Recent selections from around the web that, we think, would have caught Peter Drucker’s eye:
1. Focusing Capital on the Long Term: Companies like to talk about the long term, but most are obsessively focused on the short term, looking at quarter-to-quarter results. How do we change this? Dominic Barton, global managing director of McKinsey & Co., and Mark Wiseman, president and CEO of the Canada Pension Plan Investment Board, argue in Harvard Business Review that a change in climate starts with the major asset holders—namely, pension funds. They must learn to take a long view, get (slightly) involved with the companies they’re buying, use long-term metrics and structure their governance to encourage long-term thinking. “Until these organizations radically change their approach, the other key players—asset managers, corporate boards and company executives—will likely remain trapped in value-destroying short-termism.”
2. Beware the iSmell: 10 Rules for Successful Product Development: Yes, there really was an iSmell device being developed during the first dot-com boom. Although it’s tempting to imagine what the product was supposed to do, hold your nose and instead just read this article in Knowledge@Wharton, which takes a look at entrepreneur Dan Cohen. The CEO and co-founder of Accomplio explains what steps to take and not take when you’re trying to develop something new. One sample: “Simplicity can be the biggest feature in and of itself. . . . Don’t ruin it.”
3. For the Love of Money: When hedge fund trader Sam Polk got a bonus of $3.6 million during his final year on Wall Street, he was angry because it wasn’t enough. Today, out of the business and into the world of nonprofits, Polk takes to the pages of the New York Times to reflect on the addictiveness of money. “Only a wealth addict would earn hundreds of millions as a hedge-fund manager, and then lobby to maintain a tax loophole that gave him a lower tax rate than his secretary,” he writes.
4. Dx Comment of the Week: Last week, when we took a look at an economic freedom ranking put out by The Wall Street Journal and the Heritage Foundation, we suggested that Peter Drucker, while a supporter of economic freedom, would not have viewed it as the single most important indicator of the health of a society. Reader Brendan Alexander did not agree:
Where there is maximum economic freedom, rule of law and limited government, societies and their underlying cultures thrive and prosper. . . .When there is economic freedom, great cultures and societies prosper, and their wealth can take many forms: spiritual life, family life, health and not merely money. The [economic freedom] index doesn’t measure these intangible qualities, but there are countries with high degrees of economic freedom that don’t have the level of wealth of the U.S. but still would probably be better places to live.