13. August 2014
Source: BusinessWeek By Brad Stone
I’m toiling away on my laptop, getting lots of work done. Notes are being reviewed, interviews are being prepared, and I’m exchanging instant messages with two colleagues. This productivity is great! But I feel so, so tired. Like I should be under the covers instead of checking off my endless to-do list. That’s because it’s bedtime, 11 p.m., and I’m home in my striped pajamas. This isn’t an anomaly or the result of a new deadline or an unusually busy week. It’s my normal nighttime routine—and probably yours, too.
Work has been leeching onto people’s off-duty time for years. E-mail makes it easier to communicate and more likely that annoyingly ambitious colleagues will respond to every message, at length and in real time. (In-box volumes are increasing by about 15 percent a year, according to global data group Experian.) With the growing irresistibility of the smartphone and the ubiquity of cloud collaboration, evening work for many professionals has become standard. We come home from the office, change into more comfortable clothes, put the kids to bed, and maybe open a bottle of wine. And then we grab our laptops and log back in. Read the rest of this entry »
16. May 2014
Source: The Economist
McKinsey tries its hand at the restructuring business
THE lawsuit makes the case sound like a spy novel. Two executives at a prestigious multinational organisation hold secret meetings with a competitor who hopes to poach them. Before jumping ship, they send a lot of confidential files, such as strategic plans and contact lists, to their personal and relatives’ e-mail accounts, in a “frantic effort to steal whatever documents [they] could”. On May 9th a judge issued an order requiring the defendants to return them and barring their new employer from using the information.
AlixPartners v Eric Thompson and Ivo Naumann, which was filed last month, will probably not become a Hollywood film. The mundane truth is that AlixPartners is a professional-services firm specialising in corporate restructuring and that Mr Thompson and Mr Naumann, the defendants, now work for McKinsey, a firm of consultants. The suit does not claim that the documents were given to McKinsey, and McKinsey has said the alleged trade secrets would have been of little use anyway. Nonetheless, the case illustrates the heating-up of competition between corporate-turnaround advisers and strategy consultants. It is the most striking example so far of the risks for both. Read the rest of this entry »
16. May 2014
Companies Choose Profits Over Productivity
When the U.S. economy emerged from the recession in June 2009, productivity was rising at a fast clip. Companies had spent the downturn cutting jobs and were lean and efficient. Productivity—output per hour worked—jumped 5.5 percent in the fourth quarter from a year earlier as workers did more with less. But as the recovery has chugged on, productivity growth has stalled, averaging less than 1 percent a year since 2011. Workers were actually less efficient in the first quarter of 2014, producing fewer goods and services per hour than they had during the previous quarter.
Although there are many reasons for the productivity rut, one of the primary ones is that businesses aren’t investing in their workers. Business investment fell almost 25 percent during the recession and hasn’t come back the way many economists had expected, especially given that low interest rates make borrowing less expensive. Growth of capital spending during this recovery is about 30 percent below the average of the prior five recoveries, according to Bank of America Merrill Lynch. That’s left many workers without the equipment, software, and structures—which economists call “capital”—that they need to be more productive. Whether it’s a computer or a forklift, workers are stuck using outdated machines. The average age of equipment in the U.S. is 7.4 years, the highest in 20 years, according to the Bureau of Economic Analysis. Read the rest of this entry »
28. October 2013
Wasabi Waiter looks a lot like hundreds of other simple online games. Players acting as sushi servers track the moods of their customers, deliver them dishes that correspond to those emotions, and clear plates while tending to incoming patrons. Unlike most games, though, Wasabi Waiter analyzes every millisecond of player behavior, measuring conscientiousness, emotion recognition, and other attributes that academic studies show correlate with job performance. The game, designed by startup Knack.it, then scores each player’s likelihood of becoming an outstanding employee.
Knack is one of a handful of startups adapting big data metrics to hiring. The companies are pitching online games and questionnaires to corporate recruiters frustrated by the disconnect between a good interview and an ideal employee. Based on records of how star workers responded to the same tests, these services predict whether a candidate will be suited for a particular job. Clients use the tool to help winnow piles of applications. “People are our biggest resource, and right now a lot of them are mismatched,” says Erik Brynjolfsson, an adviser to Knack and director of the Center for Digital Business at the Massachusetts Institute of Technology Sloan School of Management. Read the rest of this entry »
15. February 2013
Tesla CEO Elon Musk waves in front of the Model S at the Tesla factory in Fremont, Calif.
Late Wednesday night, Tesla Motors issued its much-anticipated response to a scathing New York Times review of its all-electric Model S sedan. In a blog post, Tesla Chief Executive Officer Elon Musk used data logs gathered from the car to accuse reporter John Broder of outright lies. Broder, for example, complained about freezing inside the car, since he had to turn the heating system off to save electricity and keep driving. Balderdash, says Musk: The data show the cabin had an average temperature of 72F for the majority of the trip.
Broder, in a series of posts, has argued that he followed Tesla’s instructions and that the car simply did not handle the cold weather of the Northeast well. He also claims to have been testing not really the Model S itself, but rather the network of free, superfast charging stations Tesla has started putting up around the country. This is how Broder explains away the baffling circumstances in which he didn’t charge the car while spending the night at a hotel. Read the rest of this entry »
9. January 2013
An Amazon.com fulfillment center in Ridgmont, U.K.
January in retail is a little bit like the off-season of a professional sports league. Teams dust themselves off from the grueling holiday season playoffs, evaluate their coaching staffs, and assess the balance of power in their divisions. In this month’s period of exhausted self-reflection, one of the industry’s broad conclusions is clear: Amazon.com is on its way to establishing a dangerous dynasty.
Amazon recently said it had its best holiday season ever in 2012, selling 26.5 million products around the world at a record-breaking pace of 306 items per second. Earlier this week, Amazon stock hit an all-time high, buoyed by a Morgan Stanley report that predicted the global e-commerce market will hit $1 trillion by 2016, with Amazon poised to capture nearly a quarter of that. The company is madly adding such customer freebies as new movies and television shows to its Netflix -slaying Prime Instant Video program, and its commitment to having the lowest price anywhere is increasingly exerting a gravitational effect on the strategies of rivals.
On Tuesday, Target announced a new policy of matching competitors’ prices year-round—a tactic geared toward slowing the emergence of “showrooming,” the practice by which shoppers browse in a store and then buy online, often from Amazon. Target, whose stock is also near an all-time high, is the second-largest retailer in the country, behind Wal-Mart. But if current growth rates continue, it will soon lose that title to the upstart from Seattle. Read the rest of this entry »
18. June 2012
At 71, Dave Duffield ought to be retired. He’s spent a half-century starting technology companies and is worth billions. He has a $35 million Dassault Falcon 900EX jet, homes in the Bay Area and Palm Springs, and a seven-building vacation compound on Lake Tahoe with plenty of space for his wife of 28 years and their 10 children, the youngest of whom is an adopted daughter, age 2. On a sizzling June afternoon, Duffield stands in his hangar at an airfield east of San Francisco before a flight to Reno-Tahoe International Airport. “I just bought this Chevy Camaro,” Duffield says, gesturing to the black car parked next to his jet. “It’s probably the only one around with a baby seat in the back.”
Duffield did take a break from the tech game, briefly. After his most successful company, PeopleSoft, was acquired in 2004 for $10.3 billion, he unofficially retired. With his thin frame and rich head of silver hair, he’d sit in a rocking chair on his porch in Tahoe overlooking the lake. The relaxing, family-filled glide into his golden years lasted about three months. “I was rocking away and getting bored,” Duffield says. When he told his wife, Cheryl, that he was starting another business software company, later named Workday, she cried, but didn’t try to stop him. “She understood the higher calling,” Duffield says. Read the rest of this entry »
1. May 2012
General Electric’s first research laboratory was housed in a barn in upstate New York; its newest is going up in Silicon Valley. In a vivid illustration of how the locus of U.S. innovation has shifted from the East to the West Coast, GE is pouring $1 billion into a facility in San Ramon, Calif., that will be staffed with as many as 400 people.
New hires for the Global Software Center, which is set to open in June, are coming from Oracle, SAP, and Symantec. Bill Ruh, the vice president running the venture, was lured away from Cisco Systems last year. The tech industry veteran says persuading developers to forgo windfalls from initial public offerings to come work at an industrial stalwart is not as difficult as one might think. “They want to be in on the Next Big Thing,” he says.
The big thing Ruh is referring to is called “big data,” the fast-growing market for information technology systems that can sift through massive amounts of data to help companies make better decisions. Just as information on millions of Facebook users is prized by advertisers, the details companies amass from their operations can be used to cut costs and boost profits. Norfolk Southern, which buys diesel locomotives from the Fairfield (Conn.) company, uses customized software to monitor rail traffic, reducing congestion and allowing trains to move at higher speeds. The fourth-largest U.S. railroad estimates that making trains run an average of 1 mile per hour faster will save more than $200 million. Read the rest of this entry »
23. December 2011
The Valley’s techies live in a bubble of prosperity. Optimism has its advantages, but some worry the region may lose touch with the rest of the world
Every so often, the best parties come to represent moments in time. Think of Truman Capote’s Black and White Ball in 1966, the celeb-studded Liberty Island launch of Tina Brown’s ill-fated Talk magazine in 1999, and private equity maven Stephen A. Schwarzman’s 60th birthday bash in 2007, which featured Rod Stewart. Sean Parker’s bacchanal for the streaming music service Spotify on Sept. 22 in San Francisco may well join the ranks of these epic affairs.
The Facebook billionaire—portrayed by Justin Timberlake as a swaggering lush in The Social Network—turned an abandoned warehouse in the city’s Potrero District into a couch-filled pleasure palace. Waiters served piles of lobster, sushi, and roast pig, while journalists each were presented their own $300 bottles of DeLeón Tequila. As Mark Zuckerberg, Apple (AAPL) designer Jony Ive, author Danielle Steel, and other guests mingled, acts including Snoop Dogg, Jane’s Addiction, and the Killers—flown in on private jets—performed for the well-lubricated crowd. “All the recording artists here might not have shown up if they knew I was a nerd,” said an exuberant Parker from the stage. Read the rest of this entry »
2. September 2011
As employees turn to new services, managers fret about the vulnerability of their data
Eran Feigenbaum knows a thing or two about risk. He moonlights as the TV and stage magician “Eran Raven,” known for stunts involving snakes, scorpions, and razor blades. He once played Russian roulette with nail guns on the NBC show Phenomenon, and in August he did a five-day run at Planet Hollywood in Las Vegas. That pedigree serves him well in his day job as director of security for Google’s business applications, where he’s responsible for convincing corporate risk managers of the safety of cloud computing. Working in computer security requires “a hyperawareness” of risk, he says, “the same as when you’re on stage performing with nail guns.”
Cloud computing has become one of tech’s biggest buzzwords. These services, offered by Google, Microsoft, Amazon.com, and dozens of others, offer computing power over the Internet as an alternative for companies that have traditionally bought their own fleets of giant server computers. The approach has won fans among corporate software developers and rank-and-file employees who like having access to documents and programs from any device at any time.
Corporate policymakers, though, have yet to fully embrace the cloud, fearing that the services may compromise proprietary data. A survey by researcher IDC found that fewer than a third of IT executives feel the benefits of cloud computing outweigh its risks. Nearly a quarter of the 500 executives surveyed said they don’t fully understand the regulatory and compliance issues in cloud computing, and 47 percent say cloud services present a security threat. Companies that don’t understand the risks “just shouldn’t use cloud computing,” says IDC analyst Phil Hochmuth. “The potential for a security breach or a compliance violation can be high.” Read the rest of this entry »