively 'fixate' on ineffective ideas or problem-solving strategies.
The core challenge in healthcare is not a lack of funding, commitment or individual skill. The key issue that demands disruptive innovation is that healthcare systems are highly fragmented. The author argues that the best solution is for healthcare vendors to engage more actively in the system as value chain partners. Actors across the healthcare value chain need to improve their public perception, and one way to achieve that is to work together in stronger partnerships. He explains why commercial vendors offer key knowledge and appropriate incentives as central actors in these partnerships.
The combination of artificial and human intelligence will not only drive breakthrough discoveries, it will also free employees from mundane work. Already, human creativity and judgment augmented by the computational power of AI has led to breakthroughs in energy generation and storage, drug therapies and space exploration. Next, it could yield solutions to some of humanity's most intractable problems. And what lies beyond could be even more transformative: A convergence of information technology, biotechnology and nanotechnology that promises to overhaul the very definition of what it means to be human.
Lurie took the helm at SurveyMonkey in the aftermath of tragedy: Dave Goldberg, the previous CEO and his longtime friend, had died suddenly at the age of 47. As a member of the company's board, Lurie first aided in the search for a replacement and then, after that person didn't work out, assumed the role himself. His employees were still in the grip of grief, fear, and anxiety. While continuing to provide them with emotional support, Lurie set about defining the company culture. When customers were asked what they valued most about the company's offerings, and employees what excited them about coming to work every day, the word that came up most often was "curiosity." Lurie and his team started encouraging and rewarding curiosity across the organization: celebrating the "question of the week" at town halls; using a peer recognition program to reward people for their candor; hosting the Goldie Speaker Series (named for the deceased CEO) to learn about success in other fields. They believe that when curiosity ebbs, people lapse into routine and complacency, exposing a company to disruption.
Innovative cultures are generally depicted as pretty fun. They're characterized by a tolerance for failure and a willingness to experiment. They're seen as being psychologically safe, highly collaborative, and nonhierarchical. And research suggests that these behaviors translate into better innovative performance. But despite the fact that innovative cultures are desirable, and that most leaders claim to understand what they entail, they are hard to create and sustain. That's because the easy-to-like behaviors that get so much attention are only one side of the coin. They must be counterbalanced by some tougher and frankly less fun behaviors: an intolerance for incompetence, rigorous discipline, brutal candor, a high level of individual accountability, and strong leadership. Unless the tensions created by this paradox are carefully managed, attempts to create an innovative culture will fail.
As they fight for survival in the era of online shopping, brick-and-mortar retailers are cutting costs by slashing head count and budgets for training. But that erodes their biggest edge over e-tailers: a live person customers can talk to face-to-face. For every dollar a retailer saves on staffing, it may be losing several dollars in revenues and gross profits if customers leave stores empty-handed because they can't find a knowledgeable salesperson to help them. The solution lies in optimizing staffing and training for each store, but most retailers don't know how to do that. This article offers them a step-by-step approach. It involves analyzing historical data, conducting experiments, and assessing the results, and when applied systematically can add as much as 20% to the revenues of existing stores. Even better, if staffing increases at some stores are offset by cuts at others, and vendors fund product training, those higher sales will cost retailers little or nothing to generate.
While most firms are adept at defining product brands, they're less sure-footed with their corporate brands. What exactly does a parent company's name represent, and how is it perceived in the marketplace? A strong corporate identity provides direction and purpose, boosts the standing of products, aids in recruiting, and shores up a firm's reputation. To help organizations define theirs, the authors have devised a tool called the "corporate brand identity matrix." It guides teams through an examination of the nine components of corporate identity, which include mission, culture, relationships, and core values and promises. Often that exercise reveals broken links between the elements that executives need to align and strengthen. This article describes how companies have used the matrix to clarify their relationships with daughter brands, retool their identities to support new businesses, revamp their overall image, evaluate targets for acquisition, and more.
With emerging-market giants such as Brazil, Russia, India, and China experiencing slowdowns, investors, entrepreneurs, and multinationals are looking elsewhere. They've been eyeing frontier economies such as Nigeria and Pakistan with great interest--and enormous trepidation. Can one find serious growth opportunities amid extreme poverty and a lack of infrastructure and institutions? The answer, the authors argue, is yes. The key lies in "market-creating innovations": products and services that speak to unmet local needs, create local jobs, and scale up quickly. Examples range from MicroEnsure, which has made insurance affordable for 56 million people in emerging economies, to Galanz, which has brought microwave ovens to millions of Chinese consumers previously considered too poor to buy such an appliance. What's more, the essentials of development can be "pulled in" by market-creating innovators--and over time, governments and financial institutions tend to offer their support.
Impact investing--directing capital to ventures that are expected to yield social and environmental benefits as well as profits--provides investors with a way to "do well by doing good." But whereas the business world has tools for estimating a potential investment's financial yield, it lacks them for estimating social rewards in dollar terms. Now the Rise Fund and the Bridgespan Group have developed what they call the "impact multiple of money" (IMM) to demonstrate the value of putting impact underwriting on the same footing as financial underwriting. In this article they explain their six-step process for calculating it: (1) Assess the relevance and scale of a potential product, service, or project. (2) Identify target social or environmental outcomes. (3) Estimate the economic value of those outcomes to society. (4) Adjust for risks. (5) Estimate terminal value. (6) Calculate the social return on every dollar spent. The IMM, they write, "offers a rigorous methodology to advance the art of allocating capital to achieve social benefit."