Dan Erwin

Does Helping Women Help Business?

 

Although it's still rare for companies to make investments specifically aimed at helping women in developing economies, McKinsey (full report available free) has found that it's a practice not only good for society but also very good for business. 

The original research, completed by Stephan Klasen and Francesca Lamanna, found what McKinsey called a "startlingly wide range" of mutual benefits to women and companies themselves.  The benefits include enlarging business markets, improving both size and quality of workforce and maintaining and improving company reputations.

It's becoming more widely known that the unfulfilled potential of women has a significantly negative impact on economic growth.  One intriguing study, for example, estimated that lower education and employment rates for women and girls are responsible for as much as 1.6% difference in annual GDP growth between South Asia and East Asia.  You certainly can't sneeze at a figure like that when economists and traders were celebrating the U.S. fourth quarter growth of 5.7%. 

Most intriguing to me was that the McKinsey study showed that business benefits can result from a  broad range of measures.  It's to be expected that there would be a straight link between literacy and workforce productivity.  But Anglo American Mining, for example, extends HIV antiretroviral benefits to dependents (women and children) of its employees in Africa.  The list of tracked benefits is startling and includes increased worker loyalty, increased retention rates, fewer missed days, lower infant mortality rates and healthier children.  Furthermore, the research also found that collaborative investments with women they're trying to help also create significant benefits for companies.

I have no doubt that part of my interest in helping women is based upon the simple fact that our family has three daughters.  From the time these girls were in middle-school I was being educated to the future needs of women.  I was also profoundly frustrated by the response of colleagues whose families were composed primarily of boys.  Although this is completely anecdotal information, again and again I found little concern about women's societal issues from corporate execs who were in their fifties or older.  It took the marketing savvy of women in consumer product companies to engage the interest of execs in minority niches such as Hispanics and Blacks.  The successes in marketing to those segments was often a wake-up call to execs, making it far easier for them to understand the business contribution not only of minorities, but also of women (as a minority). 

As an aside, I realized in the early 1980s that single women and women with children can be among the poorest members of American society.  As parents of three daughters, we pushed all of them through college and a graduate program, betting that at least one of our three daughters would be divorced, perhaps with a child.  That wisdom paid off.  One of our daughters is divorced with a child, but as a result of our emphasis upon graduate education and and professionalism, all three of our daughters have been able to succeed in the worst recession since the 1930s.  If we'd had sons, I'd have also insisted on graduate education, but the demographics on single women with children were shocking and scary, driving our decisions.

It's surprising to recognize, now, that a smaller and smaller proportion of boys are going to college.  They are placing huge limitations upon their future.  How times change! If I had sons. . .  well, you get the point.  Years ago, after our middle daughter's college graduation, a girl friend who had failed to take advantage of the Minnesota educational opportunities asked that daughter what her dad would have done if she hadn't graduated.  With a large, teasing smile, she responded.  "Oh, he would have murdered me!"  It strikes me that, today, a large number of boys need to hear that message. 

Inevitably, research as this from McKinsey, not at all unique, is information that should be disseminated widely to major corporations.  Thankfully, I'm finding a growing awareness of the role that helping women and children can drive corporate businesses.  Nothing like financial incentives to gain the attention of male execs. 

Photo: Flickr, Ben's Photostream, Laotian Women

Quotation of the Week: Senator Mitchell McConnell

Americans are concerned about government spending, debt, jobs, and keeping the homeland safe. They expect us to focus on these core issues until we get them right. In the year ahead, there is much work to be done, and the task before us is clear. We need to get Americans back to work and remain focused on keeping America secure and putting our nation back on the road to prosperity. Republicans look forward to working with the president on these shared goals.

--Senator Mitchell McConnell of Kentucky, Responding to President Obama's Speech

How can you make sense out of this legislator's statements?  Of course, the party of the person who said this (Republican) is irrelevant.  It could have been written by an Independent or by a Democrat.

But, the first question to be asked about any statement is to ask what you mean when you say. . . ?  Define the terms.  Specifically, what spending, what debt, what kind of jobs and what timeline are we talking about?  McConnell is in agreement that something should be done.  Nothing is stated, though, about why it should be done, how it should be done or or when it should be done ("until we get them right").

With none of the process issues (why or how) explained. I can only suspect that one purpose of the statement might be to leave the impression that the Republicans want to work with the Democrats.  

Currently, the polls show satisfaction with the Republican party at half the level of satisfaction with the Democratic party.  Satisfaction with the Democratic party runs below the fiftieth percentile.  Perhaps the opposition party believes that if it says something positive about the President's speech it might help their poll numbers.   

So, McConnell has done an excellent job of saying nothing, but he wants his readers to believe that he's positive about the speech.  That leaves a lot of wiggle room.

So my elementary analysis is obvious to you?  Hmmmmm.  I hardly ever hear anyone in business analyze statements from the point of definitions.  The assumption, instead, must be that the listener understands, or the "rules" don't permit that.  Yet, that's the most obvious reason for misunderstanding.   

The most basic step for avoiding breakdowns and misunderstandings is to ask one simple question:  "What do you mean when you say . . . ?"

Here's another example.  Following the State of the Union speech and the Republican rebuttal, I took 10 minutes to watch the CNN panel discussion, hoping that David Gergen might have an insight or two.  Instead, one of the panel members stated her opinion on the speech.  In effect, she opined, it was an awful speech.  "It wasn't presidential."  I waited, and waited.  Not a single soul asked the defining question:  "When you say the speech wasn't presidential, what, exactly do you mean?"  Or, "What would a truly presidential speech sound like?"  Or, "Why do you believe the speech wasn't presidential?"

I can only conclude that the "rules" of the panel were that a member should never ask another to define her terms.  It must be very important to never embarrass or threaten anyone in public.  Check out my conclusion.  You'll see the rule followed in the majority of relationships.  The consequence of this failure is that no one learns, grows or actually engages in any sort of problem solving.  Instead, the two word phrase, "not presidential," goes all over the ether.  Google the phrase.  It has a long history of signifying nothing.  Indeed, it's quite possible that the panel member brought in a list of phrases she could use to emphasize a point, and "not presidential" was on her list.

Chris Argyris points out that such routines in business make it highly likely that individuals, groups and organizations will not detect or correct a statement that might embarrass or threaten another because of three social rules:

1. Always bypass such statements and act as if it was not said.  That was exactly what the panel members did.
2. Make the bypass undiscussable. No one would ever think of discussing the fact that they'd ignored the "no presidential" statement.
3. Make it's undiscussability undiscussable.  (Why can't we talk about the rule that we can't talk about this?)

There is one hilarious exception to the rule from CNBC in 2007.  On Morning Joe, Mika Brzezinski refused to read the lead news story about Paris Hilton.  She tried to burn the written announcement with a cigarette lighter, and when her colleagues stopped her, she shredded the page in plain sight of the viewer.  It was, as one writer noted, "The shredding that was heard around the world."  She explained to her colleagues and viewers exactly why the story was too irrelevant to be read.

At last count, the shredding was viewed over 3,780,00 times on YouTube.  She made the undiscussable quite discussable--and in plain sight.

Initial Jobless Claims Continue Downward Trend

As announced today, the seasonally adjusted claims for the week ending January 23 was 470,000, a decrease of 8,000 from the previous week.

As Mark Zandi, a leading economist stated, these are the best figures for understanding what's happening to the economy and job market.  Several weeks ago, I reported on research to identify those economists who have the best long term success in predicting the economy.  The research found that Larry Summers of the president's staff and Mark Zandi, chief economist for Moody's economy.com hold that well-deserved reputation. 

A morning update from NPR also reported that the initial claims figures have, on average, been on a downward trend for the past 19 weeks.  That bodes well for the economy.

Here, again, is Mark Zandi's very useful interpretation of the figures:   Only when claims head down to 400,000 will the economy be creating enough jobs to maintain stable unemployment.  Closer to 350,000 will lower the unemployment rate and mean that the recovery is evolving into an expansion.  When we get to initial weekly unemployment claims of 300,000, boom times are back

Former Justice O'Connor Rejects Election Finance Ruling

In my previous post, detailing my frustration over the Supreme Court decision on election finance, I related my diminishing trust of the Court's decisions, and provided two examples to explain my "adjusted" attitude.  In contrast, though, I have trusted many of Justice O'Connor's insights, generated,at least partially by her early experience as an Arizona legislator.  I suggested, however, that she must have been on vacation with the decision over the Bush/Gore election fiasco in Florida.

However, O'Connor is not on vacation when it comes to the latest ruling on election finances.  In a brief article, tucked away on page 17 of today's NYTimes, Adam Liptak says that she did not sound at all happy about the big campaign finance decision last week.  It repudiated a major part of a ruling she'd helped write prior to retirement, and complicated her campaign to do away with judicial elections.

"Gosh," she said, "I step away for a couple of years and there's no telling what's going to happen."  In a Georgetown conference on law, she put the issue directly, adding that the ruling might create an "increasing problem for maintaining an independent judiciary."

She sketched out potential scenarios from the election finance ruling: 

We can anticipate that labor unions and trial lawyers, for instance, might have the financial means to win one particular state judicial election. . . . And maybe tobacco firms and energy companies have enough to win the next one.  And if both sides unleash their campaign spending monies without restrictions, then I think mutually-assured destruction is the most likely outcome.

Although E. J. Dionne's remarks in the Washington Post were expected, they are so pointed and colorful that I decided to share them with you: 

The only proper response to this distortion of our political system by ideologically driven justices is a popular revolt. It would be a revolt of a sort deeply rooted in the American political tradition. The most vibrant reform alliances in our history have involved coalitions between populists (who stand up for the interests and values of average citizens) and progressives (who fight against corruption in government and for institutional changes to improve the workings of our democracy). It's time for a new populist-progressive alliance.

This is a messy, messy issue that's going to take a long time to resolve.  At this point in time, I'm not yet too philosophical about the issue.  And though a number of my Libertarian friends suggest that my views are over-stated, only time will tell.  Sunday's Times had an interesting piece of "research-based advocacy" supporting the ruling, but I'm still skeptical.  In other words, I hope that I'm wrong about the consequences of the ruling, but I doubt it. 

Why Doesn't Your Boss Listen To You?

In addition to the fact that you may not understand the business, the firm's strategy, or have the trust of your boss, there are plenty other reasons why your boss doesn't listen.

Steve Tobak of BNET is always worth a thoughtful read and his list of ten reasons why your boss doesn't listen is a good reality check.  

I have another suggestion.  If you want your boss to listen to you, learn how to write a managing up memo.  You'll find the instructions spelled out in detail here.  Thinking through a managing up memo will help clarify your thinking and gain a better handle on making a successful pitch.

Mocking the Supreme Court Decision on Election Finance

Both surprised and amused by a Harvard Business blogger, Umair Haque, who mocked the Supreme Court's decision on free speech, I found myself evaluating a fundamental attitude toward government.  Although the media would have us believe that government is never? rarely? to be trusted, and though plenty of people make a business out of bad-mouthing government, there remains a deep-seated trust of government in many areas. 

Most of us expect our local government to perform well in terms of education, infrastructure and general services.  And though we complain about other people's representatives and senators, we don't usually complain about our representative or our senator.  We have split-personalities.  We believe government can't be trusted, yet our behaviors belie our beliefs.   

It's easy to see this in the things we take for granted.  When we lived in Boulder, Colorado, the city manager changed a residential street from two-way to one-way.  In 30 days, that street had been changed back to two-way.  How did that happen?  The residents rose up in arms, marched into city hall and demanded their rights along with the change of traffic.  They got what they went after.

There are two ways of looking at that incident.  What comes to mind first is that the change to one-way was just another governmental screw-up.  That's what was talked about and angrily condemned. 

At a deeper level, however, the incident revealed that the residents took their trust of government for granted.  Significantly, they believed that the city government would respond to their action and return their street to two-way.  Think about this.  In many, perhaps most, parts of the world, the people would not believe that they have the power to influence government to act in their behalf, and they certainly would not expect that they could go into government headquarters and demand changes, much less see their demands met.

What's going on is that in spite of our griping and the constant media barrage about the failures of government, at a deeper level most of us have, well out of our awareness, a firm belief that our government will be responsive to us.  Actually, almost all of us believe in government so strongly that we trust it.  We hold some attitudes so deeply that we never consider them, and we are surprised when someone points out the contradiction between what we say and how we behave. As I occasionally remind friends from my generation, “You always get your Social Security check on time, the VA hospital is always available for your medical needs, your medical expenses get paid by Medicare, the police and the fire department will come when you call, and the winter potholes eventually get fixed. And you don't trust your government?  That’s nonsense."  The silence I get from those statements means that they have never thought about their fundamental underlying attitude.

Over the years, I have held tightly to an essentially positive and constructive attitude toward government.  Sure there's corruption.  Sure there are failures.  Sure there are legislators I'd like to throttle.  But overall, I'm happy to pay my taxes and make whatever contributions I can make.  I realize, in fact, that the government is us.  And when we bitch about the government, we're actually complaining about ourselves.

However, over the past ten years, I've found my underlying attitude toward the Supreme Court shifting in a direction that I fear.  There are two incidents that drive that shift.  The first was the Bush-Gore voter decision.  Frankly, I anticipated that the Supreme Court would stay out of the issue and let the state and district courts muddle on with recounts, etc., for as long as it might take.  Contrary to the general population, I've never had the expectation that our democratic processes will be anything other than messy.  And so if the Florida recount had gone on for months to finally come to a decision, it would have been okay with me and even appropriate.

As you can see, I believe that governmental bureaucracy is as good and often far better at running things than business bureaucracy.  I can match governmental screw-ups with business screw-ups as long as you have the time to listen.  There are really smart, even wise people in both fields.  There are also idiots in both fields, and I'm hard-pressed to argue who leads in lack of intelligence.   

But the Court inserted itself into the Florida decision, and that single, highly politicized action, took a chunk out of my trust of the judiciary.  Naively, I had always seen the Court as apolitical.  What surprised me was that Sandra Day O'Connor, who has served two terms in the Arizona legislature, and who usually "gets it," didn’t on that occasion. Her rich understanding of both the public and politics, an understanding that is missing among some members of the judiciary, was on vacation.

The second action was Thursday's decision on corporate involvement in electioneering.  Having worked through several dozen articles by libertarians, conservatives and liberals, and skimmed a bit of the decision itself, I've concluded two things: 

• The action showed a monstrous lack of awareness of the political facts on the ground, and the role of special-interest groups.  I expect that of most lawyers, having worked with more than 30 from both corporate general counsel and private legal firms. But I am shocked at the naivete of some members of The Court.  In all professions there are both artists and novices, with the artists in a serious minority.  But I expect the Supreme Court to be filled with artists, not novices, unaware of the big picture.

• The action showed an originalist or fundamentalistic handling of the Constitution that is not only asinine, but profoundly lacking in perspective.  Originalists essentially believe that you can make objective decisions based upon the received Constitutional document, in spite of the well-known fact that all decisions are colored by time, exposure, personal history, work experience, values and bias.  A belief in originalism challenges my trust of the Court.  Originalism is rhetorical nonsense.

So much to my chagrin, I’ve learned that the Supreme Court is filled with fundamentally fallible people, professionals who in spite of their elevation manifest huge intellectual holes. As a result, I've painfully adjusted my perspective on the Court. I’ve decided that it cannot be trusted to "get it," either about competitive business processes or election politics. In other words, I have a seriously diminished respect for the Court.  That perspective, I'm certain, will be shared more and more, thus taking away from the trust we have granted it for more than two centuries.  The Roberts Court, at least from the perspective of this 75 year-old, is building itself a bad reputation for our democracy, and I have gained a perspective on reality that I don't really desire.

Quotation of the Week: Supreme Court Justice Stevens

Today's decision is a rejection of the common sense of the American people, who have recognized a need to prevent corporations from undermining self government since the founding … [i]t is a strange time to repudiate that common sense. While American democracy is imperfect, few outside the majority of this Court would have thought its flaws included a dearth of corporate money in politics.

--Supreme Court Justice John Paul Stevens, on the landmark decision on Citizens versus Federal Election Commission.   

The Court in a 5/4 decision made this decision on the basis of "free speech."

How did this come about?  Of course, it's easy to say it was a political decision made by the conservative side of the court.  And there may well be truth in that.

However, the public face of the decision will probably be a constructivist or originalist approach to the reading of the Constitution, a perspective that has been part of the debate on the meaning of the constitution.

A bit of background.  Especially since Scalia assumed his position on the Supreme Court in1986, Americans have debated the meaning of the Constitution ferociously.  Some, like Scalia, believe that the Constitution has an absolute original meaning and want us to recover that absolute original meaning in our current interpretations of the Constitution.  It's a position not unlike that of religious fundamentalists who essentially believe they have a magic book in the form of the Bible.

Still others believe that the Constitution means today whatever we want it to mean, and that's what is meant by a "living Constitution."  To follow my analogy of the "magic book,"  in contrast, these people are highly relativistic in their approach to the interpretation of the Constitution.

Neither of these extreme positions, of course, is correct.  As Gordon Wood, perhaps the dean of American historians of the revolutionary period, puts it, historians know that the meaning of the Constitution has changed and will continue to change through time.  But they also know that no one is free today to give whatever meaning he or she wants to give to it. . . . History, experience, and custom are powerful restraints on what we can think and do.  We are not as free from the past as we think we are. 

I'm wary of both originalistic and relativistic thinking.  But I'm especially wary of important ideas that float around the media and the ether, without the slightest sense of historical understanding.

Although Republicans initially praised the decision, I suspect that they will realize fairly soon that it is a bad decision not only for Democrats, but also for them.

After the ruling, corporations will be free to spend as much as they like on advertisements that support or oppose candidates, and with little restriction.  With all the public's hostility to big business, I can only wonder on what planet these guys are living.  The Court has given business a blank check to buy elections. Even Republican Senator John McCain told reporters that he was troubled by the "extreme naivete" of some of the justices on the role of special-interest money in elections and decisions.

Initial Jobless Claims Up Slightly for Week Ending 1/16

As I've suggested for the past month, staying on top of initial jobless claims is one of the best ways to keep track of the economy.  As announced today, the seasonally adjusted claims was 482,000, an increase of 36,000 from the previous week's figure.  The 4-week moving average was 448,250, which is an increase of 7,000 from the previous week's revised average of 441,250.  Watching the figures over the month is a better way to assess change. 

Here is Mark Zandi's very useful interpretation of the figures:   Only when claims head down to 400,000 will the economy be creating enough jobs to maintain stable unemployment.  Closer to 350,000 will lower the unemployment rate and mean that the recovery is evolving into an expansion.  When we get to initial weekly unemployment claims of 300,000, boom times are back.

How to Build Your Kid's Intelligence (and Your Own)

In a previous blog, I posted a quote from Richard Nisbett, distinguished psychology professor at Michigan and Malcolm Gladwell’s guru on human intelligence, who indicated that intelligence is under our control.  So how do you get our intelligence under control? 

Although there are a lot of answers to that question, including basics like nutrition and exercise, the best response is tied to the research of Carol Dweck, the world renown expert on human motivation.  I have written previously about her work here, here and here.  Dweck’s early research focused on why some school children persist in the face of failure while others quit as soon as the going gets rough.  Over the years her research has shown that it is crucial for parents to teach children that their intelligence is under their control. Indeed, she found that when children are praised for their intelligence, they resist accepting a challenge and doing things from which they can learn a lot.

Here is Richard Nisbett’s summary of that fascinating research:

In a clever experiment . . .developmental psychologists Claudia Mueller and Carol Dweck told children that they had done very well on problems from the Raven Progressive Matrices test and praised them either for being bright or for working hard.  They then offered the children the opportunity to work on another set of problems—either easy ones (“so I’ll do well”) or hard problems that would challenge them (“so I’ll learn a lot from them, even if I won’t look so smart”).  Sixty-six percent of the children who were praised for their intelligence chose to work on easy problems that would show that they were smart; over 90percent of children praised for hard work chose problems that they would learn a lot from.  If the children did well because they worked hard, they wanted problems that would test their limits and teach them how to do even better.

But in order to further test their conclusions, the researchers added some important “difficulties.”

Before the children actually got a chance to work on a problem set of their choice, Mueller and Dweck required them to work on a second set of problems that were much more difficult than the first set.  The children were then asked to explain why they had performed poorly on the second set of problems.  The children praised for intelligence based on performance on the first set of problems were more likely to think that their failure on the second set of problems reflected lack of ability; children praised for hard work initially were more likely to think that their failure on the second set of problems was due to lack of effort.  Children praised for ability were less likely to want to continue to work on the problems and reported enjoying working on the second set of tasks less than did those praised for hard work.  As icing on the cake, Mueller and Dweck then had the children work on a third set of problems.  Children who had initially been praised for intelligence solved fewer problems than those initially praised for hard work. 

The conclusions are obvious:  If you want to build your kid’s intelligence (and your own), emphasize and praise for effort and hard work, not for intelligence or IQ.  Not only does that process reject the conventional and highly limiting views of innate intelligence, but more significantly, it puts performance under the control of the person.  You may not think you’ve got the ability, but you sure as hell can put more effort into something you want to learn.  And, that’s especially true when you’ve got an effective teacher and coach.

Later studies by Carol Dweck and Anders Ericsson on “deliberate practice” research successes in numerous fields based on the results of this seminal research.  That includes research on sports such as golf, ice-skating, and tennis, as well as games like chess, and academic subjects like math, business, the arts and an ever-enlarging set of disciplines.

Martin Luther King, Jr. "Letter from a Birmingham Jail"

Although the public is most familiar with King’s “I have a Dream” speech, I have always thought that his “Letter from a Birmingham Jail” was a far better and even more passionate explanation of his commitment to civil rights.  In the letter King explains why negotiation and postponement of actions are no longer a viable option and argues for direct action in the form of “sit-ins, marches and so forth.” 

Here is his argument:You are quite right in calling for negotiation.  Indeed, this is the very purpose of direct action.  Nonviolent direct action seeks to create such a crisis and foster such a tension that a community which has constantly refused to negotiate is forced to confront the issue.  It seeks so to dramatize the issue that it can no longer be ignored.  My citing the creation of tension as part of the work of the nonviolent resister may sound rather shocking.  But I must confess that I am not afraid of the word “tension.”  I have earnestly opposed violent tension, but there is a type of constructive, nonviolent tension which is necessary for growth.  Just as Socrates felt that it was necessary to create a tension in the mind so that individuals could rise from the bondage of myths and half truths to the unfettered realm of creative analysis and objective appraisal, so must we see the need for nonviolent gadflies to create the kind of tension in society that will help men rise from the dark depths of prejudice and racism to the majestic heights of understand and brotherhood.

“Nonviolent gadflies?”  Indeed.

Underlying all of King’s philosophy is his concept of the interrelatedness of all communities and states, best phrased in the early paragraphs of his rather long letter: I am in Birmingham because injustice is here. . . . Moreover, I am cognizant of the interrelatedness of all communities and states.  I cannot sit idly by in Atlanta and not be concerned about what happens in Birmingham.  Injustice anywhere is a threat to justice everywhere.

As I read through these familiar lines, I am aware of how much King's statements have become a part of our heritage and, indeed, a part of the world's heritage.  For that, I am grateful.

The "Letter from a Birmingham Jail" can be downloaded here.