A lot of attention has been paid lately to big tech companies buying up smaller firms in billion-dollar deals: In January, Google acquired Nest for $3.2 billion, Facebook purchased mobile message service, WhatsApp, the following month for $19 billion; last week, it acquired virtual reality gaming company, Oculus VR, for $2 billion. There is a lot of discussion about the motives behind these large deals. Some say they are attempts to block competition, while others maintain they are efforts to stay relevant.
I see these deals as a reflection of the uncertainty companies face as they try to identify the next big thing. This is especially true for successful companies like Facebook (FB) and Google (GOOG), which are known for doing what they do tremendously well. They’ve seen similarly successful companies like Kodak struggle as technology moves on, rendering its product obsolete. As a result, companies today are eternally motivated to look outside their current business.
The media spotlight has recently been on Apple Inc. AAPL +0.52% for shifting profits overseas to avoid U.S. taxes. In its international tax strategy, though, Apple is no different from other American technology companies, which (like Apple) began moving manufacturing overseas starting in the early 1980s.
Initially, U.S. technology firms that went abroad during this period were drawn by the lower labor, sourcing, and procurement costs. They also found they could eliminate exchange-rate risk by producing and selling in the same currency.
But these companies soon discovered another important advantage of being global: favorable taxation.
There is growing interest in online programs as a way to expand the reach of executive education. However, that is balanced with our pedagogical philosophy at MIT Sloan, which involves high levels of engagement and interaction among faculty and students. A big question is: How do we keep that collaborative learning model in the context of an online program?
While there are many technologies to explore, we’re currently experimenting with one called AvayaLive™ Engage which offers an immersive online world in which participants interact in real time with avatars. We piloted it for executive education purposes last year by offering an online workshop for participants following an in-person program. We learned a lot in terms of what was effective and what needed to be tweaked, but our big takeaway was that the platform provides a dynamic learning environment for participants. Read More »
When we teach our introductory entrepreneurship class at MIT, we take it for granted that each of our 75 students will be able to start an American company upon graduating.
But many of them lack one thing they need to be able to do so—permission from the United States government to continue working in our country.
In this academic year, three in 10 MIT students, including four in 10 graduate students, are not U.S. citizens or permanent residents. So for them our entrepreneurship class is likely to remain just an academic exercise. Their student visas expire when they graduate, leaving them with two options, to leave the country or find an existing company to sponsor them for a chance at an H-1B visa.
For all of the talk about how social media, mobile and analytics are transforming our lives, the majority of big companies still have a long way to go in their digital transformation. However, two years of study with more than 400 firms around the world shows that a quarter of firms are already achieving a measurable “digital advantage” over their peers.
This research, conducted by the MIT Sloan Center for Digital Business in cooperation with research sponsor Capgemini Consulting, shows that the digital advantage is not about luck or about the industry your firm is in. It is not just about how much cool digital stuff firms are doing. Companies that manage their digital activities in a certain way are 26% more profitable than their industry peers, and outperform on other measures as well. Read More »