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Archive for January 2010

The Moment Social Media Became Serious Business

A very interesting article by Tammy Erickson in HBR. Check it out. To read the full article CLICK HERE

-DF


The Moment Social Media Became Serious Business

It happened last year, around the first of July. In my experience, the switch was just about that abrupt.

All last spring, most senior business leaders I met shrugged off the business applicability of Web 2.0. Allowing access to social networks in the workplace was something they were willing to consider only if it was absolutely necessary to keep younger employees from complaining. Twitter? What was that?

But by summer, the conversations I was having with senior executives about the use of these new technologies took on a very different tone. Recognition grew that 2.0 technologies could be used to change the way work gets done in fundamental ways. Interest in exploring these new ways of working, of sharing information, of collaborating to enhance productivity and meet business goals, was here.

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Written by David Frederick

January 20, 2010 at 3:18 PM

U.N.’s World Health Organization Eyeing Global Tax on Banking, Internet Activity

You have got to be kidding me! Just what we need. The UN, the most financially corrupt institution in the wold handling a global internet tax? NOT!!!!

Check this out.

DF

U.N.’s World Health Organization Eyeing Global Tax on Banking, Internet Activity

Friday , January 15, 2010
By George Russell

The World Health Organization (WHO) is considering a plan to ask governments to impose a global consumer tax on such things as Internet activity or everyday financial transactions like paying bills online.

Such a scheme could raise “tens of billions of dollars” on behalf of the United Nations’ public health arm from a broad base of consumers, which would then be used to transfer drug-making research, development and manufacturing capabilities, among other things, to the developing world.

The multibillion-dollar “indirect consumer tax” is only one of a “suite of proposals” for financing the rapid transformation of the global medical industry that will go before WHO’s 34-member supervisory Executive Board at its biannual meeting in Geneva.

TO READ THE FULL ARTICLE CLICK HERE

Written by David Frederick

January 15, 2010 at 7:05 PM

Posted in Business, Economics, General

The Disruptors of the Decade

Here is another interesting post from HBR.

-DF

The Disruptors of the Decade

11:45 AM Thursday January 14, 2010

Near the end of December, I created a survey with a single question: “Which companies do you think have done the best job of driving growth through disruption — transforming what exists or creating what doesn’t through simplicity, convenience, affordability or accessibility — between 2000-2009?”

To read the full post click here:

Written by David Frederick

January 15, 2010 at 3:24 PM

Posted in Uncategorized

Growth company executives want government help to drive corporate innovation, according to Ernst & Young survey Execs say innovation critical; assert tax credits, R&D grants from D.C. would spur innovation and growth

This is cool article from E&Y. Check it out!

-DF

Growth company executives want government help to drive corporate innovation, according to Ernst & Young survey

Execs say innovation critical; assert tax credits, R&D grants from D.C. would spur innovation and growth

New York, 7 December, 2009 – A new Ernst & Young LLP Strategic Growth Markets survey of C-suite executives finds that growth companies see innovation as critical to their growth, but admit they are coming up short and would do more if they had additional help from Capitol Hill to support their innovation efforts.

The critical role of innovation – visible and invisible
According to the survey, launched at the recent Ernst & Young Strategic Growth Forum, over 80% of company leadership surveyed say that innovation is critical to staying competitive and increasing profitability.

Nearly all (96%) of the executives say they invested in some type of innovation-related activity but the innovation they described is not just focused on highly visible products and services; in fact, more is focused on less visible internal processes and procedures.

Specifically, more executives (57%) cite “productivity/process improvements” as the leading area where they are investing in innovation. “New product development” is the second most popular choice with 55%.

“Innovation comes in many shapes and sizes,” said Maria Pinelli, Ernst & Young LLP, Americas Director of Strategic Growth Markets. “It’s a telling sign that these growth company executives are actually devoting more of their innovation resources to internal productivity measures. Given the ongoing financial pressures coming out of the recession, the processes companies rely on simply have to work harder and be more effective.”

As one survey respondent states: “In today’s economy, innovations in process improvements are as important as the next big idea.”

The vast majority (73%) say they will finance their innovation-related activities through “revenue from ongoing operations.” Only 16% say they will consider going to the capital markets – bond or equity offering – to finance innovation.

How innovative are they and what’s holding them back?
And though they place enormous importance on innovation, only 47% see themselves as more innovative than their competition. Conversely, 17% admit that they are, in fact, less innovative than their competition.

What might be preventing companies from being more innovative? When asked about their barriers to innovation, the point most often cited by respondents (48%) is a “lack of appropriate personnel to execute innovation.” “Lack of a big idea” is also cited by 41% as a barrier.

Government support could spur innovation
The majority (60%) of company leaders surveyed believed that the current Administration in Washington is “not” supportive of corporate innovation. Similarly, 59% assert that “innovation initiatives within my company would be enhanced with additional support from the government.”
What type of support would they like? In order of preference:

1. New tax credits for innovation initiatives
2. Increased grants for R&D programs
3. Relaxation of regulatory framework for industry
4. Increased investment in education systems

Perhaps that’s why just 27% of company executives say they plan to increase R&D spending over the coming 12 month period compared to the prior 12 months.

“By looking at the momentum behind renewable energy initiatives, driven by tax credits, we can see the impact of government support,” said James Markham, Ernst & Young LLP, Tax Leader, Strategic Growth Markets. “Corporate leaders see strategic tax incentives as offering tremendous opportunities to keep themselves and the country competitive.”

Guarded optimism in the growth sector
As the economy rebounds, optimism is returning to the growth company sector – 65% of the executives surveyed say they are optimistic about achieving their expectations for company growth over the next two years.

Still, more than one-third (35%) say they are pessimistic about achieving expectations for company growth over the next two years.

Furthermore, only 43% expect revenue to increase over the next year – and at an average rate of 13%; and just 45% expect an increase in overall profitability.

Though nationwide unemployment appears to be leveling off, almost one-third (30%) of company leaders surveyed anticipate layoffs over the next twelve months.

“When you consider the fact that the biggest barrier to innovation cited was ‘lack of appropriate personnel to execute innovation,’ ongoing reductions in human capital spending can only hurt future innovation efforts,” Ms. Pinelli said.

The year of living…cautiously
Over the next twelve months, growth company executives are cautious about where and how they will invest in their company. More executives say they plan to decrease their total spending/investment (36%) than increase it (31%).

On technology spending, 36% plan to increase it over the next year while 24% say they expect decreased spending.

Perhaps consistent with the times, the area in which the least amount of reduction appears to be risk management, where just 17% of company executives say they will be decreasing spending.

Financing growth: to most, available but expensive; to some, no access to funding
While 74% of executives surveyed say they currently have sufficient access to growth capital, and the majority (58%) believe access to capital will improve significantly over the next 12 months, fully 42% say capital is too expensive at the moment.

Conversely, 29% of company leaders say their current lack of access to capital impedes their ability to grow.

“There are a number of factors that growth companies have relied upon to help them innovate their way to growth, but those factors have been under intense pressure,” Ms. Pinelli said. “Unfortunately, this pressure couldn’t come at a more difficult time. The squeeze in the capital markets and traditional bank lending has made it increasingly difficult to finance innovation. Combine that with reduced headcount, ongoing economic hardship and a perceived lack of government support to help drive innovation and it’s no wonder America’s growth company leaders admit that they are not as innovative as they could or should be.”

“But the drive to innovate is as much a process as it is a spirit, and in the end, it will not be denied,” Ms. Pinelli concluded. “Innovation will lead America’s great growth companies out of this economic slowdown as the capital markets continue to open up. These innovators, these entrepreneurs, provide ideas today that will be the economic engine of our future.”

The Ernst & Young Strategic Growth Markets Growth Company Leadership survey was executed in September 2009, among leaders from 100 companies with $50 million to $5 billion in total revenue in 2008. Companies in the survey were equally publicly traded and private and spread over a wide cross section of industries. Survey results were announced at the Ernst & Young Strategic Growth Forum 2009 on November 11.

About Ernst & Young’s Strategic Growth Markets Practice
Ernst & Young LLP’s Strategic Growth Markets (SGM) practice guides leading high-growth companies. Our multi-disciplinary team of elite professionals provides perspective and advice to help our clients accelerate market leadership. SGM delivers assurance, tax, transactions and advisory services to thousands of companies spanning all industries. Ernst & Young is the undisputed leader in taking companies public, advising key government agencies on the issues impacting high-growth companies and convening the experts who shape the business climate. For more information, please visit us at http://www.ey.com/us/strategicgrowthmarkets.

About Ernst & Young
Ernst & Young is a global leader in assurance, tax, transaction and advisory services. Worldwide, our 144,000 people are united by our shared values and an unwavering commitment to quality. We make a difference by helping our people, our clients and our wider communities achieve their potential.

For more information, please visit http://www.ey.com.

Ernst & Young refers to the global organization of member firms of Ernst & Young Global Limited, each of which is a separate legal entity.

This news release has been issued by Ernst & Young LLP, a client-serving member firm of Ernst & Young Global Limited located in the US.

Written by David Frederick

January 15, 2010 at 3:21 PM