With better leadership, Sears could’ve been a contender – Sharmila Chatterjee

MIT Sloan Senior Lecturer Sharmila Chatterjee

MIT Sloan Senior Lecturer Sharmila Chatterjee

From The Hill

When I arrived in the U.S. for graduate school in the mid-1980s, I asked my host family in a Philadelphia suburb where to shop to outfit my dorm room. They didn’t skip a beat: “Sears,” they said. “It has everything you need.”

To say that I was in awe of Sears would be an understatement. Having grown up in small cities in India that were dominated by mom and pop stores, I’d never seen anything like it. I bought pillows and bed sheets; a hot pot, microwave, a mini fridge; and also rain boots, socks, and a pair of earrings. I remember thinking, “This is the American store of my dreams.”

So last week’s news that Sears filed for bankruptcy struck a personal chord. The company has been under pressure for years: shuttering stores, jettisoning assets and taking on ever more debt. Finally, facing a $134 million payment that it could not afford, Sears capitulated.

The main culprit, according to media coverage, was the rise of online shopping and Amazon. Amazon, of course, has become the familiar villain in these tales — allegedly responsible for the death of many once-dominant American retailers, from Toys “R” Us to Sports Authority to Radio Shack.

But considering e-commerce accounts for only 9 percent of all retail sales, that explanation rings hollow. The truth is, Sears’s bankruptcy is of its own making. Its management, led by Eddie Lampert — Sears’s chairman and its biggest individual creditor and shareholder, made a series of missteps that ultimately crippled the iconic chain.

These include focusing too narrowly on cutting costs at the expense of investing in the in-store experience, spinning off key brands and competing on price.

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Facebook and Silicon Valley’s Silent Spring: The Question of Technology – Otto Scharmer

MIT Sloan Sr. Lecturer Otto Scharmer

Mark Zuckerberg’s inability to move beyond the scripted apologies during his congressional testimony in Washington about the Cambridge Analytica scandal confirmed what many already sensed: Zuckerberg and Facebook are out of touch with the most basic concerns and feelings of citizens across America and the world—and, as a consequence, Facebook is sinking and on a path to irrelevance. The root cause of that process was sitting right in front of the senators: a founder CEO who is so stuck in his own bubble that he can’t sense how the collective attention around him has changed. To be fair, the bubble surrounds all the Big Tech and Big Data behemoths, not just Facebook. As we have learned recently, these companies navigate and manipulate people’s attention and micro-habits every day. Says Tristan Harris, the former design ethicist for Google:

“[Imagine] walking into a control room with a hundred people hunched over a desk with little dials, and that that control room will shape the thoughts and feelings of a billion people. This might sound like science fiction, but this actually exists right now today. I know because I used to be in one of those control rooms. [This matters] because what we don’t talk about is that a handful of people … through their choices will steer what a billion people are thinking today.”

The problem, explains Harris, is that app designers are trained in exploiting small vulnerabilities of the human mind that then glues them to the screen and reinforces addictive behavioral patterns, particularly among teenage users. But we’ve probably heard that before. What has shifted? What has shifted over the past several months is the perception of the collective. While people in other parts of the world have had mixed feelings about the massive asymmetry of power between the few inside the control room and the billions of us outside of it, for a long time, there have always been two countries where that kind of awareness tended to be least developed: China and the U.S. With the scandalous revelations around Cambridge Analytica, one of them finally seems to have had its wake-up moment too.

An Assault on Attention, Empathy, and Our Humanity

What’s new is that more people are seeing connections that before were visible to only a few. My MIT colleague Sherry Turkle has likened this situation to Rachel Carson’s Silent Spring, a book that sparked the global environmental movement more than half a century ago. While Silent Spring made people aware of the adverse effects of chemical agricultural technology on nature, the current moment is about becoming aware of the adverse effects of digital social technologies on the human mind.

And just as Limits to Growth (another book that sparked the global environmental movement when it was published in 1972) pointed us to the contradiction between finite resources and infinite growth, today we learn about another inherent contradiction that will shape the public discourse for the years to come. It’s the contradiction between the finite resource of human attention and the infinite hunger for growth and global dominance that Big Tech companies pursue.  Attention, argues Tristan Harris, is the ultimate battleground of all Big Tech companies in order to sell it to the best-paying advertisers. We and our attention are their product, not their customer. That’s the first assault. The second assault, argues Turkle, is on our empathy. Over the past two decades and with the rise of social media, the markers for empathy among U.S. college students have dropped 40%. The third assault is on our humanity. Go to any major city. What do you see? Droves of people moving around and interacting with each other heads down, staring at their devices. The free online documentary “Stare into the Lights My Pretties” does a good job of holding a mirror up to this highly disturbing phenomenon. The problems associated with being glued to our screens are well known. Eighth-graders in the United States that use social media for ten hours a week or more are 56% more likely to show symptoms of depression and anxiety disorder than others. Today in America, one in three teenage girls (and one in four teenage boys) show symptoms of anxiety disorder. What are we doing to ourselves and to our children?

Three collective conditions: Post-truth, post-democratic, post-human

Seeing these adverse effects on the individual is one part of the current awakening. But the other part is no less important. It concerns the effects on collective society. They can be summarized by three patterns and conditions that we see worldwide today: post-truth, post-democratic, post-human.

Post-truth. The number that best summarizes this condition is 3,001: that’s the number of lies and misleading statements by President Trump in his first 446 days in office. In spite of all these lies, his approval rating in the United States remains unchanged. Americans, according to former New York mayor Michael Bloomberg, are facing an “epidemic of dishonesty” that is more dangerous than terrorism or communism. The post-truth condition is greatly amplified by social media. According to a recent MIT study, false information is 70% more likely to be shared on Twitter than true information. Social media are intentionally designed to keep us inside our own filter bubbles. Algorithms feed us information that confirms our views and shields us from information that could challenge them—even if what confirms our views or triggers our anger is based on false information or lies. Post-truth also means that how people feel about things (the first-person perspective) matters at least as much as the objective dimension of these facts does (the third-person perspective). Finally, post-truth tends to lead to a state of confusion. For most people this condition boils down to this: You can’t know. Nobody does. 

Post-democratic. The number that summarizes this condition is 87. Facebook and Cambridge Analytica exposed private data of 87 million users, which then were used to manipulate the Brexit vote and the 2016 U.S. presidential election. The rise of filter bubbles, micro-targeting, Russian bots, false news, and dark posts to amplify hate and fear, combined with the falling apart of communities and the rise of autocrats, are all symptoms of the same collective condition. It’s a crisis of old democratic institutions that have been eroded by the use of technology and highjacked by special interest groups representing Big Money, Big Tech, Big Pharma, and the fossil fuel industry. For most people the post-democratic condition boils down to this: You can’t really participate (in the decisions that affect you) and connect (to people outside of your bubble).

Post-human. The number that exemplifies this condition is 47: that’s the percentage of all jobs in the United States that, according to a recent study, will be replaced by machines by 2050. If that’s true, what does it mean? How do we distribute work if work is scarce? How do we distribute income if it is no longer tied to work (by providing a universal basic income?)? How do we change the tax system when natural resources are scarce and work is abundant (by imposing a carbon tax?)? What kind of future do we want to create? Are we going to be the housecats of our artificial intelligence (AI) overlords? Or is there a more intentional choice that we can make around technology? Do we choose a path that entails developing more addictive technologies that diminish our creative capacities, or do we choose a path toward developing technologies that enhance our creative capacities? Which path do we choose? For most people the current post-human condition boils down to this: You can’t choose. You can’t transform.

These are the three collective conditions of our time. Donald Trump is the face and living embodiment of the first condition. His attention span is minimal, and his connection to reality is fleeting, at best. Mark Zuckerberg is the face and living embodiment of the second condition. His empathy is minimal, and his connection to others is fleeting, at best. Who is the face and living embodiment of the third condition?  We all are, all of us who check our phones 150 times or more a day for app updates and messages (current average). The issue here is the Tyranny of Technology (ToT). It’s the most disturbing pattern that is emerging around us, between us, and within us. ToT turns our minds and micro-behaviors into extensions of AI-generated algorithms, which are outside of our awareness and control.

What do these three phenomena—Trump, Zuckerberg, and ToT—share? They share a way of operating that makes us locked inside of our own bubble. You can’t get out. That condition is obvious in the case of Trump and Zuckerberg. And sadly, it’s also increasingly true for the rest of us, to the degree that we’re victims of the Tyranny of Technology.  The aforementioned documentary and the Netflix series “Dark Mirror” provide excellent examples of bringing the ToT megatrend to our attention.

Summing up from a first-person view: For most—particularly younger—people these societal conditions look and feel like this: You can’t know. You can’t connect. You can’t transform.

The Question of Technology

The most important thing we can do now is to change the conversation by starting to ask the right questions.  Those include: What future do we want to create? Who are we as human beings? What path of technology development should we choose? A path that sets us on a race to the bottom by designing addictive and creativity-diminishing technologies, or one that puts us on a race to higher levels of human and social development by designing creativity-enhancing technologies?

Who needs to be at the table for those conversations? One thing we know for sure is this: conversations that are left to the few people inside corporate control rooms or to the handful people who own those companies will ignore two critical components: diversity and awareness. Facebook’s and Mark Zuckerberg’s poor responses are the evidence. What’s lacking most in all these conversations is an awareness that the path that we are currently on as a global community—a path toward destruction of the planet, society, and self—is not a necessity but a choice.

Moving beyond the current post-truth, post-democratic, and post-human condition will require us to do more than just criticizing it. The anti-Trump media have failed so far. Billions of words against Trump have only made him stronger. The same may be true for Facebook and our various filter bubbles. We need something different. We need to go beyond restoring society’s key institutions; we need to update our institutional infrastructures in at least three key domains. We need to address the condition of

  • post-truth by creating generative learning infrastructures that link first-, second-, and third-person views in ways that blend head, heart, and hand.
  • post-democracy by creating new democratic infrastructures that engage citizens in more direct, distributed, and dialogic modes of participation.
  • post-human by creating collaborative economic infrastructures that shifts the mindset from ego-system to eco-system awareness and allows everyone to contribute to co-generating well-being for all.

The good news is that the future is already here. Each of these infrastructure innovations has already been prototyped on a small scale in various places. But what is missing is an amplification mechanism that links these innovative initiatives to each other, so that they can be coordinated and replicated. Without these infrastructure innovations—and without a profound shift of our intention in how we design, develop, and use technology—the current trajectory toward planetary, societal, and human self-destruction will not be changed.

Which leads us to the two root questions of our time: What is technology? And what is the human being? In his writings about technology, the German philosopher Martin Heidegger reminds us that the word technology comes from the Greek word techne, meaning art. For the Greeks, art and technology was one and the same. Today, that connection is less and less felt—particularly on the user-side of apps that are used by billions and controlled by only a handful inside the control room. Which is precisely why post-truth, post-democracy, and post-human are not three problems. They are three different expressions of the same root issue: the quality of intention that underlies the making of technology. Is technology designed with the intention to empower and enhance human creativity, agency, and flourishing—or is it designed with the intention to maximize the wealth of and world domination by a very small group of mostly unaware, white, middle-aged men?

What You Can Do Now

What can you do to regain agency on these topics? Here are eight micro-actions that can help you regain some of the control that has been lost to Big Tech:

  1. Ban your smartphone from the bedroom and buy an alarm clock.
  2. Get out of the filter bubble by doing what people inside Google already do: drop the Google search engine and use DuckDuckGo, an engine that protects your privacy and does not sell your data.
  3. Minimize your notifications and retake control of your social media feed (check out MIT Media Lab’s Gobo)
  4. Start your day with a moment of mindfulness.
  5. Take intentional reflection breaks—for example, a short daily walk that exposes you to the amazing beauty of nature that is all around us.
  6. Form a small circle of friends for practicing deep listening and generative dialogue conversations.
  7. Make a list of places of most potential—places that would help you figure out the next steps on your life’s and work’s journey—and then immerse yourself in at least one of those places every few months.
  8. Join the Transforming Capitalism platform to link up with inspiring innovators who share their stories, experiences, methods, and tools on addressing the issues outlined above. Join the conversation.

Otto Scharmer is a Senior Lecturer at MIT Sloan, a Thousand Talents Program Professor at Tsinghua University, Beijing, and cofounder of the Presencing Institute.


Tesla needs to put a seat belt on Elon Musk – Chester Spatt

Golub Distinguished Visiting Professor of Finance, Chester Spatt

From MarketWatch

The past few months have been turbulent for Tesla CEO Elon Musk.

From publicly accusing a Thai rescue diver of being a pedophile (without evidence) and conducting a radio interview while smoking marijuana to insulting equity analysts on one earnings call and threatening to take Tesla private — then reversing those statements, triggering a SEC and a criminal investigation — Musk has engaged in some reckless behavior.

Then there are production problems with Tesla not being able to deliver cars on time. A big question is whether Musk should step down. While investor confidence in Musk has taken a big hit, he is a visionary leader and there would likely be great disappointment if he left the company.

What Musk does need is a lot more checks and balances by his management team. Investors would like Musk to have more self-control and act more like other legendary leaders, such as the late Steve Jobs of Apple and Amazon.com’s Jeff Bezos.

For that to have a chance, Tesla’s management team must play a bigger role in guiding the company’s strategy both internally and externally. If Musk is required to step down as CEO for a period of time by the SEC, the management team must be ready to take the wheel.

Tesla also needs to step back and review the basics of corporate governance. U.S. securities laws and common business practices are meant to keep market participants honest, so that they effectively represent their own best interests and those of their shareholders.

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American Workers’ Labor Day Message: Restore our Voice at Work! – Thomas A. Kochan, Erin L. Kelly, William Kimball, and Duanyi Yang

MIT Sloan Professor Thomas Kochan

MIT Sloan Professor Thomas Kochan

From The Conversation.

When earlier this year courageous teachers in West Virginia, Kentucky, Oklahoma, Colorado, and Arizona marched on their state capitals to get a pay raise and better funding for their students, they spoke for the majority of American workers who lack an effective voice at work. Their actions should serve as a wake-up call for employers and politicians alike: It is time to restore our voice at work.

Teachers are not alone in demanding a change.  A recent national survey of the workforce we conducted found there is a persistent and deep gap between the influence and say American workers believe they ought to have at work—

MIT Sloan Distinguished Professor of Work and Organization Studies Erin Kelly

something we call worker voice–and what they experience.  A majority of workers report they have less say than they believe they should have over key issues such as compensation and benefits, job security, promotions, training, new technology, employer values, respect, and protections against abuse and discrimination.  And between a third and one half report a voice gap on decisions about how and when they work, safety, and the quality of their products or services.

The long term decline in unions is a key reason for this voice gap and many workers see reversing this decline as part of the solution. In the same survey nearly 50 percent of the workforce (equivalent to 58 million workers) report they would join a union if given the chance to do so today, a number that is up from one third of the workforce in prior decades.

But rebuilding worker voice in ways that work in today’s economy and for the full range of workers who want more of a voice will require new strategies on the part of unions and other worker advocates and an entirely new labor law.

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When was the last time you asked, “Why are we doing it this way?” — Hal Gregersen

Hal Gregersen, Executive Director of the MIT Leadership Center

Hal Gregersen, Executive Director of the MIT Leadership Center

From Harvard Business Review

During a time when many retailers are struggling, business is booming at Target. But it wasn’t too long ago that the discount retailer’s future didn’t glow so bright. When CEO Brian Cornell took the reins two years ago, he inherited a company that had been struggling for years, taking far too few risks, and sticking too close to the core.

Since then the world has fallen in love with a far edgier Target, which has expanded its offerings through collaborations with such power brands as Lilly Pulitzer, Toms, Neiman Marcus, and SoulCycle, and updated product lines that break the status quo, like its latest gender-neutral kids home brand Pillowfort. But Cornell didn’t start right out of the gate making any big changes like these. Instead, he took time to carefully contemplate his approach, listen to his team, and ask questions.

At the MIT Leadership Center, I recently spoke with another leader, Guy Wollaert, chief exploration officer at Loggia Strategy & Design, about similar experiences he encountered at another highly visible brand, Coca-Cola. During his 20-plus year tenure with the global beverage brand, most recently serving as its chief technical and innovation officer, Wollaert made it a point to seek — and surround himself with — new ideas and people who challenged him to reflect and question first, then act later.

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