U.S. Arms Sales Rise Sharply

Tanks, helicopters, fighter jets, missiles, remotely piloted aircraft and warships. These weapons of modern warfare, are being transferred in unprecedented numbers to countries around the world -- including those in the Middle East, Africa, Asia, Latin America, Europe and yes, even Canada -- from the good ole USA. The New York Times is reporting that year to date, the Bush Administration has agreed to sell $32 billion in weapons -- compared to $12 billion in 2005. Commercial sales in services and equipment to support the DoD weapons sales is an additional $96 billion, year to date.

Of course, the US isn't alone in exporting sophisticated weapons to unstable nations. Russia provides stiff competition, and the EU and a host of smaller nations sell less sophisticated and small arms. The arms trade remains quite the viable business, and was there before globalization was a buzz word. You don't need to be a cynic to see why having the US and Russia exchanging nasty words is good for business; or why arms trade need bad guys like Iran, North Korea and elusive Osama bin Laden (Even if Bin Laden is dead, bringing him back as a bogeyman is good for business.) The whole business stink of evil.

The delivery for the US DoD sales will continue for years after the Bush Administration leaves, and will haunt the new government -- a dark shadow sure to be used against Obama if he takes the reins.

Digital Darwinism

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Music.Dance.Clock

Japanese clothing retailer Uniqlo, has done something unique to get attention in a world of very short attention spans. It has created Uniqlock -- a catchy multimedia presentation on the web that blends music, dance and data visualization. It's hard to explain the experience. You'll have to take a look at it yourself. There's something compelling in the presentation that makes it difficult to just navigate away from the site. When you've had enough of the experience, click over to the Uniqlock's archives to find other presentations created by Uniqlo.

19.20.21.

19.20.21. -- 19 cities in the world with 20 million people in the 21st century, is a cool project, collecting data to gain a better understanding of how supercities are redefining the future -- culturally and economically (and if I may add, also environmentally). The 19 supercities chosen for this study may be surprising. Only two are in America, and in total, nine reside in the developed nations of the world. The others are in developing countries. The cities: Los Angeles, New York City, London, Berlin, France, Tokyo, Osaka-Kobe, Seoul-Incheon, Moscow, Mexico City, Sao Paulo, Rio de Janeiro, Bueno Aires, Istanbul, Cairo, Tehran, Karachi, Beijing, Shenzhen, Delhi, Kolkata, Mumbai, Singapore, Jakarta, and Lagos.

The mission of 19.20.21. is a multi-year, multimedia initiative to collect, organize and better understand population's effect regarding urban and business planning and its impact on consumers around the world. This 5+ year initiative will deliver results via 5 channels: web (including mobile), television (broadcast and cable), print (magazine, books and atlases), exhibits and seminars (virtual and onsite). This project will include 10 worldwide partners.

Any company with a focus on globalization will find the patterns and explanations in 19.20.21. indispensable. Whether you are a head of state, a leader of a corporation, a media or communication company, a consumer, a parent, or an armchair tourist, 19.20.21. will be a crucial tool for charting and understanding your destiny in the new world order for decades to come.

In 1800, less than 3% of the world lived in cities. Most people lived their entire lives without ever seeing one.

In 1900, 150 million people lived in the world's cities. That number has now surged past 3 billion and last year crossed another tipping point: more than half the people on earth now live in cities. By 2050 -- it will be more than 2/3 of us. Humans are now an urban species, cramming into vast urban agglomerations.

The population, including the public and private sector, is currently not prepared for life in these intensely urban hubs, not have communication strategies been honed to handle the resulting clutter in the urban marketplace.

19.20.21. will study culture, economics, societal infrastructure, physical infrastructure -- forecasting the future for cities and the challenges and opportunities that lies ahead.

It sounds like a cool project, and even though Toronto isn't on the list, I'd love to be a part of this. Toronto's population isn't big enough -- although, with our diversity, I think we'd make a good case study.

Evil Cola

What's wrong with Coca-Cola India? They're supplying a toxic sludge to local farmers in Kerala as fertilizer, to placate them for the pillaging of their water supply to create sugar water and profits for Coke's coffers. Coke claims the toxic sludge is good crops, but an independent study revealed that the sludge would be totally useless as a fertilizer.

Saying No to Weapons Export

Way to go South African dock workers! A Chinese ship docked at a South African port encountered problems when it tried to offload its shipment of weapons destined for Zimbabwe. While there is currently no UN or AU embargo on shipping weapons to Zimbabwe, public interest groups are concerned about the use of those weapons in the political turmoil that is Zimbabwe today. So, dock workers refused to offload the ship, and it had to leave. The ship had on board, three million rounds for AK-47s, 1,500 rocket-propelled grenades and several thousand mortar rounds. Just what is a country, with no economy, doing, in importing such weapons? And what is China doing, exporting such weapons to such an unstable country?

The Arms industry is huge. The economics of dealing in death just makes for good business. It's startling however, when you start digging into the flow of cash for weapons. The top 20 arms exporters in the world include the five permanent members of the UN Security Council. Yes, the body whose "primary responsibility, under the [UN] Charter, for the maintenance of international peace and security," supplies the arms to conflicts around the world. Canada is just as guilty as the five permanent members. We rank number 12, and export $10-25MM in small arms. Those very weapons that are handy in ethnic and religious conflicts in developing nations; those very weapons that are light and easy to carry and use by children who supply the bodies in some of those armed conflicts.

The Dirty Truth About Plastic

Plastics were making the news this week in Canada, with Health Canada not really announcing much that they haven't already announced. In effect, what Health Canada said this week was, yes, plastics do represent a risk, however, at the end of the day, plastics are so ubiquitous in our environment, that an outright ban due to the risks of chemicals such as Bisphenol A would create a vacuum that would cause more harm than good. And to be sure, the economic ramifications to an outright ban would be tremendous. That doesn't mean that Health Canada made a political decision and closed the door. The door remained open, even if it is just slight. Health Canada label Bisphenol A toxic, and that will now allow the government to regulate the chemical. It's a warning to industry that the days of using human health and the environment as a test bed, are gone.

Will there be changes overnight? Not the dramatic ones that vocal critics of the chemical industry had hoped for. Sure, there were forward thinking retailers who saw the financial risks of still carrying such products -- and they reacted, even to just the rumour of Health Canada releasing findings, but that will not be the end of it. The chemical industry needs to innovate, and that will result in some hits and misses -- but it also represent an opportunity for companies to deliver alternatives and shift the game in their favour.

As much as Bisphenol A is a problem, there are also a slew of other chemicals that are in plastics that remain a potential risk, and these will be examined over time by Health Canada. Verdicts will be delivered. The old ways of industry doing as they please are changing. Consumers are more educated, and a vocal subset are advocating for more transparency and social responsibility. Businesses have to respond. It's a moral imperative. To not respond to this awareness would be unethical. Responses at this juncture will signal whether corporations respect their customers and the environment, or are simply evil.

This month's Discover magazine is also running an article on the Dirty Truth About Plastic. As I said above, phenols aren't the only concern -- so are phthalates and the sheer volume and longevity of plastic. We live in a plastic world it seems, and are slowly getting buried under the stuff. There are viable alternatives out there, so why aren't they being used?

Why do we let this shit happen?

Monsanto’s Harvest of Fear

There are few faceless corporations that are truly evil. Monsanto is one of them. One must wonder about the people who are the tireless cogs in its machinery -- as they slog away, do they ever wonder about the machine they power? Vanity Fair is running an investigative piece that looks at Monstanso: its quest to control the food supply chain and the destruction of the environment that it is responsible for. If I worked for Monsanto, I think I would breaking glass and diving out of the offices of its highest towers, because I wouldn't be able to live with myself. Evil.

Feeding on Yahoo!

Here's a prediction that will be completely laughable in the near future. Concerning the battle to be the internet giant -- a battle being waged between Yahoo, Google and Microsoft. Yahoo is getting the crapped punched out of it, so it's apparently going to sidle up the online loser, AOL, but outsource its advertising operations to Google. Of course, this is only going to bilk AOL and Yahoo to fill Google's ever increasing do-no-evil coffers -- I guess it isn't evil drain the competition when they down, just Darwinian. Microsoft apparently still thinks it can get a hold of Yahoo's carcass, so they're apparently working on a deal with another deadbeat, News Corp's MySpace, in hopes of joining MySpace, MSN and Yahoo. This of course would extend Microsoft's reach into Yahoo and MySpace, and hopefully bring their users into the Microsoft fold.

Naturally, this is all probably very far from the truth.

My prediction: Google will do evil, and Microsoft will become the internet business we all cheer for -- even though we'll never use their services as much as we'll use Google's. This will happen when Balmer leaves the helm. The guy is just too way over the top for anyone to cheer for him ...

... hmm ... what was I saying again?

Going Hungry in the Global Food Chain

The NYTimes has an article on the changing food chain. There used to be a time when we ate what was grown locally. That was a long, long time ago. With the advent of packaged foods, we could eat foreign food anytime, anywhere, as long as we could afford it. Then came the global shipping industry, making it even easier to eat foreign. Foreign foods didn't need as much packaging anymore, as fresh food can be expedited just about anywhere. Even with shipping, foreign food could be had for cheap. So while we in the industrialized nations bulldozed our farmlands and poured concrete for crop after crop of suburbia, we were secure in the knowledge that the developing world was there to continuously provide slop in our biggie-sized troughs.

We should have known that it wouldn't last. Economically, environmentally and socially, it was not sustainable. We fought economics long and hard, assured in our industrialized superiority to the developing nations of the world. With careless disregard, we sacrificed third world development at the altar of consumption. And the environment: we're awakening only too late to realize what we've done to ours, and trying to convince the aspiring third world to learn from our mistakes. Only no one is listening. It's with irony how it's coming home to roost.

Global energy demand is driving the conversion of some foods to energy to feed our consumable habits. Higher oil prices are impacting the cheap binge of food globalization. It's getting harder and harder to sustain the economics of purchasing foods from the developing nations. Our keenness to assuage our environmental guilt has gotten us fixated on local food production. It may all be a little too late to really steer clear of the impending disaster -- one that we will feel economically, socially and environmentally -- but at least some of us have finally heard the warning. For the rest of you still on that unsustainable high: just remember you were warned of what was coming and but too stupid to change your ways.

A Booming Poverty Market

Micro-lending was such a novel concept to help the poor, help themselves. It started with not-for-profit organizations, lending to the poor in developing countries -- lending really small amounts of money to help folks start a small business and give themselves a sustaining chance. And it is still going strong around the world, sustained by not-for-profits -- but these days, the greedy feeding frenzy of for-profit business is taking over. The thing about lending to the poor is that most often, they are honourable, trusting people. Getting a loan establishes them in the group on their way out of the hovel, and they would do anything to not default on that status -- anything, including not going into personal bankruptcy. The poor also tend to be uneducated and unaccustomed to the sophistication of modern banking. They care only about how much they regular payment needs to be, and how long they need to make them. They are ripe and ready to be plucked. Easy pickings for those that know better. For-profits know better, and so they taken advantage of the poor, putting them on the slippery slope of 100% APR, with interest rates charged against the full amount of the load, even if the principle is lowered by repayments.

Evil. Absolutely evil! BusinessWeek is carrying an article on for-profits that target the poor in Mexico, and are doing more harm than good. That is what happens when a business caters to its shareholders, and only its shareholders, with no care for the society it serves. Totally pisses me off.

Nazi Business

Cracked.com has a cynical piece on five well known brand names and the role they played in supporting Nazi Germany. The companies are Siemens, Bayer, IBM, Volkswagen and Hugo Boss. What did these companies do to support the Nazi war effort? Hugo Boss made the uniforms worn by the Nazis -- and you can probably recognize the Nazi influence in today's Boss wear. Volkswagen created the Beetle to be the affordable wonder car every German could own. IBM supplied the Nazis with systems to keep an inventory of Jews and others, allowing the holocaust to be executed efficiently. Bayer (then part of IG Farben) produced the Zyklon-B gas used in the gas chambers. And Siemens was the Nazi infrastructure machine -- everything from railways to the gas chambers themselves.

Those five are not the only businesses to prosper and support Nazi Germany. There were many others -- and they weren't limited to German companies. Businesses around the world, including Western Europe and the US, saw the opportunity Nazi Germany represented and some even sympathized with their pursuit of a master race.

Of course, it was only just business. It wasn't like those companies were actually killing people. Really. They were just making a killing from the killing. Not much has changed today of course. Around the world, business continue to prosper from the murder of innocents. Think you're not using a product or service that either directly or indirectly is responsible for murder, war, pillage, rape? Think again.

Canada Losing its Water to the US

Stephen Leahy has a post on the machinations of the Security and Prosperity Partnership (SPP), a business-government forum that is an off-shoot of the NAFTA agreement, that is slowly plundering Canada's natural heritage for the sake of economic integration. As Global Warming, mismanagement and drought continue to dry the US, Canada's water stores in the north will be become very important the American machine. Not that I am not concerned for our American cousins, but they have yet to prove they're nothing more than a spoiled, ravenous beast, when it comes to the management of the environment. Canada isn't much better, but with a population ten times smaller than the US, at least we have an opportunity to correct the squander of the past.

The SPP today operates without public oversight. Negotiations are conducted in the dark, where short-term thinking and self-interest stink the air. The American public would be up in arms at some of the compromises being made on their behalf as well -- but we Canadians have much to worry about. We're dealing with the 50,000lb gorilla from south of the 49th. We don't negotiate on equal footing with the Americans. Our government and the greedy bastards who profess to speak for us are selling us out for their tactical gains.

Write your elected representatives folks!

Iraq Expels Blackwater

Blackwater USA is a private, mercenary army that is under the employ of the US military. It has quite a comprehensive operation in Iraq, protecting diplomats, contractors and other non-military types. The company has been regularly criticized for its operations in Iraq, where it operates as an unofficial extension of the US military, but without the oversight of civilian and military law. Iraqis have repeatedly complained that Blackwater's employees indiscriminately fire on, and kill, civilians during their operations. Now it appears that the Iraqis have finally had enough. The Iraq government has ordered the expulsion of Blackwater from their country after eight civilians were killed in the aftermath of a car bomb explosion -- although this expulsion may not affect Blackwater's operations that cater to the CIA or US State Department.

Of course, the US has quickly reacted and has promised an immediate investigation. The US military would be unable to operate in Iraq without Blackwater's presence. The US doesn't have enough soldiers to fight the war and provide security to the nation-building contractors on the ground -- half of whom are the guns for hire. In addition to the security detail, Blackwater also participates in clandestine operations on behalf of the US government. Most of these operations are shrouded in secrecy and can only be speculated on. American reliance on private armies for hire reached a pinnacle under the Bush Administration, which has successfully maintained a war while keeping congressional oversight to a minimum. This isn't disaster waiting to happen -- it has already happened, and Blackwater USA is making a killing keeping Uncle Sam's hands free of blood.

The US may be able to view Blackwater's soldiers as non-military personnel -- but the rest of the world, especially the Iraqis right now, see them all as being Americans. While the American government is now pursuing nation building, it's mercenaries are busily shredding any credibility it may be gaining. The situation is such a disaster that it must take a comatose population and administration mired in shit as to not notice.

For more on the private armies in Iraq, check out this BBC documentary.

Can China Be Fixed?

China is in a bit of a quandary. The country, opened to economic growth by Deng Xiaoping, remains closed otherwise, by the current Communist Party leadership. The result: unparalleled economic growth by any country in the history of the world, and tremendous challenges on the social, environmental and political fronts, that ironically, perhaps only a strong central -- and dare I say, one party -- government, may be capable of solving without risking the economic collapse of the country. Unfortunately, the government that can fix the problems, is also the cause of the problems.

China's central government stresses economic growth above all else. To achieve these goals, local government officials dabble in industry, compromising the welfare of the state and its people. They invest heavily in local businesses -- sometimes tying business prosperity with personal fortunes of corrupt politicians. This has led to lax laws or simply laws that aren't enforced to protect China's people, environment and society.

The same policies that have been so successful at boosting the gross domestic product by developing new export industries and public works projects, it turns out, undermine initiatives that might move China's economy to a higher level. In its pursuit of growth at all costs, China skimped on investments needed to provide basic affordable health care and the regulatory machinery that can enforce environmental, safety, and corporate governance regulations nationwide. [BusinessWeek]

China needs to change, and just as rapidly as it has developed economically. The developed world has invested a lot in China for its production capability, but more and more, are demanding that China takes on the responsibility of joining the ranks of the developed nations. What China does in the coming decades will speak volumes on whether its aspirations lie tactically in production capability -- or strategically, as a world leader and a first world nation.

Further reading:

• Light on its feet
• One country, no democracy
• Smog gets in your eyes
• An Importer's Worst Nightmare

Stuffed Cardboard Buns

Chinese food quality is making the rounds in the news in North America. Food quality is also making the news in China. Yesterday, as I flew out of Shanghai, I heard the news of an undercover TV crew that busted a dim-sum restaurant in Beijing's Chaoyang District. The restaurant, in a effort to save money amid rising pork prices, started to cut their steamed pork-stuffed buns with cardboard.

The recipe went like this: Cardboard was soaked in water and an industrial-use caustic soda, a poisonous chemical, was added. The cardboard lost its normal color and became fragile under the soda's strong causticity, making it look more like pork. Finally, pork-smell essence and pork fat were stirred into the concoction to make the stuffing more "vivid."

Product quality in China is suspect, and to be fair, China is starting to take product quality seriously. Earlier this month China executed the State Food and Drug Administration director, Zheng Xiaoyu, for taking bribes to look the other way on food and drug quality. The execution was a signal -- but hardly the end. A heck of a lot more needs to be done.

The Ignorance of Crowds

Nicholas Carr, ever the optimist, uses Eric Raymond's The Cathedral and the Bazaar [PDF], to sermonize on the limitations of the open source model for innovation, in strategy+business magazine. If you're not familiar with Raymond's paper, Carr summarizes it as follows:

Traditionally, sophisticated programs had always been "built like cathedrals, carefully crafted by individual wizards or small bands of mages working in splendid isolation." An open source project, in contrast, was the product of a large and informal community of volunteers who in aggregate "seemed to resemble a great babbling bazaar of differing agendas and approaches." What was amazing, Raymond wrote, was that "the Linux world not only didn't fly apart in confusion but seemed to go from strength to strength at a speed barely imaginable to cathedral-builders."

With the advent of the Internet, an efficient vehicle for information exchange, the bazaar took off. Innovation didn't need to be pursued in isolation. Individuals connected real-time, could share ideas and evolve products. And here's where Carr thinks the limitations lie. The open source model -- the bazaar of the internet -- has only proven itself adept at evolving ideas that already exist. It's an optimization model, whereas new, truly innovative ideas, tend to come from individuals, or small, intimately connected groups.

The approaches of the cathedral and the bazaar really need to be intertwined. The individual wizard is much more capable of begetting original creations, unhindered by limitations. The bazaar, while appearing chaotic and democratic, is really a platform of focus, discipline and autocracy -- best suited to optimize, and squeeze efficiency and value out of the original creations of the wizards. From a business perspective, Carr writes:

So if you're looking to bolster your company's creativity, you should by all means look for opportunities to harness the power of the crowd. Just don't expect the masses to take the place of the lone wizard or the band of mages. The greatest breakthroughs will always begin, to quote Eric Raymond once more, with "one good idea in one person's head," and the greatest products will always reach perfection through the concerted efforts of a highly skilled team.

Business of War

Why is America shipping military gear to Iran? A good question that should be asked, since America has been rattling sabres since GW got tingle for Mahmoud. The answer is not one that most Americans will care to hear, nor interested in doing much about. It comes down to the mixing of commerce and war. When the two meet, only horrible things can result. America's defense department apparently has a lot of surplus and legacy equipment -- the over capacity no doubt a result of defense contractors pushing Uncle Sam to buy more. Through a series of third parties, the defense department moves equipment out to civilian hands, from where it skips the country and tend to end up in the hands of the highest bidder.

Playing this out to ultimate end will find surplus American military gear in the hands of enemies on a battlefield. American made equipment being used to kill American soldiers, fighting wars triggered by politicians, at the behest of military contractors. If the present trend of contracting the military continues of course, the defense contractors themselves would ultimately supply the soldiers. So, defense contractors build weapons, ensure they end up in the hands of all combatants, and hell, maybe even supply the combatants, and profit from the chaos that result. All funded of course, by the taxpayers, who are too lazy to do anything about it. Brings new meaning to the words collateral damage.

Wars are unfortunate in civil societies, and are a necessary evil -- an instrument of good -- in dealing with uncivil societies. The business of war and warmongering however, is morally wrong for civil and just societies.

Masters of the Breakthrough Moment

Group work in the business world wouldn't have been if it wasn't for Edith and Charlie Seashore. Since the 1950s, the Seashores have been espousing the value of the group in solving problems and bringing change to organizations. Chances are, you've practiced some of the techniques they pioneered with like-minded fellows of the National Training Laboratories:

... giving feedback, conducting "check-ins" to begin meetings, sitting in circles, using flip charts, scribbling on big pieces of paper taped around the room, collaborating on visions for the future, and forming "fishbowls," or groups set up in the center of a larger circle to interact while those around them observed what they were doing.

If you throw a group of people together, conflict is inevitable. Hiding from conflicts however, doesn't make them go away. Instead, they fester, and eventually infect those around them. The Seashores teach that good leaders don't avoid conflict, but see opportunities in them. They are self-aware, and know how their behaviour affects those around them.

Edie and Charlie Seashore have been developing and honing the subtle art of helping people learn from difficult conversations. [They are] advocates for the art of the breakthrough moment. Productivity and creativity in the workplace in their view, occur when members of a group or team wade together into the muck of confusion and unspoken assumptions in order to surface concerns and conflicts that get glossed over in the rush of daily life.

Says Edie Seashore:

"Organizations can't change unless people change, and the most efficient and powerful way to help people change is in small groups. You can affect the whole system if you work with the group."

Today's shrinking world, globalization, accelerating changes and advances, has made the business playground precarious. Organizations are being driven to adopt practices of speed, agility, creativity and innovation in response. Hierarchical organization no longer guarantees success. Semi-autonomous, high-performing teams have better chances of hitting success. Effective groups are so because they are open and honest in their communication.

[The Seashores] see this practice as a way to cultivate not just capability in organizations, but democracy -- the spread of skills, power, and decision-making authority throughout an enterprise.

... decentralized authority, although it is messy and difficult to control, continues to thrive because it works. But it is always under pressure from leaders who fall into authoritarian habits, even if they pay lip service to change.

Organizations need to change according to Charlie Seashore, and change management isn't the answer. OCM talks about change, but doesn't change anything.

"What is really needed is to create enough managerial agility to enable people throughout the organization to keep learning so they can adaptto an unpredictable environment. And the way you do that is in groups."

The Seashores have problems with how some of their pioneering work on groups have been morphed over the years in organizations. Charlie Seashore takes aim on teams:

"Teams are a way of making groups more comfortable for men by adapting the language of sports. Groups were about collaboration and learning, but teams can be focused just on winning. This appeals to organizations focused on the bottom line, but the ability of people to make breakthroughs is compromised."

Edith Seashore meanwhile, have issues with personal coaches and diversity:

"Individual coaching is the death of the group. Working with a single person, you can't see how his behavior affects the whole system. And giving people evaluations rather than creating situations where they can learn to evaluate themselves doesn't really raise their awareness. Do you change just because your coach tells you to? Also, the coach is usually the instrument of hierarchy, a way of asserting behavioral control from the top."

"Diversity is a way of not talking about race or gender, by putting unthreatening language around something difficult and painful. Calling it 'diversity' makes it sound manageable and nice, something we can all agree on. You can write an uplifting mission statement about diversity. But really, it's just a way of avoiding hard truths -- the kind of hard truths that always come out in the group."

Related reading:

• How to Talk About Work Performance: A Feedback Primer [PDF]
• Organizational Culture & Leadership [DOC]
• Toward a Theory of Organizational Socialization [PDF]
• Organizational Culture [PDF]
• On Dialogue, Culture, and Organizational Learning [PDF]
• The Abilene Paradox: The Management of Agreement [PDF]

Wal-Mart's Midlife Crisis

What's happening to Wal-Mart -- and why should it matter to other retailers?  Wal-Mart has pursued the single-minded strategy of low prices to fuel its explosive growth.  That has made it the world's largest retailer, at $345b in revenues, with stores in 13 nations -- the biggest concentration being in the US, where Wal-Mart has close to 3,500 stores.  Through its phenomenal growth, Wal-Mart has kept going by sticking to low prices, and opening stores at an alarming pace.  In 2006, the company boasted a new store everyday.  It has done this on the backs of suppliers, employees, communities and competitors -- and the price has been so high, that the company now faces significant socpolitical challenges to its continued expansion strategy.

Wal-Mart isn't slowing down however. CEO H. Lee Scott Jr. is determined to continue the new store openings, suggesting that the 1-new-store/day pace can be sustained for the next five years. Meanwhile, performance at Wal-Mart's existing stores continue to suffer. Wal-Mart's own findings point to the fact that their top 800 stores perform 1000% better than the bottom 800 -- and, 25% of its stores, fail to meet its own expectations. Wal-Mart doesn't seem to know what to do to fix the problems with the stores. They continue to be understaffed, unkempt and under-merchandised -- while Wal-Mart continues to place bets on attracting middle-income shoppers who will drop cash for higher margin merchandise, and turning on the dime to embrace environmental concerns.

The challenge Wal-Mart faces is the same many large retailers face -- or will face -- if they stay disconnected from their customers, their lives and the world in which they live in.  Wal-Mart at times appear to pay lip-service to the environment.  While there are many who are cheering the company's green epiphany, I remain a skeptic.  Wal-Mart's treatment of employees, suppliers and their merchandise sourcing strategy continues to say a lot about the nature of the company.  Just because they've decided to embrace their critics with a few timed, well publicized actions, doesn't make the company different.  Wal-Mart is still about low costs at the cost with the burden transferred to the rest of the world.

Anyway, looking at the scale of corporations like Wal-Mart and their continuous drive for growth -- one has to ask: just how big is big enough?

Patent Pirates

Altitude Capital Partners, Coller Capital, Rembrandt IP Management and Northwater Capital are venture capital firms with billions of dollars between them, and out to make a quick, easy buck at the expense of others. These dubious venture capital firms are in the business of funding patent trolls -- companies that either file or buy patents with the sole purpose of going to court to collect billions from others who may have developed similar technology or processes protected by patents in-hand. Forbes reports on their war chests, patents secured, and litigation game plan. The whole practice is obscene and a misuse of the law. Read more, and if you're a technology company, be afraid ... be ah-fwaid!

Another Inconvenient Truth

It's hard not to be cynical in this short-term thinking world. When you look at the global warming problem and the efforts underway to curb the belching of noxious fumes into the air we breathe, you want to think that the motivations are for the right reasons. But, as with most opportunities, we must ride that hype curve before we get to that plateau of productivity where things can actually be accomplished. Climbing the peak of inflated expectations, are a lot of do-gooders with noble intentions -- but there are also the snake-oil salesmen, out to exploit good intentions for short-term gain.

BusinessWeek's March 26^th issue carries an article on another inconvenient truth -- the currency of carbon offsets. Companies and individuals alike, especially the vocal ones, are jumping on the bandwagon more for selfish gains than altruism.

Rather than take the arduous step of significantly cutting their own emissions of carbon dioxide, many in the ranks of the environmentally concerned are paying to have someone else curtail air pollution or develop renewable energy sources. Carbon offsets, as the most common variety of these deals is known, have become one of the most widely promoted products marketed to checkbook environmentalists. [Emphasis my own.]

Carbon offsets are supposed to work simply. If your carbon footprint amounts to x, but you're incapable or unwilling to take the steps to reduce it -- the easy way out is to insert dollars. Spend the right amount of money, and have someone else do the work to reduce by x, their footprint. Because you're funding the reduction, you can then feel good about yourself that you've negated your use of the planet as a toxic dump.

The problem with this approach however, is that the laziness has spawned a festering industry of middlemen whose promise is to take money from those that are unwilling to change and issue certificates, authenticating carbon reduction. What the middlemen are supposed to do, is invest that money to reduce elsewhere -- and they do -- somewhat. Unfortunately, that money could go to places where the reduction was already going to take place for other reasons. For instance, legislation may drive companies within a specific industry to curb their polluting. To feel good about themselves, companies in other industries may purchase carbon offsets in the first. But it's a meaningless investment, and the certificates issued have no credibility, since standards for what constitutes an offset aren't available. The reduction in the first industry would have happened anyway, because the impetus was already there.

What is needed is accountability, less hype and real action. Carbon offsets may indirectly have a positive impact on the environment -- but it's more symbolic than real. Real action requires work and the taking of accountability by individuals and businesses. I hate being cynical about this, but what is transpiring with carbon offsets is just another product of our lack-of-responsibility society.

IT and Innovation

The February 1^st issue of CIO Magazine carries an article on innovation and benefits IT can bring to the process as an enabler. CIO suggests that as product lifecycles continue to shrink, the pressure to bring the innovation cycle down to shorter timeframes will be even greater. Internal R&D departments can no longer afford to do it all on their own –- and innovation as a result, is becoming a distributed process, requiring the collaboration of customers, suppliers, independents and even competitors.

How can IT help? CIO provides these elements that specifically requires IT as an enabler:

Collaboration. Communications is critical among both internal employees and external contractors. Agree on a medium, whether its e-mail, IM or fancy collaboration software, and get everyone using it.

Data access.Easy access to research information is the basis for doing collaborative innovation work with outsiders. Make project data available in a format that is standard, simple and easily viewable –- think PDF and HTML.

Process standardization and automation.Standard templates and automated workflows that don't depend on specialization systems are important to getting multiple outside contributors involved in the process. Such tools also allow you to chunk up workflows so that one group can pick up where another left off. The caveat: Dont let standardization stomp on creativity –- its a delicate balance.

Cross-functional integration. Researchers and engineers dont own innovation anymore. Find ways to connect other functions to the innovation process –- especially those that deal with customers, like sales, marketing and customer service and give them a voice.

CIO also profiled P&Gs use of IT as an enabler to their R&D process, and cites the requirements that IT needed to meet in order to get into the game: flexibility, scalability, cross-functional integration and collaboration.

What a concept! Collaboration, flexibility, information access, and, the delicate balance of process standardization and integration –- think of your IT organization, and ask how well they do any of those. More likely than not, your IT organization is stuck in time about decade ago, and see those suggestions as dangerous –- if not downright crazy.

Beyond Virtual Reality

The April 2^nd issue of BusinessWeek carries a cover story on the coming virtualization of the world that's an eyeopener on future of human-computer interface. Lets face it, the keyboard is not natural -- neither is the mouse, the remote control or 2D simulations of 3D worlds. What is natural for humans have long been a challenge for computers to accept as input, interpret and execute. A glimpse of the future however is here, and its showing up in the unlikely place of business.

Sure the entertainment industry has been at the forefront of exploiting new technologies such as motion capture, rendering and virtualization of the real world -- but how about sensor technology that detects movements and expressions, allowing the natural interaction with presentations? Or technology that tracks the motion, allowing advertisers to interact with their audience? Others are also bringing 3D modeling to life, allowing prototypes to be interacted with -- designed, tested and virtually constructed and used before ever becoming real.

Systems that track motion and emotions are also being developed, with a varied landscape of applications waiting in the wings. Imagine if Google ads could from eye movements and facial expressions being captured by webcams, whether ads being served up are registering –- or even effective. Imagine if security systems could tell from movements and facial expressions, whether an individual is up to no-good. Or think of the possibilities, if the health industry could interpret a gait and associate it with medical conditions. The education industry could reach a higher dimension if movements and expressions could be captured and rendered virtually to bring geographically displaced individuals together.

BusinessWeek closed off the article with some words from clinical psychologist Sherry Turkle of MIT: Motion tracking is about the mirroring of body motion, and of course the subtle things like hand gestures, or the way someone characteristically cocks his head before speaking. With the widespread use of these systems in business and entertainment, these motions will give us a much greater sense of connection with our online selves. The virtual will seem much closer to the real. The possibilities are nothing short of the Matrix.

The Trouble With India

I've read a few arguments that compared the waking of the two sleeping giants: India and China, and which one will be able to capitalize and sustain the transition from third world, sprawling chaos, to developed nationhood. The advocates of democracy stress that no where in the world is there a successful country built from single party rule -- and only with freedom, can a country be successful by all measures of what success is: economic strength, social justice, freedom, etc. Thus far however, no one would argue that China is realizing successes while India continues to struggle.

The latest issue of BusinessWeek carries a cover article that explores what is troubling India. There is much. Most notably, an infrastructure that is totally lacking and in need of investment; and rampant corruption that is bilking resources and time from much needed investments. India's growing prestige in the world is coming mostly from its technology and related services sector. These are businesses that don't need infrastructure investment. Then there is China, which has grown due to its manufacturing prowess -- requiring huge infrastructure investment. China is catching up to the developed nations, while India struggles, and the gap between the rich and poor widens. With infrastructure and manufacturing investment, India's poor would also benefit from the growth. In China, decisions flow from the top. While there is no doubt corruption, there is no debate on what should be done. Not the case in India, where the sprawling bureaucracy moves at a lazy pace.

Will a democracy prevail over the new single party rule China is modeling? Can both models be successful? Only time will tell.

Designing Change

Limited thinking would view the poor as a burden to society, but if you buy C.K. Prahalad's bottom-of-the-pyramid theory, the 4-plus billion impoverished people in the world are a vast untapped market. If you're motivated solely by profits, you may limit your understanding of Prahalad's theory to bringing consumerism to the poor -- but if your aspirations are to close the inequalities that exist between those that have, and those that have don't, then this vast untapped market represents an opportunity to make a difference, even while eking out profits. The poster child for tapping into those at the bottom is Grameen Bank, with their micro-financing to aid those in developing nations towards self-sustainment.

Helping the poor help themselves is a novel idea that is taking off in philanthropy. It's not just about throwing endless sums of money at the vacuum of need -- but about wisely investing in the poor, so they can create an economic environment where the cycle of poverty can be slowed and even stopped. I've just found out about an organization, like Grameen Bank, that is investing in the poor, for a profit. Jacqueline Novogratz's Acumen Fund takes the micro-financing approach with venture funds, looking for businesses, business models and designing solutions to tap into the unmet needs of the poor -- and along the way, sometimes bringing home a small profit for their efforts that is then reinvested. What a virtuous cycle.

Acumen's $20 million investment portfolio is focused on health, water and housing, with seed money coming from some well known philanthropic organizations. Its website boasts some great success stories, such as a $325,000 loan to A to Z Textile in Tanzania, in which it lost $32,500, but got 5,000,000 Tanzanians mosquito nets to protect against malaria infection. A to Z Textile expects production to ramp up to 7 million nets. That impact, for a $325,000 investment. BusinessWeek tells the story of Acumen's equity investment in Drishtee, a startup in India, that rolls out information kiosks in rural India, complete with a computer, internet access, digital camera and fax machine. Drishtee offers the kiosks as franchise operations, allowing locals to own the kiosks that provide village access to health information, government resources and other necessities of modern India. Women it turned out made better franchise owners than men, as they open earlier and close later, but lacked skills and most banks in India do not lend to women. Acumen has invested in training village women in the basics of business and is working with an Indian bank to offer a guarantee to the bank's loans to women franchise owners -- aiming to prove to the bank that women are safe investment bets.

Jacqueline Novogratz, an American woman, making a difference to the lives of the poor women of India -- I like the female symmetry in this story -- noteworthy, since today is International Women's Day.