International Tax Reform– Mitigating Corporation Tax Avoidance Schemes– BEPS: Bring Transparency to Global Tax Systems…

Tackling corporate tax avoidance schemes in the global economy is a high international priority: Tax evasion and tax avoidance reduce government revenues, which has a significant detrimental effect on the provision for infrastructures, public services, public utilities… Almost half of all global commerce passes through tax havens in spite of the fact that they account for about 3% of global GDP…

According to J.G. Gravelle; multinational enterprises are shifting profits from jurisdictions with high-tax rates to jurisdictions with low-tax, and shifting debt from low tax rates to high tax jurisdictions… there are other creative schemes used by multinational enterprises to avoid paying a ‘fair’ share of taxes…

The Organization of Economic Development and Cooperation (OECD) estimates about $US100 billion to $US240 billion annually is lost due to array of tax avoidance schemes devised by multinational enterprises… The OECD, acting at the request of the G20, released an action plan to address concerns over ability of multinational enterprises to minimize taxation through sophisticated tax planning schemes and thus reduce tax revenues in affected jurisdictions…

The diminution of a nation’s tax base through tax  avoidance schemes is known as ‘base erosion’. Broadly, ‘base erosion’ occurs when multinationals locate profits in low-tax jurisdictions. The legal practice, known as ‘profit shifting’, diminishes tax base of corporations and thus tax receipts of nations that might otherwise claim taxes on corporations’ profitable activity…

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As a counter measure to these tax avoidance schemes, the OECD initiated an ‘action plan’ known as ‘Base Erosion and Profit Shifting’ (BEPS). This ‘action plan’ or BEPS project, sets forth a number of areas of concern and corresponding approaches to reduce ‘double non-taxation’, and ‘double taxation’ of corporate and individual income…

The OECD’s recent report identified the following 6 elements as key drivers of BEPS:

(1) hybrids and mismatches which generate arbitrage opportunities– differences in the tax treatment or transfers between two or more countries;

(2) residence-source tax balance, in context of the digital economy;

(3) intra-group financing, with companies in high-tax countries being loaded with debt;

(4) transfer pricing issues such as treatment of group synergies, location -specific savings;

(5) effectiveness of anti-avoidance rules, which are often watered down because of heavy lobbying and competitive pressure;

(6) existence of preferential regimes.

According to Ian Shane; in theory this mean that multinational enterprises operating cross-borders must make changes in their operations, but don’t get too excited just yet… Each country that sign-up to the BEPS rules (90 nations have signed-up) must enact legislation to bring the rules into effect and amend their individual tax treaties with other countries…

And the exact form in which the new rules are to be enacted is up to each country… and at present time many countries have only agreed to apply a minimum standard to some parts of the proposed new BEPS regime. Also, participating countries are not obliged to implement certain parts of the BEPS plan, such as; curbs on tax deductibility of interest payments… At least for the present, there is no need for cross-border business to do anything, but watch this space; however, change is coming and it means tighter international tax rules…

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In the article What is the Purpose of BEPS? by Patrick Love writes: Some multinational enterprises that are worth billions pay practically no taxes in countries where they operate and make profits… Not because they are defrauding the system, but because tax systems simply have not kept-up with innovations in the digital economy, e.g.; added value, profits on intangible assets, licensing, even exploiting personal data… Multinationals avoid paying– what most citizens would consider– ‘fair’ taxes through; ‘tax base erosion and profit shifting’ or BEPS, as OECD calls it. BEPS schemes can be extremely complicated, but the basic idea is simple; shift profits across borders to take advantage of tax rates that are lower than in the country where the profit is made. Three popular schemes include:

  • Hybrid Mismatches is when multinational enterprises try to have the same money or transaction treated differently– e.g.;  as debt or equity– by different countries so as to avoid paying taxes, and often they feature dual residency– companies that are residents of two countries for tax purposes…
  • Special Purpose Entities (SPE) is when multinational enterprises have– no or few employees, little or no physical presence in a host country, and the assets and liabilities represent investments-in or from other countries… and the core business consists of group financing or holding activities…
  • Transfer Prices is when multinational enterprises’ various parts of the enterprise pays each other for goods or services received. Through transfer prices profits are allocated among the different parts of the enterprise in different countries… also they are used to determine the amount of tax the multinational pays, and to which tax administration. There is not a simple method for calculating a transfer price and the lack of good ‘comparables’ often results in profits being artificially shifted to ‘no- or low-tax’ jurisdictions…

International tax rules are generally efficient in ensuring that multinational enterprises are not subject to double-taxation, but some multinationals takes advantage of gaps in the rules to avoid paying tax completely, so-called ‘double non-taxation’… In this scenario multinational pay a sum across two or more countries that is less than what they would pay in a single country. Multinationals tax avoidance harms everybody: Governments lose revenue and may have to cut public services and increase taxes on everybody else…

And, business suffer too, e.g.; small and new businesses working mainly in one national market cannot compete with  multinationals  that are continually shifting profits across borders to avoid or reduce tax… Hence, purpose of BEPS is to provide greater transparency to mitigate the growing disconnect between where money and investments are made, and where  multinationals report profits for tax purposes…

In the article Why BEPS is Game Changer by Nieuwsbericht writes: BEPS is game changer for two main reasons: First, BEPS is the first substantial move ‘in almost a century’ to align the international tax standards with the globalization of international business. One may argue that governments will always lag the speed and creativity with which multinational enterprises adjust to changing regulation. However, this misses the point; BEPS signals that governments around the world are beginning to work together to adapt to new realities… And even more importantly, governments expect multinational enterprise to demonstrate responsible business conduct, even when it comes to taxation.

Second, BEPS is an unprecedented process in which OECD and G20 countries are working together on creating a new international tax standards and all participating countries are engaged on an equal footing… dealing with highly complicated, controversial topics. Even though the initial drive came from the G20, technical work is being shared by an extended OECD Committee, which includes; both emerging and developing countries participating equally… Hence, this new found– co-operative, co-ownership, equality-based initiative between countries may very well provide an excellent best-practice model for other complicated policy issues outside the tax area…

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In the article BEPS Tax Storm Is Coming by Joe Harpaz writes: BEPS is a set of reforms currently on the way to becoming one of multinationals’ biggest challenges… but few people outside of the geekiest recesses of tax policy are even aware of its existence… At its root, BEPS lays-out a series of actions designed to realign tax policies with the realities of the global economy…

The most significant of these suggests is that multinationals must file detailed tax reports in every country where they do business; they have never had to do that before… Previously, multinationals had to show only the transaction flow from one country to another. Now, the full details of each multinational tax payments to each country will be available globally in a standardized, shareable template. Beyond that, the new reporting guideline will require– financial, sales, personnel information… to help countries determine the value of the operations within their borders and how that should be reflected in taxes for that jurisdiction…

It’s important to note the unique nature of the OECD and the role it plays in the global marketplace: BEPS is just a series of suggestions made by a consortium of global government representatives, which has no real legislative authority… Although OECD does have a clear-cut agenda and detailed deadlines it hopes to meet with its BEPS ‘action plan’… the passage, enforcement of these guidelines are left to individual countries…

Hence, sensing this burgeoning tax issue will blossom into something bigger, some multinational enterprises are already adjusting policies, e.g.; Amazon announced it will change the way it accounts for revenue from retail sales in EU: Under new arrangement, Amazon will book all revenue from retail sales in each countries, rather than routing the profits through Luxembourg (as it has been doing), which has the lowest corporate tax rate in the EU…

It’s still too early to determine if other multinationals will follow, but one thing is clear: multinationals will have to provide unprecedented  level of tax transparency…

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Overall multinational enterprises have welcomed efforts to bring greater clarity to the international tax system. However, some are growing concerned about how the project is shaping-up: The International Chamber of Commerce (ICC) for instance has affirmed its ‘active engagement’ in the BEPS project, however, the ICC warns that it’s ‘crucial’ for both OECD member states and non-members to reach agreement on BEPS project’s outcomes to avoid inconsistencies and conflicts between the national tax regimes and to reduce double taxation… Whether or not the BEPS project succeeds in substantially reducing opportunities for ‘base erosion and profit shifting’ in the international tax system remains to be seen. However, it’s clear that unprecedented change is going to take place to the international tax landscape in months and years ahead and multinational enterprises must be alert to these developments…

Delegation of Authority– Power to Manage, Power to Change: Core Principle in Management Practice…

Congratulations; you are delegated to lead an organizational initiative! But there is a catch– its success hinges on the cooperation of several people across the organization over whom you have no formal authority…

According to Lauren Keller Johnson; many managers are facing this challenge more often these days because of flatter organization structures, outsourcing, virtual teams… New kinds of partnerships and alliances have emerged, which require managers to exercise influence over peers without formal authority… Delegation of authority is a transferring of responsibility to accomplish a certain task; and as it’s given, it can also be withdrawn at any time…

Delegation is the process of sharing power and work, it’s technique of management used to get the things done through others, presumably much more effectively… In a delegation process only authority is delegated, not responsibilities– control remains with the delegator… it’s an important process in the art of management…

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The delegation of authority is one of the key and essential tools in the development of any organization– it strengthen the internal control system, clarifies who is responsible for decision-making for each task, and is a critical process of an organization… According to Mooney and Reily; authority is the principle at the root of any organization, and so important that it’s impossible to conceive of any organization without some person(s)requiring a delegated action from other people… However, authority is not just a matter of telling other people what to do… Delegation of authority is all about empowerment… There is a wide range of authority that can be conferred on people and the rate and extent of authority delegated is a fundamental driver for getting things done…

According to Dougcas C. Basil; delegation is granting authority or the right to decision-making in certain identified areas and charging other people with responsibility for carrying through an assigned task… Typically, authority flows from top to bottom across the organizational structure, however, in many modern organization the command-and-control leadership, i.e.; ‘I Leader-You Follower’ approach, does not get a manager very far.

According to Jay A. Conger; managers and executives at all levels must use a more lateral style of leadership… Lateral leadership (informal authority) is an essential skill and comprises a variety of capabilities– from networking and coalition building to persuading and negotiating… As the business landscape continues to shift, organizations need people who can exercise lateral leadership with increasing skill, confidence…

In the article Difference Between Power, Authority, Leadership by Koen Marichal writes: There is a difference between– authority, leadership, power. According to Ronald Heifetz; authority is the conferred power to perform a service; it can be given and it can be taken away, it’s part of an exchange… Authority provides direction, protection and order, it’s an imperative in any organization, and it can be both formal and informal…

The power to influence is the resource of authority and leadership. Power can be both informal and formal; where formal power comes with a ‘position’ (or ‘rank’) within an organization. Whereas, informal power comes from ‘personal attributes’ as does informal authority… informal authority and power are necessary conditions to gain formal power and authority…

Hence, authority and leadership do not necessarily go hand-in-hand… In order words, authority is given to provide– order, direction, protection… whereas, leadership– creates visions, challenges status quo, changes value systems… leadership is not merely the informal side of authority or power, leadership is closely linked to purpose, it’s the  ‘why’. Hence, the critical differentiator between authority and leadership is the question: Does making progress on an issue require changes in people’s values, attitudes, habits of behavior? If yes, leadership is needed. If no, authority can do just fine. However, both authority and leadership need ‘power’; formal or informal…

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In the article Power vs. Authority by Jim Bouchard writes: Power is the ability to act or perform effectively, which is essential ingredient in effective leadership… In conventional thinking there is little or no power without authority. However, some people see exactly the opposite; there is no authority without power; not for long anyway! Authority comes from; titles, degrees, positions… which is usually be given by another person(s). Whereas, power comes from within a person; power is the capacity to have influence, to act and get things done, and power grows directly from a person’s willingness to learn, change, develop…

Some people try to expand personal ambitions by directly expand their authority; that can work for a time, but authority without power is always open to attack– vulnerable to the next coup… Both power and authority are important; a person cannot lead effectively without authority… hence, it’s a matter of means: A person can gain a tremendous degree of authority by being a jerk, or through political maneuvering, lying, cheating… Or they can cultivate authentic power through meaningful achievements…

In the article When and How to Delegate by Stephanie Reyes writes: A basic question leaders often asked is: When to Delegate? The classic answer is– delegate whenever possible without compromising the objectives of the task, or overburdening the team… Giving people challenging and meaningful work, along with the authority and resources needed to accomplish the work, make a team stronger and more motivated. It also frees up management to focus on planning and other strategic issues… Rather than trying to determine when it makes sense to delegate, Peter F. Drucker suggests; leaders must be aware of what they should not delegate, and then assume everything else is fair game for delegation…

It’s also important to remember that the leader remains ultimately responsible for the successful completion of delegated tasks, even when team members are given the necessary authority and resources to accomplish them. In other words; true delegating means giving up what you would like to hold onto, i.e., the authority… and holding onto what you would like to give up, i.e., the responsibility…

Delegation of authority means empowerment, which is often incorrectly perceived as a binary choice: Either you empower someone, or you don’t… However, in reality, there are different levels of empowerment… According to G.M. Spreitzer; empowerment is a variable; people can be viewed as more or less empowered, rather than empowered or not empowered… 

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In the article Principles of Effective Delegation by kevinb writes: Delegation is an important tool that many leaders hesitate to use, and it has been the downfall of many organizations. The biggest barrier to delegation is overcoming the attitude that ‘you’ must do it all! It becomes a leader’s curse when you adhere to adage; If you want something done right, do it yourself… Delegation is very different from simply assigning someone a task or project that falls within their established job description or requirements…

When you delegate, you give someone else tasks to complete with the authority and control to complete it properly: Delegation is not abdication. You share accountability for the assignment, which is why checkpoints are established to monitor overall progress. Just as the outcomes of the entire team is your responsibility, you are also responsible for the ultimate success of the delegation process…

When delegation is done properly and for the right reasons, it helps foster a climate of trust and creates growth opportunities for the entire team. Once you have created a solid process for delegation, stick to it, void reverse delegation… At times, a team member may try to dump the delegated task back to you, and you may feel tempted to take it back especially if he or she seems to be struggling. Helping him/her stretch outside their comfort zone is all part of a positive growth, development… Here are five principles that can help create an effective delegation process:

  • Determine what to delegate: Effective delegation of authority begins with defining the responsibilities. Write down all of the activities and responsibilities. Review the master list and categorize all of the items into two secondary lists: Things you alone must do and things that others could do or help complete. Anything that falls into the second list presents an opportunity for delegation…
  • Choose right person to delegate the task to: Andrew Carnegie said; The secret to success lies not in doing your own work, but in recognizing the right person to do it… The key to finding the right person to delegate an assignment to is matching skills and attitude to the task at hand…
  • Clarify desired results: When the results are clear, it allows the person(s) delegated to use their own creativity and resources to accomplish the task. An added benefit of effective delegation is the person(s) may find a better and more effective way to accomplish the task or achieve the desired results…
  • Clearly define responsibility and authority as it relates to the delegated task: Clearly communicate the expectation, responsibilities, and timeline. Be sure to ask the delegated person(s) about their understanding of the task…
  • Establish follow-up or touch-points: The follow-up should be focused on two things; monitoring progress and determining the need for assistance. The number of follow-up will vary based on the scope of the task…

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Delegation involves three important aspects, such as; assigning duties, granting of authority, creating obligation or accountability… The followings are some of the important principles of delegation of authority:

(a) Authority should commensurate with responsibility: It’s not correct to say that authority should be equal to responsibility. Authority is the power to carry out an assignment and responsibility is the obligation to accomplish it…

(b) Responsibility cannot be delegated: When authority is delegated to another person(s), the delegator does not pass on the responsibility for it. The delegator is still accountable for it as their responsibility is absolute, it’s also termed as the principles of absolute responsibility.

(c) Dual delegation should be avoided: There is a saying that a person cannot serve two masters in the same way. Every person(s) in the organization must know who delegates authority to them, and to whom the matters beyond their authority will be referred…

Authority flows downward, as it implies the right to acquire action of others… Responsibility flows upward, as a person(s) is accountable to another in a higher rank…

Journalism is Dead, Long Live Journalist; Corporate Puppet Masters of Media in the Digital Age…

Journalism is the gathering, assessing, creating, and presenting news and information, e.g.; news stories, magazine articles, TV, radio, video, music, advertising, photos, web pages, and of course social media… All of it, all the ‘content’ that is fit to print and all that is not…

Independent journalism (freedom of press) is indispensable for a democratic society– history reveals that the more democratic a society, the more news, information it tends to have… Modern journalism exists due to a curious convergence of factors… and there is no doubt that the world of journalism is going through a period of rapid change…

The centuries-old profession of journalism is undergoing change so cataclysmic that it may soon be unrecognizable…

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The journalist hero of the past, e.g.; Edward R. Murrow, Walter Cronkite, Bob Woodward… have become displaced by pundits… According to Lee Waters; the number of journalists has fallen significantly in recent years as free content has been voraciously consumed, and the nature of journalism has inevitably had to alter to adapt to the rapidly changing environment…

The basic mission of the journalist still remains the same, i.e., to tell the most important stories in the most engaging way to a readership… and these core principles are codified in the standards of professional journalism which include; truth, accuracy, reliability, balance, objectivity… and are termed the ‘journalistic model’.

However, the digital age has brought about fundamental changes to the ‘journalistic model’ and to the world of journalism; with the most profound being the complete transfer of the dominant media power from the written journalistic forms (e.g.; newspapers, periodicals, books…) to the elevation of the Internet and television as the uncontested monopolies, and what is today called mainstream media…

According to Stephen Waddington; Internet broke the shackles of journalist deadline, page count, schedule… It has made the cost of the distribution of content zero and provides search and social mechanisms to aid discovery… Now everyone is a journalist: Anyone equipped with an Internet connection can challenge organizations and provide a contrary filter to their content. It’s known by many as ‘citizen’ journalism, and its forcing organizations to be more transparent… This is a story of changing business models where corporate media is becoming the new journalist model for producing content…

In the article Unstoppable Rise Of Corporate Media… by Tom Foremski writes: Every organization is a media company– not because they want to be, but because they have to be. They have to be seen in the world or they cease to exist, which is why organizations are ramping up their output of corporate media and they are just at the start of this trend… Organizations know that the value of high quality media content is essential to bottom-lines… Since traditional sources of media, i.e.; newspapers, magazines, TV… aren’t producing enough of it; hence, corporations are producing it themselves…

There is a fundamental shift in the business of all media and the rise of corporate media is unstoppable and inevitable and it’s essential for their survival… Producing more content creates opportunities for more revenues… When organizations produce higher quality media they rise above the rest… Also, in today’s digital age, traditional PR has less impact, and traditional advertising has even less effective… It’s a cacophony of voices becoming ever more shrill and difficult to hear, good and bad, filtered and unfiltered– it’s a mass of content, and media is a tsunami on an unprecedented scale…

In the article Rise of the Corporate Publication by Meredith L. Eaton writes: Today most people prefer TV and increasingly the Internet to get their news and information… and while these media outlets may run similar stories and have a familiar look and feel as traditional outlets, upon closer look; they are actually content marketing initiatives run by major organizations… and they are more than just fancy corporate blogs… They cover news of other trends beyond their own corporations’ core competencies, and even competitors… and as more corporations self-publish their news, traditional media outlets risk becoming irrelevant… the trend is happening just be aware of the corporate logo represented on any press clippings…

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In the article Social Media and Evolution of Corporate Communications by Laura Matthews writes: In today’s corporate world, the success or failure of any company hinges on public perception. The opinions of key company stakeholders, such as; shareholders, investors, consumers, employees, members of the community in which the organization is based, are all crucial to the long-term success of the company...

Social media allow for corporate communications opportuni­ties that a decade ago was not plausible… Public relation is an old industry that has relied on the same tactics and formulas for much of its his­tory and has traditionally been measured by the amount of media coverage resulting from output of company messages. Social media is rapidly changing the way public relations campaigns, programs are distributed and measured…

Hence rather than the traditional method of measured output, which is completely company controlled messages being broadcast to the stakeholders– social media has forced corporate communications to shift to a dialogue in which the stakeholders, and not just the companies, have power over the message. Social media allows stakeholders to ask questions and have questions answered directly by corporate execu­tives, and for corporate executives to receive important feedback and even ideas from stakeholders… Public relations in the traditional sense has come to be seen by many as ‘smoke and mirrors’, deceptive messages being created by ‘spin doctors’… Because of this, many people have come to distrust media– the traditional means by which the industry is measured– and put more trust in the opinions of their peers, which they have access to on social media sites… Social media not only offers an opportunity for direct and instant corporate communication, but also an opportunity to get back to the ideal basics of public relations– building and maintaining relationships…

In the article Myth of Public Opinion by Jeremiah Jameson writes: Those who control the corporate media control public opinion, not the public… As revolutions, both violent and peaceful, overthrew kings and authoritarian rulers, modern states began to be ruled by representative democracies. In representative governments, the most important voice is no longer the king or the ruler…

The most important voice is the media, and most often corporate media. Of course the media pretends to be speaking for the people, for the masses… The media likes to fancy itself as the voice of public opinion‘… But, What exactly is public opinion? It’s the opinion of the public, the popular view… But public opinion is a myth: In fact, what the consumers of the media get is the voice of the ‘few’, the well-connected; the unseen hands moving the masses to their desired place…

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One of the tools used to manipulate ‘public opinion’ is the public opinion poll. These polls supposedly are strictly objective, scientific ways to measure the opinion of the public… According to the esteemed Winston Churchill; there is no such thing as public opinion, there is only published opinion… And now the reader knows why the press is so exalted in countries without authoritative rulers… The king may be dead, but the real power rests in those who control the media… These ‘powers’ daily manufacture ‘public opinion’ and then inform the public what their opinion should be…

The digital age news machine is a reality, bringing enormous benefits, even as it forces society to make difficult choices. Without a doubt, this new technology is changing journalism, and it’s up to consumers to make sure that this change is for the better. According to According to Vineet Kaul; if the free press and journalistic ethics are to survive the treacherous journey into cyberspace, society needs to answer the tough questions that new technology will raise about the role of journalism in a free society, remembering that technology, no matter how powerful, can only be as useful and worthwhile as consumers of media decide to make it… As Edward R. Murrow warned many years ago; technology without thoughtful human involvement is merely– lights and wires in a box…

Companies are waking up to the fact that the traditional approach to media relations , i.e.;  put-out a press release, wait for coverage…  is not as effective as it used to be. There are fewer journalists who cover much of the routine business announcements that would have likely been picked up by some wire service… The Associated Press (AP) now has robots covering financial news; it’s a recognition that while these things are important to record in some neutral fashion, they don’t attract many readers and it’s better to have reporters focus on features, scoops, hot breaking news items…

According to Robert Teitelman; the business and financial world has grown more complex and global, and journalism must effectively bridge that chasm between the complex realities at play and potential readers who know little… and in many cases, lost the habit of consuming ‘serious’ journalism due to a million other distractions…

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Journalism is inevitably a commercial product and must be sold to an audience to survive… According to Tom Foremski; we are entering a world where special interest groups will gladly pay for the media ‘they’ want ‘you’ to read… on the other hand, ‘you’ won’t pay for the media you need to read… A basic issue in journalism is– who pays for  quality news? Or, is this task abrogated to the corporate media mills? If consumers have junk media, they make junk decisions about important issues: Garbage in, garbage out…

The once free press is fading quietly into the night, and people who are a part of this new media system will simply do as they are told… As Abraham Lincoln wrote; great nations are rarely destroyed from the outside. When they falter and lose their freedoms– freedom of press, freedom of speech, quality journalism– it’s because they destroyed themselves…

Rise of On-Demand Economy– Reshaping Nature of Business, Uber-ization of Work: Great Gigs Vs. Less Security…

The ‘on-demand’ economy is reshaping the nature of companies, structure of work, consumer behavior… It’s a new wave business model where workers are on-tap, ready in instant, available at moment’s notice to service consumer demand…

And, depending on who you ask ‘on-demand’ proliferation will either create a Dickensian-era nightmare of unregulated capitalism that eviscerate workers rights, or usher-in worker-centric utopia in which workers control all aspects of their working lives…

According to Sharon Florentine; none of this is really new; workers have been doing it forever, it’s just the new way to look at things as an ‘instant-on’ economy… but like most things in business; what’s new is really what was old, just renamed.

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According to The Economist; the on-demand economy is relatively small but growing rapidly… and it has profound implications for everything from the organization of work to the nature of the social contract in a capitalist society… According to a report from the nonprofit ‘Freelancers Union’; about 53 million U.S. workers are on-demand workers, i.e., about one in three workers and the pool is growing…

By 2020, according to estimates by Intuit; independent contractors will make up 40% of the U.S. work force, with on-demand workers representing a significant subcategory… According to Leo Mirani; there are only two requirements for an on-demand service economy to work; First, the market being addressed needs to be big enough to scale, e.g.; food, laundry, taxi rides… Without that, it’s just a concierge service for the rich rather than a disruptive paradigm shift, as a venture capitalist might say…

Second and perhaps more important, there must be a large enough labor class willing to work at wages that customers consider affordable and that the middle-people consider worthwhile for their profit margins… There is no denying the seductive nature of convenience– or the cold logic of business that create new jobs… But the notion that brilliant young programmers are forging a new-fangled ‘instant gratification’ economy is a falsehood, instead it’s a rerun of the oldest sort of business, i.e.; middle-people inserting  themselves between buyers and sellers… and all that modern technology has done is make it easier, through the omnipresent of smartphones, to amass fleets of increasingly willing workers on-tap who want more earning power…

The most obvious beneficiaries of a on-demand workforce are businesses and consumers. Large enterprises are increasingly using a flexible workforce to cut costs while addressing bursts in demand, while small business who cannot afford the overhead required for full-time workers– healthcare, vacation, sick time, and the like — are also tapping into a growing pool of available– freelance, contract workers…

While an hourly workforce is a boon for cost-conscious businesses and for certain demographics for others it can be problematic, e.g.; the downside for business is fairly obvious – the workers don’t work for the business, hence they have no real loyalty or skin in the ‘business’ game… and the downside for workers is also fairly obvious– they don’t have the benefits or security of an employee… but, consumers get the best of both world– lower price, great service, within an ‘instant’ of their call…

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In the article On-Demand Not Delivering on Promises to Workers by Avey Alba writes: For all the criticisms of the ‘1099’ economy– the cornucopia of app-based and push-button services provided by an increasing number of businesses is a very attractive prospect for many workers, i.e.; the promise of a good wages while working whenever hours they want. Business promotes the opportunity as a bright, flexible future in which the worker is a micro-entrepreneur; a business of ‘one’…

However according to survey of on-demand workers; many encountered lower pay than they expected and hours tied tightly to periods of peak demand. Workers discovered that they had to work longer hours than expected and the systems were not as flexible as they first assumed. The upshot; many workers are leaving the on-demand economy because– promises, benefits… that were made by business just do not hold-up…

According to research by data scientists affiliated with Stanford University; an over-whelming majority, 75%, of 1330 independent workers respondents from on-demand companies, including; housecleaning services, ride services, delivery services, real-estate rental services… said their top reason for doing on-demand work was for greater schedule ‘flexibility’… and their top complaints, included; not being able to find enough work, not understanding legal obligations and taxes, not being unable to optimize their schedules to maximize earnings…

Half of respondents said they planned to stop working for on-demand business within the year, citing; insufficient pay, lack of enjoyment of the work, or simply because they no longer had the need to work the job… The average hourly wage in the on-demand economy is about $18 an hour. A study of Uber driver wages that was co-written by a company executive said drivers were making an average of $16.20 to $30.35 an hour depending on location. And the wages did not take into account the expenses that drivers have to pay for vehicle up-keep…

In the article Rise of the On-Demand Economy by Irving Wladawsky-Berger writes: Two powerful forces are fueling the trend toward on-demand workers and pushing it into more parts of the economy. First is the availability of ubiquitous, inexpensive smartphones, sophisticated applications, cloud-based services… Second is rapidly changing consumer behavior… However, not all experts see the on-demand movement as an unstoppable force, e.g.; ‘The Economist’ is rather skeptical about the chances for most on-demand  businesses to succeed, citing three main potential obstacles:

First, these businesses face difficulties training, managing, motivating their on-demand workforce… Second, the regulatory, political problems that on-demand business face are very challenging… Third, the on-demand worker pool may be limited in the sense that many people value stability more than flexibility… Although there are many workers who do value flexibility more than security, e.g.; students who want to supplement their incomes; workers who can afford to dip in-and-out of the labor market…

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In the article Uber’s Business Model Could Change Work by Farhad Manjoo writes: The Uberization of work may soon be coming to your chosen profession… Just as Uber is doing for taxis, new technologies have the potential to chop-up a broad array of traditional jobs into discrete tasks that can be assigned to workers– just when needed– and wages set by a dynamic measurement of supply and demand, and workers’ performance constantly tracked, reviewed, subjected to the harsh light of customer expectations…

Uber and its ride-sharing competitors are the boldest examples of this new breed, which many in the tech industry see as a new kind of business– one whose primary mission is to efficiently allocate workers… According to Dr. Sundararajan; this trend may end-up with a future in which a fraction of the work force engages in a ‘portfolio of work’ to generate income, e.g.; Uber driver, Instacart shopper, Airbnb host, Task rabbit… But, the rise of such work makes workers’ income much less predictable and long-term employment less secure… It also relegate the idea of the traditional long-term work career as a distant memory…

According to Robert B. Reich; it’s all nonsense, utter nonsense; the on-demand economy means a work life that is unpredictable, doesn’t pay very well, and is terribly insecure… most workers would much rather have good, well-paying, regular jobs… However, proponents of on-demand work point out that the key perk of an Uber-like job is work flexibility, e.g.; in most of Uber’s largest markets, a majority of its drivers work from one to 15 hours per week, while many traditional taxi drivers work full-time.

A survey of Uber drivers found that most were already employed full or part-time when they found Uber, and that earning an additional income, on the side, was a primary benefit of driving for Uber…The larger worry about on-demand work is not about benefits, but about a lack of agency– a future in which computers, rather than humans, determine what workers do, when, and for how much. The rise of Uber-like jobs is logical culmination of an economic and tech system that holds ‘efficiency’ as its paramount virtue…

What sort of world will on-demand model create? Pessimists worry that everyone will be reduced to the status of 19th-century ‘dock-worker’ crowded on the quay-side at dawn waiting to be hired by a contractor… While boosters maintain that it ushers in a world where everybody can control their own lives, doing the work they want when they want it. Both camps need to remember that the on-demand economy is not introducing the serpent of casual labor into garden of full employment; it’s exploiting an already casual workforce in ways that will ameliorate some problems, even as they aggravate others…

According to Benjamin Sachs; as legal challenges to the ‘1099’ economy mount about the work status of the worker (i.e., are they employees, or not). There may be need to experiment with a new category of worker; a legal work status between ’employee’ and ‘independent  worker’… a status that would ensure sufficient protection for workers in the on-demand economy…

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According to Leslie Tolf; certain aspects of the ‘gig’ (on-demand) economy provides a great opportunity for some workers… but there are many questions about how to protect the workers… The gig economy is here to stay and for many consumers it means more convenience, lower price… However, companies, government, consumers must also consider the rights of the on-demand workers…

Any convenience, no matter how cost- effective or efficient, should never undermine the very work force that makes the economy function, or it will eventual fail… According to Kevin Roose; on-demand economy shows no signs of slowing down in a technology-driven world, but the key to its sustainability is to figure out– how to meet the needs of efficiency conscious business, respecting rights of workers, while meeting consumers on-demand expectations… it’s a challenging balancing act…

Leverage the Power of Business Storytelling– Narratives: Ultimate Weapon to Engage Mind & Heart, Change Thinking…

Business storytelling changes the way people think, act, feel… Business stories form the foundations of an entire workplace culture, and they have power to break down barriers and turn bad situations into a thriving workplace environment.

Business stories capture imaginations, illustrate ideas, arouse passions and inspires in a way that cold, hard facts often cannot… Stories are a very powerful business tool, so if you want to motivate others effectively, you need to learn how to tell a good story…

Business stories are most often used when leadership is trying to; inspire the organization, set a vision, teach important lessons, define culture and values, describe who they are, explain a belief system… Also, sales and marketing people often use (or should use) stories when they are engaging customers, partners… Although storytelling isn’t always the right tool to help ‘manage’ people; it’s an exceptional tool to help ‘lead’ people…

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Leaders (or in fact, anyone) can tell business or life experience stories to communicate and connect with employees, customers, colleagues, partners, suppliers, media… When you tell a story, well; it creates an intense, personal connection between the message and the audience… good stories told effectively can change opinions, they can inspire to achieve goals that you may not think possible… Business storytelling is one of the most powerful tools of ‘influence’ that a business leader (or any person) has at his or her disposal… and it’s used not only in public speaking but in all areas of a business, such as; in boardrooms, conferences…

It’s the X-factor in business communication… The art of being able to tell stories, effectively, in a range of business contexts is critically important… one well placed story can touch and influence many people in profound ways and change the dynamics of a situation…

What is Storytelling? At its core, storytelling is the art of using language, vocalization, visualization, and physical movement, gesture to reveal the elements and images of a compelling event  to a targeted audience… A unique aspect of business storytelling is its reliance on the audience to develop specific visual imagery and detail to complete and co-create the story… Most dictionaries define a story as a narrative account of an event, real or imaginary…

Within the storytelling community, a story is more generally agreed to be a specific structure of narrative with a definitive style and set of characters, which includes a sense of completeness. Through the sharing of business experience you use stories to pass on accumulated wisdom, beliefs, values… Through stories you explain– how things are, why they are, roles, purpose… Business storytelling is building blocks of knowledge and the foundation of memory and learning.

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Stories connect people with their humanity and link the past, present, and future by teaching the audience to anticipate the possible consequences of their actions… Facts, data, statistics, quotes are essential parts of a business but their specific significance depends on the framework in which they are placed… You can spout-off graph after graph and statistic after statistic but if you fail to provide a relevant context for the information, then all of the  data has little value– data has meaning only when you ascribe significant to it (i.e., it’s ‘why’ or ‘what’ that’s important). Business stories connect a presentation’s stats to the audience through a storyline’s– nuances, lessons learned, benefits, risks, rewards… which enhances the relevancy of the message in the communication…

The beauty of storytelling in business lies in the ability to connect with others. Don’t underestimate the power of this modest device; it can compel the audience to trust you, it can encourage the audience to relate to you, and it can move the audience to take action. Even a boardroom full of serious, successful business executives would rather listen to statistics and facts in the context of a fascinating story rather than listen to a colorless list of cumbersome facts… don’t make the audience think: Tie the prosaic facts into an engaging story to hammer home the main idea. Show audience why they should care; don’t leave them hunting for reasons…

Stories are how people learn best. People absorb numbers and facts and details, but they keep them all glued into their heads with stories… Stories let you convey wisdom, and/or explain information in an entertaining way… Leveraging the unparalleled, far-reaching power of storytelling is– the new doctrine in business… stories work in an unseen way to transform the way people absorb and process information…

It’s ironic that in the decade where you have access to more data than is humanly comprehensible, the vehicle that garners the most trust, confidence and belief is not a data point but a story. Although the Internet has created an explosion of storytelling and content-sharing channels, the first priority is not about the channel, it’s about the story… Stories connect, transform, engage people… stories are an important mechanism for creating an atmosphere for teaching, leading… Business storytelling is a powerful enabler to cut through the clutter and engage the audience…

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Business storytelling is a pull, not push, strategy; it’s about engagement-interaction… the audience is just as active participant as the storyteller… Business storytelling is a selfless, empowering act– great business storytelling points people toward a desired conclusion but gives freedom to draw that own conclusion… Business storytelling draws from both magic and logic; truly great business storytelling touches people’s ‘hearts’, as well as their ‘minds’… get people to both– ‘feel’ and ‘think’…

Business storytelling looks to the future, respects the past, and appreciates the present but it also looks boldly into the future, moving people past– ‘what is’ to ‘what if’… Done well, storytelling helps people collectively imagine a vision of the future that is achievable and worth achieving, helping them to understand not only what they are working-on, but also what they are working-toward…

The overall goal is not to become the best business storyteller in the world but to grow the business; hence, develop a storyline that helps people connect the dots between– ‘problem’ and ‘solution’, or ‘event’ and ‘outcome’

Science of Blogging– Art of Engagement: Embrace or Reject Popular Wisdom for Bloggers Blogging Blogs in Business…

What Is a Blog? What is Blogging? Who are Bloggers? Sounds a bit dry, well maybe we can spice-it-up a bit; let’s give it a try…

First, something you probably already know; a blog is written content with or without images or videos… and content can be just about any topic and in the form of an article, journal, commentary… which is then posted on a website…

Second, bloggers are people who create, maintains a blog… Third, blogging is the action of authoring, writing, developing… a blog.

According to Zac Johnson; blogging is all about experience… blogging is about growth, about development, about change… change is a huge part of what bloggers do (or they should do)… However, it takes more than just building a ‘blog’ to be successful, it takes building a ‘tribe’.

According to Seth Godin; a tribe is a group of people connected to an idea, which in turn is connected to a leader. In other words, blogger  must be a ‘champion’ and ‘leader’ to visitors and that means bloggers must view their mission as more than just getting million of visitors in order to make a quick sale… instead, bloggers must think far beyond that– think relationship…

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Yes instead of focusing on numbers bloggers must focus on building a tribe… Building anything is risky, which means that a blogger can be just one step away from success (whatever that means), or just one step away from failure (whatever that means)… However, a key component of blogging is selling, which bloggers often ignore. Selling ideas is the foundation of a blog (whether bloggers like selling or not). Bloggers success is only limited by their ability to sell ideas, dreams… as represent by their content.

According to Toni Nelson; a blog must have a clearly articulated ‘purpose’; one that provides– real value, uniqueness, relevancy… Often bloggers think of themselves as loners creating great content and for many bloggers this is true, but the world is more complicated, e.g.; there are about 31 million bloggers! about 42,000,000 blogs in the U.S. alone! about 329 million people who view blogs on a monthly basis! about 25 billion blog pages viewed per month! about 500,000 blog posts per day! about 400,000 blog ‘comments’ per day!

In the article Blogging Advice You Should Ignore by Chris Sturk writes: The Internet is full of information; some beneficial, high-quality, accurate… while other is pure garbage… There needs to be discretion when consuming or posting copious amounts of information, so here are few pieces of advice about conventional wisdom that– bloggers blogging blogs for business might wish to– reconsider or better yet just ignore:

  • Focus on Content–That’s All That Matters: Oh, we love to hear this one. Yes, it’s important to put ‘focus’ on content… However, great content isn’t all that matters. And it’s only the second part of the process – bloggers must get readers first! The goal should be to create great content that is optimized for search engines (SEO), and that allows great content to live-on forever…
  • Social Media Has Replaced Blogging: Wrong; social media is a tool for promoting blog content, but it does not replace blogging… Social media is all about social interaction, and not the proliferation of comprehensive information…
  • Be Controversial: Controversy can be valuable to attract a wide array of viewers, but it’s not necessary to build an audience. Attempts at being controversial can also backfire. Be careful when going the route of controversy because it can ultimately back-fire…
  • Write Content That Everybody Wants and Loves: The best part about business blogging and SEO is that bloggers can target specific types of readers… hence, recognize the audience reading your content and use language that not only appeals to that audience, but also is quantifiable in search volume. Writing a blog that targets everyone is a waste of time and money…
  • Images Are Not Important: Readers look for visual connections… the culture is dominated by visualizations– images, videos, pictures… they catch readers’ eyes, they draw people-in; if a blog has well-done written content and aligned with visual imagery, then that the makings of a good blog…
  • Backlinks Are Key to Blogging Success: Backlinks do certainly have value but only if they are associated with websites that are reputable; by creating good content, it will attract quality links naturally…
  • Business Blogging is Just Fad: Business blogging is not a fad, and in fact, experts suggest that blogs and blogging is more valuable than social media for business… Consumers are more likely to buy after reading a blog post, than from clicking a link on Twitter or Facebook…
  • Blog Comments: There is a belief that ‘comments’ on other bloggers blogs would lead to more interactions and more connections, maybe… but more important, actively engage visitors to your blog by responding to comments, retweets, shout-outs… acknowledge and engage visitors and that will encourage more loyalty, more shares, and ultimately a more popular blog…
  • Blog Every Day: Blogging every day is good, but only if your blog has value… Don’t push garbage content out, just to do it… content must have value…

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In the article Legal Facts Every Blogger Must Know by Jonathan Bailey writes: When it comes to legal issues, most bloggers are either unaware or misinformed about the laws that they operate under… That’s unfortunate because now, with blogging and social media; everyone is a journalist, publisher, investigative reporter… The web is ubiquitous and as such, content can reach virtually every country, every jurisdiction… in the world. Hence, what is legal in one country, region… may not be legal in another, which in some situations can bite you… As blogger, you are responsible legally for what you post and posting anonymous or pseudonymously is not a guarantee against legal consequences… hence, some legal facts about U.S. law that every blogger should know:

Copyright:

  • Copyright protects works of creative authorship and is a collection of rights over those works. Those rights include the right to make copies, the right to publicly display/perform the work and the right to make derivative works. Doing any of those things to a copyrighted work without permission is an infringement…
  • Copyright is given either to the author of the work, or their employer if they are creating the work for their job (Note: Contract work does not always transfer copyright), the moment that work is fixed into a tangible medium of expression. No further action is required for a work to be protected, though copyright registration is required to sue and has other benefits…
  • Current term for copyright in the U.S. is for the life of the author plus 70 years for individuals or 95 years for works of corporate authorship. Once that term expires, the work lapses into the public domain, where it has no copyright protection…

Defamation:

  • Defamation is the communication of any statement, presented or implied to be true, that is false and puts a person, business or other entity in a negative light, falsely harming their reputation…
  • Slander is any defamation presented in a transitory medium, usually spoken word. Libel is anything that is printed, published or otherwise put into a fixed form. Most defamation online is libel, not slander unless it’s not being saved as it’s being said…
  • Truth is an absolute defense against a defamation claim but it must be a verifiable fact. Likewise, opinions are not libelous but they must be actual opinions, not statements falsely labeled as opinions…

Trademark:

  • Trademark is a word, symbol, phrase, sound or almost anything used to identify a business or their goods/services. Trademarks do not have to be registered to be protected, but registration can and does help. As such, if you use a site for business, you likely have some level of trademark protection in your name…
  • Trademark law is designed to prevent confusion in the marketplace. This means using a mark in a way that implies you have a relationship with the business that doesn’t exist is likely trademark infringing. The same goes for using a confusingly similar mark…
  • Trademark protects things copyright cannot, such as names and phrases, that protection is limited to uses that cause confusion. You are free to talk about a business…

Privacy:

  • There are four different types of privacy torts: Intrusion upon seclusion, misappropriation of image, publication of private facts and false light, the latter of which is similar to defamation…
  • Once a fact has been made public, it’s considered in the public domain and repeating it is not the same as making it public. As such, any information you put on a blog, Facebook… is considered public and can be repeated by others…
  • Privacy laws, as with defamation, vary from state-to-state, be sure to look up local laws…

Conventional wisdom says that people on the Internet generally have shorter attention spans, so that the logical correct way to blog is to produce smaller, more concise posts that visitors can read and finish quickly… However, according to Neil Patel; shorter is not necessarily better… conversion rates can actually be less for shorter length content in a blog– many readers are looking for significant ‘substance’ on a topic and that may mean more content… experienced is showing that longer blog posts gain more natural links, more tweets, more Facebook ‘likes’, higher engagement… and these lead to increased page views per visit, longer time on site… and likely, higher rankings for the keywords…

According to Syncro; this does not mean that you should produce thousands of words of rubbish content, you should only write as much as you need to describe the situation in meaningful and useful words… If it takes 2,000 words to (usefully) describe the features and benefits of something, then write those 2,000 words… Also, a great title will catch the attention of the reader and draw them in– it implies that the content is interesting, useful, relevant, fulfilling…

In addition, images, videos… are very important in a well-conceived blog– they serve to break-up content by giving visualization of what you are talking about, making a page more visually appealing to readers… Great images improve conversion rates, increase engagement with the site, keep visitors on the site looking at more pages for longer…

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Finally, engage and involve visitors to your blog by– ask questions, give them a task, ask for opinions, links to other websites where they can find related information… Blogging is a business activity; think of it as a conversation with– customers, partners, suppliers, on-lookers… and share opinions, ideas… even if they don’t agree with you…

The best business blogs are when bloggers consistently create content that is– engaging, interesting, useful, relevant… for the target audience. The purpose of a blog is to establish the blogger as an– authority, expert, leader… in the eyes of the audience, and anything less than that is a compete waste of time…

 

 

Most Under-Estimated Business Risk in Face of Uncertainty: Blindness to Ever-Increasing Threats in World of Business Risk…

Underestimated business risk, in hindsight, may seem obvious… Yet many companies fall prey to an ever-increasing world of business risks… management often believes that a risk-event just came out of nowhere, or it could not have been anticipated… Business risk is probabilistic; an event that may happen, or it may not… and often management is either, blind to the risk factors, or just neglects to identify the risks that might impact the organization.

Often business may suffer from a risk-event even before knowing that one is actually occurring, and typically the root cause is a management ‘blindness’ to the business risk factors, such as; change in consumer behavior, increase competition, change in government policy, market disruption, product obsolescence… Also, there may be loss of company assets due to– fire, flood, earthquakes, riots, war, political unrest… which may cause serious interruption to business operations…

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Many companies are often ill-equipped to deal with uncertainty and business risk. Yet every day companies base business plans on uncertainties, and do not adequately consider business risk, whether they be– next month’s sales, next year’s costs, tomorrow’s stock price… According to Sam Savage; business plans based on ‘average’ assumptions are wrong, on average… and typically business risk is depicted as a single number in a spreadsheet to represent future uncertainty– statistical uncertainties are pervasive in business decision-making every day…

According to David Leonhardt; many companies make two basic, and opposite, types of business risk assumptions, i.e.: When an unlikely risk-event is difficult to imagine, business tend to underestimate its likelihood; so management assumes it would not happen at least not to them… On the other hand, when an unlikely risk-event is all too easy to imagine, management often go in the opposite direction and overestimate the risk…

Fourth Allianz Business Risk Barometer 2015: This years survey conducted among more than 500 business risk managers and corporate insurance experts from businesses in 47 countries found following; companies are facing new challenges from a rise of disruptive scenarios in an ever-increasing interconnected global business environment… And according to survey certain types of business risk are of continuing concern, e.g.;  market interruption and supply chain linkage (46% of responses), natural catastrophes (30%), fire and floods (27%)… In addition, cyber (17%) and political risks (11%) are the most significant movers…

According to Chris Fischer Hirs; the interdependency of many industries and processes means businesses are now exposed to an ever-increasing number of disruptive scenarios. Hence, negative effects can quickly multiply and one risk can lead to several others. Natural catastrophes or cyber attacks can cause business interruption not only for one company, but to whole supply chain, industry sector, critical infrastructure…

Business risk management must reflect this new reality by identifying the impact of all ‘inter-connectivity’ early in the process, which can mitigate or at least help prevent significant business risk… It’s also essential to foster ‘cross-functional’ collaboration within organizations to quickly identify potential business risk…

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In the article Executives Underestimate Business Risk of Security, Privacy to Consumers by Deloitte writes: Research uncovered a notable discrepancy between consumer product industry executivesperceptions of consumers attitudes toward security and privacy, and consumers’ stated views on the topic… Many consumer product (CP) industry executives may be out of touch with consumers’ opinions on the importance of data security and privacy… Results of an online survey of U.S. consumers and 70 CP industry executives suggest that consumers care a lot more about the security and privacy of personal data than many CP executives seem to realize… CP companies’ treatment of the personal data they collect from consumers appears to factor prominently in consumers’ purchasing decisions…

According to the survey data: 80% of consumers who responded to the survey say they are more likely to purchase from CP companies they believe protect their personal data; 72% avoid purchasing from companies they believe do not take adequate measures to protect consumers’ personal data; 70% say they would be more likely to buy from a CP company that a third-party verified as having high standards for data privacy and security; 59% say knowing a company experienced a data breach would negatively impact their likelihood of buying from that company…

Industry executives are putting their companies at significant business risk by not fully understanding consumers concerns… According to Frank Milano; the more sensitive data a company collects the greater its attractiveness to hackers and the greater the risk for data breaches… Companies may avoid alienating consumers and losing their hard-earned trust by being transparent about data collection and digital marketing practices… and giving consumers more control over their own personal data…

Executives also tend to overestimate effectiveness of their companies’ data privacy and security policies and value consumers receive in exchange for sharing their personal data, e.g.; the survey data shows that 77% of executives believe that their companies’ data privacy policies are clear and well-understood by consumers, while roughly 73% of consumers say they would like to see more clarity in companies’ data privacy policies… also 47% of executives believe consumers regard the risks of sharing their personal data is worth the personalized promotions, advertising, coupons they receive from companies in return…

However, only 25% of survey consumers agree with that assessment… also 47% of executives think consumers view the risks of sharing personal data as worth the brand recommendations they receive from companies… however, only 18% of consumers agree with that conclusion… Clearly there is a serious disconnect of perceptions between consumers and company executives…

In the article Managing Business Risk: Where Are You on the Curve? by Ralph Jacobson writes: Business risk must be in the forefront as management most critical agenda item… Knowing how to assess and properly manage business risk is an organization competency that must be fostered for long-term sustainability… This requires techniques and tools… that will facilitate effective strategic thinking, decision-making, decisive action…

One such technique that can be used to help management transition in world characterized by significant business risk factors is represented by an S-curve. The S-curve is a tool for evaluating risk and determining various kinds of actions that can be taken at specific points in time, e. g.; the S-curve technique suggests when growth and change in growth happens along an almost  predictable trajectory of three distinct phases…

brisk1 untitledUnderstanding where/when an issues falls on the S-curve determines the most effective action… One of the powerful attributes of the technique is that it can provide a timely way to determine when a new discontinuous change occurs and its relationship to the  existing state of the business. The S-curve strives to predict the collision of two worlds: The concept of S-curve helps to frame the situation so that players can depersonalize the negative energy and help each-side find value in the other-side. It’s in this manner that management can help balance business risk, e.g.; long and short-term conditions; existing and new financial models…

Without the use of this type of technique and tool business risk issues are prone to serious intra-organizational conflict– hence, the potential for very contentious risk issues can move from politically imposed solution, to more collaborative solution that embraces a larger set of possibilities…

The importance of business risk management can never be underestimated when you are involved in any business venture or making decision that might impact the very survival of a business. Identifying and mitigating business risk properly and correctly before they can make a serious impact on business is paramount to having a successful business… The importance of risk management is often seen in hindsight when ignored  business risk factors result in a failed business issue… In retrospect business risk issues fail because management was not properly prepared to engage the specific risk that had the potential for serious negative impact on the business… By having a business risk plan, business can prevent or mitigate most of underestimated business risk factors that might occur…

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According to Srini Pillay; many companies fall prey to unforeseen business risk, because management may believe that probably of occurrence is low, or that they are immune from the risk, or they just turn a blind-eye to the possibility, or the risk could not be foreseen or anticipated… While these excuses may be true for many issues, but a more plausible explanation is business risk ‘blindness’, which occurs due to the way the human brain is wired… business risk ‘blindness’ is the tendency to overlook immediate business risk when making decisions due to human factors, such as; fear, greed… a condition that occurs all too often in many organizations…

Business risk is inherent in decision-making, hence one of the most important management skills for ensuring long-term success is the ability to effectively evaluating all risk factors in making business decisions… No matter how obvious business risk might seem in hindsight, it’s critically important to detect the impact of specific risk factors on a business, in foresight…