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What’s All The Fuss About this New Sheriff at Downing Street?

kathyrobison — Thu, 15 Jul 2010 13:41:09 +0000

With an British mother and an American father, comparing the US and Great Britain is simply a way a life in my family . . . plus it gives me a bit of street-cred in this department. In this story, in my opinion, the Brits clearly win!

Sunday mornings with Fareed Zakaria on CNN are sacred in my house. Which basically means that my kids and husband abandon me for that hour. More often than not, I’m highly tempted to blog about one or two of the topics Fareed covers. I typically resist, because I rarely disagree with Fareed and over time I’m afraid I might come across as a “Fareed Groupie”, which could tarnish my image of a self-thinking, intelligent, strategic, modern woman. That said, this week, I am giving into temptation. I simply must blog about this new British government and the 39-year old George Osborne (Chancellor of the Exchequer – Secretary of the Treasury to Americans) whom I found to be slightly pompous (expected), highly intelligent (expected), but unexpectedly refreshing and on-point in his ideas around what people really want from their governments. I personally, think the US Republican party could take a lot of cues from the new conservative sheriffs at Downing Street. As an Independent, I actually prefer it when both the Democrats and Republicans are acting wisely as it makes for better candidate options and more solution oriented action.

If you missed the show, it’s easy to watch or listen on demand. Just click here.

Just to add my own touch to the conversation, and keep up my image, here are the four primary reasons why I like what I heard from Osborne and feel strongly that this is the direction that successful politicians will have to take (regardless of party) to be successful in the future.

Not Afraid to Act

Osborne has pledged to the British people that he will not hide hard choices from them and he will make them. He has clearly lived up to this campaign promise with his austere budget that is getting a lot of press. He feels strongly that the public wants a government who can admit when there is a real problem, and work quickly to get it fixed.

Proper Leadership

The kicker here is their assumption that the public can and should act as an intelligent deputy to a sheriff who is willing to make and stand behind decisions regardless of which direction the political winds are blowing. This new conservative party clearly recognizes that the British public clearly understands there is a debt problem, and that the country has been living beyond its means for some time, and so they are willing to take it on as their first priority. They also realize that not only Great Britain, but Europe, requires proper leadership to bolster their image and regain the world’s confidence in their ability to pay their own way.

Collaboration is Not a Death Sentence

Osborne speaks of forming a proper coalition government where the other party holds seats in the cabinet and how the real benefits of diversity in Parliament are less about looking different and more about being different and thinking different. One of the best statements Osborne makes in Fareed’s interview is, “We can’t abandon whole areas of policy to the Left in British politics. There is no reason why the Conservative Party should not have a progressive policy on climate change or be interested in issues of poverty and equity in our society and have answers to those issues.”

Open, Open, Open

They are open to new ideas, new views and anyone who can come up with a better way to reach a common goal. Osborne indicated that he constantly seeks out second opinions and alternative views. He encourages large numbers of people to come into meetings and say what they want to say, and understands that listening is a large part of the job. His office recently asked the broader group of public servants for their ideas on how to reduce budgets in a way that doesn’t damage the frontline services people receive. They received over 65,000 responses in a couple of weeks, and had some of them around to Number 11 Downing Street for a chat recently. Interactive governement . . . what a concept!

I’ve been saying for years (just ask my friends) that the politicians in the US are simply making things worse and what most people really want is an entirely new breed of politician that is much more suited for the 21^st century. We need politicians who care less about party line and more about solving problems. We need politicians who can explain both sides of an issue, without bias, and why they believe their decision is the best option. We need politicians who can work with other politicians to get the job done and stop wasting the public’s time and money on petty politics.

As much as I love they way in which this new and refreshing British government is behaving, I would certainly caution them that the best solution in today’s environment is likely a combination of austerity in some areas and stimulus in others. Because western politicians failed to play the austerity card when times were good, we are all now stuck in a precarious position. The equation is really quite simple and it works for government, companies, and at home. When times are good you pay off your debts, make smart investments, and put a little under the mattress for a rainy day. When times are hard you dig out your mattress money and stretch on credit a little if necessary. If used responsibly, credit can be a very stabilizing element in an economy. When abused, as we all now know, credit can backfire as surely as a 1970’s MG.

One of the things I love the most about this new government is the fact that they aren’t letting fear run the show. They are taking a stance, creating a strategy, and they are willing to listen to other ideas. The longer we let fear run our households, our businesses, and our politics, the longer this era of uncertainty will linger. It really is that simple.

Redeveloping the Real Estate Industry

kathyrobison — Wed, 30 Jun 2010 19:19:12 +0000

The opportunity to redevelop the real estate industry such that it contributes to the solutions the world is seeking, instead of continuing to pile on to the multitude of challenges, is huge. Such challenges include the energy crisis, climate change, natural resource preservation, population growth, urban sprawl with ineffective infrastructure, and a lack of sustainable growth practices. Those with the courage to see these opportunities and act upon them quickly will realize tremendous competitive and economic advantages.

Indulge me for a moment as I try to integrate the big picture of how the real estate industry can play a significant role in addressing the challenges we face as global citizens. Then, I’ll offer some details and specifics that outline a new approach to real estate.

Tom Friedman says in his book Hot, Flat, and Crowded, “We Americans are in no position to lecture anyone. But we are in a position to know better. We are in a position to set a different example of growth. We are in a position to use our resources and know-how to invent the renewable, clean power sources and energy efficiency systems that can make growth greener. If we, as Americans, do not redefine what an American middle-class lifestyle is – and invent the tools and spread the know-how that enables another two or three billion people to enjoy it in a more sustainable fashion – we will need to colonize three more planets.”

Real estate investors and developers play a huge role in how communities and cities are constructed, how buildings utilize energy, and what infrastructure and transportation is necessary to connect where we live to where we work, shop, and play. Without drastic changes in how we construct and live in our communities, what’s left of America’s competitive advantage in real estate will continue to fade. Others will take the lead in creating the technology and investment and development models that allow populations and standards of living to grow in sustainable ways that are also grounded in the pursuit of happiness and wellbeing for oneself and the rest of the world.

The global economic crisis should represent the perfect opportunity and context in which to effect meaningful change, unfortunately little is different today than it was 5 years ago in an industry that has endured massive losses over the last 2 years. The only changes fund managers (who ultimately control where and how capital is deployed) appear to be making are to appease their investor base with executive musical chairs, token fee reductions, and maybe a claw-back clause. Their plan is to ultimately convince investors that the world will soon get back to normal. Some fund managers are even sitting out a round or two of fundraising in order to avoid setting a precedent of unfavorable terms with their investors. These kind of non-structural changes or avoidance strategies will, unfortunately, not bring a new mindset, new strategies, creative partnerships, and the innovative models that are needed in the dynamic and interdependent world in which we all now reside. The pace of global change is so great, that the concept of “normal” may eventually become obsolete.

Investors, on the other hand, realize they have been paying too much to fund managers who, quite frankly, have lost their edge, allowing their value proposition to shrink to an almost unrecognizable point because such a large portion of profits have been driven by extremely favorable financing terms. Because investors rely on the income from their investments to fund whatever it is that they do (pensions, universities, etc.), they need to make commitments and keep the economic wheel turning. And, with so few new choices, many institutional investors are forced to give in to what fund managers are offering.

Large institutional investors have more power today than they realize, and with the right leadership they could help re-shape the industry for the better. Relying heavily on a previous track record as an indicator of likely success, in a future that will undoubtedly look quite different than the past, may not be the best strategy. A better bet may be fund managers that are more adaptable to change, that are more willing to present structures which focus on creating long-term value, and have a desire to begin working toward sustainable and energy efficient strategies of investing and development. When assets are viewed in terms of creating economic, social, and ecological value, growth is more balanced and sustainable and less susceptible to large swings in the financial and capital markets.

Suburban sprawl with carbon copy retail centers, minimally constructed housing developments, and energy-gorging apartment complexes are all simply unsustainable and will not work for the future. They are also poor examples to set for emerging markets that have to figure out how to support a net increase of 3 billion people over the next 40 years and typically look to America for answers.

The real estate industry will have to evolve because we are rapidly approaching the tipping point where it is economically advantageous to create and embrace new types of value. The real question is who will be the first group to realize just how incredible this opportunity is for those with the courage to change. Detailed below are two areas in which I believe the real estate industry can make great strides and become the leader the world needs in building more efficient communities that promote healthier lifestyles and sustainable living.

First, we must start with an investment model that is focused on creating value instead of creating fees. The days of creating a majority of profits from financing arbitrage while collecting huge fees and adding very little value are over (or at least they should be over). Those who can design integrated investment models that eliminate the double promote and have a viable long-term strategy that includes some elements of sustainability will have a tremendous competitive advantage.

Second, we must build asset management strategies that not only address the needs of capital but also begin to address the energy and climate conundrum we are all facing, offer end-users options that help solve their daily problems, and are congruent with the direction local municipalities and communities are headed. Typical asset management models are based on a pyramid structure driven by a chain of command. An integrated asset management model, as depicted below, puts the asset at center stage and focuses on adding value by integrating end user needs, investor needs, social needs, and environmental needs into one cohesive strategy.

An integrated asset management model is all about adding value. For example a C class apartment complex that provides residents with free parenting classes, free money management classes, and partners with a local non-profit that provides a mobile medical clinic to families that cannot afford healthcare, will enjoy the highest occupancy rate in its market. Alternatively, a high end retail center whose tenants all relate to health and fitness, sponsors weekend community races and farmer’s markets, will be able to charge a premium, because tenants will insist on being where the action is. Or how about an office complex that caters to “green” businesses that are happy to pay a premium because the building is carbon neutral and net positive on energy. These are just a few examples of a multitude of creative strategies available in an integrated model that views value through a multiple lenses.

The Courage to Change the Healthcare Game

kathyrobison — Mon, 10 May 2010 22:52:44 +0000

As someone who dreams up creative ways to engage customers and helps companies update their business models to thrive in the 21^st century, I find myself often thinking about the healthcare system and how desperately it needs an updated model.

There have been a couple of news spots recently on healthcare providers starting to do things differently and experiencing huge success. In one doctor’s office in Seattle, patient emails are answered daily by a physician, and appointments last twice a long as the average doctor’s visit. The result is a much higher level of connection between patient and doctor and a much greater chance that “health-care” is being provided as opposed to “disease management” services. The other story I saw involved a hospital here in Dallas that last year experienced the death of a patient while he waited in the ER for hours. They completely revamped their ER process creating a number of different pods or mini ERs that take in multiple patients at one time so they can keep a closer eye on everyone. Again, huge success in dropping their wait times and even more impressive, a dramatic drop in the percentage of patients that left before they were seen by a professional care giver.

In my opinion, the US healthcare industry needs a new business model far more than it needs new legislation. We seem to be in this mode in America where we think that the best solution to all problems begins with massive new legislation. Sometimes a tweak here and there can be very helpful, but solving all problems with more rules just runs counter to everything I’ve experienced on how to create change and lasting success.

At its most basic level, it is relatively easy to see that the healthcare system in our country is a bit backward. We pay physicians when patients have something wrong with them as opposed to when they remain healthy. To get paid for anything, the physician must start with a diagnosis and a diagnosis code. Any time or energy a physician spends on prevention or educating patients on how to stay healthier longer is a bottom line deduction from their profits. It is a simple case of rewarding the wrong behaviors. There are no fingers to be pointed or people to blame, it’s simply a model that is ineffective at creating what is needed, which is healthier and happier people at a lower cost. Perhaps 100 years ago, when there was far less knowledge about and focus on prevention, the currently model was relatively effective. Healthcare is no different than so many other industries (like energy, automobile, finance, and telecommunications to name only a few) that need to change with the times in order to remain effective. What is sneaking up on most of us is that the rate of change has skyrocketed and is now at a pace that is uncomfortable to most industries and businesses. There is hope though; we just have to be willing to change the way with think about things and be willing to do it in dramatic ways.

During the thrust of the healthcare debate, I only saw one article that touched on the real issues. The article discussed how organizations such as The Mayo Clinic and the Cleveland Clinic appear to run at a much lower cost structure and simultaneously have reputations for the best service available in the industry. The article attributed this in large part to the fact that doctors from different disciplines collaborated very effectively on all kinds of cases on a daily basis, which tends to cut out tests and procedures that ultimately end up being unnecessary. Unfortunately, most of the healthcare industry is built on an “every doc for himself” model that actually dissuades doctors from taking the time to collaborate as much as they would probably like to. It is much easier to collaborate when people are co-located and when the concept is built into the care model.

Because the “every doc for himself” model is so pervasive, it has been difficult for the industry to take advantage of technology to the extent that it could, which would ultimately benefit the patients and reduce costs. For example, if a doctor sees a new patient and diagnosis him/her with diabetes, there schedule probably only allows for them to spend 15 or 20 minutes explaining everything. The patient is in such a state of shock they likely are only taking in a portion of the information that is radically changing their life. What if you could also send the patient home with a computer login that accesses their own health web page customized to their personal care needs? It could contain a longer video, of their very own doctor, explaining everything again that they could watch as many times as they wanted and could share with family members who might be participating in their long-term care. A private chat board could be available that is manned by an RN or Physician’s Assistant answering questions in real time. The possibilities are endless in this area. How many relapses could be avoided if patients watched daily videos that indicate how things should be progressing after surgery discharge or an outpatient procedure.

The point is, we need to start thinking in terms of radical changes, and honestly considering if the business model is working toward our goals or working away from them. Imagine a time when doctors get paid for keeping people healthy. Imagine if your healthcare facility was a place where you could workout, ask a quick question, learn about nutrition, pick up some new recipes, and get motivated to live a healthier life? The reality is the current business model is stifling progress, innovation, and advancement in how we think about and deliver healthcare. Our healthcare system has been narrowed down to a transaction system. It feels like progress is being made because there have been great advancements in understanding diseases and innovating new treatments, however, very little has been done around the delivery of healthcare. We have State of the art medical knowledge delivered, in many cases, through an outdated and archaic system. If you are looking for ways to cut costs and increase the quality of service, this is where the opportunities lie. Unfortunately, until we correct the structure of the system, those efficiencies will likely continue to lie dormant.

In the business world we call this a classic case of structure taking over the strategy. You always want your strategy to dictate the best structure, not the other way around. Unlike a single business transaction or a single company, where you change the structure relatively easily, this is an entire industry in one of the world’s largest countries. It is likely impossible for a single healthcare provider, a single hospital, or even a single hospital system to make a change to the structure on their own. Maybe it will require a grass roots movement that strives for a total do-over in the way our healthcare system works. Once the structure is changed to create the alignments and incentives necessary to meet the goals then, and only then, will we see meaningful change.

As much as I dislike the behaviors that the medical insurance industry sometimes displays, it is a complete waste of time to try and fight them. Everyone has responsibility for things getting to the point that they have, and these bad behaviors are just another symptom of a system that is governed by an outdated and ineffective model. The insurance companies will have to be a part of the solution. Insurance is a numbers game. When the youngest and healthiest people opt-out because the cost is too high it simply continues a vicious cycle where the insurance companies feel they have to remove the other end of the spectrum as well in order to balance out their risk. I am actually a fan of having a minimum insurance requirement with the government picking up the tab if someone can’t afford it. We have this requirement in the auto industry and I believe it is one of the reasons that auto insurance seems to work so well.

If you look at healthcare as an entire business system and start to dissect its “operating statement” you quickly realize that revenues are generated by one party (insurance companies) and expenses are created by another (providers), though for the providers those expenses are viewed as revenue. The profits from the system are shared but not anywhere near equal to the value that each party contributes or in a way that promotes the desired outcomes. The real value that an insurance company provides is an administrative function, yet in many cases, they take an outsized portion of the profits from a value perspective and often have the most control. The insurance companies will say they also take on the risk, but I would argue that it is the purchasers of insurance that take the risk. When profits start to go down the insurance companies simply start denying claims, dropping high-risk people, and jacking up rates for everyone else. They have become experts at deriving ways of mitigating their risks by passing them on to their customers, and we have let them get away with it for so long that it is now seen as standard practice. In fairness, nothing has been done to ensure that the young and healthy remain part of the pool, which I believe could solve a lot of the insurance issues. This would be one of those areas where some legislative changes could be good.

The real question is not, could we come up with creative and inventive ideas to cut costs and increase quality, but do we have the courage to make the necessary changes to the underlying structure? Do we have the courage to design a model that provides the incentives to promote the investments necessary to increase service quality and bring down costs? I hope the answer is YES. I believe the answer is YES. We can have all the intelligence and innovation imaginable, but without the courage to make system wide structural changes we will likely only create an updated and over compromised version of what we already have, spend a lot of money getting there, and leave an even more complex mess for our children and grandchildren to clean-up.

We must find the courage to critically examine the current system and understand how the alignments and incentives are simply miss-directed to accomplish the goals of the medical community and our society.

We must find the courage to recognize that the failures are not born of malice from any party, but are born of a system that is simply out-dated and broken.

We must find the courage to work together and commit to create the world’s finest healthcare system and be a leader for the rest of the world.

WE MUST FIND THE COURAGE TO CHANGE THE GAME!

7 Keys to Innovation – European Style

kathyrobison — Tue, 23 Feb 2010 14:15:01 +0000

Last month, I attended the Front End Innovation Europe Conference (FEI Europe) held in Amsterdam. One of the highlights was seeing the car in the picture above in person. Yes, they drove it into a large conference room inside the Hilton Hotel. It is the 2010 BMW Vision EfficientDynamics Concept car, and it is even more cool in person than in the photo. It’s BMW’s answer to the green car revolution. Though perhaps a little late to the game, I suspect it will eventually prove to be a huge success as they continue to do engineering with more style than most other car makers. In addition to seeing the car, we got to hear directly from Adrian van Hooydonk, the Director of Design of BMW Group and mastermind behind the group that developed the car. They clearly rose to the challenge of eloquently working Future Sustainability into their brand of the Joy of Mobility in a record amount of time.

We also received a lesson from Josephine Green, a well-known leader in trends and strategy from Philips Design, on Engaging with the Future Differently. It was a real eye opener for many. We also heard fantastic examples of innovation in conjunction with universities from Sigvald Harryson with Copenhagen Business School that left us all realizing the vastness of the untapped resources lurking around our universities. The event concluded with a superb presentation from the World Business Council for Sustainable Development and an interactive session that literally no one wanted to leave. All in all . . . a huge success! If you missed Europe, don’t miss the Front End Innovation USA in Boston coming in May. I suspect it to be equally as tantalizing.

I’ve written previously about the Pitfalls of Innovation, and I still believe that far more talk about innovation occurs than actual innovation because true innovation comes from doing not talking. Just go to any third world country where people are forced to live with minimal resources and you will see what true innovation is all about. It comes more from unmet needs and a gap in resources than heavily padded budgets purposed toward the never-ending replacement of old gadgets with new gadgets. None-the-less, well done conferences such as FEI, are well worth it.

Below are the 7 Keys to Innovative. Some are my standard favorites, and others I picked up at the FEI Europe Conference.

7 Keys to an Innovative Business

1) Multiple Approaches to Innovation Provide the Best Results

Hire people with innovative characteristics
Seek partnerships / the more unlikely, the better
Lead users and co-invention can be extremely useful in some sectors
Complex Coalitions (public/private/univ/venture/research) are coming

2) Don’t Overlook the Importance of an Innovative Business Model

Ensure culture and vision include a commitment to innovation
Business as usual is no longer an option for 21^st century success
Traditional hierarchical and rigid organizations don’t foster creativity
Change should be the fuel of your business model not what creates a crisis

3) Find the Right Balance Between Old, Adjacent, and New Business/Products/Services

Varies between industries, companies, and brands
Don’t chuck out the old, just for the sake of it
How much of the value of your firm is based on its future potential?

4) Innovation Requires Optimism, Curiosity, and a Splash of the Future

Spend more time studying the fringe / the middle is already known
Analyze what isn’t and not what is / finding the gaps
Understand the “big think” trends
Get to know younger generations, they will be running things soon

5) From Linear, to Exponential, to Circular

From “out of the box thinking” to “thinking without boxes”
Renewable and sustainable are circular concepts and here to stay
Constant feedback loops are critical to staying ahead of the curve

6) Cultivating the Right Mindset is 90% of the Battle

Learning from failure is a key to success
Blur the lines and anxiety around internal vs external
Collaboration with competitors can be the best option in some situations

7) Leadership Sans Egos

Cultivating trust requires the courage to be vulnerable
Constructive conflict produces the best answers
Business model intimacy – creating solutions with customers
Money is a low-level motivator . . . find out what really motivates your employees

Originally published as guest post on Blogging Innovation ! Blogging Innovation is a great source for all things Innovation and they publish a tremendous amount of very useful information.

Waking Up In Jacmel

kathyrobison — Sun, 24 Jan 2010 15:55:11 +0000

Just a couple of months ago Aimer Haiti and I met with Agronome Noel (“Agronomist Noel”), one of Haiti’s leading agronomists. You cannot imagine the determination and drive that this man and his wife have for their country and the need to rebuild the agricultural industry. We dreamt of the possibilities sitting around the table of an office building that was completely destroyed in the earthquake. He showed us the book that he has written on how to rebuild agriculture in Haiti. We talked about the need for a master land plan for the island. Over time, the lower flat lands that are prime for agricultural production have been used for housing and has wrecked havoc on the natural drainage ways. We talked about how important this step is, but how difficult it would be to implement since it would require huge changes. It now represents one of the hidden opportunities in the horrors of the earthquake.

After several hours of invigorating discussion, which left our minds swimming with ideas and possibilities, Agronome Noel invited us to visit his farm. Fifteen years ago, he turned his frustration with politics into action and wanted us to see first hand what he had created. So, that was that, three of us were going to Jacmel for the weekend! This was huge treat for me, as I knew that agriculture would be a large part of the success equation for Haiti. For decades, Haiti had been given the well-intended advice to buy their food on the global markets and instead build factories to manufacture clothing. That strategy failed when world food prices rose dramatically and no one was interested in building factories in a logistically difficult place like Haiti when they have options like Mexico, Brazil, India and China. It was simply bad advice that millions paid the price for. A country should be able to feed itself. It cuts the risk of being subject to the large fluctuations in world food prices, it provides jobs, and for a tropical country like Haiti it can produce significant exports. But more importantly, it provides a sense of pride and accomplishment for its people.

Agronome Noel and his wife Nani purchased 15 hectares of dried up and barren land in Jacmel 15 years ago that was considered useless, for what amounted to a few hundred dollars. He told the community he was going to grow wonderful and rich fruits and vegetables. Many laughed at him and from that point on he was known as the “crazy agronomist”. He did not mind because he knew that some years down the road he would prove his point, and he did. Though at this point, I am not sure the fate of the Agronomist and his wife. They spent most of their time during the week working in Port au Prince in order to fund their farming operation in Jacmel.

Three of us from Aimer Haiti spent a weekend with the Noels on their farm in Jacmel. We stayed in the beautiful home they have been building for 3 years that was to eventually to become their retirement home and a bed and breakfast. I suspect it is no longer standing. The 3 hour drive from Port au Prince took us on a journey through the slums where all the garbage eventually collects after the rains, over broken roadways still not completely repaired from the hurricanes, and up through a gorgeous mountainous region. Despite some barren areas, there is still enough vegetation in the mountains that you can see and feel its natural beauty. The roads in the mountains were actually quite good and we past many small farmers bundling their harvests ready for the trip down the mountains that more often than not ended in spoiled produce before it reached a market.

We arrived at the farm in Jacmel after dark. The only light we had was from the cars we were driving and a small generator powering a couple of light bulbs in the house. We sat on the porch facing the ocean enamored with just how striking the stars are when you are so close to the equator and there is very little artificial light. We drank, we ate, we laughed, and we continually talked and dreamt of the possibilities for Haiti. The energy of hope and passion was strong in the air and it felt good to me. You cannot spend time in Haiti and not fall in love with the land, the people, and its spirit. It does not matter how much other heartbreak and sadness you witness, in Haiti love always wins. I am certain this is why the Clintons have remained so committed to this tiny country after all these years.

The sun arrives early near the equator; at 5:30 am in Haiti. The breeze from the sea is not as strong as I expected. Nor is the sound of the waves crashing against the 3-meter wall of rock down to the sea just 30 yards from the back porch of this large, half finished house in Jacmel. I am a lover of all sunrises, so there was no way I was going to miss this. The sun arrived on time, but shielded for some time by a large cloud. Soon, Agronome Noel was with me preparing for the day while everyone else still slept. I heard goats on the adjacent property and asked if he had any. He pointed to one goat off in the distance tied to a rock and told me that today would be the goat’s last day. Sure enough, about an hour later he and two others went out to meet the goat. And by the end of the day, well . . . we were eating goat stew.

A ball of fire finally burst from beneath the cloud and its rays reached far and wide as we quickly move from a shadowy sunrise to the full-fledge beginning of a new day. What a peaceful and gorgeous place I had awoken to, now that I could see everything. How could anyone have ever considered this land a lost cause?

When the Noels began 15 years ago with a plot of dry barren land, there was no road, no access to water, no electricity, and no soil. For the crazy agronomist, these weren’t problems, just things to be done. On weekends and holidays, with the help of a few farm hands that live on the property, they began the transformation by hand. There are no big machines and no tractors, just simple hand tools. They trucked in water and topsoil and began to build the tree canopy. You see, first you must create enough of a canopy to cool, shelter, and nourish the soil below. Once the canopy began to work it’s magic they were able to plant the tender topical plants and fruit bearing trees. They have bananas, cocoa, coconuts, mandarins, figs, papayas, and almond trees. At least those are the ones I can remember. The barren land was transformed into a tropic forest full of agricultural treasures in a few short years.

I will never forget the day I woke up in Jacmel!

Rebuilding Haiti – A Unified Strategy

kathyrobison — Mon, 18 Jan 2010 14:15:16 +0000

When you see the level of response from the US and nations around the world to the tragic earthquake that rocked Haiti only a few days ago, it is hard not to feel proud of the quality of global citizenship displayed by so many. Individuals and organizations have been sent to help with security, medical care, food distribution, general aid, and journalistic coverage and they should be commended for their commitment to humanity.

However, as an economist who was working on economic development in Haiti before the tragedy, I know that the strategy and model used for rebuilding is the key to success. Despite good intentions, the developed world does not have the best track record for helping under-developed countries gain any significant traction. There has never been a lack of funds or good intention, but there has been a lack of effective and unifying strategies designed with the population’s physical and cultural needs in mind. This unfortunate and tragic earthquake has presented the world and Haiti with an opportunity to set the rebuilding of Haiti on a course that will have long term significance for its people, if we are all willing to try something new and think about building sustainable economies with a new perspective.

There are a number of areas that will obviously require simultaneous focus, however the primary force and core strategy should be helping Haiti to rebuild their own country, with their own hands, and resist the temptation to do it for them. Often our own need to help gets in the way of truly understanding what is needed. This may sound over simplified or inconsequential to many, but I assure you it is not. The rebuilding must be done in a way that unites and aligns citizens, government, businesses, investors, and aid organizations. Without unity, there will be continued factions, hoarding, corruption, and minimal progress. This monumental task requires a top-down strategy with a bottom-up implementation plan. I have faith that with the assistance and guidance from the rest of the world, Haiti can rebuild itself and become much stronger than it was before the earthquake.

We must avoid simply jumping in with quick fixes and rebuilding everything back they way it was. A master infrastructure plan that is comprehensive in its ability to connect the disparate parts of the country and support agriculture and other industries is critical. It must take into account the reverse urban migration that is likely to occur as a result of the earthquake. Many people will go back to the small towns and villages where they are from because they no longer have homes and jobs and have nowhere else to go. The people in Haiti’s countryside are generally the poorest of the poor — why so many migrated to the big cities in the first place. Supporting agriculture, tourism, and arts industries in the countryside will provide people the means to stay, to start over and to allow the country to grow in a more balanced way.

Agricultural Development Aid is a crucial component, and it will be required in a way never seen before. With the traditional strategy of sending a disproportionate amount of food aid compared to Agricultural Development Aid, we generally set a country up for failure. Sending only food aid does serve an immediate need and feeds people today, but it can also destroy what markets still exist. Building chicken farms, developing farm land and building other food production facilities puts people in business so they can build up their own markets allows the aid to continue to churn through the economy and even increase economic activity over time. Simply handing out food produced elsewhere and brought in through an outside distribution channel fills an immediate need, but if it is not balanced with other strategies eventually also feeds the equation of poverty.

Businesses must be created and financially supported so they can hire local employees and begin the re-building process. Contracts must be structured with built-in profits from the rebuilding efforts that can be used to create further self-sustaining economic activity. The banking industry must be supported such that the bankers can make enough profits to stay in business and grow while providing heavily subsidized loans for building businesses and rebuilding structures. The World Bank and the IMF need to find creative ways to support industries and businesses directly as opposed to giving the lions share of funds directly to the government. When businesses begin to grow and more money is invested in capitalistic endeavors, the government’s revenue will grow in sustainable ways and can it begin to rely less and less on foreign hand-outs. The government should be orchestrating, aligning, and ensuring coordination of all efforts. The government should be making master plans and ensuring long-term strategies are properly focused on growth. Groups like Aimer Haiti, who can help build and mentor businesses, should be working with the government, the World Bank, the IMF, the US, foreign investors and domestic investors to develop completely new strategies for growth. Aimer Haiti has already been working on such collaborative and creative economic development strategies since their launch in 2009 and for years before as concerned citizens and Haitian business owners.

Energy has been a growing issue for Haiti as its population rises, and is now even more critical. Electricity has never been reliable and is often supplemented with large battery stores powered by diesel generators. The good news is that technology has advanced enough that a country like Haiti can leap-frog many of the evolutionary steps in energy that the developed world could not. It’s a matter of getting the brightest minds together, inside and outside of Haiti, to come up with the best solutions given the unique conditions of the country. Before the earthquake Aimer Haiti was exploring the possibility of using small solar energy units in some of the poorest areas to provide light, refrigeration, and power. With refrigeration, people can store and sell perishable products such as produce and fish. With power people who cannot read or write can begin the process of building an education base through radio and television. Mobile phones can be powered and connect people to markets to sell their goods.

Solving the energy issue is also the key to stopping deforestation. Until there is a reliable source of energy to replace charcoal, and until there are jobs and small businesses to give people a means to survive, deforestation will continue. Deforestation causes rapid erosion, which leads to road and bridge destruction, and leaves the land unsuitable for farming ensuring the cycle of poverty continues. The cutting down of trees does not happen because Haitians do not care about their land, it happens because it has become a means of survival for so many people.

The interconnectedness of all of these major issues in Haiti is another reason why getting the overall re-building strategy right is so key to its long-term future success. Every solution and every single effort of aid and rebuilding should be viewed as an opportunity to put Haitians in businesses that will create jobs. For example, the distribution of food and creation of helicopter landing sites, which is happening right now in Haiti, is a huge opportunity to employ people and allow them to feel a part of the solution and not a part of the problem. There shouldn’t be such a stark line between those giving aid and those receiving aid. This is an example of the change in thinking and the change in mindset that is needed to change the trajectory of how under-developed countries are assisted, particularly in times of need.

This type of re-building is not done from an office or over the phone, it is done by creating relationships on the ground, building businesses, one at a time, and helping families, one at a time. It’s about doing, creating, uniting, and elating in each small success that both dedication and determination will bring.

History has proven time and again that capitalism and the building of a significant middle class are still the best ways to bring people out of poverty. Before the earthquake, one of the first billboards you saw when you were leaving the Port au Prince airport, was the large unity triangle of Aimer Haiti, which of course translates to “Love Haiti” in English. I hope it is still standing!

Realistic Impossibilities

kathyrobison — Fri, 08 Jan 2010 15:02:05 +0000

This week YURU is guest blogging on Blogging Innovation, a leading innovation and marketing blog from Braden Kelley of Business Strategy Innovation. We are honored to be a guest blogger as this is one of the best places on the web to find latest discussions on business innovation.

Click here to read Realistic Impossibilities

What Does the Debate on Climate Change Have to do with 21st Century Business Models and Global Economic Development?

kathyrobison — Fri, 18 Dec 2009 13:31:37 +0000

The short answer is EVERYTHING. The long answer is what this post is all about. These are three of today’s most pressing issues that are all too often discussed in a vacuum. The best progress will be made at the margins where each of these pressing issues overlap. When we begin to see them each as an integral component of global economic progress and prosperity and not discrete issues, much will be gained.

Perhaps the inclusion of 21^st century business models is a surprise to many lumped in with the other two that get a lot more focus and media airtime, but please notice that I use the predication “21^st century”. If we want to do something about the ramped greed and selfish strategies that exist in many of today’s firms, then it must be added to the mix. If created correctly, new and improved business models can be a large part of the solutions to climate change, global economic development, and their own perils of decreased employee morale and disgraced public opinion.

They all require new, passionate, and innovative solutions. In fact, we must assume that the very best solutions are not yet known. Thus, the solution frameworks that are being bantered around today need to accommodate the unknown solutions of tomorrow. It’s beyond out of the box thinking and into a world without the constraints of boxes of any sort. It’s about unleashing the mass of untapped potential and productivity that lies dormant inside people and organizations around the world.

They are each integral to the success of the others. Slowing population growth in the developing world is one of the keys to avoiding a climate catastrophe down the road. Economic development and the creation of a middle class is the most effective way to slow population growth in the developing world. Private sector ingenuity is key to new technologies that will reverse the current trajectory of climate change as well as promote economic development in the developing world.

Alignment is key to effective solutions in each case. Businesses are learning how to align their shareholders, employees, customers, and the public in ways that will dramatically increase productivity. When transparent alignment and partnerships are created between foreign aid, domestic and foreign private investment, and public money, global economic development will become significantly more efficient and effective. Unless we properly align the big players in the world on climate change soon, it will likely suffer the same fate as the Green Revolution in Africa.

The most successful businesses models in the 21^st century will be those that realize contributing to the creation of new markets is a winning long-term strategy, that focusing on something besides growth and profits is the key to engaging employees and winning the hearts of customers (yours as well as your competitors), and that how you decide to be in the world can be just as important, if not more important, than what you sell.

Too often when these topics are discussed in the media, there is too much focus (in my opinion) on the facts known today which narrows the conversation and too little focus on what we want to create. In other words, discussions and potential solutions are being filtered based on what we know how to do today and not on whether or not they fit what it is we are trying to create. All great movements start with an unadulterated view of what should be created, if anything is possible. There isn’t much humans can’t do once they set their minds to it. Some things take a few months and others a few generations. The problem is that we sometimes lack the belief that it can be done, which ends up being the biggest thing that holds us back from succeeding.

Looking for Profits in All the Wrong Places

kathyrobison — Wed, 02 Dec 2009 18:19:50 +0000

Investment comfort in the world of high finance all too often comes from fast profits in known and proven markets. The never-ending game of offering higher profits at lower [apparent] risk to attract capital was certainly alive and well before the global economic crisis. The question is, why does it appear to be coming back? Didn’t we learn anything?

A global economic recession of epic proportions should have taught us a few lessons, but the days when CNN is glued to the US consumer expenditure figures as if it were the only barometer in existence, it seems it isn’t so. Too much investment comfort will lead to not enough investment in the future and much greater economic turmoil down the road. For economies to flourish they need to grow, and we seem to continue to look for growth in places where the potential is quite low.

One of my mentors used to always say that if you aren’t feeling nervous and agitated about a deal, then it’s probably not a good one. We were investing Goldman Sachs money, so the deals we worked on weren’t small and were often the first of their kind in that country. A healthy amount of discomfort means we’re forging new territory. Forging new territory in a world that primarily relies on capitalism to make the wheels go around is a good thing. Running in the same old markets over and over and over again may move the wheel around, but it does little to make the wheel bigger. In a world where we are slated to break 9 billion inhabitants in the next 40 years, we will definitely need a bigger wheel.

There is an inherent flaw in this mindset of investment comfort. It stays in the world of what is known and it over-exploits markets such as US housing, US consumer, and luxury hotel. While billions of dollars were being invested by countries all of the world in relatively finite (but comfortable) markets, much of the world’s potential new markets were being ignored. I would argue that it is actually riskier to invest in false markets (backed by too much debt) that are unsustainable and maxed out on growth than it is to invest in creating completely new markets in the emerging and developing world that are backed by sustainable commerce. It doesn’t feel riskier because it is known territory and feels comfortable, but from a purely economic system point of view it is, definitely riskier in the long run.

I believe this will be the biggest lesson of the 21^st century for both the private and public sectors around the world. During the 20^th century, there was adequate growth potential in the population and quality of life in developed countries to support investments shrouded in the comfort of known markets. This will not be the case for the 21^st century. The 21^st century requires new investment models, new leaders, and new perspectives on globalization.

I predict that the very best Wall Street firms will turn from security selection and asset management in known markets to designing unique investment solutions that build entirely new markets around the globe. They will bring public and private money together in ways that have never before been attempted. The old model of trying to build nations through foreign aid and local (sometimes corrupt) governments alone clearly doesn’t work. We need new models that forge new territory and challenge conventional thinking. The potential and the opportunity are there. The question is are we going to seize the moment and begin to look at the world differently? Are we going to set future generations around the world up for success or for failure?

An uber-macro-global economic view of the world indicates that with stagnant population growth and an already high quality of life in much of the developed world, the economic progress and growth necessary to continue building global wealth must come in large part from under-developed countries. In other words, the developed world is becoming over-saturated with capital. The excess capital is creating false markets in many cases because new markets are unobtainable. Companies are either stealing customers away from the competition or simply swallowing the competition because the markets are not big enough to support them all. We also saw this play out over the five years prior to the recession where cheap debt allowed for an ever-increasing portion of returns to come from debt arbitrage as opposed to real investment fundamentals, which basically masked the issue.

Though, without the comforts of known markets, the developing world represents a significant potential for entirely new markets. These new markets won’t get created overnight; however, they will require long term commitments and a lot of hard work. The ones we are seeing pop up in China and India have been in progress for decades. Creating entirely new markets requires both time and investment in infrastructure to create an environment where a middle class can flourish and grow. Investors are starting to consider places like China and India, which is good, but they must realize that though the business mechanics are similar, the subtleties, relationships, and manner in which business is conducted is quite different. There is still much work to be done in these markets and well as smaller ones that get far less attention but hold an equal amount of promise.

Success in creating new markets and building a middle class in nations void of one will require new and innovative ways of combining public global aid with both foreign and domestic private investment. Creating partnerships that promote food security, business investment, and job creation to jump-start capitalistic activity seems far more beneficial than the old ways of shoring up the local government and banks. When businesses are sustained, tax collections will shore up the governments in much more sustainable ways, and citizens will gain more political power to avert corruption. It’s about starting an economic cycle, not circumventing it. Governments generally do not produce economic activity, but they do benefit greatly from it. It starts with building business, not building governments. We need an entirely new perspective on how we can work together to build markets and bring people out of poverty and increasing the quality of life of those who currently reside at the bottom of the pyramid. This ultimately requires a broadened view of capitalism. Creation of the haves and have-nots does not have to be a side effect of capitalism. We can choose a different path for the future of our world. This is what it means to start thinking like a global citizen.

Innovation From the Inside Out

kathyrobison — Tue, 03 Nov 2009 14:36:35 +0000

If your company is following suit in a growing trend and starting an Innovation campaign, beware of the pitfalls. Many companies assume they can create a few goals, advertise the idea, provide a bit of training, and expect that greatness will appear.

If it is unbridled success you are after, and you are trying to create a stark competitive advantage, it is critical to start by innovating your management strategy. Asking employees to be innovative and contribute to the next competitive advantage while employing a management strategy left over from the Industrial Revolution is like asking your 1960’s percolating coffee maker to give you a triple shot skinny vanilla latte with extra foam. You will be lucky to get a decent cup of joe and a monstrous mess. However, if you are willing to entertain at least some components of a 21^st century management strategy, I promise you will likely be blown away by the creativity and innovation that follows.

Hierarchical organizations, not matter how progressive, generally promote a unidirectional flow of information, which hinders the establishment of an innovative organization. Take, for instance, a large multi-national fast food chain that I was recently in discussions with. They wanted to become creative and innovative to ensure they didn’t loose market share in what is a relatively competitive industry. They hired an innovation guru, wrote up a manual on innovation, and then informed all their employees of their new direction. They simply couldn’t understand how 2 years into it, it just wasn’t working. Unfortunately, they are still trying to make their dictatorial strategy work, as they simply couldn’t grasp the idea that the executive team had to make the first move in the game of innovative.

There is no shame, blame, or guilt intended here. We’ve all been doing as we were taught in business school when in comes to organizing and managing companies. The difference now is, we know there is a better way and with it comes higher productivity, greater enjoyment, less turnover, and most importantly the magic that emboldens companies like Patagonia, Best Buy, Zappos, and Dutch Brothers Coffee. All companies who understand that it starts with innovation at the top.

Without creativity, a collaborative flow of information in all directions, and trust, all attempts at suddenly becoming an innovative firm that is competitive in the ever-changing world of the 21^st century will likely fail. The essential ingredient for creating an innovative work environment is the courage of the folks at the top to change the rules of the game. With that one ingredient, everything else will come naturally. Not without hard work and dedication, but without friction. Your team will amaze you, inspire you, and keep you humble enough to savor every moment, even the ones that aren’t so great. It is possible to create an environment where failure is understood to be a key to success and support and trust are commonplace.

If you want employees to think creatively, design solutions to fix problems beyond the ones you know about, collaborate, and generally bring their A-game, you must be willing to give them the freedom to do those things in their own way and with their own style. People are only going to give you as much as you believe they can deliver and no more. If you believe your team is invincible and you tell them often, then that is what they will become.