Here’s proof that Wall Street regulators listen to you — Andrei Kirilenko

MIT Sloan Professor Andrei Kirilenko

MIT Sloan Professor Andrei Kirilenko

From MarketWatch

Especially concerning business regulations, critics argue, an inside the Beltway mentality prevails. Only the lobbyists and industry insiders are heard.

I am sensitive to this criticism. Five and half years ago, the United States experienced the worst financial crisis since the Great Depression. In response to the crisis, Congress passed the Dodd Frank Wall Street Reform and Consumer Protection Act. One part of the legislation instructed a financial regulatory agency called the Commodity Futures Trading Commission (CFTC) to write rules that regulate “swaps” — the same derivatives that had been implicated in the financial crisis. As the Chief Economist of the CFTC during 2010-2012, I helped with the rulemaking process.

After leaving the federal government in December 2012 to join MIT Sloan School of Management as a finance professor, I set out to study the work that I and other staff members had done on designing new Wall Street regulations.

My goal was to create a scientific tool to evaluate whether thousands of public comments that were delivered in response to the rules proposed by the CFTC were meaningfully taken into account. I wanted to study how responsive the government is to its constituents. Is the government really for the people?

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The financial case for local manufacturing — Suzanne de Treville

MIT Sloan Visiting Professor Suzanne-de-Treville

MIT Sloan Visiting Professor Suzanne-de-Treville

From Outsource

In the last 20 years, we’ve seen a massive wave of manufacturing jobs move to low-labour-cost countries. Now, many companies are beginning to question whether the cost differential offered by distant suppliers compensates for the cost of working with an extended supply chain. These companies find themselves with massive inventories, yet in spite of those inventories they frequently are not able to meet all demand.

It has been difficult for managers to analyse the cost differential mismatch trade-off because mismatch costs are difficult to quantify. The intuition is that the mismatch costs are high, but the managers I discuss with have difficulty believing that overstocks and stockout costs are high enough to wipe out the cost advantage enjoyed by their offshore supplier. Without solid numbers, it’s difficult for managers to incorporate these costs into decision-making.

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How to get employees to be more entrepreneurial — Deborah Ancona

MIT Sloan Professor Deborah Ancona

MIT Sloan Professor Deborah Ancona

From Fortune

Organizational change has never been easy, but in the past it was a little more straightforward. Fifty years ago, companies followed a basic blueprint. They had heroic leaders — a CEO and an elite top layer of management — who had tremendous authority and made all the important decisions. When they wanted to make a change, they set a direction and it cascaded down through the firm.

Today things are different. As companies compete more on speed, agility, and innovation, decision-making needs to get pushed down. Sure, there remain some old-school companies that rely solely on top-down leadership. But in an increasing number of firms, leadership is shared across the organization, often in teams. Command and control is out; collaboration and teamwork are in.

These are positive developments, but they don’t make organizational change any easier to pull off. The key for managers is to create an environment where teams and individuals — even those lower in the organization — have the latitude and autonomy to recommend and try out new ideas, be it a new environmental initiative, a new technology, or a way to seize some new opportunity in a different market. The goal is an entrepreneurial workforce at all levels of the company. Here are some ways to achieve that:

Think beyond the official job title.

Managers tend to put employees into neat little boxes according to their place on the corporate organizational chart. But these boxes make it hard for someone lower down in the organization, without an official title, to vet and test a new idea. There’s a prevailing attitude of: “We need a formal manager to do that.” To combat that tendency when assigning people to projects, consider who has the passion, knowledge, and networks to succeed — independent of that person’s title. If this is not politically possible, then think about creating two-person teams or small groups that include people with the necessary expertise.

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Reengineering the kitchen: Lessons from a manufacturing expert — John Carrier

MIT Sloan Sr. Lecturer John Carrier

From The Huffington Post

As a manufacturing expert, I help factories become more productive by refining the way they operate. Small improvements over time can lead to big changes in the long term.

But it wasn’t until I arrived home late and exhausted from a trip that I realized I needed to use these same principles at home. Opening the closet to hang up my coat, I found the closet crowded with kids’ sporting equipment and old school projects. Similarly, evenings at home seemed shorter as our after-dinner hours became crammed with homework and activities.

Where had all our time gone? And how did the space in our cabinets and closets disappear? Why had the job of doing the dishes slipped from right after dinner to right before bed? And why was I finding myself more frequently being drawn into a game of “Dish Tetris,” struggling to fit all the dishes into the dishwasher when they used to fit in just fine?

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Negotiating your next deal: It’s okay to, literally, sweat it — Ashley D. Brown

MIT Sloan Alumna Ashley D. Brown

MIT Sloan Alumna Ashley D. Brown

From Fortune

We negotiate nearly every day. While the term “negotiation” often brings to mind larger-stake deals, such as the purchase of a new home or car, more often these negotiations are smaller and involve project deadlines at work or divvying up of household responsibilities.

Many of us, myself included, can’t stand negotiations whether big or small — so much so that it comes as a surprise that others actually relish each chance they get to negotiate.

Regardless of which camp you’re in, most of us can relate to the feeling of pounding hearts and sweaty palms when we negotiate. Do these visceral responses — also known as physiological arousal — hurt or help us?

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