Feed Translate



GlobeSpotting with Steve Hamm - BusinessWeek

Read the latest globalization blogs on innovation and leadership. Get up-to-date news on the benefits of globalization, offshore outsourcing and global innovation.



Farewell

Today is my last day at BusinessWeek, and I got shut out of the corporate Intranet when I was in the middle of posting the last blog item. Seems fitting. (I got back in via a friend's log-in.) I'm going to continue blogging on my own at Globespotting.net. I hope to see you there.

 
Dec 1, 2009 10:34:09 AM (9 months ago)

The Power of Government-as-Platform

The most successful companies in the tech industry learned long ago that they would be far stronger if they created an ecosystem of allies who build businesses on top of theirs. They designed their technology as platforms, or foundations, for others to build upon. (Think Microsoft's Windows and the hundreds of thousands of applications created to run on top of it.)

Now governments are following the same path--most notably the Obama administration. It's attempting to create an innovation platform that organizations and businesses can use to make themselves stronger and/or help improve the performance of government. Tim O'Reilly, the founder of O'Reilly Media and promoter of the Web 2.0 and Gov 2.0 phenomena, calls this the Obama administration's most important technology initiative. "The government is starting to think like a platform provider rather than an application provider," he wrote me in an e-mail.

The most significant step so far has been Federal CIO Vivek Kundra's Data.gov project. Launched on May 21, Data.gov is a collection of federal data housed on the www.data.gov Web site that's open to public access. It's not just a bunch of impenetrable databases, through. Kundra and his team has provided easy-to-use tools that people can use to make use of the data--and they welcome suggestions on additional data sets and tools that people would find useful. The project launched with 47 data sets and now hosts over 118.000 of them.

A couple of examples of how Data.gov has been put to use:

Datamasher: Allows people to compare vital economic and demographic data by state, and view it graphically. There are more than 1,500 mashups of data available so far.

FlyOnTime.us: Allows travelers to see the on-time records of specific flights between cities.

One unintended effect: In an era when traditional media is short of people and resources, non-journalists can do their own investigating and data mining.

This notion of providing an innovation platform is central to the national innovation strategy being developed by the federal Chief Technology Officer, Aneesh Chopra. He's in the final stages of working up his platform for consumer e-health, and says he'll reveal the details soon. For now, here's a high-level teaser: "The government doesn't have to run everything. We can create the conditions whereby we improve our collective well-being."

I have a feeling that Big Government, Obama-style, is going to be a new sort of Big Government. Likely better, too.


 
Dec 1, 2009 9:03:37 AM (9 months ago)

Can Obama Make Big Government Run Better?

The Obama administration has mapped out an incredibly ambitious set of objectives: stimulate the economy; reform the health care system; save the planet; and combat terrorists. But all of this saving, stimulating, reforming, and combating is making government ever larger and more expensive. So another task looms large: Obama has to make government run better--meaning more efficiently and effectively. If he fails to do so, he'll lose the support of the people and will have no chance of completing his agenda.

I spent the last few weeks working on a story about this effort. My conclusion: Despite the immense difficulty of the job, Obama's team has the potential for making real progress. However, given the hysterical tone of the national debate, I fear that it's unlikely that improvements in government operations will register and will sway public opinion. In scoundrel times like these, fear and loathing trump rationality and earnest hard work.

The government efficiency team is captained by Jeff Zients, a private sector efficiency expert. For details of what Zients and his team are up to, read the story. But there were a couple of themes I couldn't get into, for space-shortage reasons, so I'm going to explore them here:

1) I was impressed by the Obamans respect for the people who work in government. The Bush administration treated government workers like lazy dolts--setting rigid goals for them and outsourcing government functions to private industry as much as possible. (Do a Google search on "Halliburton" to see how well that worked out for the taxpayer.) In contrast, Zients helps government people set their own goals and provides some of the essential tools they need to accomplish them. Craig Newmark, founder of Craigslist and good-government maven, explains the shift: "In the past, government workers were told that government is the problem and nothing was expected of them. Now there's a new message: You do matter. Now, get stuff done."

2) One of the major debates that came up while I was developing the story was whether the Obama administration is being ambitious enough in its good-government efforts. This is tricky stuff. Chris Edwards, director of tax policy at the conservative Cato Institute, says the efforts by successive administrations to make government work more efficiently are laudable, but insufficient. "I think you can make marginal improvements around the edges but you don't get at the core problem." Which, in his view, is that government bureaucrats don't have the proper motivation and legislators are interested in getting credit from their constituents for bringing home the pork--regardless of whether the money is well spent. His prescription is do something big with government by making it smaller.

Don Kettl, dean of the University of Maryland School of Public Policy (and author of the new book, The Next Government of the United States), also faults the Obama administration--but for different reasons. He says its vitally important for Obama to make a big splash with the performance initiative so everybody involved understands how important it is and is highly motivated to make improvements. Also, he says, the administration needs to come up with a fundamentally new idea to build momentum around. "Unlike in the previous administrations, there isn't an obvious "new thing" that the administration has embraced," he wrote me in an e-mail. "There just isn't a large stock of intellectual capital that the administration is tapping--no 'big idea' to drive the effort."

Jeff Zients insists that Obama has made it clear within government that performance improvements are a top priority. But Zients doesn't believe a radical restructuring of government is needed. His model for the task at hand is Louis Gerstner, who was hired by IBM's board to turn around the company when it was on the rocks in 1993. The previous leaders had planned on breaking IBM into parts. Gerstner took an opposite approach: He would re-integrate the company and focus on making it run better. "He came in and started to change the culture," says Zients. "He delivered the message that IBM needed to turn around or it could go out of business. In the end, it was the greatest turnaround in modern business history. It was all about execution. It wasn't about vision or grand strategy."

There have been other corporate turnarounds that followed a similar path. Mark Hurd's work at Hewlett-Packard is another instance of execution being more important than vision. But the countervailing example is a powerful one: Steve Jobs' transformation of Apple. The difference is that HP and IBM had vast resources that could, if harnessed properly, produce very successful businesses. Apple, when Jobs returned from banishment, was in a very different situation. It was on the verge of irrelevancy. To me, the government's situation is closer to that of IBM and HP, so Zients' execution-oriented strategy seems more likely to be the right one.

Then again, given the rotten temper of these times, successful execution may not matter as much as it should.

 
Nov 30, 2009 11:26:34 AM (9 months ago)

Who Knew NIST Could Be So Sexy?

The National Institute of Standards and Technology has been in existence since 1901--responsible for promoting economic development via standards setting and measuring. Vital work, to be sure, but seemingly dull, at least to the non-measurement scientists among us. But now something really intriguing his happening. The onrush of the smart grid, cloud computing, green energy, sustainable manufacturing, e-health, and a new wave of cybersecurity threats has suddenly placed NIST in the middle of some of the most crucial technology advances of our era. One result: it's a great time to be Pat Gallagher, the newly appointed NIST director. "NIST has never been asked to perform such significant, high-visibility roles as it is now. Its day has come," he says.

Think about it this way. NIST is responsible for making sure the physical and technical interfaces in the nation's infrastructure fit together well. In the past, it concentrated on things like fire hydrant connections, so any fire hose could connect to any hydrant. Now it's handling digital systems of all types. Its role is becoming ever more vital as the world is increasingly networked.

The smart electrical grid is an example of the kind of role NIST is playing these days. Gallagher and his colleagues have come up with a three-phase approach that they hope will hasten the adoption of smart grid technologies and the energy savings they promise.

Phase I: NIST has been convening all of the parties with economic or business interests in transitioning to smart grids. In the past, most of the players in any standards discussions were in a single industry, but because of the importance of info tech in these initiatives, new players are coming to the table. So NIST's role as a convener is important. It's bringing people together and helping them identify the standards that already exist that can be used or adapted. Then it's working to identify the gaps and help to define the system architecture that needs to be put into place. This phase has been underway for 6 months.

Phase II: It's putting together a permanent governance model for ongoing standards and measurement deliberations. Last week it announced the formation of a panel to oversee the development of standards--with 20 members elected by companies, trade groups, and government agencies. Members include Google's Vint Cerf, Intel's Matthew Theall, and the Consumer Electronics Association's Brian Markwalter.

Phase III: Getting the participants in smart grid initiatives to agree on measurement techniques and testing procedures. You want to make sure that devices and digital systems really do interoperate--that the interfaces really work. This is key, says Gallagher: "The real challenge isn't mal intent; it's the complexity of the system. When you put three and four devices on a network that have to talk to each other, with different ways of talking to each other, the complexity increases so fast that you can have 'emergent behaviors'--new behaviors you didn't anticipate when you look at the components in the system piece by piece." This phase also starts now.

Gallaher's approach points to one of the big challenges emerging in the 21st Century. Because of the application of digital networks to most every physical and electronic system, everything is increasingly connecting with everything else. And all those systems have to interoperate. So you don't just have to understand the inner workings of an individual system; you have to understand the inter workings of intersecting systems. So I'm talking about systems of systems.

This stuff is crazy complex.

But I'll predict this: The nations and companies and individuals that come to understand the interrelatedness of systems and take problems on holistically will be thriving a couple of decades from now. The ones who try to handle things the old fashioned way will lose out.

 
Nov 25, 2009 9:20:23 AM (9 months ago)

Consumer Tech Invades the Enterprise

...... and brings plenty of bugs with it.

The trend has been a long time coming, but corporations are finally caving in and okaying the use of free or mostly-free social networking Web sites as in-the-office software applications. Facebook, LinkedIN, Twitter, Google Apps, etc. are becoming the everyday tools of the knowledge worker--elbowing aside stodgy programs like Microsoft Outlook and the like. Corporate IT managers have been forced to accept the inevitable and lower their guards. Unfortunately, though, allowing workers unfettered use of social networking and Web 2.0 sites is like leaving the back door open on a restaurant. A lot of bugs are coming in.

Here's the problem: Traditional firewalls are fairly good at filtering out ordinary Web threats, but they're not good at managing Web 2.0 stuff. Enter Palo Alto Networks. The three-year-old Silicon Valley startup has leapfrogged legacy firewall makers such as CheckPoint and Cisco with its next-generation firewall technology. It inspects digital traffic coming from the Web into a corporate network and not only understands what's in the data flow but also recognizes the applications associated with it. This level of penetration allows corporate tech managers to set policies that block certain risky Web 2.0 activities, such as Facebook Chat, and limit other activities to people in the organization who need to do them. For instance, programmers who use the BitTorrent program to download software code can be permitted to do so while other employees can be blocked from using the program. "This is about dealing with the negatives of companies opening up to social media," says Rene Bonvanie, who heads worldwide marketing at Palo Alto Networks.

Bonvanie knows all about the risks and rewards of social media. Until a couple of months ago, he headed marketing at Serena Software, where he helped lead a major shift in software strategy. Over the past couple of years, the company has dropped most of its traditional software and is using Facebook, Google Apps, and other Web services instead. When Serena began the switchover, there wasn't much in the way of malicious code in the social media world. That's not true anymore. A prime example is Koobface, which targets the users of Facebook, MySpace, Friendster, and Twitter. Another is the spam program being run by My Mafia Family, an online game, which gets its tentacles into people's Twitter accounts and the won't let got. At one point, the company had to close off all external file sharing via Google.

There are lots of Web 2.0 services that are vulnerable to being abused by Black Hat hackers and other unscrupulous operators. Palo Alto Networks does occasional studies of the aggregate traffic of its 600 corporate customers, and the survey done in September found 202 Web 2.0 services inside corporations, 70% of them capable of transferring files and 28% of them known to propagate malware.

As employees use more and more Web 2.0 stuff, the threats will get worse and worse. It just goes to show once again: Free software doesn't necessarily come without costs.

 
Nov 24, 2009 3:20:37 PM (9 months ago)

Social Networking for Global Citizens

When Google launched Orkut in 2004, the social networking site seemed to have the potential to eventually grow to rival MySpace and Facebook in size and influence. That didn't happen. Early on, Netizens from Brazil became such avid users of the site that many people from other countries felt out of place and settled elsewhere. These days, according to Wikipedia, about half of Orkut's users are Brazilian and another 18% are Indian. (Apparently Indians aren't put off by Portuguese. What could that mean?) The first social networking site that seemed positioned to be global didn't work out that way.

Now, along comes an upstart with truly global ambitions. It's XIHA Life Launched last year, the site was designed from the ground up by a young Finn living in China, Jani Penttinnen, to be multilingual and to bridge between languages and cultures. Users submit content or chat in their own languages and other people can translate the discrete chunks using Google's translation technology, which is deeply embedded in the site. Today, the site has 600,000 registered users from 208 countries (No country accounts for more than 5% of the total traffic) and about 1 million unique visitors per month. Small, yes, but it's only a year old. Penttinnen, a soft spoken guy with an elfin persona, has ambitious growth targets: 5 million in the next year and 30 million in the next five years.

This site has great potential in its globalocity. But it's not for everyone. It's a magnet for people who see themselves as global citizens or who want to reach across the national chasms. (A group that's about 70% female.) For some, the site offers the possibility of developing online pen pals. For others, it's mostly about reaching out to people in places where they're planning to travel or where they're temporarily working to get the skinny on what they should see and do. A smaller group is hooking up with people willing to help them learn a foreign language. "We try to get and keep the 'right' people--the people who are focused on our themes," says Penttinen. To help steer things in the right direction, he's rounding up a network of expats who will produce high-quality blogs about their experiences--in exchange for small fees. (If you think you have the right stuff, contact Jani@xihalife.com)

Penttinnen, 33, has a personal history befitting his occupation. He came to the US in the early 2000s as a game software programmer when he was hired by EA's Westwood Studios in Las Vegas. After EA closed the studio in 2003, he launched his own tiny mobile gaming company, XIHA Games, with a dab of angel funding. He tried to keep costs ultra-low by outsourcing much of the programming to China, but discovered that remote management of software projects didn't work very well. So he moved to China and managed a small team of programmers. A new problem emerged: To make it in the mobile gaming business, he needed to create versions of his games for each handset operating system--a huge amount of work that was unattractive to him. Fortunately, he had a hobby that he could turn into a business. Back in 2006, he had launched a crude social networking Web site aimed at an international and multilingual audience. In late 2007, he and his Chinese wife, Wen, moved to Finland and launched an early version of XIHA Life.

This could be one of those really good ideas that never grows up, though. XIHA Life doesn't have much of a business model. Today, Penttinnen, collects affiliate fees for selling mobile games and connecting people with travel sites. That won't support a big operation. Fortunately, he has low costs. The whole thing runs on a single server (Highly optimized software) So it seems likely that XIHA Life will have a chance to succeed. In the meantime, it will be well worth watching to see how a truly global community develops. It could teach valuable lessons even if it doesn't become the next big thing. And, for travel-related businesses, it could turn into a valuable advertising and sales venue.

By the way, xiha means "fun" or "happy" in Mandarin and "Hip-Hop" in Cantonese.

 
Nov 23, 2009 10:48:23 AM (10 months ago)

The (Attempted) Rebirth of Silicon Graphics

Silicon Graphics Inc., or SGI, is one of the storied Silicon Valley names. Co-founded by Jim Clark (who later co-founded Netscape) in 1981, SGI was a pioneer in powerful desktop engineering workstations and, later, super-powerful servers. The company got hammered by Sun Microsystems and other competitors and became a shadow of its former self after the dot-com bust. It filed for bankruptcy in 2006, limped along in a zombie state, and then was picked up in May for about $25 million by Rackable Systems--which bought it out of a second bankruptcy proceeding. Rackable renamed itself Silicon Graphics International to squeeze the remaining brand equity out of the Silicon Graphics name. Mark Barrenechea, a former Oracle and CA executive who took over as CEO of Rackable in 2006, has the task of reviving a faded icon. "It's humbling to have this incredible brand under my stewardship," he told me recently.

He's got a terribly tough job. Only two tech icons have brushed with death and come back to become powerful factors in the industry again: Apple and IBM. One of Barrenechea's hurdles is the name itself. It cuts both ways. While there's brand equity in SGI, the name also has the odor of failure lingering around it. Do tech managers really want to buy from a faded icon? While SGI's 6000 existing customers may want to stick with the name they know and the technology they have adopted, it seems unlikely that new customers will rush to sign up.

So the value of the name is a question mark.

Barrenechea is depending on other factors, namely new product development and the trend winds, to power the new SGI forward. The trend winds are blowing in his direction. Rackable specialized in producing thousands of small computer servers that are mounted on racks in data centers--so it's benefiting from the growing popularity of cloud computing. On the product side, the new SGI is starting to deliver new computers that were already underway before the merger was completed, and which strengthen its hand in a couple of important markets.

First, a month ago, it introduced a new line of deskside supercomputers for use by university researchers, national laboratories, and product designers. These babies take up very little space (one foot by two feet) but pack up to 80 microprocessor cores.

Second, on Monday, the company announced a new generation of server products, called Altix UV, aimed at supercomputing applications, large-scale databases, and data analytics. The clustered machines take advantage of x86 processors, the Linux operating system, and shared memory--so they're economical. SGI hopes to differentiate itself with a proprietary and ultra-fast interconnect system linking the servers. This marks Barrenechea's attempt to keep SGI relevant in the high-performance computing market--where he hopes to collect 30% to 40% of the company's revenues.

SGI has a solid position in supercomputing. One of its systems, nicknamed Pleiades, located at NASA's Ames Research Center in California, ranked sixth on the Top500 semi-annual ranking of supercomputers that was released on November 15. Bill Thigpen, engineering branch chief in NASA's advanced supercomputing center at Ames, says he and his colleagues chose SGI's technology when they installed the machine last year because "we got the most computing for our dollar." Also, the supercomputing center provides shared services for all of NASA, so it needs general-purpose machines that can handle a wide variety of software. That's what SGI sells. Thigpen calls the merger of SGI and Rackspace a good marriage. "It's good for the industry. By having multiple vendors in the space, everybody benefits. And having multiple healthy vendors is even better," he says.

But the crowded competitive landscape is going to be a major challenge for SGI. It faces supercomputing giants HP and IBM, an on-rushing Dell, and a strong niche player in Cray, which captured two of the top three positions in the Top500 ranking. Sun Microsystems is fading, true enough. But in a business where size matters a lot, SGI will have a difficult time keeping up with the giants.

I don't know enough about SGI and its markets to expertly handicap its chances, but, based on what I know of the industry I'm going to have to wish Barrenechea luck. He'll need it.

 
Nov 18, 2009 9:52:10 AM (10 months ago)

Globespotting and International Students

I was pleased to get an e-mail message today from Online Colleges.Net telling me that Globespotting ranked in the top 10, overall, among blogs that appeal to international business students. Here's the list: http://tinyurl.com/ykvdamb

A lot of the people who post comments on Globespotting are angry about one thing or another, which, of course, disappoints me. I hope my blog can build bridges across cultures and continents.

 
Nov 16, 2009 9:19:37 AM (10 months ago)

Kiva Plays Loose With the Facts

Kiva.org has been one of my favorite social enterprises even since I started lending small amounts of money to poor entrepreneurs in developing nations a couple of years ago. To me, what was so compelling about it was you could read little stories about entrepreneurs then choose the one you want to back. At least that's what Kiva said was happening. Turns out, that was a fiction--in most cases. Instead, Kiva channels money to micro-finance organizations that have already made the loans. I read about this outrage today in a story in the New York Times. The person who exposed the fiction, David Roodman, laid out his findings in a blog posting. A more charitable person might forgive Kiva.org for misrepresenting how its model works. But not me. Social enterprises should be held to an even higher standard than are for-profit businesses--not a lower one.

 
Nov 9, 2009 2:26:48 PM (10 months ago)

A Mini-MBA Program for Social Entrepreneurs

One of the tough things about being a social entrepreneur, I'm told, is that it's lonely out there. Unlike regular entrepreneurs who can readily find other people in their geographic proximity and share ideas and experiences with them, social entrepreneurs tend to be widely scattered. They commune via social networks or at infrequent and typically short gatherings of the clan.

A group of four friends in Boulder, Colorado, has come up with an inventive way to address the loneliness of the social entrepreneur. These folks, founders of The Unreasonable Institute, have created a 10-week mini-MBA for promoters of social change. No, check that. The metaphor isn't quite right. That's because the 25 or so young entrepreneurs who participate in the program next summer won't just be learning the skills of social business; they'll be putting them to work, too. The idea is to come up with ideas, develop them into business plans, vet them, divide up a small pool of venture capital, and connect with a support network--all in the span of an intense 10 weeks. It's like packaging Silicon Valley in a box. "We want to give young social entrepreneurs the skills, training, and networks to help their ideas grow wings and create a lot of impact," says Tyler Hartung, the Institute's community tactician.

The four founders, all University of Colorado at Boulder grads, scan like a mini-United Nations. They refined their ideas for the Institute last summer when they were widely scattered: Teju Ravilochan in Boulder; Vladimir Dubovskiy in India; Daniel Epstein on a bike ride down the West Coast; and Hartung volunteering for a microfinance outfit in Uganda. "It was a most unreasonable time for our founding team," quips Hartung.

For sure, these guys are having almost too much of a good time, but their idea seems to be both ingenius and practical. All experienced social entrepreneurs themselves, they'll do a lot of the training in the program, but they're also planning on bringing in 50 mentors from around the world who are experts in everything from business formation and venture capital to international development and poverty alleviation.

The whole process gets started on Nov. 15, when they begin taking applications from people who want to be Unreasonable Fellows. (www.unreasonableinstitute.org) Applications close on Dec. 15 and a list of finalists will be posted on Dec. 20. Then it's time for philanthropists and social investors to get into the act. They'll vote with their dollars for the entrepreneurs who seem to be most promising, and every applicant who raises the $6,500 tuition by Jan. 31 that way will be invited to the summer program. "We want market forces to determine who will come," explains Hartung.

Now for my part: I'm supposed to help the group round up applicants and funders for the program. So, how about it?

 
Nov 4, 2009 4:59:16 PM (10 months ago)

Hillary Clinton's Tech Guru on 21st Century Statecraft

This is a relief. Alec Ross, one of the key architects of Barack Obama's technology policy during last year's campaign, isn't pushing ultra-high-tech solutions as a cure-all for the world's diplomatic and social problems now that he's senior adviser on innovation for Secretary of State Hillary Clinton. He's practicing the art of the practical.

Ross's job at State is to figure out how to use the global communications network to address poverty, health pandemics, human rights violations and the like. "With the ubiquity of our global networks, there are opportunities to engage with people that weren't possible in the past. We're practicing what I call 21st Century statecraft," he says. While he's supposed to use technology to accomplish Clinton's goals, "In some cases it's cutting edge. In other cases it's basic."

There's a temptation to fantasize that just because the opposition in Iran used Twitter so successfully during its brief uprising, the latest in social media can be spread around globally like some sort of super digital goo. So it's good to know that Ross is thinking in a more nuanced way. He gave me a couple of examples of calibrated responses to particular situations.

The low-tech solution: In the eastern Democratic Republic of Congo, where nobody rules and militias run wild, one key issue is figuring out how to get militia members to quit fighting and return to peaceful living. Ross visited with former militia members in demobilization camps and asked them for their advice. What he heard back was that the authorities should use radio to communicate with fighters who are hiding out in the bush, since they all listen to it. The former fighters also suggested that they should be put on air. Fighters would listen to somebody else who had walked in their shoes. So now the State Department is putting together a radio outreach program. "We use 1920s technology if 1920s technology is the right solution," Ross says.

The high-tech solution: In Mexico, the State Dept. is working with the Mexican government, NGOs, and telecom companies to set up a system for tracking crimes. Right now, a big problem there is that citizens are afraid to report crimes for fear of reprisals--sometimes via police who are working with the thugs. So Ross and his collaborators are working on a cellphone-base tip-off system for the police that will scrub identifying information about the tipsters from the system. They're also planning on mapping out the activities of common criminals and narco-trafficantes in near real-time on Web sites, so citizens can see where to avoid. "We're bringing transparency to the activities of the bad guys and empowering citizens," says Ross.


 
Nov 2, 2009 5:31:13 PM (10 months ago)

Help with Story About Government Effectiveness

I’m working on a story about the Obama Administration’s efforts to make the federal government more effective and efficient. Over the past few months, the USCIS has made a series of modifications to its Web site to make it easier for applicants for green cards and citizenship to find out the status of their applications and understand what is required of them. I’d like to speak to one or two people who have had extremely frustrating experiences in the past with the case-tracking system—to speak to them about those experiences and find out if the new system is any better. Please e-mail me at steve_hamm@businessweek.com. Also, feel free to comment on this blog posting.

 
Nov 2, 2009 9:29:01 AM (10 months ago)

How to Achieve Global Food Security

By Guest Blogger Bruce McNamer
CEO of TechnoServe

World hunger is projected to reach a historic high in 2009 with more than one billion people -- one out of every six people on the planet; one out of three Africans - going hungry every day. From rural African communities to private high-tech research labs, many parties are working towards lasting solutions.

A global lack of food is not culpable for increasing food insecurity and hunger. The projected 2009 global cereal harvest is a mere three percent below the record world harvest of 2008 and will be the second highest ever. And globally, the use of maize and other foodstuffs for biofuels (i.e., non-food uses) is marginally significant.

Then, what's causing the increase in world hunger?

Part of the answer is the worldwide economic downturn. The global recession has affected poor individuals and communities in developing countries by starkly reducing their employment opportunities, incomes (including domestic and international remittances), and their ability to buy food. These hardships are exacerbated and complicated by ongoing challenges like weak business policy and regulatory frameworks (and enforcement capacities), lack of investment and business growth, declining soil fertility and infrastructure, and minimal access to information and technology.

In 2008, the World Bank's World Development Report assembled overwhelming evidence that broad-based agricultural growth is the most powerful way to reduce rural poverty and also improve food security. To increase local agricultural productivity and spur agriculture-based growth, a variety of organizations, from governments and regulatory agencies to financial institutions, agribusinesses and nonprofits, must collaborate on five key pursuits:

First and foremost, we need to develop human capital by teaching local farmers and entrepreneurs the skills they need to thrive. By mastering agronomic and business best practices farmers can maximize the productivity and profitability of their crops, participate in crop sectors on a more competitive footing and gain access to new markets and sources of finance. Other entrepreneurs across agriculture-based industries, from input suppliers to processors to end-product distributors, need to improve their capacity to identify and develop opportunities and profit by providing goods and services that boost productivity and add value.

Second, social capital is required, in the form of effective producer groups and supporting institutions. Through these organizations, transaction costs can be minimized and the rural poor can negotiate with markets more equitably.

Third, financial capital is needed to enable local entrepreneurs to operate and invest for growth in their businesses. This requires intermediation focused on steering affordable capital flows to investments that will generate productivity improvements and poverty reduction.

Fourth, physical capital, such as road networks, grain storage, power grids, irrigation and sanitation systems, hospitals, and schools, is critical to stimulating economic activity and increasing incomes. Until local tax bases improve, outside assistance is needed.

Finally, we must ensure effective markets exist. Markets are the basis for buyers and sellers to interact, by generating mechanisms for distribution, establishing prices and effecting transactions. Open transparent markets weave these different forms of capital together and optimize value.

Only when we integrate these efforts, can impoverished communities take significant strides towards lasting improved welfare. Communities will be able to feed themselves, the incomes of small farmers and agricultural workers will increase, and new jobs will be created. Also, as more food becomes available, prices will drop in growing urban markets, resulting in broad increases in disposable income for education, healthcare, housing and other needs, all of which improve communities and their broader society.

In order to achieve global food security and end the hunger crisis farmers, investors, agri-businesses and governments are starting to come together at the local level to build more open and efficient agricultural markets. Global leaders also need to agree to deploy their development assistance commitments according to the following principles: 1) apply lessons from prior experiences of boosting productivity in food crops; 2) focus on holistic programs in crop sectors with the greatest economic opportunities, and 3) plan for sustainability -- economic, social and environmental.

Sustainable global food security is possible. Many are ready to do their part. Our leaders need to do theirs.

###

Bruce McNamer is President and CEO of TechnoServe, a global non-profit organization that empowers people in the developing world to build businesses that break the cycle of poverty.

 
Oct 30, 2009 3:48:15 PM (10 months ago)

Galleon: Another Black Mark for the Tech Industry

When the tech industry and Wall Street intersect, often, bad things happen. First came the shenanigans around the dot-com boom and bust, then the skullduggery at CA and Peregrine, then the stock option backdating scandal, and now the Galleon insider trading blowup. For the tech industry, it has been a decade of infamy.

I guess this dismal track record is no surprise for a dynamic industry where stock prices are volatile and fabulous fortunes have been gained by so many. Tech is an easy mark for unscrupulous people.

But are these waves of badness the work of a few rotten apples or is there a climate of corruption surrounding the tech industry? I asked this question today of John Mutch, CEO of software maker BeyondTrust Corp., who has seen the tech industry from some very interesting vantage points. After working for nearly two decades at Microsoft, one of the straight-arrow companies, he later served as CEO of Peregrine Systems after several of its executives were fired and prosecuted on charges of falsifying sales and accounting information. He recalls that the scandal was still unfolding after he was hired as CEO to attempt a turnaround of the company. During a speech he was giving to the staff, the FBI entered the room and arrested two Peregrine managers.

Early this morning, I had read one of the government's complaints in the Galleon matter, this one against Danielle Chiesi and Mark Kurland of Newcastle Partners and Robert Moffat of IBM. Then I read that former AMD CEO Hector Ruiz, long considered one of the industry's boy scouts, is being implicated. It all made my head swim.

I asked Mutch: Is the Galleon mess an anomaly or are there many crooked information-gathering networks operating under the covers? His answer: "Unfortunately, I think the tentacles of information networks that cross the boundary of insider trading are deep and pervasive in the industry."

He recalls being called in the past by Wall Street types in search of intelligence about upcoming earnings announcement. Which he rebuffed. He said people in the investment community work hard to develop sources of information, sometimes without much regard for propriety. And their sources within the tech industry, he said, don't seem to understand when they're nearing or crossing the line. "People feel, 'If I'm not trading, I'm not doing anything wrong,'" he said. "They don't understand that tipping is an illegal activity."

Clearly, there's harm in this type of activity. It gives some people unfair advantages in the equity markets. But Mutch says it also puts a black mark on the reputation of the tech industry--hurting the entire industry's credibility. "This is a great industry. I don't want to see it dragged into the mud," he told me.

I remember that during one of the earlier scandals, I surveyed some of the most respected leaders in Silicon Valley, and Bill Campbell, the longtime chairman of Intuit scolded the industry for having lax values. But, think about it: you seldom hear giants of the industry preaching about law-breaking or ethics. Maybe it seems uncool.

I'd like to hear more of it. The tech industry has a high calling. Information technology has tremendous potential to improve the workings of companies and the services of government, to build economies, and to empower individuals. But every new scandal cuts into the industry's credibility--making people wonder whether claims about the capabilities of tech are feed too often by the desire to profit at any cost.

In fact, I think the tech industry should operate with higher standards than others. Not only should people not break or shave the law, they should aim to have a positive impact on the world. This business isn't the same as selling toothpaste, or widgets, or complex derivatives, or sugar water. At least, in my view, it shouldn't be.

 
Oct 28, 2009 3:25:29 PM (10 months ago)

No Money Marketing

Over the past decade, India's top tech outsourcing firms have transformed the global IT services industry. Giants such as IBM, EDS, and Accenture had to adapt or face extreme consequences. One of the keys to the Indians' success was their low-cost labor, of course. But another advantage is that they're frugal in most everything they do.

That includes marketing. Unable to match the global brands in advertising clout, they came up with creative ways of getting the word out about their capabilities on a tight budget. Now one of the leading practitioners of this art, Jessie Paul, chief marketing officer for Wipro Technologies, has come out with a book, No Money Marketing, that tells how it's done. Her book is a great primer for upstart companies in emerging markets, but also provides useful ideas for people in large, established companies at a time when the Internet and globalization are putting big cracks in traditional marketing orthodoxy.

Here are some of the ways that Wipro spread the word on a tight budget:

--The company (and the other leading Indian outsourcers) took advantage of the network of more than 300,000 people of Indian origin that worked in the US tech industry. The company's executives, sales people, and marketers tapped their contacts among university alumni and former employees and colleagues to find allies in US corporations who helped them connect with decision makers.
--Because of the Internet, Wipro saw that it shouldn't attempt to segment and differentiate its marketing messages by type of customer. Instead, communicated mainly via the Web, its consistent marketing messages reinforced each other rather than clashing with one another.
--Corporate leaders were hungry for information about offshoring to India, and the operators of industry conferences needed experts to make speeches and sit on panels. Wipro came up with a pool of experts that it offered up to the conferences--and got a ton of free publicity.
--Rather than putting on huge and expensive user conferences, Wipro stages annual "Mandala" meetings of top executives at its clients. There are no sales pitches, just lots of big-think talk about management and technology issues, but the situation frequently yields new pieces of business.

Paul worked for Infosys, iGate, and Ogilvy & Mather before she went to Wipro, and her book has examples from those companies and more. One of her insights that interested me most concerns Infosys. She writes about "core branding" and "surround branding." Core branding is the work you do to communicate about the quality and benefits of your offerings. Surround branding is the work you do to create excitement about the brand and give it credibility. Early on, the leaders of Infosys decided to differentiate themselves from the competition by becoming world-class in each of the surround elements. They accomplished this by creating a strong ethics policy and financial transparency, for example. But surprising things mattered, too. Co-founder and longtime CEO Narayana Murthy noted that India had a reputation for being dirty and backward, so he insisted that the Infosys campus in Bangalore would be ultra neat and clean. In fact, he was known to personally supervise the cleaning of the cobblestone pathways with toothbrushes.

It worked. I can remember my first visit to Infosys, years ago. It was startling to leave the chaotic and gritty reality of Bangalore for Murthy's haven of calm and cleanliness.

India's big tech companies have successfully bridged the chasm between the emerging and the developed worlds. They did it in part by turning a disadvantage, their relative paucity of resources, into an asset--and some really innovative marketing techniques.

Read and learn.

 
Oct 27, 2009 2:05:09 PM (10 months ago)