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4a2d06686da9a446a45da46423583149
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https://www.forbes.com/sites/roberthof/2015/11/12/sf-app-startup-cola-creates-slack-for-the-rest-of-us/
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SF App Startup Cola Creates 'Slack For The Rest Of Us'
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SF App Startup Cola Creates 'Slack For The Rest Of Us'
There's no end of messaging apps that let you exchange texts, photos and videos with friends--Whatsapp, Snapchat, Instagram, Facebook Messenger and so on. There are also a lot of business-oriented apps such as Slack , HipChat, and Yammer.
But what about a messaging app that lets you address the space in between entertainment and work, which is to say coordinating and planning activities with a few friends or coworkers? That's what Cola aims to do.
Today the San Francisco-based startup is launching a limited, private beta test of an app that uses messaging as the basis for a wide variety of common things people want to get done, from figuring out where and when to meet with friends and creating joint to-do lists to tracking expenses at work and even engaging in multi-player games. The idea, says cofounder and CEO David Temkin, is that messaging has emerged as the most important function of a smartphone and even the foundation of many apps on the smartphone, from Uber to DoorDash to Venmo. "We are entering an era when messaging is the central app, like the browser was for the Web," says Temkin.
Indeed, Temkin hopes to make Cola the first "messaging OS," a platform on which activities that need to be coordinated among a small number of people can get done using messaging as the essential delivery mechanism. Cola, whose name was chosen to suggest "collaboration" without actually using a word that sounds mostly like work, was still playing with the language to describe itself Wednesday. That's an indication that the company is still feeling its way toward the clear value proposition it will need to communicate.
For now, it's trying several descriptions, all aimed at busy people on the go. The tagline at the top of its homepage is "Don't just text. Do something." And the tagline on a demo video calls it a somewhat more geeky "autocomplete for your day." But the pithiest description comes from cofounder Marc Canter: "Slack for the rest of us."
OK, so how does it work? The beta app, which will be available first on Apple's iOS and likely early next year on Android, looks like the messaging app it basically is. Everything starts with a conversation with another person, or among a group of up to 50 people.
Once a message opens the conversation, Cola brings up a list of several possible actions called "bubbles" (yes, Cola bubbles) that people commonly want to complete throughout the day. That includes "When Can We Meet?", "Where Are You Now?", "Take Photo Or Video," "To Do List," and "Quick Poll." In other words, they're mini-apps contained within messages.
Tap "When Can We Meet?", for instance, and a calendar for the next few days appears. You choose several possible times, and those appear instantly on the screens of the people you messaged. They choose options that work for them. Once each person agrees on a common time they can meet, that can be added to their calendars.
At least in the demo, that whole process took only a few seconds. Wireless glitches aside, a couple of the other options appeared to work quickly as well. "Where Are You Now" lets you "advertise" your location for a certain period of time so others in your conversation know where you are, in real time--no more multiple texts while you're driving to tell people how late you will be to a meeting.
The big advantage here is the speed with which these tasks can be carried out. You don't have to open multiple apps such as messaging, calendar, and maps in a cumbersome series of steps that some call "pogo-sticking" in order to tap into the functions of those apps. In a real sense, you're sending apps or selected functions of an app through the message. "It's about getting you through your day quicker," Temkin says. "We're winning when people send fewer texts."
If you don't have the app, by the way, you can still get the bubbles through your default text messaging app, though you're prompted to get Cola for the full-featured experience, such as the ability to initiate a conversation.
The next step for Cola, and it's a key one, is to engage outside developers to create their own bubbles with apps embedded inside them. The bubbles are engineered so that they can "talk" to external apps and services such as Uber and the FlightAware flight tracker using their APIs (application programming interfaces).
Temkin aims to have hundreds of bubbles, maybe many more, created by outside developers so more tasks can get done within Cola. The developers could be those apps themselves, such as Uber or FlightAware, or independent developers that might mix and match existing app capabilities to create a bug tracking system, an expense reporting system or even multiplayer games.
So how does Cola make money? TBD, but the idea is a freemium model like Evernote's or Dropbox's. Temkin won't hazard a guess yet on what features Cola might charge for, but if and when a significant number of people get hooked, there's usually a way to persuade them it's worth paying for more features.
The 10-person company includes a number of Silicon Valley veterans besides Temkin, who most recently was chief technology officer at Hightail (formerly YouSendIt), a former executive at AOL and Palm, and an engineer who worked on Apple's early mobile device Newton. Others on the founding team include Macromedia founder Marc Canter; onetime Adobe engineering director Mike McEvoy; Jeremy Wyld, a member of Apple's original iPhone engineering team; and Brian Maggi, founder of Postini. The company has raised $1.3 million in seed funding from AngelList founder Naval Ravikant, Tribeca Angels, and other individual investors such as AOL cofounder Steve Case and longtime tech executive Brad Garlinghouse.
The big difficulty with any app is getting enough people to try it to get a virtuous cycle of use going. Cola is no exception. The company also needs to make it very clear why people would want to try what at least superficially looks like yet another messaging app when most people have too many of those on their phones already.
Cola competes at least nominally with any messaging app, of course. Although it's focused on the U.S., its notion of doing everything within a messaging app echoes that of China's WeChat. Cola also goes up against as any number of single-purpose apps such as sports calendar TeamSnap and multipurpose apps such as Pingpad for social productivity and Evernote for creating an online workspace. Most of all, it competes with existing, if imperfect, ways of coordinating and getting things done with other people, whether it's email or shared Google Docs.
But Temkin believes no other company competes directly with its approach. It's possible Cola is on to something valuable no one else has picked up on, but the flip side of a product that doesn't have a direct competitor is that perhaps nobody really needs it. There's no telling whether there's enough market space between messaging for entertainment and messaging for work until Cola is out in the wild for a few months.
Despite the wondrous capabilities of the smartphone, it remains too hard to get things done quickly on them. For all the challenges, Cola has identified a problem that a lot of people want solved.
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190f9b360d60a0191de1f19d1436be7a
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https://www.forbes.com/sites/roberthof/2015/12/17/optimal-pitches-smart-subscription-alternative-to-ad-blocking/
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Optimal Pitches Subscription Alternative To Ad Blocking
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Optimal Pitches Subscription Alternative To Ad Blocking
Rob Leathern has spent the last decade and more trying to find better ways for advertisers to serve us online ads. So why are he and four colleagues from his previous company starting a new one that will let us pay publishers not to show us ads?
“We got to know the good, the bad, and the ugly,” said Leathern, founder and chief executive of Optimal.com. Since he sold his last company, the unrelated social media analytics and ad software firm OptimalSocial, to Brand Networks, in 2013, Leathern has been mulling how to fix a “broken” online advertising industry plagued by too many annoying, bandwidth-sucking, privacy-invading, malware-carrying banner and video ads.
To address that mess, today he’s announcing plans for what he calls a “smart subscription service for all the content on the web, minus the ads.” The idea is that people could sign up to pay a yet-undetermined monthly or annual fee to see any content they want but without ads for whatever sites they choose. They could still agree to see ads from sites that are showing ads “respectfully,” meaning those that aren’t deceptive in content or how they use people’s data for targeting.
After taking a small cut of those revenues, Optimal would pay publishers according to the percentage of overall Web traffic they generate. If users upvote a publisher or its specific content using Optimal’s system, the publisher could get a higher revenue share. Either way, the intention is that publishers would get at least as much revenue as they would from these subscribers viewing ads.
“We think there’s a legitimate use case for ad blocking,” says Leathern, whose younger brother is a magazine journalist in their native South Africa. “But if publishers don’t get paid, they can’t produce good content.”
Optimal will let people start signing up starting this morning ahead of a planned early version of the consumer service in January or February.
The company aims to provide a better solution than ad blocking software such as Adblock Plus, which blocks all ads except those deemed “acceptable.” The company has been criticized for essentially letting large companies such as Google buy their way out of blocking, which it has strenuously denied.
But Leathern sees other problems with ad blockers too. One is that they can block ads that may or may not be unacceptable to a particular viewer, but the end result is that a publisher’s revenues from those users is blocked too. (One ad blocker, Peace, was pulled off Apple ’s App Store in September by founder Marco Arment because he felt it was harming legitimate publishers.) More than that, Leathern says, ad blockers address only ad formats, not the identity of either the advertisers or the publishers.
The success of Optimal’s system rests on a lot of unknowns. First is how much readers or viewers will get charged. Clearly, Leathern thinks it can be low enough to be appealing. He didn't want to do the precise math for me, so I will. He would arrive at an average figure basically by dividing the entirety of display ad revenues in the U.S., where Optimal is starting (that's $27 billion in 2015, according to eMarketer), by the number of people online (let’s say 300 million), to determine how much each person’s worth in terms of ad revenues. My math produces an even $90 a year per person.
Leathern says that’s not a bad guess, though some could pay less and some might pay more. For instance, some would pay less if they’re willing to view more ads, while others would pay up if they could get enhanced services such as Hulu Plus or YouTube Red bundled in with fewer ads.
No one will be forced to subscribe, of course, so unless a publisher prevents people with ad blocking software from viewing content, Optimal’s system won’t stop non-subscribers. Leathern admits that most people won’t want to pay for ad blocking, just as many people listen to National Public Radio even if they don’t subscribe. But he’s hopeful enough would decide to pay to be worthwhile to publishers and users alike.
Then there’s how many publishers will go along with the idea. Leathern says he has already started working with some. But many more will have to be convinced it’s worthwhile--though as Leathern points out, “if we give them anything, it’s better than zero,” which is what they currently get from readers and viewers who don’t see ads.
The company isn’t the only one mulling new ways for consumers to support publishers. In June, Sourcepoint Technologies announced a content compensation program for “premium” publishers. In other words, the company can restore blocked ads, run new ones, or insert offers to buy subscriptions to ad-blocked websites. PageFair also can run ads to people who use ad blockers.
Ultimately, Leathern hopes Optimal’s system will incent advertisers to run better ads and be more transparent about data they’re using to target people.
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48a00856e35f755269af8fd049823d05
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https://www.forbes.com/sites/roberthof/2016/01/27/with-5-million-cardboards-shipped-googles-vr-ambitions-gain-traction/
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With 5 Million Cardboards Shipped, Google's VR Ambitions Gain Traction
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With 5 Million Cardboards Shipped, Google's VR Ambitions Gain Traction
Google is starting to double down on its fledgling bets on virtual reality as the next frontier for computing, communications, and media.
Today, the company announced that some 5 million Cardboard VR viewing devices have shipped since their introduction 19 months ago at Google's I/O software developer conference. These are the cheap but surprisingly effective foldup viewers that hold a smartphone so you can view a variety of apps and videos in 3D.
Google also released a raft of other numbers indicating rising interest in Cardboard-driven VR experiences:
* More than 25 million installations of Cardboard apps, including 10 million in the past two months alone--no doubt thanks to big giveaways of Cardboards by the likes of The New York Times.
* Some 350,000 hours of VR video watched in YouTube.
* 750,000 photos taken using Google's VR camera app.
The momentum indicates that despite some folks calling Cardboard a joke compared with much more capable VR devices from Facebook's Oculus, Samsung, Sony and others, it has an undeniable appeal as a starter device.
Google has gotten more serious on the executive front as well. It recently moved former apps, VR and Gmail VP Clay Bavor (who offered some thoughts to Time magazine today) to focus solely on VR. It also recently hired Jason Toff, former head of Twitter's Vine, to its VR team.
Still, Google doesn't appear satisfied with betting everything on Cardboard. It has been advertising several new job postings for positions such as "hardware engineering technical lead manager, virtual reality," and "electrical hardware engineer, virtual reality," according to Macquarie Capital analyst Ben Schachter. In a note to clients Jan. 26, he said it's clear that Google is getting more aggressive in VR. These hint that Google is "aiming to build its own consumer VR product beyond its existing Cardboard viewers."
It's not clear that Google itself would make a business out of VR hardware, any more than it has made a business out of its Nexus smartphones and tablets, which serve more as a nudge to the rest of the industry. What's more, Google has a large investment in Magic Leap, whose augmented reality devices may be Google's longer-term bet in the field.
For now, though, the company intends to use Cardboard to get VR into the masses on the cheap. The latest numbers indicate it has made a credible start.
Meantime, if you haven't yet experienced VR and want to try out yourself, find a Cardboard on the cheap and try out the top five Cardboard apps on Google Play:
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5439aac11043cb25178c34e803f1a0d2
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https://www.forbes.com/sites/roberthof/2016/02/02/the-biggest-challenge-in-yahoos-turnaround-plan/
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The Biggest Challenge In Yahoo's Latest Turnaround Plan
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The Biggest Challenge In Yahoo's Latest Turnaround Plan
Another new year, another Yahoo turnaround attempt. But this one may be the toughest of all to pull off.
Today Yahoo announced plans alongside its fourth-quarter earnings report to proceed on a three-track strategic plan in response to shareholder demands. First, the company will cut 15 percent of the workforce--I mean, "changes in the employee footprint," as Yahoo so eloquently put it--as it exits or cuts back on everything from games and TV initiatives to once-promising services such as Flickr and digital magazines.
Second, it will look into spinning off the core business plus its stake in Yahoo Japan , keeping only its $30 billion stake in Alibaba . (Though a company called Yahoo that is comprised only of a bunch of shares in a Chinese company still sounds odd.)
And third, it's open to fielding offers to buy Yahoo outright. (Hello, Verizon. Or is it AT&T? Or News Corp.?)
Here's the central problem: human nature. If you work at Yahoo and you know the company is getting shopped around to unknown buyers, how hard are you going to work on a plan that, in all likelihood, won't make a bit of difference to a new owner who will, in all likelihood, slash and burn half of what you just did?
I'm sure there are people who would work plenty hard anyway, because they're happy or at least not unpleased to have a job at a time when layoffs are mounting throughout tech and startups suddenly don't look so hot anymore. If you're battling Silicon Valley traffic to get into the office every day, why not actually do something while you're there?
It's hard to begrudge Mayer, the Yahoo board, and whatever bleeding-purple employees remain their desire to keep a Valley icon alive if it's at all possible. If Microsoft had bought the company years ago, investors would have been happy, but whatever remained of Yahoo would have withered and died under a company that has never understood the media business. How depressing is that?
Still, you can't ignore human nature, and human nature is not to work hard on something that probably won't matter. Especially if you've done this fire drill a few times already, with little to show for it. And this time, you wouldn't blame them for thinking that maybe this latest plan, with all its staff cuts, product shutdowns, and asset sales, is just a sprucing-up to look better to a buyer.
For their part, analysts appear doubtful about the prospects for a turnaround. "Given that we have covered the stock for 15+ years now, let’s just say that we are not going to give them the benefit of the doubt on this one," Macquarie Research analyst Ben Schachter wrote in a note to clients. Others think that activist shareholders will wage a proxy fight if Yahoo isn't sold before the turnaround even has a chance. "We are generally doubtful that it will be seen through by the current management team (or the current board)," Pivotal Research analyst Brian Wieser said in a note to clients.
When one analyst noted on the earnings conference call that it's pretty complex and time-consuming to pursue all three plans at once, CEO Marissa Mayer conceded that Yahoo's situation is "complex" and so is execution of the strategic plan.
But she said that the most important job is the turnaround attempt, because "that's what unlocks the most shareholder value" in the event of a spinoff or sale. That's why, she said, "Most people here need to be focused on executing the plan."
And that's the problem. They're going to be focused on just about everything else: Will I have a job in three months? Will I be working for someone else in six months? Where should I send my resume next? How about I get another cup of coffee?
And so, it may be only a matter of time before Yahoo is in fact spun off or sold--either way, heading from near-irrelevance to oblivion.
That matter of time could take awhile, though. Chief Financial Officer Ken Goldman said a "reverse spin," as the spinoff of Yahoo's core business is called, would take nine to 12 months. Perhaps that provides just a bit more time for Mayer's new plan to start showing enough results, to either hold off the activist shareholders or at least to extract a dearer price for a spinoff valuation or sale price.
But it's almost certainly not enough. The company says its four-point plan is expected to return Yahoo to "modest and accelerating growth in 2017 and 2018."
Except it's 2016. And it seems increasingly unlikely that investors will give Mayer and Yahoo yet another year to prove what it hasn't been able to show for the past four: a reason to remain independent.
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c592ed1841723bcd28342a45dfe8e39a
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https://www.forbes.com/sites/roberthof/2016/04/06/ceo-tom-reilly-makes-the-case-for-cloudera-and-its-ipo/
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CEO Tom Reilly Makes The Case For Cloudera - And Its IPO
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CEO Tom Reilly Makes The Case For Cloudera - And Its IPO
Tom Reilly, chief executive officer of Cloudera (Photo: Matthew Busch/Bloomberg)
Ever since Tom Reilly joined Cloudera as chief executive in June 2013, he has faced speculation that he was brought in to spruce up the pioneering distributor of Hadoop cloud analytics technologies for a sale.
Those doubts have persisted, despite talk until the recent market volatility about Cloudera as one of the next hot IPOs. The skepticism is thanks partly to the recent travails of Hortonworks, a direct rival whose shares plummeted after it announced plans for a $100 million secondary stock offering in January, and Tableau Software, whose shares plunged by half in February when the company reduced its revenue outlook.
But in a recent interview at the Strata + Hadoop World, the conference in San Jose that Cloudera runs with O’Reilly Media, Reilly insisted he has no intention to sell Cloudera. Instead, he's still looking to an initial public offering--though not in this volatile market.
Although Cloudera isn’t yet profitable, Reilly reckons it has plenty of cash to get there, and he thinks cloud software is finally proving itself with use cases that corporate boardrooms can understand--and pay for. Here’s an edited version of the conversation:
Q: There are a lot of companies with overlapping capabilities here at this show, but it seems like there’s a bit of a struggle for many of them to make money. Does that cloud of companies, as it were, make the opportunity tougher for Cloudera?
A: I have a different view of that. There are 100-plus companies here, and every one of them is very well-funded. The funding’s going because this is one of the largest, fastest-growing areas of spend in enterprise software. There’s a large land grab going on to capitalize on this opportunity.
It’s just the past five to seven years the world has become hyper-connected. It’s that interconnected world that is creating tremendous opportunity, or threats, for traditional enterprises. So if they want to re-engineer their business for the interconnected world, that means they have to get their arms around all the new idea sets. If you’re an auto manufacturer and you’re not building a connected car, you’re in trouble. So auto manufacturers are becoming data management companies.
Q: But a lot of the revenues so far have gone to the big guys such as IBM, Oracle, Microsoft. The big seem to be getting bigger, so what’s the role for the smaller companies here, and the early innovators like Cloudera?
A: We in the industry eat our own. We’re here to compete with the IBMs and the large players. But both the big guys and the startups are embracing Hadoop in this new era of computing. The embracing by the large guys is expanding the market by validating it. And it creates the opportunities for the next tier of players, like Cloudera.
Q: Where do you see your biggest opportunity for Cloudera and generally where are the biggest pools of value to be created around Hadoop and open source enterprise generally? Are apps on top of Hadoop the biggest opportunity?
A: Back in 2014, we spent a lot of time talking about animals in the zoo--Zookeeper, Pig, Impala--the technologies. In 2015, the conversation advanced and we talked about the collection of animals as a thing--a data hub, or what some call the data lake--to indicate to CIOs how all this fits into your data lake landscape.
What we’re seeing now in 2016 is the emergence of the boardroom use cases. They come down to customer insight, Internet of Things data-driven products and services, lowering business risk. And we’re mapping those to particular industries. You’re not going to turn to legacy solutions to solve these problems, because they involve new data sets. Hadoop is designed for that data set.
Q: How far along are you or your partners in developing the applications on top of Hadoop?
A: I don’t think we’ll see packaged applications like we did with the last set of enterprise technologies. Take usage-based insurance: The algorithms that determine what your product will be when you say “pay when you drive” will be the competitive advantage. So the last thing they want to do is buy packaged algorithms. They’re going to want to have their data scientists create their own and use that as a competitive advantage.
What we do is package as much of the building blocks as we can but then give them the tools to determine their specific offerings. We work with partners who are experts in each vertical industry--healthcare, transportation, financial services.
Q: What about direct sales or working with big integrators such as Accenture?
A: We have 2,200 partners--infrastructure providers such as hardware and cloud providers, tools providers such as data management, analytics partners such as Tableau, Qlik, SAS, and consulting groups such as Accenture. What our sales force does is assemble a team of partners for almost every opportunity. When a partner is attached to one of our projects, it tends to be larger and more successful faster.
Q: How big is Cloudera’s sales force?
A: We don’t give out those numbers, but we have surpassed 1,200 employees. There are more than 20,000 enterprises using our software globally. We have proprietary software on top of the core open source, and we license that software to more than 825 large enterprises. About 75 percent to 80 percent of our revenues are software licenses, 15 percent 25 percent professional services, and 5 percent to 10 percent training.
Q: There’s a lot of services businesses in open source.
A: Yes, but services businesses are not high-margin. That’s why we sell software. Investors want to invest in software companies, not services companies.
Q: Which raises the question of how investors are looking at your company. What does Fidelity’s recent 38 percent reduction of the estimated value of its Cloudera investment say about Cloudera or the broader industry?
A: It says nothing about the state of the company, because they have no data about our performance. The macro markets have changed and they’re adjusting their portfolios down. Every public company’s valuation is down. The fact that they elect to change their estimated valuation of a private company is just conservatism on their part.
Q: Does that conservatism have any impact psychologically on customers?
A: No.
Q: Because a lot of people also look at Hortonworks and Tableau shares getting hit recently. Are customers wary as a result?
A: Let’s take Fidelity. Even after it marked down its investment, it’s still significantly up from what it paid. They’re very happy.
We’re not focused on it. We’re not a public company. We’re fully funded through profitability.
Q: But not profitable yet?
A: We have more than enough cash to become profitable. We’re not dependent on the public markets for financing. In three-four-five years, we’re going to be immensely valuable. I’m looking at our growth rates, I’m looking at the customers we have, I look at this event, the momentum behind this industry, and we’re the market leader.
Q: There’s some perception that you were brought in to sell Cloudera at some point.
A: No. I hope this is my last job. And I hope to work a very long time.
In fact, the last company I ran was a public company [ArcSight], that was acquired by Hewlett-Packard. I learned something in that process. I didn’t want to sell that company. Were I running it today, it would be an amazingly large company. But the minute you’re a public company, there’s a for-sale sign out. If someone wants to come along and pay you a premium … and you say no, your shareholders are going to be very upset. Private companies can say no.
We’re building a lasting, enduring enterprise software company.
Q: Obviously there are advantages to going public--access to capital, a presence. Red Hat has gotten attention not only from going public but getting to $2 billion in annual revenues. Is that ultimately your goal?
A: Yes. We fully intend to be a public company. We’re just fortunate that we can do it on our timing, when we’ve reached the right scale, when the business is more predictable, when there’s greater visibility.
We are of a size and scale today to be a successful public company. We’re operating well enough to be a well-run public company. It’s not a market that we’d want to enter as a public company right now.
Q: So that big slug of funding in 2014 [$900 million, including $740 million from Intel] really helped?
A: The Intel partnership has really improved our company and our operations. We have a good three- to five-year visibility into what’s coming in the silicon and they want our software to be optimized and designed to take future advantage of their silicon. Their hardware engineers interview our data scientists. They say, if you’re doing an anti-money laundering use case or a next-best-offer use case, how do you write your algorithms?
It turns out data scientists use a lot of subroutines consistently, so their hardware engineers go, if we can write an instruction set in the chip that can automate that part of it, we’re accelerating the performance. It’s Intel’s goal that if you design hardware and software together, you can get upwards of an 8X multiplier on Moore’s Law.
Q: How do you navigate the uncertainties of customers over whether to use public cloud versus private clouds versus hybrid clouds?
A: Public cloud is our fastest-growing environment. Our overall business is roughly doubling. Our cloud business is double that [growth rate]. It may be 15 percent to 20 percent of our customer workloads today. Most of our customers are operating in a hybrid environment.
Those new data sets--mobile, social data--that is being generated outside the data center, in the cloud. You want to marry it with data in your own data center, like customer contracts, historical records, customer support cases.
Data has mass. Data that’s created in your data center wants to stay there. It’s hard for banks or healthcare companies to put it in the cloud. But data that originated in the cloud also has mass and wants to stay in the cloud. All the new data is in the cloud.
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3b4296a2b20d67c6bd54c212bdad70e7
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https://www.forbes.com/sites/robertkidd/2018/10/29/english-premier-league-week-10-review-5-things-we-learned/
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English Premier League Week 10 Review: 5 Things We Learned
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English Premier League Week 10 Review: 5 Things We Learned
Tributes outside Leicester City Football Club after a helicopter carrying owner Vichai... [+] Srivaddhanaprabha and four others crashed on Saturday. Mr Srivaddhanaprabha, two members of his staff and the pilot and a passenger all died. (AP Photo/Rui Vieira).
From the tragedy that has shaken soccer to the team that lost its winning run, here are five things we learned from the weekend’s Premier League action.
Tributes flow for Leicester City owner
There are plenty of things that are more important than soccer and, after news the Leicester City owner and four others had died in a helicopter crash, the weekend’s action suddenly felt insignificant. Vichai Srivaddhanaprabha, the Thai billionaire who bought Leicester City in 2010, was well-loved at the club and oversaw the remarkable, 5,000-1 shot title win in 2016.
Leicester captain Wes Morgan led the tributes to Mr Srivaddhanaprabha. “Absolutely heartbroken and devastated regarding the news of our chairman,” the center-back tweeted. “A man that was loved and adored by everyone here at lcfc."
Arsenal winning run ends at Palace
Yesterday’s matches went ahead after a minute’s silence, with Arsenal looking to extend their winning run to 12 matches at London rivals Crystal Palace. Palace have only won twice this season but fought hard to come back for a 2-2 draw and a deserved point.
Arsenal will be disappointed their winning run is at an end but manager Unai Emery was understandably relieved to take a point. Alexandre Lacazette clearly touched the ball with his hand for Arsenal’s second goal and, though both Palace goals came from penalties, this was not a match the Eagles deserved to lose.
Chelsea purring under Sarri
Arsenal stay in fourth but Chelsea moved up to second after a comfortable 4-0 win at Burnley (Spurs play Manchester City tonight). Burnley haven’t had a great start but Turf Moor has been an uncomfortable stadium to visit for the big clubs in recent years. Yesterday Chelsea – without the injured Eden Hazard who has made such an impressive start to the season – had no problems.
It was the second bad week in a row for Burnley keeper Joe Hart, who could do nothing about any of Chelsea’s four goals (from four different scorers). Midfielder Ross Barkley, signed from Everton in January, seems to be loving life under Maurizio Sarri and yesterday scored for the third match running while adding two assists. Sarri is now the first Chelsea boss to go unbeaten in his first 10 matches.
Plenty of penalty debate
Perhaps the only negative for Chelsea was a penalty box dive by the otherwise excellent Willian, who was rightly booked. The three matches yesterday brought four penalties and plenty of discussion. For me, the two awarded to Palace were correct and Everton’s penalty at Manchester United was the clearest you’ll ever see. In the same match though, Idrissa Gana Gueye was unlucky to be penalized for a challenge on Anthony Martial where he clearly touched the ball.
The referees got most decisions right this weekend but it still surprises me there is resistance to introducing VAR, as the evidence suggests it would help referees, not hinder them. A final point on penalties – surely soccer’s lawmakers could do a lot worse than clarify the rules around penalty run-ups. Paul Pogba’s 26-step run for his penalty against Everton was silly. Even though he missed (and scored the rebound), in my opinion approaches like this give the kicker a bigger advantage in a situation where odds are already stacked against the keeper.
Wonderful Watford proving me wrong
Watford’s 3-0 win over Huddersfield on Saturday was their sixth of the season, putting them seventh and three points off the Champions League places. After each of their wins, a friend has mercilessly reminded me of my pre-season prediction that Watford would be relegated.
After a great start, the Hornets had a sticky spell of one point from four matches, including a 4-0 home defeat to Bournemouth. But they have recovered with two wins on the bounce without conceding a goal and Argentine forward Roberto Pereyra has burst into form with two stunning goals in his past two. There’s plenty of time left but if he and his team keep performing, my prediction will be well and truly wrong by season end.
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75f23d53e21678cffe78a810d6dfb0ee
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https://www.forbes.com/sites/robertkidd/2018/11/05/english-premier-league-week-11-review-5-things-we-learned/
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English Premier League Week 11 Review: 5 Things We Learned
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English Premier League Week 11 Review: 5 Things We Learned
Manchester City's Leroy Sane, front left, celebrates after scoring his side's sixth goal during the... [+] English Premier League soccer match between Manchester City and Southampton. It was the 12th time City have scored five or more in a match since manager Pep Guardiola arrived. (AP Photo/Rui Vieira).
From the club who have finally won to the team who love playing promoted clubs, here are five things we learned from the weekend’s Premier League action.
Growing gap between the big boys and the rest
Manchester City thrashed Southampton 6-1 yesterday to return to the top of the league. The match was over after 18 minutes, with City already 3-0 up. It is the 12th time City have scored five or more in a match since manager Pep Guardiola arrived. Chelsea also won, against Crystal Palace, meaning the top three (Liverpool are third) are all unbeaten after 11 matches. At the other end, Southampton are 16th – two places outside the relegation zone – despite picking up one win and conceding 20 goals.
Domestic dominance is one of the reasons some favor a controversial European Super League where, the theory goes, the biggest clubs would have more competition (and more money). The idea has again been in the headlines thanks to leaks provided to DER SPIEGEL. The backlash to the leaks suggests the big clubs will have to think a bit harder about any breakaway league, but, in the Premier League at least, it will be a shock if one of the current top three are not champions by season end.
Leicester pay emotional tribute to late owner
After the death of their owner and four others last week, most neutrals were rooting for Leicester in their match at Cardiff City. Before the match, the entire Leicester bench joined players at the center circle for a minute’s silence after a tragedy that has affected everyone at the club.
Demarai Gray got the only goal of the game (then an unfortunately inevitable yellow card after revealing a t-shirt tribute to the late chairman) to give Leicester an emotional win. Leicester keeper Kasper Schmeichel has clearly been deeply touched by the death of Vichai Srivaddhanaprabha and admitted afterwards “mentally it was a tough game for all of us”. “Everybody wanted to win for him and his family,” the goalkeeper said.
Arsenal show steel
Arsenal lost their winning run with a draw at Crystal Palace last week so another draw this weekend might not seem ideal. But the Gunners impressed in an entertaining 1-1 draw with Liverpool. Both sides entered the match in fine form and attacked with a desire to win. It looked like James Milner’s goal had given Liverpool a valuable before Arsenal fought back for a deserved point.
James Milner is worth an extra mention as he continues to excel for his club. This was his 50th Premier League goal but the midfielder, 32, has so much more to his game. After the match his manager Jurgen Klopp compared Milner to a “fine wine” and it’s true he only seems to be getting better with age.
First win for Newcastle
A rocky start and continued off-field uncertainty has given Newcastle fans plenty of reason to be pessimistic so far this season. But the Magpies are off the mark after picking up their first win, at home to Watford. The hosts rode their luck in the 1-0 win but climbed to 17th – a point and a place outside the relegation zone (Huddersfield play Fulham tonight).
Watford have started the campaign in great form and shouldn’t be too worried even though they will have been frustrated to leave Saturday’s match with nothing. Watford had plenty of chances, including hitting the bar, and really should have won the match. If they keep playing this way they will keep picking up points.
Spurs love playing promoted clubs
One of the weekend’s more startling statistics was that Spurs are unbeaten in their last 39 matches against promoted clubs, including 36 wins. The latest came at Wolves on Saturday where Spurs triumphed 3-2. It was Spurs’ third game in six days and, with Erik Lamela again impressing, a valuable win to keep pace at the Premier League summit.
Wolves kept going and did well to get back to 3-2 after being 3-0 down. But, while Wolves have won plenty of plaudits for their football and start to the season (including a home draw with Man City and away point at Man United), they have lost their last three. A bad run can quickly drag you down in this league and it doesn’t get easier for Wolves – they play Arsenal next.
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a5c14085aae7dcdb4db21ba9e4b977a1
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https://www.forbes.com/sites/robertkidd/2019/05/30/visa-make-substantial-investment-to-support-womens-soccer/
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Visa Makes 'Substantial Investment' To Support Women's Soccer
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Visa Makes 'Substantial Investment' To Support Women's Soccer
World Cup squad members Adrianna Franch, Becky Sauerbrunn, Jessica Mcdonald, Abby Dahlkemper and... [+] Rose Lavelle will feature in Visa's new marketing campaign. Visa
Visa has announced a “substantial investment” in the future of women’s soccer, including a five-year partnership with the U.S. Soccer Federation.
Eight days before the Women’s World Cup begins in France, Visa revealed it would partner with both the Women’s and Men’s U.S. National Teams. However, it said the terms of the deal ensured “at least 50%” of the investment would fund the USWNT and women’s soccer programs and surrounding marketing efforts.
Jay Berhalter, chief commercial officer, U.S. Soccer, said the partnership would aid the federation’s goal of developing “world class players, coaches and referees, and increasing fan engagement”.
“With Visa joining us in our long-term investment in women’s soccer, we will continue to increase opportunities for women players, coaches and referees at all levels,” he said.
The deal – which Visa would not disclose the value of – will see the company become the presenting sponsor of the SheBelieves Cup, an annual four-team international invitational tournament in the U.S.
USWNT co-captain Megan Rapinoe will be the latest player to join Visa's roster of athletes. (Photo... [+] by Rich Graessle/Icon Sportswire via Getty Images). Getty
And the financial services brand will also launch a new U.S. marketing campaign featuring World Cup squad members Adrianna Franch, Jessica Mcdonald, Rose Lavelle, Abby Dahlkemper and Becky Sauerbrunn.
It also announced USWNT co-captain Megan Rapinoe would join Visa’s “roster” of athletes and that Visa will be the first brand partner of the Player of the Match award at the FIFA Women’s World Cup.
“Women athletes and women's sport in general are underrepresented in marketing and in promotion and that contributes to gender inequality. So we want to make sure we are helping to close that gap,” Mary Ann Reilly, SVP of North America Marketing at Visa, told me in a phone interview.
“We're putting our money behind causes and partners that we believe in and we believe in women's soccer and supporting the women's national team and She Believes Cup.”
Visa will be the first brand partner of the Player of the Match award at the FIFA Women’s World Cup. Visa
The announcement comes as a growing number of brands are investing in women’s sport ahead of the World Cup.
Visa’s investment in women’s soccer already includes partnerships with the Women’s World Cup, U-17 Women's World Cup and U-20 Women's World Cup. In December, Visa agreed a deal with European soccer’s governing body, UEFA, to sponsor Uefa's women's football tournaments until 2025.
“The inspiration behind our support of women and women’s empowerment is focused on inspiring women in both sports and in the boardroom,” Reilly said.
“Visa Stands behind our values and we believe women and men should be given equal opportunity and equal pay.
“Brands can and should make a stand by making decisions that reflect their values and this is one of our values.”
The issue of pay equality in soccer was highlighted in March, when 28 USWNT players sued U.S. Soccer over pay equity and working conditions, citing “institutionalized gender discrimination”. U.S. Soccer has denied the accusations of gender discrimination.
The pay gap between men’s and women’s soccer is reflected in the prize money awarded to teams in their respective World Cups.
The total prize money for this summer's Women's World Cup has doubled from 2015, when the USWNT won,... [+] but is still far less than the prize pool for the men's tournament. (ASSOCIATED PRESS Photo/Elaine Thompson, File).
Prize money for last year’s men’s World Cup totalled $400 million for the 32 competing teams, with winner France receiving $38 million. The prize fund for the 24 teams at this summer’s Women’s World Cup has doubled from 2015, to $30 million.
Visa is a major sponsor of both the men’s and women’s World Cups. Asked if the company had raised the issue of the difference in prize money with world soccer governing body, FIFA, Reilly said she could not disclose “anything around our contractual agreements”.
“But I will say that this year we're making our biggest investment in women's soccer ever,” she said.
“We're doing our part in closing the gap in the investment in women in sport and their opportunity to be promoted and get sponsorship.
“So that's the part that we're playing and what we feel like we have the ability and the obligation to do as a brand.”
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2463760d45ff420dbc4a7345bda6426c
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https://www.forbes.com/sites/robertkidd/2019/08/08/premier-league-transfer-window-grading-each-teams-summer-business/?sh=3c1dc74a1d5e
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Premier League Transfer Window: Grading Each Team’s Summer Business
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Premier League Transfer Window: Grading Each Team’s Summer Business
Tanguy Ndombele became Spurs' record signing. Spurs were one of 10 clubs to break their transfer ... [+] records this transfer window. (Photo by Tottenham Hotspur FC via Getty Images/Tottenham Hotspur FC via Getty Images via Getty Images) Tottenham Hotspur FC via Getty Images
The English Premier League transfer window has slammed shut after another frenzy of spending. Some fan-favorites have left but plenty of big names have arrived as half of the 20 clubs broke their transfer record. Here’s a look at how each club performed in this summer’s transfer market.
Arsenal
The Gunners have a potent-looking attack after spending a record $89.7 million on winger Nicolas Pepe. The loan signing of Dani Ceballos from Real Madrid could prove another shrewd move, though he will need to hit the ground running to make up for the loss of Aaron Ramsey. After former captain Laurent Koscielny left the club under a cloud, Arsenal look short at the back, even after signing Scottish left-back Kieran Tierney and centre-back David Luiz.
Grade: B
Aston Villa
Villa are banking on more than $121m’s worth of new talent to keep them in the Premier League. It’s been an intriguing recruitment drive from the club, mixing players with Premier League experience – like Tyrone Mings and Matt Targett – with promising youngsters like Egyptian winger Trezeguet and Brazilian forward Wesley. Fans may well feel the best piece of business was keeping hold of influential midfielder, Jack Grealish.
Grade: B
Bournemouth
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A relatively quiet window for Bournemouth, with the club focusing on buying younger players. One of those, Philip Billing, performed well for Huddersfield last season, despite their relegation. Winger Harry Wilson, signed on loan from Liverpool, impressed during another loan at Derby last season and should be ready to step up to the Premier League.
Grade: C+
ST ALBANS, ENGLAND - AUGUST 07: Nicolas Pepe of Arsenal during the Arsenal Media Day at London ... [+] Colney on August 07, 2019 in St Albans, England. (Photo by David Price/Arsenal FC via Getty Images) Arsenal FC via Getty Images
Brighton
New manager Graham Potter has put his faith in youngsters in the hope of keeping of Brighton in the Premier League after they narrowly avoided relegation last season. The club paid more than $47m for two Championship players – centre-back Adam Webster and striker Neal Maupay. A deadline day loan signing of Aaron Mooy is smart business and so is keeping hold of Leicester City-linked defender Lewis Dunk.
Grade: C-
Burnley
A tough campaign last season for Burnley hasn’t tempted boss Sean Dyche to splash too much cash. He’s brought hometown hero Jay Rodriguez back to the club, but the modest fee makes it a gamble worth taking on the striker. Danny Drinkwater arrives on loan with a point to prove, having barely played for Chelsea.
Grade: C-
Chelsea
Unable to sign players due to a transfer ban, this was always going to be a tough window for Chelsea. It was made that much harder when star man Eden Hazard departed for Real Madrid. But new boss Frank Lampard does have US attacker Christian Pulisic raring to go (after being signed then loaned out in January) and young midfielder Mason Mount could be ready to make an impact.
Grade: C-
MOENCHENGLADBACH, GERMANY - AUGUST 03: Stefan Lainer of Borussia Moenchengladbach and Christian ... [+] Pulisic of FC Chelsea battle for the ball during the pre-season friendly match between Borussia Moenchengladbach and FC Chelsea at Borussia-Park on August 3, 2019 in Moenchengladbach, Germany. (Photo by TF-Images/Getty Images) Getty Images
Crystal Palace
A few safe signings from Roy Hodgson with James McCarthy, Jordan Ayew and Gary Cahill all arriving with plenty of Premier League experience. Victor Camarasa joins on loan after a promising spell with Cardiff last season. Palace lost one of their two big stars when Aaron Wan-Bissaka moved to Manchester United. The other, Wilfried Zaha, wanted to move but Palace didn’t receive a high enough bid. How he reacts will likely determine Palace’s success this season.
Grade: D
Everton
Everton have made some really interesting additions as manager Marco Silva looks to put his stamp on the squad. Moise Kean, the 19-year-old striker from Juventus, is an excellent prospect, and many were surprised the Italian giants would let him leave. Alex Iwobi’s expected arrival from Arsenal is another that should get fans excited. The downside of the window was losing midfield lynchpin Idrissa Gueye, but potential replacements signed include Fabian Delph, Andre Gomes and Jean-Philippe Gbamin.
Grade: B
Leicester City
Leicester started the window with a couple of useful signings in midfielder Youri Tielemans, who impressed on loan last season, and striker Ayoze Perez from Newcastle. But they have a Harry Maguire-shaped hole in their defence after selling the centre-back to Manchester United for a record fee. Brendan Rodgers surely would have liked to have spent some of that money on a replacement.
Grade: C
Liverpool
European Cup holders Liverpool had one of the quietest transfer windows and after their performance last season, who can blame them? The club have kept hold of their stars and will ask them to back up last season’s fine run when they lost the title by a single point. The only arrivals of note are Sepp van den Berg, a 17-year-old centre-back, and back-up goalkeeper Adrian.
Grade: C+
HALEWOOD, ENGLAND - AUGUST 3: (EXCLUSIVE COVERAGE) Moise Kean poses poses for photo with Davis ... [+] Harrison after signing for Everton at USM Finch Farm on August 3, 2019 in Halewood, England. (Photo by Tony McArdle/Everton FC via Getty Images) Everton FC via Getty Images
Manchester City
Like Liverpool, City didn’t like a club that needed too much strengthening. But they have managed to spend around $187m on a few precious new recruits. Defensive midfielder Rodri is one of those, arriving after an excellent season for Atletico Madrid. João Cancelo, a right-back, joins from Juventus and will likely challenge Kyle Walker for a first-team place.
Grade: B
Manchester United
A strange window for United, who have recruited well in defence but look a little short in other areas. Ole Gunnar Solskjaer has the new-look backline he wanted after signing Wan-Bissaka and, eventually, Maguire but the loss of Ander Herrera without replacement has fans worrying about depth in midfield. Romelu Lukaku joined Inter Milan for a healthy fee after making it clear he wanted to leave, so United will need to rely on others for goals this season.
Grade: C
Newcastle United
Losing Rafa Benitez as manager and replacing him with Steve Bruce has not gone down well with Newcastle fans and they will be feeling even more nervous after the window closed. Losing last season’s top scorer Ayoze Perez is a blow and his replacement is Joelinton, a 22-year-old untested in England. Andy Carroll on a free transfer may not be as desperate as it seems – if the big man can stay injury free.
Grade: D
Norwich City
Norwich won the Championship comfortably last year but you still have to admire the club’s confidence in preparing for the Premier League. The Canaries have only spent a few million dollars, choosing to rely on the squad that secured them promotion. Time will tell if that decision is inspired or asking for trouble.
Grade: C-
MILAN, ITALY - AUGUST 08: New FC Internazionale signing Romelu Lukaku poses for a photo during on ... [+] August 8, 2019 in Milan, Italy. (Photo by Claudio Villa - Inter/Inter via Getty Images) Inter via Getty Images
Sheffield United
Following Villa’s lead – rather than Norwich’s – promoted Sheffield United have brought 10 new faces to Bramall Lane. Strikers Oli McBurnie, signed from Swansea City for $21m, and Lys Mousset, from Bournemouth for $12m, could be crucial in whether the Blades survive in the top flight. Loan signing Muhamed Besic brings experience and midfield stability, while free transfer Ravel Morrison has a point to prove.
Grade: C+
Southampton
Danny Ings scored seven league goals for Southampton last season to help the club avoid relegation. And that crucial contribution has been rewarded with a permanent transfer. Promising striker Che Adams arrives from Championship side Birmingham and winger Moussa Djenepo from Standard Liege. Other than that, the club is keeping faith with last season’s squad. Will the gamble pay off?
Grade: C-
Tottenham
Spurs were getting a reputation for stinginess having not signed a player since January 2018. But this summer they have put their money where their mouth is, breaking the club transfer record to sign all-action midfielder Tanguy Ndombele. On deadline day he was joined by young full-back Ryan Sessegnon and creative midfielder Giovani Lo Celso. For a while it looked like another Argentine, Paulo Dybala, might sign too, but ultimately Juventus decided not to sell. Dane Christian Eriksen could still leave while the La Liga transfer window is open.
Grade: B
Watford
Senegal international Ismaïla Sarr is the star signing for Watford and the club have pulled off a coup in securing one of the highest-rated young forwards in Europe. He cost a club-record $33.5m. Watford surprised a few people with how well they performed last season and will be delighted they have kept hold of the key members of their squad despite plenty of interest.
Grade: B
West Ham
After selling Marko Arnautovic, West Ham need goals from somewhere and have focused on boosting their attacking options with their summer signings. The club paid $44.7m to secure the services of French striker Sebastien Haller and have also brought in attacking midfielder Pablo Fornals. Another forward, Albian Ajeti, arrived on deadline day.
Grade: C
Wolves
Wolves moved quickly to sign last season’s player of the year Raul Jimenez on a permanent deal and have also signed Leander Dendoncker to compete for a place in an already-impressive midfield. Wolves didn’t sell anyone they didn’t want to despite an excellent first season back in the top flight and also added a couple of exciting youngsters, including striker Patrick Cutrone from AC Milan.
Grade: B+
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7f71537364a449feeb2dc8aafe28d777
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https://www.forbes.com/sites/robertkidd/2020/04/17/why-this-company-is-making-data-analysis-a-language-sports-can-understand/
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This Company Is Making Data Analysis A Language Sports Can Understand
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This Company Is Making Data Analysis A Language Sports Can Understand
Joe Cole and James Milner, seen here playing for Chelsea and Aston Villa respectively, have invested ... [+] in Apollo, a sports data management platform. (Photo by Richard Heathcote/Getty Images) Getty Images
Joe Cole knows how fine the margins are between success and failure.
In a 20-year playing career, the former Chelsea and England soccer player won Premier League titles, played in a Champions League final and played (and scored) at a World Cup.
And, as teams searched to find that winning edge, Cole saw firsthand soccer’s move to an increasingly scientific approach.
“We were in the era where mistakes were made, when we were trying to get to grips with (sports science). I saw a lot of good things and I saw an awful lot of bad things,” Cole, who made his debut aged 17 in 1999 for West Ham United, told me in an interview.
“The reason football’s the beautiful game is because it’s not easy to quantify statistically … it’s the most popular game because anything can happen. Sports science is constantly changing so you want to be at the forefront of it.”
His interest in the area has seen Cole invest in Apollo, a company that offers teams across any sport a fully customizable data management system.
The mobile software provides clubs – and individual athletes – with sporting performance data and analysis, delivered quickly in an accessible and visually engaging format.
“Individual players now, more and more, see themselves as an individual product within a team and there’s a desire to be the best,” Cole said.
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“The margins in top level sport are minute so you have to use the science.”
Apollo is the brainchild of Dave Hancock. A former head of physiotherapy at Leeds United, Chelsea (where he met Cole) and the England national team, Hancock has more than 20 years’ experience working in strength and performance roles in soccer, rugby and basketball. He came to the US in 2008, after being headhunted to be the Performance Director of the New York Knicks.
Apollo, which Hancock serves as chief executive, was originally set up in 2006.
“I was one of the cofounders of Apollo with Ram Mylvaganam, the guy who created (UK sports analysis firm) ProZone,” Dave told me.
“When I was at Leeds United, I had this situation where I was using multiple different platforms to do different jobs. I was in one system to do medical, another system to look at heart rate and other systems to look at the video analysis of the games. I thought ‘this is crazy. I'm coming in and out of all these different systems, I should have one system to go into’.”
Dave Hancock helps Chelsea goalkeeper Petr Cech off the pitch during his role as head of physio at ... [+] Chelsea. (Photo by Darren Walsh/Chelsea FC Via Getty Images) Chelsea FC via Getty Images
About three years ago, Hancock took over the company and launched Apollo V2, a new system designed to cater for any team, regardless of how specific its needs are.
Working with “a blank canvas”, he spent six months investigating the market and building a development team.
“I basically opened up my black book and spoke to everyone I knew in the world of sport, which is quite a lot of people,” he said.
The team includes Dr Tony Strudwick, the former head of performance at Manchester United, and Sean O’Donoghue, the ex-head of IT at Madison Square Garden and DreamWorks. As well as Joe Cole, Liverpool midfielder James Milner is also an investor in Apollo.
“We sat down and drew out the pluses and negatives of all the existing systems,” Hancock said.
“And we made a list of what it is that teams want now and what will they want in the next 10 years.”
The resulting software took nearly three years to build at a cost of $4 million. Hancock said it provides a foundation for any sports organization to “build their house however they want it to be built”.
Joe Cole using the Apollo system during his time as a player and assistant coach at the Tampa Bay ... [+] Rowdies. Apollo
A key sell is that any existing software currently used by a team can be built into the Apollo program, so clubs don’t need to change how they work. Apollo promises its system will reduce silos and increase efficiency with all data automatically uploaded from any mobile device and stored in the cloud.
It also aims to empower those who collect and record athlete data, by translating it into a format the ultimate decision maker can understand.
“If you are collecting data and it is not influencing a change, you shouldn’t be collecting it,” Hancock said.
“Sometimes if you’re the data scientist or the analyst, you’ll produce a report and give it to the coach and the coach will look at it and then forget it.
“But if that report is visual, simplistic, and in a format they understand, the coach is going to make that change.”
As well as allowing players and clubs to quickly see strengths and areas for improvement from games or strength training, for example, machine learning algorithms predict potential injuries and highlight areas where performance can be enhanced.
Using the Apollo app, a coach can assess a player on any metric they choose within seven seconds.
Hancock said Apollo’s clients had already seen the benefits of the software. The Washington Nationals and LSU Tigers won the World Series and National Championships, respectively, while using the Apollo system last year. Other clients include Manchester United.
Cleveland Browns wide receiver Odell Beckham Jr., a client of Hancock’s, has been using the app to track his stats during the NFL off season.
“It has been a great system to communicate with my trainers during my rehabilitation, especially in the current climate,” he said.
An example screenshot from the Apollo app which Odell Beckham Jr is using to train during the ... [+] offseason. Apollo
A grassroots arm of the company, Apollo Youth, has also been established with a mobile platform allowing coaches to give personalized feedback to players.
Whether a youth player starting out or an athlete at the top of their game, Hancock hopes the technology will ultimately help teams and individuals to improve.
“This is my dream. I’ve invested over $1 million into this, I’m all in,” he said.
“I’ve been fortunate enough to have had an incredible career. I’ve worked with the most amazing athletes in the world and won trophies.
“I’ve seen how technology can actually help people but I don’t think it’s where it needs to be. That's what I'm trying to improve.”
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6b50694cf566a78b2ba81f2c45666684
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https://www.forbes.com/sites/robertkidd/2021/03/29/inside-right-to-dream-the-unique-organisation-transforming-lives-that-could-change-the-future-of-soccer/?sh=6379c6004069
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Inside Right To Dream, The Unique Organization Transforming Lives That Could Change The Future Of Soccer
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Inside Right To Dream, The Unique Organization Transforming Lives That Could Change The Future Of Soccer
Right To Dream Park, the home ground of Danish club FC Nordsjaelland. Right To Dream
When King Osei Gyan thinks of his childhood in Nima, he doesn't remember a "slum".
He remembers music, spontaneous dance performances and kids playing soccer "everywhere".
Where outsiders to this area of Ghana’s capital Accra may see poverty, Gyan sees opportunity. What Nima may lack in infrastructure, it makes up for in talent.
"I feel blessed to have come from a community that is known to be a talent hub for music, fashion, culture," Gyan tells me in an interview.
"It's very rare to find yourself in an environment where the creativity is so high and it erupts with so much talent. You basically just pick things up and then along the way you find the right supporting structures to take it forward."
Having played soccer "for as long as I can remember", Gyan's obvious talent was with the ball. By the time he turned 11, he was already on the radar of some of the big European teams with academies in Ghana.
But he was instead convinced to join a fledgling academy, set up by a Brit named Tom Vernon.
A different type of academy
Vernon was 19 when he moved from the UK to Ghana to coach young players. Everywhere he looked – from kickabouts on dusty pitches to performers juggling balls at traffic lights – he saw natural soccer talent.
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With his then girlfriend (now wife), the origins of an academy were born in their house in Accra. Bunk beds, desks and 16 players, including Gyan, were moved in.
More than once the academy looked like it would run out of money. A lot of "hustle" was needed to keep it alive.
Then, with a friend, Vernon started a business offering sports gap years – offering those taking a post-high school break the opportunity to coach at youth teams in Accra. It took off. Before long, Vernon and his wife were able to grow the academy, moving the 16 players out of their house and opening a new facility.
The Right To Dream academy in Ghana focuses on developing people, not only soccer players. Right To Dream.
From the beginning, Vernon, who also worked as Manchester United's scout in Africa, was determined not to copy the model of big European clubs. At the academies he’d seen in West Africa, the sole aim was producing professional players.
His academy, named Right To Dream, would have two graduate pathways for student athletes – a professional soccer career, or a sporting scholarship at a prestigious US university.
While all entrants to the academy would need a certain level of soccer ability, those not quite good enough to turn pro would not be left without a career path. Developing the person would be just as important as developing the player.
"We love to work with kids and we love to work in youth football. And if that's your starting motivation there can't be any thought in your mind that if a kid has a bad season you ask him to go home. It's pretty morally bankrupt thinking," Vernon tells me.
"(At other academies) the boardroom is analyzing human beings as numbers on a spreadsheet and justifying the investments that are made basically according to the transfer system, which is the fundamental problem.
"We don't feel that the vast majority of people working in the academy system like it as it is, it's the financial construct around football dictating it that way. That will surely change. And we would like to be one of the case studies of where football could aspire to move towards in how it works with its youth."
Growing Right To Dream
The investment in individuals is paying dividends. From its humble beginnings more than 20 years ago, the Right To Dream facility in Ghana's Eastern Region is today regarded as the best in sub-Saharan Africa. It boasts eight grass pitches and the only residential girls' academy in Africa. There is a Cambridge-accredited school, LEGO labs and robotics programs.
Every year, 25,000 boys and girls are considered for five-year scholarships at the academy, which include everything from education and training to food and equipment. Between 15 and 20 of the best players in the region, and the most intelligent players with the soccer level to play at some of the world's best universities, are chosen.
There are currently 82 children at the academy and, of the more than 140 graduates since 1999, 61 have played professionally, including in the MLS, Champions League and World Cups. On the education side, about $45 million worth of scholarships has been raised for graduates to attend private boarding schools and top universities in the US.
As the academy continued to grow, Right To Dream made an unorthodox move.
In December, 2015, Right To Dream bought Danish Superliga club FC Nordsjaelland (FCN), with Vernon becoming chairman. It was the first time a European soccer club had been purchased by an African not-for-profit.
The deal offered academy graduates the chance to gain experience playing in a European league and Vernon the opportunity to prove the Right To Dream model at a professional team.
Danish Superliga club FC Nordsjaelland has developed a reputation as a training ground for young ... [+] coaches. Former Chelsea and Ghana star Michael Essien is currently on the coaching staff. Right To Dream
Since the takeover, which Vernon describes as a "massive learning curve", FCN has become known for doing things differently.
It became the first club to join soccer social impact movement Common Goal. There is a big focus on developing character, with a program designed to educate players on the importance of giving back and finding a purpose beyond being a soccer player. There are cultural exchanges, with young players from Denmark visiting Ghana and vice versa.
After the takeover, FCN established a professional women's team that secured back-to-back promotions and won the National Cup. The men's team has finished in the top six in Denmark for the last five years despite playing, for the past three seasons, with the youngest team in Europe. The average age of this season's squad is 22 and 80% of the first team are Right To Dream academy graduates from Ghana and Denmark.
FCN's women's team has achieved back-to-back promotions and won the National Cup since the Right To ... [+] Dream takeover. Right To Dream
Can a purpose-driven approach be financially sustainable?
An important part of FCN's strategy has been income from the transfer market, though there is a plan to reduce the reliance on this by boosting revenues from commercial partners.
One of the latest players to be sold was Mohammed Kudus. The 20-year-old joined Right To Dream in Ghana aged 12, went on to play for FCN and, last year, joined Dutch giants Ajax for a reported fee of €9 million ($10.6m). In total, FCN has generated transfer fees in excess of €65 million ($76.6m) since the takeover, the majority from academy graduates.
According to Right To Dream's most-recently filed accounts, the business made a pre-tax profit of £3.19 million ($4.4m) on revenue of £22 million ($30.4m) to year end December 2019.
The ability to combine a "purpose-driven" approach with financial sustainability in soccer has not gone unnoticed.
In January, Man Capital, the UK-based investment arm of the Egyptian Mansour Group, announced a €100 million ($118m) partnership with Right To Dream. The newly-established Man Sports now has majority control of the organization, with Vernon remaining the other significant shareholder.
Mr Mohamed Mansour, the founder and chairman of Man Capital, became chairman of the board of Right To Dream, while his son, Loutfy Mansour, also joined the board.
The partnership's first major project is to build a Right To Dream academy for boys and girls in Egypt. To be located in West Cairo, it is expected to welcome the first group of student athletes in 2022. A professional women's team will also be launched in Egypt.
Opportunities to expand women's and girl's programs across the Right To Dream group will be explored, and the organisation will look at opportunities to acquire academies and clubs in the UK.
In a rare interview, Mr Mansour tells me "football is in our blood" and points out his uncle, Mostafa Kamel Mansour, was a goalkeeper who represented Egypt at the 1934 World Cup.
Mr Mansour, who is a founder of Mansour Group, the family-owned, global conglomerate with more than 60,000 employees and revenues exceeding $7.5 billion, says the investment in Right To Dream is for the long-term.
"We as a family believe that sports helps nurture people," he says.
Mr Mohamed Mansour & Loutfy Mansour. Man Capital, the UK-based investment arm of the Egyptian ... [+] Mansour Group, recently announced a €100 million ($118m) partnership with Right To Dream. Matthew Joseph
"We see this as an investment that brings us happiness and fun. It's an investment that brings us purpose. It's an investment with an excellent partner.
"This is not a charity model. There are many talented young men and women in Africa, in Denmark, in Egypt. This is just creating opportunities for them, whether in education or sports. It's a long-term project. Whatever returns come in from this business will stay and grow it. That's the formula.
"You can work all your life, but to get the gratification of something, it's not always about numbers."
Mr Mansour says he had been considering purchasing a soccer club in the UK when Loutfy told him about Right To Dream in Ghana. His son had been aware of the academy since 2013 and, about three years ago, went to spend time there.
"There are very few moments when you see something for yourself and you hold on to it forever. And that was one of those moments," Loutfy tells me.
"It's always been in the family's DNA to help something grow. But to help it grow with a purpose and a passion is very powerful as well.
"The network effect that you will get from the players that come out of Right to Dream – whether it be on the academic or professional route – what they will learn and how they will feel about giving back to their communities … There's no spreadsheet that can calculate that."
"Actively exploring" other clubs and academies
For Vernon, the academy he started on a shoestring could one day be an organisation with soccer clubs in several markets. The group is "actively exploring" opportunities with clubs in the "Big 5" European leagues and Vernon admits he isn't sure how big Right To Dream will become.
"Personally, I see the concept like pushing a boulder up a hill, and, once we push it over the other side, we don't envisage that we can keep control of the whole thing," he says.
"That opportunity creation and establishment of academies, whether it be through a hybrid franchise or through our control or others who are just replicating and taking our IP, the passion here is unlocking the physical and psychological barriers for children achieving their dreams. And that goes beyond us."
"Personally, I see the concept like pushing a boulder up a hill, and, once we push it over the other ... [+] side, we don't envisage that we can keep control of the whole thing," Right To Dream founder Tom Vernon says. Right To Dream
As to whether other clubs will follow Right To Dream's "purpose-driven model" and seek to take an active role in social change, Vernon says it must be authentic and not because "purpose is selling".
"If it's driven from a classic commercial motivation, it will fail," he says.
"We believe that understanding of your own identity and purpose and deepening that journey on a consistent basis leads you to be happier, which is our primary objective for the kids in our academies. And that happiness will also lead, in our mind undisputedly, to greater performance."
Reinvesting in people
In 2004, King Gyan was among the first generation of graduates when he was awarded a scholarship at the prestigious Dunn School in California. Two years later, he was offered a professional contract at English Premier League club Fulham. Two years after that, aged 19, he was called up to play for Ghana.
"Wow," Gyan says as he recalls pulling on the shirt of the Black Stars for the match against Tanzania.
"There are moments in life that you never forget. And it's one of those moments."
After Fulham, Gyan went on to play in Belgium, Norway and Sweden. In 2016, aged 27, he had a chance to continue playing but opted to hang up his boots and return to Right To Dream in Ghana. After his leadership skills impressed during an internship, he was offered the role of deputy managing director.
"It was a good opportunity for me to come in and be part of building the future," Gyan, who is also a member of the Obama Foundation's Leaders: Africa program, says.
"I will never stop loving football. If a footballer ever tells you that they stopped because they lost the love for it, they are lying! But the point is not to stop loving it, it's knowing where it's taking you."
Now Right To Dream's director of purpose, Gyan plays a key role in the strategy to develop "socially-focused, purpose-driven leaders". He oversees different academy operations and delivers coaching and the character development curriculum.
As Right To Dream's director of purpose, academy graduate King Gyan plays a key role in the strategy ... [+] to develop "socially-focused, purpose-driven leaders". Right To Dream
Right To Dream graduates are encouraged to give back to their communities and Gyan is no exception.
Though he prefers the word "reinvest" to "give back": "Because with investment, you take into consideration both sides of what people are bringing to the table."
Gyan founded the Amin Nima project, a business to support and celebrate people in Nima undertaking projects in everything from sport and fashion to music and poetry.
"One of the things that people from Nima are really known for is that we are stubborn. We say that we are 'stubborn on purpose' because we refuse to be told what the limitations of life can be," he says.
"And when you come from where we come from, the impossible doesn't even exist."
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271bd6c1548461581b2c86ab7a73ba19
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https://www.forbes.com/sites/robertkuenster/2018/11/18/mlb-players-who-produced-most-bang-for-the-buck/
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MLB Players Who Produced Most Bang For The Buck
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MLB Players Who Produced Most Bang For The Buck
Oakland's Khris Davis led the majors with 48 home runs in 2018 while earning a base salary of... [+] $10,500,000. His dollars earned averaged out to $218,750 per homer. (AP Photo/Michael Wyke) ASSOCIATED PRESS
Since MLB sluggers have been splintering the upper deck seats at big-league ballparks across the majors over the last 20 years, the home run has redefined the game. Baseball is more of a home run entertainment match than it is a contest requiring baserunning skill, hit and run strategy, or small ball run production.
And, with this being the offseason when clubs are looking to improve the offensive output of their clubs and trying to curtail as much cost from their payroll as possible, it seems appropriate at the moment to delve into the subject of the earning dollar of the game’s leading home-run hitters in 2018.
There were countless gigantic blasts in the majors last season that were propelled by long ball hitters. Colorado’s Trevor Story hit the longest home run with a 505-foot blast on Sept. 5 at Coors Field against Giants hurler Andrew Suarez. Bryce Harper’s longest homer went 473 feet. Texas’ Joey Gallo drove a ball 472 feet. Yankees power trio of Aaron Judge (471 feet), Gary Sanchez (461 feet), and Giancarlo Stanton (458 feet) were among the 35 players to discharge balls further than 455 feet.
Lesser known performers also hit some mighty cannon shots, such as Franchy Cordero of the Padres (489 feet), Christian Walker of the D-backs (479 feet), San Diego’s Franmil Reyes (477 feet), and Mac Williamson of the Giants (464 feet).
Regardless of the distance or who hit them, there were 5,585 home runs hit in the majors during the regular season in 2018 with 48 players finishing the year with 25 or more homers.
So, among the power hitters with a minimum of 25 home runs, what team received the most bang for the bucks they paid for home-run production?
Breakdown of players salary, among sluggers who clubbed 25 or more homers in 2018, and the dollars... [+] they earned per home run. BK
Well it’s easy to guess it was a slugger ranked among the minimum salaried ($545,000) players, but for fun let’s take a look at how much each player, who hit 25 or more homers last season, got paid per ball he hit over the wall.
If these sluggers were paid strictly on the number of homers they hit, Gallo of the Rangers was the most economical, earning $14,000 per home run hit. He finished the year with 40 homers and his base salary was $560,000.
Mike Trout of the Angels clubbed 39 homers for his $33,250,000 salary which turns out to be $852,564 per HR—the most among players with 25 or more. This is just an exercise in fun because it is understood that Trout is the best all-around player in the game and home runs are not the only tool he loads on his utility belt.
The major league home run leader last year was Oakland’s Khris Davis, who hit a career high 48 dingers to go with the highest salary he has earned while playing in the majors—$10,500,000. He averaged $218,750 per home run. In this HR era of high-salaried players, his dollars earned per homer was a bargain.
Over the last three years (2016-18), Davis hit a total of 133 homers and his base salary earning during that span is a combined $16,024,500 which calculates into $120,485 per long ball. The A’s have received valued home-run production from their left fielder in return for the dollars he’s collected.
In 2017, when Stanton was with the Marlins and captured N.L. MVP honors with 59 home runs, he earned $14,500,000 or $245,763 per homer. With the Yankees in 2018, his salary jumped to $25,000,000 while his HR output dropped to 38 and his dollars per homer escalated to $657,895.
Players shouldn’t be judged solely on their home run production, since the great majority of sluggers that belted 25 or more homers in 2018 offer much more to their teams than the number of balls they hit into the bleachers. But with the market value for home run hitters being given top dollar, it’s fun to breakdown what they earned through the power they produced with balls clearing the outfield walls.
I think Hall of Fame slugger Ralph Kiner, who once said, “Home-run hitters drive Cadillacs,” would agree.
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478236098586ac7e352a7c79ac0e5341
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https://www.forbes.com/sites/robertkuenster/2020/01/26/sudden-death-of-nba-great-kobe-bryant-brings-back-tragic-deaths-of-some-former-major-league-stars/
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Sudden Death Of NBA Great Kobe Bryant Brings To Mind Tragic Deaths Of Former MLB Stars
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Sudden Death Of NBA Great Kobe Bryant Brings To Mind Tragic Deaths Of Former MLB Stars
It's been 47 years since the tragic death of Pirates All-Star Roberto Clemente in a plane crash on ... [+] December 31, 1972. (Photo by Bettmann Archive/Getty Images) Bettmann Archive
When the tragic word of former NBA superstar and certain Hall of Famer Kobe Bryant’s death came out Sunday afternoon, the immediate reaction was sadness and disbelief.
His death with his daughter in a helicopter crash in Calabasas, California at age 41 was shocking and unexpected as his passing is mourned by those who knew him best, as a man and as one of basketball’s most successful performers in NBA history.
He was what every fan likes to see in a professional athlete—exceptional talent, easy to root for, outstanding personality on and off the court, and a classy individual who cherished his family.
Fans who watched him play witnessed greatness with his skill, determination, and self-confidence that spilled over to his teammates and opponents alike.
It’s a sad day for the sporting world and it sends thoughts back to some outstanding baseball players who died at age 45 or younger. Underlined names indicate Hall of Famer.
• Ed Delahanty, 35, Washington Senators first baseman, died reputedly in a fall from Niagra Falls bridge, July 2, 1903.
• Dan McGann, 39, New York Giants first baseman, died of self-inflicted gunshot, Louisville, Kentucky, December 13, 1910.
• Addie Joss, 31, Cleveland Indians pitcher, died of tubular meningitis, Toledo, Ohio, April 14, 1911.
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• Rube Waddell, 37, A’s/Browns pitcher, died of Pneumonia, San Antonio, Texas, April 1, 1914.
• Ray Chapman, 29, Cleveland Indians shortstop, killed by a pithed ball, New York, New York, August 17, 1920.
• Jake Daubert, 40, Dodgers/Reds first baseman, died from appendicitis, Cincinnati, Ohio, October 9, 1924.
• Christy Mathewson, 45, New York Giants pitcher, died from tuberculosis, Saranac Lake, New York, October 7, 1925.
• Ross Youngs, 30, New York Giants outfielder, died of Bright’s disease, San Antonio, Texas, October 22, 1927.
• Urban Shocker, 38, New York Yankees pitcher, died of heart disease, Denver, Colorado, September 9, 1928.
• Lou Gehrig, 37, New York Yankees first baseman, died of amyotrophic lateral sclerosis, Bronx, New York, June 2, 1941.
• Tony Lazzeri, 42, New York Yankees second baseman, died from a fall after suffering a heart attack, San Francisco, California, August 6, 1946.
• Josh Gibson, 35, Homestead Grays catcher, died of a brain tumor and stroke in Pittsburgh, Pennsylvania, January 20, 1947.
• Arky Vaughan, 40, Pirates/Dodgers shortstop, drowned when fishing at Lost Lake in Eagleville, California, August 30, 1952.
• Ken Hubbs, 22, Chicago Cubs second baseman, killed in a plane crash in Provo, Utah, February 13, 1964.
• Roberto Clemente, 38, Pittsburgh Pirates right fielder, killed in a plane crash near San Juan, Puerto Rico, December 31, 1972.
• Don Wilson, 29, Houston Astros pitcher, died of carbon monoxide poisoning in Houston, Texas, January 5, 1975.
• Lyman Bostock, 27, California Angels outfielder, murdered from a gunshot wound in Gary, Indiana, September 23, 1978.
• Thurman Munson, 32, New York Yankees catcher, killed in a plane crash in Summit County, Ohio. August 2, 1979.
• Darryl Kile, 33, St. Louis Cardinals pitcher, died of a sudden heart attack in Chicago, Illinois, June 22, 2002.
• Kirby Puckett, 45, Minnesota Twins outfielder, died after he suffered a stroke, Phoenix, Arizona, March 6, 2006.
• Cory Lidle, 34, New York Yankees pitcher, killed in a plane crash in New York, New York, October 11, 2006.
• Jose Fernandez, 24, Miami Marlins pitcher, killed in a boating accident, Miami Beach, Florida, September 25, 2016.
• Yordano Ventura, 25, Kansas City Royals pitcher, killed in a car crash in Dominican Republic, January 22, 2017
• Roy Halladay, 40, Blue Jays/Phillies pitcher, killed in an aviation accident, Gulf of Mexico, November 7, 2017.
Some of the mentioned players were just beginning to flourish with their big-league ability at the time of their death. Others already had established Hall of Fame careers, and all were special in the talent they possessed that brought them to the major league level.
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83f796f03d04630733cf80c36c063c05
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https://www.forbes.com/sites/robertlangreth/2010/08/16/stunning-news-brain-scientists-go-whitewater-rafting-without-their-iphones/
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Stunning News: Brain Scientists Go Whitewater Rafting Without Their iPhones
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Stunning News: Brain Scientists Go Whitewater Rafting Without Their iPhones
Thousands of Americans go whitewater rafting each year without their Blackberries, Apple iPhones, or Motorola Droids. But when brain scientists do it, it is big news. The New York Times has a hilarious article on a bunch of neuroscientists who take a rafting vacation on a river without cell reception. The story goes on for a whole page, more space than President Obama gets for his swimming trip to the Gulf coast:
Todd Braver emerges from a tent nestled against the canyon wall. He has a slight tan, except for a slim pale band around his wrist. For the first time in three days in the wilderness, Mr. Braver is not wearing his watch. “I forgot,” he says.
It is a small thing, the kind of change many vacationers notice in themselves as they unwind and lose track of time. But for Mr. Braver and his companions, these moments lead to a question: What is happening to our brains? Mr. Braver, a psychology professor at Washington University in St. Louis, was one of five neuroscientists on an unusual journey. They spent a week in late May in this remote area of southern Utah, rafting the San Juan River, camping on the soft banks and hiking the tributary canyons. It was a primitive trip with a sophisticated goal: to understand how heavy use of digital devices and other technology changes how we think and behave, and how a retreat into nature might reverse those effects. via Your Brain on Computers - Studying the Brain Off the Grid, Professors Find Clarity - NYTimes.com.
All this is supposed to reveal something about the nature of attention in an ever-more-distracting digital age. Of course, it does nothing of the sort--other than the blindingly obvious stuff like people relax on vacation. How could conclusions be reached? The scientists didn't do any experiments; they went rafting! But the Times knows this is just the kind of story that will do great on the web among its digitally hyperactive readers. I credit the reporter for getting so many good quotes without getting his notebook/recorder soaked.
But there are a lot of musings about the nature of attention, and a nice history of the debate over whether being constantly connected sometimes screws up our our performance. There is even a vacation photo of a pot-bellied brain scientist jumping into the river.
Next time I'm on vacation in Oregon in a place where cell phones don't work with my cognitive psychologist in laws, I'm going to call the New York Times to see whether they want to send along 10 reporters and two photographers. In fact, I think the New York Times should do a whole series on scientists going on vacation with or without their smart-phones:
--Primatologists Unplugged. Two New York Times reporters go on safari with a team of leading Harvard primatologists to the heart of the Congo basin. Can they chart the defecation patterns of wild chimpanzees, the old fashioned way, using pen and paper, without GPS or laptops?
--Geologists Unplugged: Six NY Times editors climb Mt Everest with team of leading Harvard geophysicists. They don't take satellite phones or GPS. If storm hits, can they get themselves out without being able to call for helicopter rescue? (Slideshow opportunity: dead bodies of those who don't make it back, and smiling pictures of the survivors.)
--Marine Biologists: Leading shark experts go on vacation with a team of NY Times web videographers to Tahiti to conduct a randomized, controlled trial of whether iPhones or blackberries work better underwater.
--Journalists: First person story by Times political reporter to see if she can continue blogging 24/7 during busy Martha's Vineyard vacation with family. Can she hold onto her 7-year-old son in the surf with one hand, while still sending blog update via blackberry with the other? Will she drop her iPhone into a pond when five-year old throws tantrum while kayaking on Chappaquiddick? With web video and slide-show.
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b89f9188f0f6d2731cfcbf26e6c6c27b
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https://www.forbes.com/sites/robertlangreth/2010/09/03/setback-for-personalized-medicine-as-pfizer-drops-celldex-brain-drug/
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Setback For Personalized Medicine As Pfizer Drops Celldex Brain Drug
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Setback For Personalized Medicine As Pfizer Drops Celldex Brain Drug
Celldex shares cratered by 30% after Pfizer dumped its partnership to develop a new brain cancer vaccine. We wrote about the vaccine two years ago as an early example of new personalized cancer treatments moving through trials that will target only the patients whose tumors have the bad genes. The Celldex drug, undeniably a long-shot, would be a big deal for brain cancer patients if it works. Now tiny Celldex will now have to come up with the money to do a definitive trial on its own. Here is what we said two years ago:
A new brain cancer vaccine, now in midstage testing at Pfizer and [Celldex]... is one of a new wave of ultratargeted treatments moving through human testing at drug and biotech companies. Instead of aiming at broad tumor categories, such as all patients with lung cancer or colon cancer, the new medicines target specific subsets of patients whose tumors have particular gene mutations. The brain vaccine aims at about 40% of brain glioblastoma patients.The hope is that by better matching drugs to patients likely to benefit, researchers can improve upon the lukewarm results seen with targeted cancer drugs to date.
While many drugs that attack single genes have hit the market recently, they often have been used indiscriminately in all patients with a single tumor type. Better targeting could help improve clinical trial success rates by excluding patients for whom the drugs have little chance of working. "The last millennium approach was 'treat all the patients and that is the biggest marker,' " says Pfizer senior marketing director Alison Ayers. "We just cannot continue with that model," as it means everyone gets side effects, but only some benefit. "We are heading toward a day where we don't even think about the anatomical locale of the tumor," says University of North Carolina researcher Howard McLeod. Instead, he says, researchers will perform tests to determine which mutations drive a tumor's growth and then give drugs that hit those specific mutations. The downside for drug companies, he says: "Markets will be smaller than before."
via Taking Aim at Brain Cancer - Forbes.com in 2008
Exactly why Pfizer dropped the vaccine is unclear. Pfizer may know something that we don't. Certainly a definitive trial would have been difficult to perform, and the odds of success are slim thanks to the aggressive nature of glioblastoma. The early trials of the vaccine all had no control group, making the seemingly good survival times reported difficult to intepret. (Merck sells one of the few drugs approved for use in the disease.) Now glioblastoma patients will have to wait even longer to know whether they have one more option for treatment.
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f6f8ca54ba556c2876ce6d9b46d1766d
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https://www.forbes.com/sites/robertlangreth/2010/09/27/from-cicada-fungus-to-ms-drug-how-big-will-novartis-new-pill-be/
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From Cicada Fungus To MS Drug: How Big Will Novartis' New Pill Be?
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From Cicada Fungus To MS Drug: How Big Will Novartis' New Pill Be?
Image via CrunchBase
The coolest thing about Novartis' new MS drug Gilenya is that it is derived from an immune suppressant first found in a fungus that kills cicadas in China and Japan. It is just the latest example of a drug derived from natural chemicals. Merck's original cholesterol-lowering medicine Mevacor is another.
You can read the full history in this story by my college band friend Peter Landers, but the short version it that is was discovered by a Kyoto University pharmacologist in the mid-1990s who was searching for better transplant drugs. Novartis purchased rights to the drug in 1997 hoping to come up with a successor to its old drug cyclosporine. The transplant trials didn't pan out, but animal studies indicated early on that it might be a powerful MS treatment. Years later, it is the first pill that can slow the progress of MS. All competing drugs, such as Avonex and Tysabri from Biogen Idec and Copaxone from Teva Pharmaceutical Industries, have to be injected.
"It will certainly be a blockbuster if things play out as we plan," says Novartis development head Trevor Mundel. Novartis just got an additional gift as a rival drug cladribine from Merck KgaA was rejected by European regulators. One class of patients that Novartis is likely to go after is the substantial minority of the 400,000 MS patients who don't take any drugs now. Some just don't want to deal with the side effects of existing drugs such as fatigue and flu-like symptoms (Avonex) or painful injection site reactions (Copaxone) . "That is definitely a category of patients [who are] reluctant to be treated because they have felt the use of injectables is oppressive," Mundel says. Another potential group of patients are those want something more potent than Avonex, but who don't want to risk rare but potentially lethal brain infections associated with Tysabri. Gilenya beat Avonex in a head-to-head trial. (One other MS pill on the market, Ampyra from Acorda Therapeutics, helps patients walk better but it does not target the underlying disease process.)
"Where this will fit in is a little hard to say just yet because the appeal is to people who don’t want to take injections," says neurologist Fred D. Lublin of the Mount Sinai School of Medicine. "It is hard to know how many there are because they weren’t necessarily coming in." (Lubin has done consulting for Novartis.) Over time, he predicts that pills like this will take a larger and larger proportion of the market if their side effect profile remains relatively benign.
MS happens when the body's own immune system gradually destroys myelin, the insulation surrounding nerves. Gilenya works by a totally new mechanism to block some immune system t-cells from escaping from the lymph nodes. They can't destroy the myelin. One unusual effect of the drug is that it appears to reduce the gradual brain shrinkage seen in MS patients over time, says Mundel. The significance of this is not known.
Early on, it looked like Gilenya might have so many side effects that it could held up at the FDA, but it ended up sailing right through the approval process. "It had the potential to have a lot of scary nasty side effects, [but at low doses] it actually looked much cleaner than initially was presumed," says Mundel. Some of the problem turned out to be that Novartis initially tested the drug at a relatively high dose in MS patients, not far below what it has used in its transplant trials. But it turned out that the drug could produce powerful anti-MS effects at much lower doses. One side effect reported in some early higher dose trials was skin cancer. But at the lower dose the problem didn't occur. The main side effects that remain include fluid buildup in the eye in a minority of patients and lower respiratory tract infections.
Some doctors may be reluctant to prescribe Gilenya until it has been on the market for a while and its full side-effect profile becomes clearer. Doctors initially will be "a bit cautious and have their antennas out" to see if unexpected side effects emerge, predicts Lublin. Novartis will have to work fast to convince doctors to adopt Gilenya. Sanofi-Aventis and Biogen all have rival MS pills in trials.
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60c0a1c97686ba9cb7a513246c21473c
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https://www.forbes.com/sites/robertlangreth/2010/11/18/why-telemedicine-is-overhyped/?boxes=financechannelforbes
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Why Remote Patient Monitoring Is Overhyped
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Why Remote Patient Monitoring Is Overhyped
Telemonitoring of patients with chronic conditions is a hot concept in the tech world. Companies like Intel, General Electric, Philips, and numerous upstarts are pursuing various gadgets that aim to provide seamless communication between patients and their doctors. The premise is that people with chronic diseases like heart failure and diabetes will do better and avoid complications if there are better means to communicate daily fluctuations in symptoms with their health providers. But two big new studies show, shockingly, that better communication may not be enough. Yale cardiologist Harlan Krumholz, who led one of the studies, discusses why below.--RL
By Harlan Krumholz
What happens to patients after they leave the hospital is becoming a national focus for health care organizations. We have discovered that patients return to the hospital at a distressingly high rate - among those who are hospitalized for heart failure, almost one in four of them end up in the hospital again within 30 days. The health care reform law has added economic incentives for hospitals to reduce re-hospitalization rates.
Such a focus has led to novel approaches to improve patient care and reduce the need for hospitalization. Many of these strategies depend on technologies that employ remote monitoring of patients so that doctors and nurses can track their progress without needing them to come to the office. In some cases patients are conveying information about their symptoms, weight, blood pressure, and other parameters.
Preliminary studies have suggested that these strategies, which are promoted by a variety of companies, have remarkable effects in reducing patient risk. The problem is that many studies in this field are small and have many limitations. Some experts have combined these studies to estimate the effect of the interventions - but combining a bunch of weak studies does not produce information that is better than the studies themselves.
At the American Heart Association meetings two studies of patients with heart failure provided a striking negative verdict on remote monitoring. First, a government-funded study from my evaluated an interactive voice response system - patients called a number and responded to automated questions about how they felt and what they weighed (an important metric to follow). The information was transmitted to their doctors , with a flag for responses that signaled concern that their condition was worsening. We only chose motivated cardiology practices and enrolled patients who consented to participate and agreed to make the calls. We employed a commercially available system that was selected because it was high quality and in use around the country.
The study, which was also published in the New England Journal of Medicine, revealed no benefit to the telemonitoring system over 6 months inn reducing hospitalizations or deaths. Nothing. No group of patients benefitted. No secondary outcome showed promise.
And then, following our presentation, a very high quality study from Germany on the same topic was presented. Their intervention involved the collection of even more data and the German patients were even more conscientious about following directions. And they had a longer follow-up. And they found no benefit. Striking confirmation of our results (or ours was confirmation of their results).
What are the lessons? We need to test telemonitoring strategies in the same way we test drugs and devices if we really want to know if they are effective - and are worth the cost. We need to be skeptical of small studies and poor quality studies . We need to understand how to employ technology to improve outcomes. Studies with negative results can help us avoid wasteful efforts. We need to invest in knowing what we are achieving by strategies that are in current use. Also, there may be value in having the group doing the evaluation be entirely different from the group that developed the intervention - that was true in our case . We should not have advocates doing the evaluation - but people who are impartial.
These two studies may raise the bar on companies that want to claim that their product, using technology to improve care, is truly effective. We are learning that assumptions of benefit based on the design of the interventions or the results of pilot studies may be premature.
Harlan Krumholz is a cardiologist at Yale University and Forbes.com contributor.
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4d2512579ac9538ddc0b28dadde8be6b
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https://www.forbes.com/sites/robertlangreth/2010/12/01/new-study-on-hazards-of-being-plump-wont-help-arena-or-orexigen/
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New Study on Hazards of Being Plump Won't Help Arena or Orexigen.
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New Study on Hazards of Being Plump Won't Help Arena or Orexigen.
A new study is out showing the hazards of being even moderately overweight. Too bad it won't help Arena or Orexigen get their obesity drugs approved.
Wouldn't it be nice if just being a little plump--25 or 30 pounds overweight--was good for you? While obesity is definitely bad, you may have heard the debate over whether being a little overweight could actually be good for your health and make you live longer. Some controversial studies have suggested this, generating endless rounds of debate--and newspaper headlines.
Too good to be true? Of course. A giant government study (published today in the New England Journal of Medicine) has combined data from numerous previous studies to get a clear cut answer to the question of whether being moderately overweight is good or bad for longevity. The new study contains a total of 1.46 million people who were followed for a median of ten years; 160,000 of them died. This massive numbers allowed the researchers to exclude smokers and people who had already been diagnosed with heart disease or cancer, and still have strong statistical power. Smoking is such a big killer that it dilutes any association between extra pounds and death, while people who are already sick may be thinner because of their disease.
The conclusion: even being moderately overweight increases your risk of dying. Roughly speaking, every 25 to 30 pound increase above ideal body weight--people with body mass index between 20 and 25 had the lowest risk-- boosted the risk of dying in the study period by 31%.
Doesn't this mean that the FDA should be rushing to approve more obesity drugs, like those from Arena or Orexigen? Not necessarily. Their drugs generally have modest weight loss over placebo and often won't get you in the type of weight loss range that could even achieve the modest 31% death reduction, even assuming there are no side effect issues. This great difficulty in producing highly effective fat pills that don't have big side effects is why so few obesity drugs are on the market.
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49233b9f6994a9da94c13b114b888c31
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https://www.forbes.com/sites/robertlangreth/2010/12/05/pfizers-kindler-flames-out/
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Pfizer's Kindler Flames Out
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Pfizer's Kindler Flames Out
Image by Getty Images via @daylife
Another Pfizer chief executive is gone. Pfizer chief executive Jeffery Kindler is abruptly leaving, to be replaced by senior vice president Ian Read, who had headed the company's drug operations. The company has done mega-deal after mega-deal is recent years--most recently buying Wyeth--but all it has done is make the company from a medium-large sluggard to a gigantic sluggish company. It still faces the mother of all patent expirations next year, when Lipitor loses its protection. It is still plenty profitable, but there is no clear growth path in the short term. No wonder the job burns out CEOs.
Here is what is Pfizer had to say:
Pfizer Inc. (NYSE: PFE) today announced that its Board of Directors has elected Ian C. Read, 57, currently head of the Company's global biopharmaceutical operations, as President, Chief Executive Officer and Director. Mr. Read succeeds Jeffrey B. Kindler, who has retired from the Company.
Mr. Kindler commented, "My nearly nine years at Pfizer and, particularly the last four and a half as CEO, have been extremely exciting and rewarding. I feel our team can proudly boast of some transformational accomplishments. However, the combination of meeting the requirements of our many stakeholders around the world and the 24/7 nature of my responsibilities, has made this period extremely demanding on me personally. Now that we are about to complete a full year of operating Pfizer and Wyeth together, with our world-class team fully in place, I have concluded the time is right to turn the leadership of the company over to Ian Read. Ian is an outstanding and experienced pharmaceutical executive who I know will make the next phase of the company's future a successful one. He is more than ready to take on these responsibilities and I am excited at the opportunity to recharge my batteries, spend some rare time with my family, and prepare for the next challenge in my career.
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811582fb2d5fe7df7663f997de34a06d
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https://www.forbes.com/sites/robertlangreth/2011/01/17/the-media-should-stop-invading-steve-jobs-medical-privacy/
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The Media Should Stop Invading Steve Jobs' Medical Privacy
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The Media Should Stop Invading Steve Jobs' Medical Privacy
Image via CrunchBase
Steve Jobs has taken yet another medical leave from Apple, resulting in huge headlines splayed across the top of the websites of the New York Times, Wall Street Journal and Bloomberg. The only person in the United States who could generate bigger headlines by going on medical leave would be President Obama.
Over the next few days we are likely to see endless speculation by people who don't really know over what is likely to happen to Steve Jobs, what the leave is about, and what his exact prognosis is. Urgent e-mails are going around at major newspapers right now from editors to reporters breathlessly demanding information about what may be happening to Steve's liver.
Here's what I think: It is an embarrassment.
Assuming that the leave relates to his pancreatic neuroendocrine cancer or related liver transplant (and we don't even know this for sure), the truth is that even Job's own doctors who know the details probably have precious little insight into what the immediate future holds for him.
Beyond saying that the prognosis for most advanced cancers is "bad", all those detailed survival statistics you read in the newspapers about how "patients with type of cancer X live just 6 months" mean precious little for an individual patient, given just how widely individual cases can vary from the mean. Even when the odds are bad, individual patients can survive a long time, or vice versa. Statistics for pancreatic neuroendocrine tumors, a rare tumor type that is not as aggressive as standard pancreatic cancer, are murkier and less reliable given how few patients there are. It is not that the statistics are wrong. It is that cancer often deviates wildly from the averages, so much so that merely applying the general statistics to an individual patient can often turn out to be downright misleading.
There's no question that Steve Jobs himself is partly to blame for the fixation on him. He helped make the company into a cult of personality, and created the impression the Apple could barely exist without him. (See "Apple Is More Than Steve Jobs")
Here's a real story that should get more attention. What are Apple's plans if Mr. Jobs can't return any time soon? Apple's board should be sued by shareholders if it doesn't have very specific plans on the front, given the longstanding issues around Mr. Jobs' health. The plans should include ideas for how the company will survive and maintain its unique combination of cool design and engineering commitment to highly user-friendly devices when Mr. Jobs eventually leaves or retires.
Of course, these kinds of stories won't happen (or will be relegated to inside pages) because the more sensational story is to focus on the morbid details of Mr. Jobs' health, with anonymous second or third hand sources speculating about Mr. Job's recent physical appearance or how many days a week he has been at the office. This will get more page views, for sure, but is it good journalism?
See Also:
Apple Is More Than Just Steve Jobs
Jobs, Apple and the Strategic Landscape
Secretive Steve Jobs In His Own Words, For 119 Pages
Steve Jobs Changed My Life
Complete Coverage: Steve Jobs
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3e6f9beda4a6b51ad543d337b1a90002
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https://www.forbes.com/sites/robertlaszewski2/2015/06/29/why-the-affordable-care-act-isnt-here-to-stay/
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Why The Affordable Care Act Isn't 'Here To Stay'--In One Picture
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Why The Affordable Care Act Isn't 'Here To Stay'--In One Picture
Here is one picture that tells you just about everything you need to know to understand where Obamacare stands--politically and financially.
In the wake of the Supreme Court decision President Obama said, “the Affordable Care Act is here to stay.”
Will it be repealed and replaced by Republicans? I doubt it because it is so unlikely that Republicans will score the electoral trifecta Democrats did in 2008 by winning the White House, the House of Representatives, and having a filibuster proof 60 votes in the U.S. Senate and therefore have the power for a complete repeal and replace.
But does that mean Obamacare is “here to stay” as it is? It clearly is not.
Why not?
Here is the answer in just one picture:
Why is Obamacare still so unpopular? Why aren’t the working class and middle-class signing up for it? Why is the Obamacare population sicker and causing so many big rate increases a year earlier than expected? Is Obamacare financially sustainable in its present form? Is it politically sustainable as it is?
Why is Obamacare still so unpopular?
The most recent Real Clear Politics average of recent Obamacare approval finds 43.6% favoring the law and 51.4% opposing it.
Why have so many more opposed Obamacare than approved it since its inception?
Just look at the picture.
For those eligible for Obamacare, an impressive 76% of those earning between 100% and 150% of the federal poverty level have signed up. [Note: the eligible up to 400% of the federal poverty level includes only those eligible for Obamacare's insurance subsidies and does not include those in or eligible for employer-based plans.]
But after that income level the percentage of those eligible who have signed up drops like a rock.
Also on Forbes:
Gallery: Obamacare Sign-Up Stats 5 images View gallery
The proportion of the population that is signing up for Obamacare is concentrated in the very lowest income categories while Obamacare is obviously unattractive to everyone else.
It's no secret that wealthier consumers who make more than 400% of the federal poverty level, and therefore don’t get an Obamacare subsidy, have seen their individual health insurance rates increase substantially because of the new law and haven’t been happy about it.
So, this picture tells the story. Obamacare is unpopular because only the poorest have literally embraced it by buying it.
Why do they buy it? Because they pay very little in after subsidy premium and they get their deductibles and co-pays substantially reduced to boot.
And who votes? The poor don’t come to the polls in the same numbers as the rest of the population. Even in the 2008 election, with the first African American presidential candidate nominated by a major party on the ballot, only 52% of adults coming from families making less than $20,000 a year voted while 80% of the adults from families making over $100,000 voted.
Obamacare will never be popular, or a great vote getter, unless it meets the needs of other than the poorest.
Despite all of the subsidies, why aren’t the working class and middle-class signing up for it?
Consider this:
The law requires people who do not have health insurance to buy Obamacare. If they do not buy it they are subject to a fine. Obamacare subsidies help people who can’t afford it pay for it. Obamacare is a monopoly—the only way in America you can buy individual health insurance is to buy an Obamacare compliant plan. The only place you can get an insurance subsidy is on the Obamacare exchanges. People generally want to have health insurance.
After all of this and two complete open enrollments, only 40% of those who are eligible for Obamacare have signed up—far below the proportion of the market insurers have historically needed to assure a sustainable risk pool.
If this were a private enterprise enjoying these kinds of benefits, and only sold its product to 40% of the market, its CEO would be fired.
Looking at this picture, only 20% of those eligible for Obamacare, who make between 251% and 300% of the poverty level, bought Obamacare. Why?
According to the Kaiser Calculator, a family of four making $60,300 a year (253% of poverty) would still have to pay out premiums of $4,934 a year (8.18% of household income) for the second lowest cost Silver Plan after their Obamacare subsidies. The good news is this is about half the price of an unsubsidized policy.
The bad news is Obamacare would still cost this family $4,934 a year for a policy with an average deductible of almost $2,900. How many families making $60,000 have an extra $4,934 in their budget for a policy that will likely pay them almost nothing?
Apparently, many of these families have concluded that they are better off staying uninsured and paying for their health care costs out-of-pocket.
Of course if someone in the family is really sick even premiums and deductibles this high can be a great deal.
And therein lies the challenge as the administration tries to sign-up enough healthy people to offset the cost of the sick, who will join no matter what the price, and keep premiums affordable.
Why is the Obamacare population sicker and causing so many big 2016 rate increases a year earlier than expected?
Because, the very poor aside, the people who most often see value from Obamacare’s high priced policies and big deductibles are those who know they will use it and take more money out of the system then they will put into it.
That the Obamacare exchange population is a lot sicker than the off-exchange population has been clearly demonstrated by a recent research brief, “Understanding the Exchange Population: A Statistical Snapshot,” from Truven Health Analytics.
Among Truven’s findings was the fact that the on-exchange population had 39% more hospital admissions and 64% more emergency room admissions, have a “significantly higher prevalence of chronic conditions,” is much older, and has a higher use of expensive specialty drugs, than the off-exchange population.
The Truven data also reaffirmed the notion that most exchange participants are the poorest who, unlike everyone else, benefit from substantially reduced deductibles and co-pays because of cost sharing reductions: "For all of the exchange members we found that most (73%) are enrolled in a [cost sharing reduction] plan, and most of these enrollees (44%) are in the Silver plan with an actuarial value of 94% [the most generous of plans]."
Is Obamacare financially sustainable in its present form?
Just look at the picture.
To be financially sustainable Obamacare is going to have to attract a lot more people. This program, with its high after subsidy premiums and huge deductibles, simply isn’t attractive to most consumers—unless a person is really sick. So, far the only people attracted to Obamacare are the poorest—whose premiums and out-of-pocket costs are very attractive.
Is Obamacare politically sustainable as it is?
Supporters have often pointed to surveys that say Obamacare participants are very happy with their policies, including one that found that 86% were happy with their coverage.
Of course they are! Just look at the picture. The majority of people who bought it are poor and therefore have very low premiums and out-of-pocket expenses. Marketing 101 would suggest that these supporters should also ask the 60% of the people who didn't buy it how they feel about Obamacare.
So far Obamacare is popular among the poor people who disproportionately get the benefits. It is not popular among the people who get far less out of the program, are the taxpayers who have to pay for it, and also are the people who vote the most often.
If the only information you had about Obamacare you got from this picture, would it look to you like Obamacare is both financially and politically sustainable?
The good news is that Obamacare dodged a huge bullet when the Supreme Court upheld its subsidies in 34 states.
The bad news is that it is still Obamacare.
For health insurance reform to be both politically and financially sustainable Obamacare will have to be materially changed and I have no doubt, that when the 2017 rates are known to all of the people going to the polls in late 2016, there will be an undeniable mandate to change it come 2017--no matter who wins the election.
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b78ba2ff7833a9315445995ba86b74f9
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https://www.forbes.com/sites/robertlaszewski2/2020/08/15/kamala-harris-has-had-some-difficulty-with-the-health-care-issue/?sh=499ea785cced
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Kamala Harris Has Had Some Difficulty With The Health Care Issue
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Kamala Harris Has Had Some Difficulty With The Health Care Issue
At a Democratic debate in June of 2019, the candidates were asked, "Who here would abolish [employer-provided] health insurance in favor of a government-run plan?'
Harris enthusiastically raised her hand––joined over the two evenings of the debate by Sanders, Warren, and de Blasio. Not a surprise since she had already signed on to Bernie Sanders' single-payer health bill.
MIAMI, FLORIDA - JUNE 27: Former Vice President Joe Biden looks on as Sen. Bernie Sanders (I-VT) ... [+] and Sen. Kamala Harris (D-CA) raise their hands during the second night of the first Democratic presidential debate on June 27, 2019 in Miami, Florida. A field of 20 Democratic presidential candidates was split into two groups of 10 for the first debate of the 2020 election, taking place over two nights at Knight Concert Hall of the Adrienne Arsht Center for the Performing Arts of Miami-Dade County, hosted by NBC News, MSNBC, and Telemundo. (Photo by Drew Angerer/Getty Images) Getty Images
But the next day she walked that hand raising back. This from NBCNews.com:
“Kamala Harris was one of two candidates who raised their hands when asked at Thursday night's debate if they would get rid of private health insurance, but the California senator said Friday she'd misunderstood the question.
“No,’ Harris told MSNBC's ‘Morning Joe’ when asked if she'd work to abolish private health insurance in favor of "Medicare for All" if elected president.
“But in her subsequent answers, she struggled to clarify her position about the role of private insurance under her plan, something that has become a pattern in recent months as Democratic candidates look to navigate politically charged questions about Medicare for All's policy implications.”
In January of 2019, she told CNN she wanted to get rid of the "process of going through an insurance company."
Then in May 2019 she said she was referring to bureaucracy and waste, not the insurance companies. "I know it was interpreted that way. If you watch the tape, I think you'll see that there are obviously many interpretations of what I said."
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Whatever she meant, she had already signed-on to the Sanders' single-payer bill that would have entirely eliminated the insurance industry and employer-provided health insurance.
Then a month later, in July 2019, she came out with her own plan. That plan was similar to one developed in January 2018 by the Center for American Progress (CAP) called "Medicare Extra." Like the Harris plan, the CAP plan would essentially take today's private Medicare Advantage plans and make them, and traditional Medicare, available to all of those under-age-65. Harris would have gone further by eventually eliminating employer-based coverage by transitioning everyone to the choice of the traditional Medicare plan, or a private Medicare plan run by the insurance companies, over a ten-year period.
So, in a few short months during 2019, Harris co-sponsored the Sanders' single-payer plan that would have completely eliminated private insurance, enthusiastically raised her hand in support of single-payer during a debate, the next day walked that back in a difficult to understand explanation of why she wouldn't entirely eliminate private insurance, and then proposed her own hybrid Medicare plan that would have eventually offered today's insurance company run Medicare Advantage plans to everyone.
Now, she is Joe Biden's running mate––a candidate that has proposed fixing Obamacare.
Here is what Biden said about her own plan when they were opponents:
"The plan, no matter how you cut it, costs $3 trillion when it is, in fact, employed, number one. Ten years from now, after two terms of the senator being president, after her time. Secondly, it will require middle-class taxes to go up, not down. Thirdly, it will eliminate employer-based insurance. And fourthly, what happens in the meantime?"
Harris is a smart politician. She will quickly learn the Biden incremental health plan talking points.
But, I find it hard to believe she will ever truly be comfortable with the health care issue.
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1cfddd2662e7c11e34926cd0ce9fcda7
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https://www.forbes.com/sites/robertlaszewski2/2020/11/07/what-a-biden-win-means-to-health-care/?sh=659563025a23
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What A Biden Win Means To Health Care
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What A Biden Win Means To Health Care
We will have a Biden administration more inclined to promote and expand the insurance exchanges and Medicaid expansion under the Affordable Care Act as well as controlling prescription drug prices through regulation.
But as for Congressional action, it is much more likely we will be facing gridlock––even if Democrats eke out a tiny Senate majority.
WILMINGTON, DE - OCTOBER 28: Democratic presidential nominee Joe Biden delivers remarks about the ... [+] Affordable Care Act and COVID-19 after attending a virtual coronavirus briefing with medical experts at The Queen theater on October 28, 2020 in Wilmington, Delaware. Participants in the briefing include former U.S. Surgeon General Dr. Vivek Murthy, Director for Science in the Public Interest Dr. David Kessler, New York University professor Dr. Celine Grounder, and Yale University professor of medicine Dr. Marcella Nunez-Smith. (Photo by Drew Angerer/Getty Images) Getty Images
Presuming the North Carolina and Alaska Senate seats remain in Republican hands, the Senate will come out no better for Democrats than a 50-50 tie with Vice President-elect Harris being the tiebreaker. And, if Republicans win at least one of the two Georgia run-off Senate races, the Republicans will maintain control and the Democrats will not have the votes to move any partisan health care legislation.
But the Democrats will control the Department of Health and Human Services and the federal government's health care regulatory apparatus.
I will suggest the health care plan Biden campaigned on can be summarized into three primary parts:
Fixing the Obamacare/Affordable Care Act (ACA) individual health insurance subsidies for the middle class. Giving Medicare the power to negotiate prescription drug prices. Creating a government-run individual health insurance plan option called the Public Option.
The Public Option
The most controversial part is the Public Option.
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Just exactly what the Public Option would look like is not clear. It would likely look much like a typical Obamacare/ACA exchange plan but based upon provider reimbursement rates like those in Medicare––which pay hospitals about 40% less than insurance company plans and pay doctors about 20% less. This would likely lead to a Public Option costing much less than similar plans offered by private insurers.
Employers worry that giving their employees access to a cheaper government plan will undermine their own benefits and ultimately back them into government health insurance whose costs they will not have control over.
Insurance companies will worry a cheaper government option driven by Medicare-like reimbursement rates in the insurance exchanges will drive out commercial plans starting in the individual market and spreading to the employer market.
Health care providers will worry that introducing another government plan that pays hospitals 40% less, and doctors 20% less, will squeeze their ability to operate even more than the pressure they already feel from Medicare and Medicaid.
For these reasons, and even if the Democrats are able to squeak out a one or two vote margin in the Senate, I see no chance that the Democrats will be able to get such a controversial provision, with so much powerful special interest opposition, through the Senate.
Improving Middle Class Insurance Subsidies in Obamacare
The second major part of Biden's plan is the improvement in insurance subsidies to make the Obamacare/ACA exchange plans more affordable for the middle class.
Biden would dramatically improve the cost of the Obamacare/ACA individual market plans for those who now receive either relatively small or no premium subsidies.
Subsidies for the middle-class would be increased first by ending the income cut-off for subsidies––currently no one making more than 400% of the federal poverty level (about $26,000 for an individual and $103,000 for a family of four) gets any subsidy. Under Biden's plan, no family would be excluded from a sliding scale subsidy whose insurance costs exceed 8.5% of their income. He would also significantly increase the premium subsidy by tying subsidies to what it takes to buy the generous Gold Plan, instead of the current rule that ties the subsidy to the standard Silver Plan.
Today, the cost of individual insurance is often very unaffordable for middle-income people who either get no subsidy or a very small one and end up often faced with annual family premiums in the $15,000 to $20,000 range with deductibles in the $7,000 area. Under Biden's fixes, a family making $150,000 would pay no more than $12,750 in annual premiums with much reduced deductibles.
On the one hand, even with a narrow two seat Republican majority in the Senate if they keep the Georgia seats, I can see an opportunity for compromise in fixing the most broken part of Obamacare. I can see three possible moderate Republican votes to fix the ACA––Alaska Senator Lisa Murkowski, just reelected Susan Collins from Maine, and Mitt Romney. Romney doesn't have the usual antipathy for Obamacare that many other Republicans have. As governor of Massachusetts, he led the way to "Romneycare"––something not much different than what an improved ACA would look like.
But the hitch may not so much be the notion of fixing an obvious shortfall in subsidies that hurts the middle class, as how to pay for it.
The Biden health plan outline would pay for the improved subsidies by rolling back the Trump tax cuts on those making more than $400,000 a year. He would also tax capital gains at ordinary rates for people earning more than $1 million a year, and eliminate the step-up basis for the sale of securities by heirs.
Republican support for those payfor proposals will be the bigger issue.
That makes any legislative improvement to Obamacare, the Democrats gaining control of the Senate aside, hard to see.
Prescription Drug Prices
The Biden plan for reducing prescription drug prices includes making a government-negotiated drug price available to Medicare, his Public Option, and to private individual and employer plans that wanted to take advantage of it.
He would also set up an independent board to establish prices for new breakthrough drugs not subject to competition and enable drugs to be imported from countries that have already negotiated the lowest prices, as well as cap annual drug price increases at the rate of inflation.
So long as the Republicans control the Senate, there is no chance of government direct negotiation of drug prices.
But, ironically, the Trump administration flirted with some of the same ideas that have attracted Democrats.
Through regulation, Trump would have used a market basket of drug prices already negotiated by single-payer nations as an index for how much Medicare would pay under a demonstration program. Trump would have also allowed broader use of the "reimportation" of drugs from single-payer nations like Canada to cut the cost of drugs for consumers and employers as well as ending the practice of paying drug rebates to middlemen.
There is also a bipartisan drug price bill in the Senate sponsored by Republican Senate Finance Chair Chuck Grassley (IA) and Ranking Democrat Ron Wyden (OR) that would make changes to Medicare by adding an out-of-pocket maximum for beneficiaries and capping drug-price increases at the rate of inflation. Grassely has said he has at least twelve Republican supporters––if he could only get Republican Senate Leader McConnell to bring it up.
Perhaps the best chance for action––either through regulation or legislation––is over drug prices.
Affordable Care Act/Obamacare Regulations
Democrats have long complained that Trump was doing his best to sabotage Obamacare through regulations, by badmouthing Obamacare, and limiting the budget for the annual enrollments.
A Biden administration can quickly reverse these.
But will they reverse all of it?
I have no doubt the Biden administration will do more to promote the ACA.
One of the most controversial actions the Trump administration took was to allow limited benefit "short-term" medical plans (the Democrats call them "junk insurance") so people who could not afford Obamacare's high prices and big deductibles had access to an albeit much more limited plan. But, if the Biden administration kills these plans before it can improve the subsidies, they will dump a couple of million people back into the ranks of being entirely uninsured.
Democrats were also very critical of Trump ending the subsidies to insurance companies for the insurance exchange cost sharing assistance. But when Trump did that his action had the bizarre affect of increasing premiums, and low income subsidies in turn, at the expense of higher premiums for the unsubsidized. Reversing this Trump action would now just increase costs for those same low-income people.
A Biden administration can also be more flexible in encouraging the expansion of Medicaid among those states that have yet to do so. A number of traditionally Republican states have shown more interest in joining the vast majority of states that are taking the very generous federal subsidies for expansion.
In Summary
The upshot of all of this is that we will have a Biden administration more inclined to promote and expand the insurance exchanges and Medicaid expansion under the Affordable Care Act as well as controlling prescription drug prices through regulation.
But as for Congressional action, it is much more likely we will be facing gridlock––even if Democrats eke out a tiny Senate majority.
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f18e930e0f8f3035f64f3e73f67a8510
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https://www.forbes.com/sites/robertlaszewski2/2021/03/01/the-democrats-are-about-to-set-a-whopper-of-an-obamacare-political-time-bomb-for-republicans/
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The Democrats Are About To Set A Whopper Of An Obamacare Political Time Bomb For Republicans
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The Democrats Are About To Set A Whopper Of An Obamacare Political Time Bomb For Republicans
Contained inside the Democrats' $1.9 trillion coronavirus stimulus bill is a political time bomb for Republicans.
Included in the bill's long list of stimulus spending is a provision that delivers on President Biden's promise to strengthen the Affordable Care Act, or Obamacare.
Obamacare's big failure has been what it did not do to help––and actually hurt––middle class buyers of individual health insurance. Since the health law's inception, consumers, who are eligible for little or no Obamacare subsidy, have faced daunting premiums and out-of-pocket costs.
In 2021, for example, a family of four with mom and dad age-40 in the Alexandria, VA zip code would find that the cheapest unsubsidized Silver Plan would cost $18,046.32 in annual premiums, with a per person deductible of $6,500 a year.
Candidate Biden's plan would fix that by capping what people at any income level would pay for marketplace plans at 8.5% of their income––the 400% of the federal poverty level cap on subsidy eligibility would no longer apply.
A family of four making the current 400% of poverty level annual income of $106,000 would pay no more than $9,010 in annual premiums (8.5% of their income) under the new rules.
The House passed stimulus package includes this and goes even further by letting people who earn up to 150% of the federal poverty level get full subsidies and also by extending full subsidies to those receiving unemployment benefits.
At 150% of the federal poverty level, four person families earning up to $39,750, and individuals earning up to $19,320, would pay nothing in premiums for their Obamacare individual health insurance under the House passed plan.
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The House stimulus bill would also cover 95% of Medicaid expansion costs for states that have not yet expanded––up from the baseline 90% match.
The Congressional Budget Office has estimated that these changes would cover 1.3 million more people and cost $34 billion.
If these changes survive in a Senate passed coronavirus stimulus bill, they would dramatically improve the costs middle class individuals and families face on the Affordable Care Act's insurance exchanges and encourage states to expand their Medicaid programs.
But here's the catch. These improvements are part of a temporary stimulus bill and would only apply to health insurance subsidies and federal Medicaid costs in 2021 and 2022.
On January 1, 2023, the Obamacare insurance subsidies would revert to the old levels that have caused middle class families to face these huge premiums.
What else is happening at the end of 2022? The Congressional elections.
This would make Obamacare another huge election-year issue.
Would Republican House and Senate candidates support making these middle class improvements to the Affordable Care Act permanent, or would they call for letting them drop?
Now, that is one heck of an ugly election-year choice for Republicans who have consistently called for Obamacare to be repealed and replaced.
If Democrats can succeed in keeping these substantial improvements to Obamacare in a stimulus bill they can get passed through the Senate, they will have set one whopper of a political time bomb for Republicans come November 2022.
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02be28bdcdc8fc736393aeb36a748a29
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https://www.forbes.com/sites/robertlaura/2012/03/29/new-jobs-act-will-revolutionize-retirement/
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New JOBS Act Will Revolutionize Retirement
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New JOBS Act Will Revolutionize Retirement
The recently passed JOBS Act may go down as one of history’s most revolutionary pieces of legislation, relative to the future of planning and investing for retirement. The bill is designed to make it easier for small business to access investment capital and, by doing so, will create a new, Crowd-funding asset class as well as bring self-directed IRA’s out of the shadows and into the spotlight.
New Asset Class: Crowd-Funding
In recent years a variety of alternative asset classes have gained popularity. Private equity funds, long-short funds, target date funds, and everything in between, have become part of the conversations that advisors are having with clients. Through the crowd-funding segment of the new Jobs Act, entrepreneurs can now offer small amounts of stock to individuals and companies through the Internet or elsewhere, allowing them to raise as much as $1 million annually without being required to register the shares for public trading with the Securities and Exchange Commission.
At first glance, these may seem a little scary, and many opponents suggest this will ring in a new era of fraud. However, one doesn’t have to look far to realize that fraud will always be a part of the investment world and investors should proceed accordingly. Seriously, how pathetic is it that a former senator and his colleagues at MF Global are still short billions of investor dollars but walk around as if nothing wrong has happened? And how about the billions (not millions) of dollars Bernie Madoff and the forgetful Robert Allen Stanford scammed people out of? Investors can’t, and shouldn’t, rely on the government or regulatory agencies to perform their due diligence. This type of investing isn’t for everyone but for those who are willing to do their homework and assume some risk, it could not only help fund the next Google or Apple but also boost the economy while adding jobs.
Looking at it from a portfolio management perspective, crowd-funding could provide excellent diversification. Investors who commit some of their money to a local start-up will find that their investment isn’t affected by the same factors that drive the general stock market. Generally speaking, there’s very little correlation between your son’s computer company being run out of your garage and the S&P 500. If one of the major indices drops 5%-10%, the local company isn’t going to be affected and, if they’re working as hard as they should be, they won’t even know.
Investors should treat this new asset class like other alternatives, allocating only a small portion of their overall assets. One benefit to the crowd-funding portion of the legislation is that it should allow a larger number of investors to participate in a new, unregulated start-up as compared to current guidelines and requirements, ideally reducing the amount each investor will need to contribute in order to participate.
Self-Directed IRAs Will Shine
For years wealthy investors have been using the benefits of the self-directed IRAs to grow their net-worth. In fact, many people were surprised to learn that Mitt Romney had accumulated more than $20 million dollars in his IRA because he owned his former company’s stock within it. Others have used the power of self-directed IRAs to buy and sell residential and commercial real estate. And now, savvy entrepreneurs will have a huge opportunity to use self-directed IRAs to attract new capital. In fact, I expect the self-directed IRA market to experience dramatic growth in the next few years. According to a report by the SEC’s Office of Investor Education and Advocacy and the North American Securities Administrators Association, currently less than 2%, or $94 billion, of the estimated $4.7 trillion in IRA assets are held in self-directed programs.
Quite frankly, it doesn’t require much more than common sense to see the growth potential in this area. Many of the so-called “99 percent” are sick of the ups and downs of the markets. They think the game is rigged and they’re tired of being jerked around by it. This bill, combined with other business program like ROBS (Roll-over for business start-ups), will cause an explosion in the number of entrepreneurs staring a new business … particularly by baby boomers not ready to retire and wanting to turn a passion or hobby into a part-time business or to generate investment income for retirement.
Fact is, Congress has finally stepped up by creating the new JOBS Act and by doing so, given investors, a monumental opportunity to use both crowd-funding and subsequently, self-directed IRAs to help stimulate the economy. Combined, I expect each of these factors to revolutionize the way people plan for and invest in retirement.
Follow Robert on Twitter @robertlaura
Check out Robert Laura’s recent articles:
What Broke Athletes & Entertainers Can Teach Retirees
Retirement Strategies for Sugar Daddies and Cougars
Grandma & Grandpa Can Save The Economy
Horseshoes, Hand Grenades, and Your 401(k)
Try Laddered Dividends for Retirement Income
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https://www.forbes.com/sites/robertlaura/2012/04/10/5-retirement-questions-youre-afraid-to-ask/
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5 Retirement Questions You're Afraid To Ask
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5 Retirement Questions You're Afraid To Ask
(Photo credit: TaxCredits.net)
Retirement is filled with questions. How much do I need to save? How long will my savings last? How much can I withdrawal each year? Fortunately, there’s an almost endless supply of calculators and resources that help investors answer the usual questions. However, a number of often neglected, more personal questions never get asked and can cause unnecessary stress and anxiety as long as they go unanswered. Here are the five retirement questions many new and existing retirees are afraid to ask:
1) Can I afford to get divorced now that I am retired?
The financial impact of divorce, particularly during retirement, can be severe. There are no simple equations or clear-cut rules to follow. Deciding how to divvy up real estate, retirement savings, pensions, a family business, or stock options, while staying conscious of life insurance proceeds, long-term care insurance policies, and debts, can not only be expensive but also emotionally devastating. Tension and angst stemming from divorce can result in a mental state that leads to financial hardship later in life because the process causes some to just give up, thus reducing their share of the assets or future income that they may equally need and deserve.
In most cases, divorce during retirement will handicap each party’s ability to maintain their current standard of living. Even in an ideal situation where the breakup is mutual, and there’s a 50/50 split of assets, divorced retirees may be forced to increase withdrawals from their retirement plan and perhaps incur more debt as they are forced to maintain a household and the attendant costs of appliances, utilities, property taxes, etc. Once more, in situations where divorce is “worth it,” the more damaging aspects for retirees can be the impact it has on their personal and social life as both family and friends pick sides and divorcees find themselves alone and sometimes ostracized by married couples.
2) Can I leave more money to one child than another?
Yes, and without proper estate planning documentation many people do it without even realizing it. In my prior role as a trust officer, I’ve found an even split among heirs to be most common. But I have seen documents that completely omit some children based on everything from the heir’s choice of a spouse, the way they discipline kids, and of course spending habits or drug abuse.
What most people don’t realize is how an estate plan, or lack of one, will affect their family after they are gone. Money, in any amount, can quickly and dramatically alter family relationships for decades and even lifetimes. A common problem is the parent who becomes ill, forcing the child who lives closest to care for them, while siblings who live far away prove to be of little help. Mom’s wishes may have been to split the money evenly, but the caring sibling whose name is now on the deed to the house and all of her bank accounts becomes in many states the sole beneficiary. Equally troubling is the fact that, because of the time, energy and effort one child invests in caring for Mom, they oftentimes feel they deserve the money and house. They wind up parceling out only a few mementos to siblings, and essentially undoing everything Mom had done to keep the family close.
3) Do I have to name my spouse as my primary beneficiary?
No! And I’m finding more and more female breadwinners unwilling to just hand over the reins of the family and all they have worked hard to accumulate to a not-so-savvy or spendthrift husband. While an account holder doesn’t have to name their spouse as their primary beneficiary, the spouse does have to sign a form stating that they acknowledge and understand that they are not being named primary beneficiary.
While this provision is part of almost every retirement and pension plan, too often an unknowing and trusting spouse is simply asked to “sign here,” doing so without taking the time to truly read and accept what they are being asked to do. That being said, there are other pertinent reasons for not naming a spouse as primary beneficiary. For example, when there is a large estate, or the surviving spouse is much older, there may be some benefits to using other heirs as a means of “stretching” an IRA or to reduce overall income taxes.
4) Do I need to save money during retirement?
Yes. Despite all of those years of saving to finally become retired, people should still find ways to save money during retirement, particularly in the early years. I’ve heard retirement compared to a lot of things but feel it’s best compared to marriage … in the sense that if you had to plan your entire marriage before your wedding day, how would that be working out now? Like marriage, retirement is unpredictable and constantly evolving. The old days of sitting in a rocking chair until your number comes up are gone. Therefore, new and existing retirees should find ways to make spending and saving trade-offs in order to prepare for both future emergencies and opportunities
Savings can be found in regular places like groceries, cable, phone services and car insurance, not to mention the potential upside of selecting generic prescriptions over the name brands, and comparison shopping supplemental healthcare programs. Also, retirees shouldn’t refuse savings just because they feel like turning up their nose at “senior discounts.” Instead, use the savings to offset a gym membership, haircut or activities with grandkids. Finally, that extra savings can be a major benefit when something unexpected happens. Vision, dental, and hearing issues aren’t covered by Medicare, nor are some likely future medical needs like grab bars, heating pads, and certain bed types.
5) How do I say “No” to my adult child’s request for money?
It’s no different than telling them “No” at any other stage in their life. You said “No” when they wanted to stay out late, attend a party that wasn’t appropriate, and countless other times that their personal, social, or business life was at stake; yet somehow they survived. The secret is communication and clear-cut statements like, “anything worth having or doing is worth saving for,” which they know they will hear every time they ask … and which they can later repeat to their own children.
Communication is important because everyone has their own ideas of what retirement means and represents, especially when it comes to younger generations. Many in Generation X & Y wrongly assume their retired parents have more than enough nest egg to go-around, and can somehow replace any lost savings. But that’s not always the case. Therefore, retirees can reduce the incidence of adult children asking for money by sharing what retirement means to them and what it doesn’t mean to their children. As a last resort, consider treating your adult children like a speculative investment. Allocate a small portion of your assets, say 1-3% and if the investment in them doesn’t produce a satisfactory return, there is no additional funding.
With over 10,000 baby boomer reaching retirement age every day, more and more questions like this will continue to bubble up. The old days of financial advisors and clients focusing only on questions such as “how much do I need to save in order to retire?” and “how much can I withdraw when I’m retired?” will be replaced with more personal and pressing questions like these.
Follow Robert on Twitter @robertlaura
Check out Robert Laura’s recent articles:
New JOBS Act will Revolutionize Retirement
Could Facebook and Twitter Cost You Your Inheritance?
What Broke Athletes & Entertainers Can Teach Retirees
Retirement Strategies for Sugar Daddies and Cougars
Grandma & Grandpa Can Save The Economy
TaxCredits.net
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https://www.forbes.com/sites/robertlaura/2012/06/12/food-network-stars-pat-gina-neely-share-their-recipe-for-success/
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Food Network Stars Pat & Gina Neely Share Their Recipe For Success
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Food Network Stars Pat & Gina Neely Share Their Recipe For Success
Recipe For Success
Whether you’ve watched their show on the Food Network or caught their guest appearances with other foodies, the “king and queen of barbeque” are equally serious about money and their future. They’re not only savvy business owners, best selling authors, and accomplished TV personalities, but I found them exceptionally down-to-earth on matters of family, finances, and spirituality.
Humble Pie
“People see the glory but they don’t know the story,” said Gina Neely (The Spice Fairy). “People see where we are now but have no idea how much it took for us to get here.” Both Gina and husband Pat come from very humble beginnings, which plays an important role in who they are today.
“My father died when I was 12,” said Pat. “From then until I was in 11th grade we didn’t have a car and had to ride the bus everywhere. That had a huge impact on me as a kid - and still does - because it made me want to make sure I had a secure, stable life … with the security of knowing there was a car to drive, a nice house to go home to, and the knowledge that my daughters could go to college.”
Gina explains, “We lived with my great grandmother and though we didn’t have a lot, it felt like we did because we had each other.” That slow start didn’t speed up right away, she adds, “When Pat and I got together, we didn’t even have a bed; we threw some pallets together to make one. We were at zero and he had to build from that; but when you go through humble beginnings, that’s what makes you sustainable.”
Slow Cooked Success
For the Neelys, humble beginnings have given way to better times. I asked them why their restaurants continue to flourish and avoided failure like so many others. This question seemed to stump them because it appears that failure was never really an option for them.
“We’ve succeeded,” said Pat, the family entrepreneur, “through hard work, being honest and having faith in God … plus a big, big passion for the business. Gina and I would put on our work clothes and go in there and do whatever was required, never asking employees to do something we wouldn’t.”
As Gina, who has a banking background, explained, “You always have that feeling that you need to do something. You can never rest on your laurels. There is always that steady grind that makes you ask how can I make this better … how can I make this great? You can never rest if you want to be the best; you have to always keep trying and pushing and changing to make it better … and that’s what we always tried to do.”
Financial Recipe:
How does this celebrity couple manage money and their plans for their future? It’s all about strict rules, self-discipline, and experience.
Gina said, “Every check that comes through the door, no matter what the amount, we save that same percentage.” “Fifteen per cent is a strict rule,” said Pat. “Gina keeps us to it … and it has nothing to do with what goes into retirement.”
While the Neely’s success came fast once they got into the entertainment business, their timing was helped by their age and experience. I asked what was different about their financial success as compared to those celebrities and athletes who end up bankrupt.
“We understood taxes” said Pat. “After working for yourself for two decades you learn that it’s not all your money. You also need to be disciplined, and prepare for the good and the bad years. And that means putting some money aside so you can weather the storms.”
They are also budget conscious, and focused on what they want from money. It helps that they have never lived “over the top” or outside of their means, avoiding credit card debt and other financial traps. “We live on a budget that gives each of us an allowance,” said Pat, “and what Gina does with her allowance is her business and what I do with mine is my business. That works because we’ve already taken out our savings and household expenses … and that’s worked for us for 20 years.”
“Because of my banking background,” said Gina, “I knew the importance of savings and using things like CDs and SEP IRAs to put money where I would be penalized if I touched it, and that’s made us more disciplined.”
“Gina is more familiar with investments,” acknowledges Pat. “When you’re still learning, like me, you’re a little more cautious. I have our planner come in and ask her to take me to school and explain what everything means. You want to work with a person that can speak your language.”
Insurance also plays a key role in their financial plan. “I’m extremely adamant about my family being taken care of once I’m gone,” said Pat. As he points out, “My father died with six children and a wife and he didn’t have any insurance. I want to be able to rest in peace knowing my family is taking care of.”
“When you’re in an industry where you and your body are the actual product, you have to think about disability insurance, too,” said the former banker. “What happens if I can no longer cook? Am I positioned to do what you need to have done in case something happens? You have to look at every picture and plan for it,” said Gina.
Seasoning Future Generations
As successful African-Americans I asked what challenges and opportunities other African-Americans face as they plan and save for retirement.
“For the first time we’re seeing African-American millionaires,” said Pat. “A generation or two ago, we weren’t earning that kind of money, and it’s difficult for many African-Americans because they didn’t grow up knowing how to manage money. Children are a lot more educated about it today. My daughter, still in high school, has a checking account and savings account. She always balances her account and when she dips into savings she puts it back with a little more. My hope is that with each new generation we’ll become a race more skilled at managing money.”
“We all need to move our blessings forward,” said Gina. “Yes, we need to tithe at church but we also have a responsibility to tithe to our community as well. I know what it’s like growing up without certain things, and as African-Americans we need to pay blessings forward as a village for our kids.”
Like Peas and Carrots
Those who watch the Neelys on the Food Network wonder if they really like each other that much or if it’s all part of the show. The answer is evident in their advice for couples.
“Gina, gave me something I truly needed: balance. Marriage is like a scale … you have to keep it balanced. You both bring stuff to the table. Neither is more blessed or greater than the other. You know each other’s strengths and weaknesses and roll with it.”
“When you say ‘I do’ you’re saying ‘I’ll work,’ said Gina. “You have to work at your marriage every day. If you don’t want to work every day, you need to abstain.”
“Learn to be flexible,” Pat added. It’s not always about you … you don’t always get to watch your TV show in the bedroom … and if she wants to cook a certain dish, that’s okay. You might not be crazy about it but she’ll cook this time and next time I’ll cook what I want.”
They both agree that creating a long-lasting marriage starts with rules and regulations they both agree to abide by. They also encourage young couples to seek premarital counseling and to have God or some type of spirituality in the home as a way to build strong foundations.
In summary, what you see is what you get with Pat & Gina Neely. They are a true testament to living a passionate life together. Whether it’s business, family, spirituality or community, they understand the value of hard work and discipline and hope to be an example of paying it forward that inspires others to find their own personal and financial success.
Follow Robert on Forbes.com or on Twitter @robertlaura
Check out Robert Laura’s recent articles:
How Star Athletes Deal With Retirement
What Broke Athletes & Entertainers Can Teach Retirees
5 Retirement Questions You’re Afraid To Ask
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https://www.forbes.com/sites/robertlaura/2012/08/29/five-things-to-do-before-you-retire/
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Five Things To Do Before You Retire
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Five Things To Do Before You Retire
For retirement advice and tools, whatever your age or assets visit The Forbes Retirement Guide.
So often people think they enter a magical world once they retire … that everything is somehow going to be lovely because they’re no longer working. Make no mistake, though, retirement has a tendency to magnify who you already are and what you already do; you just have more time to think and stew about it. With 10,000 people retiring every day and hoping to make a smooth transition to the good aspects of that life (not just the financial aspect) I suggest every pre-retiree do these five impactful things:
1) Eat A Meal Good Enough To Be Your Last
This is something you can do whether you’re five, 10 or even 20 years away from retirement. Whether its lobster, filet mignon, or some other delicacy, make it an annual tradition to stimulate your taste buds in a way you’ll never forget. Post pictures of the meal online, acknowledging your fine company and those who helped prepare it. Think of it as a special time to celebrate and enjoy some of the finer things life has to offer.
2) Take Lots of Pictures
Two important aspects of retirement that often go unaddressed are staying socially connected and maintaining a strong network of friends. Study after study has shown that those who stay socially engaged with others and who have a strong network of friends that they can rely on, tend to outlive their peers. Therefore, one of the easiest ways to connect with old and new friends is through pictures. Simply ask for their email or Facebook id and offer to send them copies of photos or tag them in it. It’s a proven way to create lasting memories and friendships.
3) Establish Some Investment Beliefs
With the Presidential election heating up, more and more people are discussing their political and religious beliefs. You may consider yourself conservative or liberal, or you may side with the right or the left. Either way you have acquired a series of beliefs that guide your voting decisions. That should also be the case when it comes to money management and investing. Before you retire, reflect on past financial decisions you’ve made; what has worked and what hasn’t, then write down five beliefs you have about money and investing. Several years ago I developed an Investor Constitution that outlines my beliefs for investors – here’s three of my top five.
Investors shall respectfully require each investment to have a specific purpose in their portfolio Investors shall not invest in something that cannot be easily monitored and explained Investors shall understand all of the fees and expenses associated with each investment, transaction, and professional service, and use that information to align themselves with services that best serve them.
4) Eliminate Stress
In my book Naked Retirement, I ask readers to assume they are celebrating their retirement on a wonderful Mediterranean cruise when suddenly they become stranded on a deserted island. Despite the situation, this becomes something of a big relief because now they don’t have to deal with _____________. It’s a quick and concise exercise that pinpoints an area of stress in your life you’d like to eliminate. Whether it’s a relationship, bad habit, financial commitment, or other situation, take steps to remedy it now rather than later. Seek out support from friends, or get help from a professional if necessary, but try not to drag any unnecessary stress or anxiety into retirement. If you don’t, you’ll just wind up with more free time to ponder and worry about it.
There are lots of things you can do to eliminate stress from your life, but it starts with identifying the cause and changing negative responses to them. Whether you overeat, binge drink, or avoid people, break major stress factors down into parts you can examine and then design a plan for change.
5) Create Healthy Habits
We’ve all heard that first we make our habits and then our habits make us. In retirement, nothing could be further from the truth. Remember, there is nothing magical about retirement. That means there’s no magic potion you drink daily that motivates you to work out or walk every morning. There’s no mystical maid who cooks healthy meals for you every day. Yet these are two routines retirees often talk about wanting to do once they retire. So instead of hoping healthy habits find you, start establishing them right now. If you’re plan is to walk every day, start now. If you hope to eliminate meat or gluten during retirement, get ready now so you can focus other things instead of constantly hoping for the motivation to exercise, or the inspiration to prepare healthy meals.
Combined these five steps can help you address mental, social, physical, and financial aspects that lead to a successfully transition into retirement.
Follow Robert on Forbes.com or on Twitter @robertlaura
Check out Robert Laura’s recent articles:
How Star Athletes Deal With Retirement
What Broke Athletes & Entertainers Can Teach Retirees
5 Retirement Questions You’re Afraid To Ask
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https://www.forbes.com/sites/robertlaura/2012/09/30/two-truths-and-a-lie-about-dividends/
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Two Truths And A Lie About Dividends
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Two Truths And A Lie About Dividends
If you’ve ever played this game, you know it’s both fun and simple. I’ll share three statements about dividends and you have to decide which ones are true and which one is the lie. So here they are:
Average dividend payments for companies in the Dow Jones Industrial Index (DJIA) are at least 100% higher than average one-year CD rates. Dividend payments are based on a company’s stock price when the dividend is declared. Certain company dividend payments are more consistent than those from dividend paying mutual funds and ETFs
You see I teach dividend and several other investing classes and I’m always surprised at how individual investors will acknowledge that they know or are familiar with an investment concept but when they are asked to define it, they appear like a deer in headlights.
For example, if you ask most people if they know what a mutual fund is they say, “Yes.” But when you ask them to define it, they can’t articulate its basic meaning. So too is the case when to comes to dividend paying stocks. People are familiar with them but can’t verbally express the pros and cons of one of the most important investment vehicles for retirement income today.
So let’s finish the game and take a look at how you did? Which one is the lie? Number 1, 2, or 3?
1. Average dividend payments for companies in the Dow Jones Industrials Index are at least 100% higher than average one-year CD rates: Truth
Average CDs rates are hovering at multi decade lows. The latest report put them at less than 1%, and with that, well more than 100% below the average dividend payment for DJIA companies of 2.8%. Ben Bernanke’s decision to keep interest rates near zero is having a damaging affect on the portfolios of conservative and retired investors who traditionally seek guaranteed or fixed income such as CDs and bonds.
That may be a tough pill to swallow for some retirees but it’s a reality they have to face… and of course one of the main reasons I wanted to play this game: To help retirees better understand how to invest in dividends especially since it looks like dividends may continue to out yield CDs and other traditional fixed income investments until at least 2015.
2. Dividend Payments are based on a company’s stock price when it's declared: LIE
Many investors don’t realize that a company’s dividend is not based on its current share price. Dividends in their most basic form are payments made to shareholders based on company profits. Companies can either retain their earnings and plow them back into operations or give a portion of them to shareholders. Therefore, dividends aren’t an expense, but the sharing of profits.
Dividend payments are therefore not related to a company’s stock price outside of the time in which you buy them. For example, Johnson & Johnson (JNJ) is currently trading near $68 a share with a dividend yield of roughly 3.50% ($0.61 cents a share). If you buy 100 shares at that price, future dividend payments will be made based on your number of shares, not a change in stock price. If the stock goes up to $75 or down to $55, the company will still pay you a rate based on the number of shares owned, not it’s current market price.
3. Certain company dividend payments are more consistent than those from dividend paying mutual funds and ETFs: Truth
Not only are there a plethora of companies who have maintained a consistent dividend for years, there are over 50 companies who have consistently increased their dividend payments for 25 years or more (Dividend Aristocrats). That’s not the same case when it comes to dividend paying mutual funds and ETFs who have to manage dividend payments based investor outflows and inflows, not to mention price appreciation and depreciation. A quick look at a popular ETF, the Vanguard Dividend Appreciation Fund (VIG) and Johnson & Johnson points out the difference.
Source: Yahoo Finance
As you can see, not only is JNJ’s dividend payment more consistent, but it’s dividend growth over the period highlighted equates to an inflation busting average of more than 7%.
Since Ben Bernanke has changed the interest rate landscape and retirement income game, it's more important than ever that retirees and conservative investors understand their options when it comes to making the most our of their retirement savings. I hope you enjoyed playing the game and learned something new or helpful about dividends. Come back again for more dividend and retirement income games and strategies.
Follow Robert on Forbes.com or on Twitter @robertlaura
Check out Robert Laura’s recent articles:
How Star Athletes Deal With Retirement
What Broke Athletes & Entertainers Can Teach Retirees
5 Retirement Questions You’re Afraid To Ask
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db5c1689c68b9f2672eeb2f5d5fa0cf1
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https://www.forbes.com/sites/robertlaura/2012/10/23/planning-for-a-posh-retirement/
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Planning For A Posh Retirement
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Planning For A Posh Retirement
The wealthy, particularly the 1%, have been criticized of late. Whether you believe this condemnation is well-deserved or counterproductive to our capitalist society, those who live in gated communities, frequent yacht clubs, and drive Ferraris can teach other well-to-do and middle class retirees important lessons relative to making retirement more enjoyable.
It seems retirement today gets negatively associated with the threats and feeling that individuals, corporations and the government will run out of money, raising people’s fears that they’ll be forced to live on dog food to survive. Report after report comes out detailing how people haven’t saved enough and will never be able to retire. In reality, though, living a successful and fulfilling retirement may be less about money and more about keeping in contact with friends, staying healthy, and mentally sharp. For those who can and do dream big, plan ahead and make the necessary sacrifices, there are major lifestyle advantages that come with a luxury car, cruising around the bay in a yacht, or living on the links at a country club.
I uncovered several unique benefits to a posh retirement from interviews with Garrett Hayim, President, Ferrari-Maserati of Fort Lauderdale, Michael McCarthy, CEO of the Addison Reserve Country Club, and Terry Anglin, General Manager of the San Diego Yacht Club.
The first and most important theme they reinforced was the need to plan ahead. Not so much like the old cliché “fail to plan, plan to fail” but more in the vein that there are waiting lists for everything posh. A new Ferrari has a five year wait list; it could take ten years to get a golf membership at the Addison if you don’t buy a house that includes membership rights; and, while you can become a full member of the SD Yacht Club within a couple years, you might have to wait five or six years to get dock space that fits the size of your boat.
I couldn’t possibly imagine every wealthy person being willing to endure long waits, so I asked, “Can’t you just buy your way to the top of the list?” In each situation, money wasn’t the primary means to the end. According to Anglin, “Membership at the Yacht club isn’t about the money. It’s about tradition and preserving experiences you’ve valued and wanting other members of your family to enjoy.” Ferrari dealer Garrett Hayim said, “We have an ongoing relationship with owners who buy and then sell their cars back to us, and that’s worth more than letting someone jump to the front of the line just by waving money.”
Make no mistake, these clubs and prized assets are not free; nor will you likely be able to afford them by saving 3-5% of your income. The sticker price for a new Ferrari is roughly $350,000 but it could retail for as much as $475,000. While the price includes routine lifetime maintenance, if you’re planning to burn a lot of rubber four new tires cost at least $1,500. Of course, you don’t have to walk in with a brief case full of cash and plop down $350k (wouldn’t that be cool, though?). There are financing options ranging from $800 per month for an interest only loan, to as much as $2,500 per month. Estimated gas mileage is 12 miles per gallon in the city, with one website estimating annual fuel costs at as much as $4,500. Car insurance will of course depend on your driving record and state of residence.
Driving your car to the yacht club actually seems fairly reasonable. One-time initiation fees at the SD Yacht Club range from $2,400 to $21,000 depending on your age. There are monthly dues of roughly $130 and dock fees can range from $9 - $11per linear foot. A well for a 60-footer, for example, may cost $600 per month. While you don’t have to own a boat to become a member, Anglin had quick access to some general boat listings, noting that a 35’ sailboat could go for less than $50,000 while a 70’ power boat would hit your retirement savings a little harder around $400,000.
As Michael McCarthy related, “Initiation fees for southern Florida’s gated communities range anywhere from $25,000 all the way up to $300,000.” The Addison Reserve Country Club maintains an initiation fee of $115,000, of which members receive 50% back when they leave the club. There are annual dues of $20,000, and the cost to buy a home within the community can range anywhere from $300,000 to $6,000,000.
“You don’t have to come into our community at the top end for homes,” he added. “You can basically buy a $300,000 home and in some cases live a lifestyle as lavish as a multi-millionaire or even a billionaire.”
Gallery: 6 Unusual Retirement Lifestyles 7 images View gallery
Sticker shock of these outright costs must make you wonder if any retiree can truly afford to maintain these luxuries. Breaking it down to its simplest, you may not be able to afford all three at the same time, but bare bones annual costs aren't as frightening as you might think. Add up $20,000 for the country club, $10,000 for the Ferrari (interest only), and $9,000 for the yacht club and it’s just $39,000 per year. Considering that you may not have all three at the same time, nor maintain any of them all through your golden years, it’s not too distant from Fidelity’s latest research that suggests a couple may spend as much as $240,000 on health care costs alone during retirement.
But here’s something most people don’t realize and rarely plan for: there are also the mental, physical, and social benefits included in the price of these exclusive luxury items.
Country clubs, yacht clubs, and car enthusiast clubs not only provide the opportunity to develop a strong network of friends who keep you engaged and connected, but they can also lead to other healthy, stimulating activities. Things like group travel, health club facilities, and healthy menu options can keep retirees physically fit and may reduce health care costs. Meanwhile, volunteer work through committees, organizing events, or maintaining skills such as golf, tennis, or car maintenance can go a long way to help retirees keep their wits about them.
“Residents in our community realize the health and social benefits of being members,” said McCarthy. “Our golf, exercise facility, and healthy menu items keep people looking and feeling good. With six restaurants, a spa and other amenities, residents never have to leave the community or fight the crowds during peak season … and it’s nice to walk into a place where you are going to know everyone and feel welcomed.”
The SD Yacht Club offers a similar experience based on the camaraderie among boat enthusiasts. “We serve meals 364 days a year, offer members a workout facility, and have regular races and other social events that help people stay active and socially connected,” said Anglin. “Members are usually assigned to a
fleet based on the type of boat they own and can crew with other members at races and social events. Sailing in particular provides great exercise as well as an easy way to build strong relationships with others who have similar interests, skills, and experiences.”
“Ferarri owners are a unique group of people who see their cars as works of art,” said Hayim. “They age like fine wine and there is a great sense of pride that comes with owning one. Ferrari clubs and associated events connect people on a different level and give owners a reason to celebrate life every time they slip behind the wheel.”
I think a lot of people today have the wrong idea when it comes to dreaming big and desiring a posh retirement. While not everyone can afford a Ferrari, gated community, country club, or boat at a yacht club, they can and should consider aligning themselves with clubs in their particular socio-economic range so they have every opportunity to stay socially connected and mentally and physically sharp.
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Follow Robert on Forbes.com or on Twitter @robertlaura
Check out Robert Laura’s recent articles:
How Star Athletes Deal With Retirement
What Broke Athletes & Entertainers Can Teach Retirees
5 Retirement Questions You’re Afraid To Ask
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https://www.forbes.com/sites/robertlaura/2012/10/31/how-to-find-your-passion-in-retirement/
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How To Find Your Passion In Retirement
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How To Find Your Passion In Retirement
For retirement advice and tools, whatever your age or assets visit The Forbes Retirement Guide.
In my opinion, living a passionate life is the ultimate personal and financial achievement. People make their way through life and into retirement in various ways. But it’s the time, experience, and wisdom that individuals accumulate on their way that make it an ideal time to find a new, or live out an existing passion.
Living retirement with a passion helps resolve personal and financial issues common among both new and longer-term retirees, including replacing one’s work identity, staying socially connected, and remaining mentally sharp as well as physically strong. It can give retirees something to be thankful for every night and a reason to wake up smiling every morning.
Finding your passion isn’t as difficult as one may think. I personally had a formula handed to me several years ago at a conference I was attending. A person I didn’t know approached me and asked, “Are you passionate about your work?” It was a question I’d thought about before but had never been asked … and let’s just say I wasn’t as prepared to answer as I’d hoped.
After a short pause, this stranger helped me move beyond my stumbling response by saying, “You’ll know you have found your purpose in life when you can say that your pursuit of it is Timeless, Tireless, and causes Contagious Energy. It was definitely an “A-ha!” moment for me, and one that I have never forgotten.
It’s important to carry that concept into retirement because, for some reason, people think retirement is so different, almost foreign when it’s compared to the life they were living while employed. But there is nothing magical about retirement itself. Retirement is a blank slate where each individual who approaches it must fill it with what is important to them. It’s also a privilege that many people never get to experience, so the time allotted to a retiree should be approached with purpose and intention. For added perspective, consider that there is nothing automatic about retirement. It doesn’t just unfold into the greatest time of your life. It takes time, practice, and concentrated efforts to make it the best it can be.
My simple starting point toward living a passionate retirement includes asking yourself the following questions:
1) What feels timeless when you do it?
2) What can you relentlessly pursue without ever growing tired of?
3) What is a constant source of energy in both your words and actions?
Taking the time to reflect on these questions on a regular basis can make you a member of a very exclusive club, and put you years ahead of less-prepared people moving toward retirement. There is a catch however. Like other aspects of life, finding and living a passionate retirement isn’t free or easy. It takes time, requires discipline, demands commitment, and won’t come without practice.
Whether your retirement passion ends up being some form of mentoring, higher learning, traveling, gardening, or helping others you’ll probably have to make some sacrifices to make it a regular part of your life. It could be as simple as sacrificing time away from TV or something more impactful like time away from family and friends. Unfortunately, too many people expect that their passion or mission in retirement will just come along one day, like a birthday or holiday, and just reveal itself. But just as I had my own A-ha moment when the concept was revealed to me, so too may be the case if you’re willing to put yourself in situations and circumstances that expose you to new and diffferent opportunities.
I’m sharing these thoughts and suggestions with you because often times I see people transition into retirement with no plan to address the non-financial aspects of retirement… specifically, ways to stay connected to family and friends, live a fit and healthy lifestyle, and stay mentally at the top of their game. This situation can partially be attributed to financial services and marketing companies harping on the financial aspects of retirement. But what a retiree can gain by devoting their time, energy, and resources to living this time passionately can be vastly more rewarding than any amount of money that comes from saving and investing.
Follow Robert on Forbes.com or on Twitter @robertlaura
Check out Robert Laura’s recent articles:
Planning For A Posh Retirement
Two Truths And A Lie About Dividends
5 Retirement Questions You’re Afraid To Ask
For retirement advice and tools, whatever your age or assets visit The Forbes Retirement Guide.
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https://www.forbes.com/sites/robertlaura/2013/02/12/helping-your-adult-child-get-back-on-their-own-two-feet/?ss=retirement
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How To Help Adult Children Get Back On Their Own Two Feet
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How To Help Adult Children Get Back On Their Own Two Feet
An interesting aspect of being a financial professional is that we get a firsthand look at how people earn, save, and spend money as well as many things they’re dealing with on a daily basis. One primary issue impacting the health and well-being of current and future retirees is the role their adult children play in their life.
Today, more than ever before, adult kids are moving home again and remaining financially dependent on their parents for longer and longer periods of time. It’s no longer just a trend or a fad; it’s the way things are now.
Despite becoming more commonly accepted, there are, nevertheless, specific things that parents can and should do to make sure a transition back home, or ongoing financial support, doesn’t negatively affect retirement plans or any long-term relationship with children or other family members.
Christina Newberry, author of The Hands-On Guide to Surviving Adult Children Living at Home, offers several reasons why adults commonly transition back home, including college graduation, job loss, and divorce. Her expertise comes from personal experience, having moved back in with her parents twice in less than 10 years. In both cases, she notes that her parents’ attitude and structured home life played key roles in very short but very positive stays.
“My parents were always very clear on what their role in my support was. Growing up, when I went through my allowance, I wasn’t getting anymore and when I moved home their attitude was ‘this is our house and a privilege for you…and you will contribute.’”
Some families can make having adults kids at home a positive experience by setting firm goals and having the kind of attitude that helps their children get back on their feet, but there are just as many cases where things don’t go so smoothly because of past experiences and differing expectations. To my surprise, Dr. Fran Walfish, author of The Self-Aware Parent, suggests the trouble parents are having with their adult children can start when kids are as young as 18 months. “The way parents deal with a young child’s natural tendency to claim themselves as a separate being sets the bricks and mortar for how children react later in life.
We live in a “Facebook society” where everyone, including parents, strives to be, and worries about being liked. Dr. Walfish, Psy.D., points out that family dynamics have also changed. “We are now living in a culture of two income families with both mom and dad working. Mothers in particular can feel guilty about the time they spend away, and feeling exhausted from their long day, don’t want to say ‘no’ or argue with their children.”
As she points out, “Each parent has to feel comfortable balancing two things at the same time; the ability to love and nurture their children as well as the ability to set and hold onto boundaries. Most parents do pretty good with the love and nurturing but fall down on the boundaries.” In doing so, leaving the door wide open for them to expect their parents to continually rescue them from the harsh realities of the real world, both emotionally and financially.
While financial professionals do get an up close and personal look at other people’s lives, it doesn’t make our families immune to the situation. Lloyd Lowe Sr., founder of LD Lowe Wealth Advisory and author of Life's Bridges: Building Your Bridge To Financial Wealth, found himself in a family dynamic where he had to practice what he preached to clients when it came to dealing with the financial impact that adult children can have on retirement plans. After some troubles in high school and a difference of opinion over his son’s future (and who was footing the bill), Lloyd had to find that balance between love and boundaries when he discovered that his son took his college money to LA in hopes of becoming a movie star.
“For roughly five years we shipped him cases of ramen noodles on the bus line because it was the cheapest thing we could do, and we were going to make a point. My wife and I were unified on what we were willing to do and not do in order to help him become economically self-sufficient.”
“During that time we stayed visual, visiting him twice a year and always staying in contact even when he wasn’t contacting us. As parents you have to know what you are signing up for and at times that can include lots of hollering, self-doubt and worry.” Lowe and his wife finally received the call they were hoping for: “Dad, I‘m sick of eating ramen noodles,” said his son. But, instead of just accepting his boy's decision at face value, they sent him a bus ticket, not a plane ticket, and immediately set him up in an efficiency apartment with strict guidelines on support and college enrollment. This balance of love and boundaries eventually created a very economically-reliable child and strong, appreciative bond between the family.
Another aspect regarding adult children and financial dependency that rarely gets discussed is what happens when one child sees another family member, such as a sibling or cousin, take advantage of a parent. “It’s infuriating,” explains Linda Riebel, PhD who witnessed her mother hand over hundreds of thousands of dollars to a family member. “My initial response was, ‘Mom’s been good to me; how can I complain?’ But as things get worse, you become enraged and have to take steps to stop it.”
She describes dependent adult children as “family passengers” and has several interesting viewpoints on the relationship between the parent and adult child. “Oftentimes, a dependent adult child may have been ill or injured as a child and the parent can become fixated on the idea that this child is vulnerable and they never give up the habit of being the caretaker or rescuer for the child.”
“A parent can get a personal benefit from being the rescuer,” she adds, “which can be an additional motivation for them to continue writing checks. They get to feel like ‘I’m the provider, I’m the strong one.’ It’s a mutual dance that can fracture a relationship between spouses as well as other family members.”
In Riebel’s case, she eventually had to take control of her mom’s money until she died, with no beneficial change in her family member’s dependency. A scary reality that suggests that son or daughter (or family member) in the basement or lounging on the couch may not be an easy or immediate fix.
In the end, no matter the reason, today’s parents have to take a longer view at the extended time and expense that children may bring to their life. In order to help them stand on their own two feet here’s what the experts I interviewed suggest:
Christina Newberry: Parents have to realize that no one else is going to get them out of the situation. They are going to have to have some very difficult conversations with their kids and brace for challenging moments. They have to realize they are not doing them any favors by allowing them to remain dependent and are only delaying the inevitable.
Dr. Fran Walfish, Psy.D: Have a straight, honest open talk with your 30 year-old and say, “We made a mistake…we goofed! We excelled in loving you but fell down in helping you deal with and experience letdowns in life; and the reality is we kind of set you up for disappointment because that is not how the real world is and you have a right to be pissed off.”
Lloyd Lowe Sr., RFC: If situations get harsh, you have to be prepared to get your thick skin on because taking a firm position with your child can paint you in a bad light. Just stay unified and it will be worth every last bit of it.".
Dr. Linda Riebel, Ph.D: Parents need to learn to tolerate their child falling down or risk becoming a rescuer. If there was a period of illness or injury when a parent had to commit extra time to a child, if the chapter is over, let go of the role. Instead of saying. “I’ll fix it” and take the pain away let them learn how to deal with a big disappointment and come to a resilient conclusion.
P.S. If you found this article helpful, please let me know by leaving a comment. Also, if you're interested in a copy of my latest FREE guide: Three Things No One Tells You About Retirement please click here.
Follow Robert on Forbes.com or on Twitter @robertlaura
Check out Robert Laura’s recent articles:
Can Your Marriage Survive Retirement?
5 Retirement Questions You’re Afraid To Ask
Gallery: Turn Your Kids into Millionaires 11 images View gallery
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https://www.forbes.com/sites/robertlaura/2013/05/29/rick-harrison-pawning-his-way-to-the-top/
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Rick Harrison: Pawning His Way To The Top
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Rick Harrison: Pawning His Way To The Top
For centuries, people have used various forms of barter, exchange, and pawning for quick access to money. Despite advances in currency and technology, the practice is still around today and more relevant than ever thanks to the hit TV series Pawn Stars. My interview with owner and star Rick Harrison went much like a new episode. His approachable style and desire to educate made me feel like I was standing in his shop, across the counter from him. He was not only willing to give me a fair deal on his life and experience in the pawn business but also an inside look at his thoughts about money, investing, and retirement.
His rise to wealth and celebrity status is anything but the stuff of fairy tales. “Growing up I was a really sick kid. My dad was in the military, which meant he was overseas a lot and I had a working mom. Being a middle class family back in the 1970s meant we only had one TV… and it wasn’t in your room … so when I was 8 years old I began developing a passion for reading history, and it’s never stopped.”
That thirst for knowledge and hunger to achieve his own success eventually evolved into entrepreneurship. “I was a businessman for a long time before I was a celebrity,” said Harrison, “and to succeed for over 20 years, as I have, you have to be innovative and have a lot of perseverance. When times got tough, you have to lay people off and work two or even three shifts straight, sometimes spending 24 hours at the shop. When you’re the boss you have no one else to turn to.”
Like other successful business owners, Harrison did whatever it took to keep his company up and running, “even before I owned the building I’m in now, I was the electrician who went through and rewired everything.”
Asked what advice he has for aspiring entrepreneurs he emphasized the importance of reading (a lot) and “if you don’t have a great work ethic don’t even try it.” Advice that mirrors his own grueling work day that begins at 4:30 a.m. and ends at home with some reading by 6 p.m.
When asked how he invests all those big profits from the pawn business, Harrison’s answer seemed to mimic his inventory at the shop. “I do a little bit of everything,” he said.
“I have an advisor who does some investing for me, but I also do some of my own.” As you might expect, he’s a big fan of gold and silver (the name of his Las Vegas Shop is Gold & Silver Pawn Shop). His own personal asset allocation includes 10% gold and silver (which he calls an insurance policy) 80% in blue chip companies, leaving 10% to have “a little crazy fun with.” Like those treasure hunters who walk away from Rick’s pawnshop with less money than they’d hoped for, the king of pawnbrokers says, “You may not always win with that 10% but eventually you will get that rocket.”
Rick’s investment style is a wake-up call not only for other business owners but regular investors as well. Now more than any other time in history people are more responsible for their retirement savings and investing. Making it crucially important to be more involved in the investment selection and monitoring process. That doesn’t mean you have to follow his asset allocation, but it does mean you may want to start looking at how you can be more involved.
Obviously, Rick has his own unique perspective on investing, particularly in the area of precious metals, which interestingly, very few investment professionals even have access to. He personally created his own position in a leveraged Silver ETF because none of his contacts could get their hands on the industrial commodity, believing that over time it’s destined to rebound. And, unlike many mainstream investors, he can actually quote ticker symbols and talk daily pricing.
When it comes to his own retirement, Harrison has more questions than answers. “Ten years ago I tried to slow down and sell many of my businesses, but within a couple years I had a bunch more. Work is in my blood, but we’ll see. When the show ends, which it will, simply because it’s TV and that’s what happens, then I’ll have to think about it. If I’m still having fun I’ll probably just stick with it.”
That prompted me to ask Rick about his 72 year-old dad, aka The Old Man, and his retirement plans. “My dad’s the type that would die six months after retiring,” he laughed, “so I plan to have him work here forever, which should keep him alive forever.” A reality that many people face.
There are a lot of things in the world that can kill you, but I have found one of the biggest threats to longevity is retirement itself. The potential loss of purpose, identity, and personal interaction is something retirees need to plan and prepare for. There’s a lot more to retirement than just the dollars and cents of it and Rick’s comments highlight the need for people to prepare for the mental, social, and physical aspects of it.
Of course one of the ways retirees can fill their time and replace their work identity is to become garage salers or treasure hunters looking for that $10 item that’s worth $1,000’s. Making me curious about Rick’s most profitable purchase, his biggest mistake and what treasures he’s kept for himself.
“Twenty years ago a woman walked into the shop with four sets of American Indian photogravures by Edward Curtis.” Like most viewers and people who visit his shop, I didn’t know who Edward Curtis was or what the heck a photo grave was, so Rick gave me a free history lesson, (which you can hear in the audio clip). As it turns out, the owner of those photos graves only wanted $50 for all four sets so Rick decided to take a chance. A few trips to the library later, he sold them for $20,000 … a handsome profit any investor would take.
Listen to Rick explain photogravures only the way he can, how much he pays all of those experts who come into the shop, the advice he gives to everyone, and more.
Of course with the good comes the bad. Harrison admits that he is not immune to mistakes and “in business you have to be innovative, but so are crooks. A couple of times I got lazy and didn’t pay attention to new and improved fakes, so a few times I lost some big money on Rolex's.”
As far as his home collection goes, Rick said, “I have a lot of weird things in my library and I just bought a rare, colored map from the1650s that has the ‘island of California’ on it.”
While many people may not wish to have such a map in their home collection, Harrison's endeavors offer investors a rare look at someone who has amassed wealth and celebrity status through physical assets such as gold, silver, his business real estate, and historical artifacts. A very different form of diversification and wealth creation than the paper currency so many people plow into the paper statements of their 401(k)’s every month.
By making the most out of what life dealt him as a child, he has risen to great heights of entrepreneurship in a manner that we can all learn from. His willingness to educate and inform is contagious, and so I leave all of you would-be treasure hunters out there with one last tip from the pawn guru: “When you come across something, and its quality is just outrageous, that’s probably something of value. It’s been that way for hundreds and hundreds of years – the really, really expensive stuff is also really, really high quality.
A lesson in quality and value that can not only be applied to treasures but also to investments, financial professionals, and how you plan your retirement.
P.S. Leave me a comment if you thought the article was helpful. Also, let me know what other stars and celebrities you want me to interview about investing, retirement, and life lessons from the top.
Follow Robert on Forbes.com or on Twitter @robertlaura
Check out Robert Laura’s other celebrity related articles:
Property Bothers
Pastor Rick Warren
How Star Athletes Deal With Retirement
Amy Grant
Pat & Gina Neely
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https://www.forbes.com/sites/robertlaura/2014/08/28/this-is-what-1000-of-monthly-retirement-income-really-looks-like/
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This Is What $1,000 of Monthly Retirement Income Really Looks Like
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This Is What $1,000 of Monthly Retirement Income Really Looks Like
There is a lot of talk about how much money one should save for retirement and what percentage of assets retirees can withdraw each year. However, many retirees hope to preserve their principal, living off just their investments. That sounds simple enough, but how does it actually play out with different investment options?
I decided to paint three separate pictures of common retirement income streams. The first employs dividend paying stocks from my laddered dividend portfolio. The second stems from a collection of bond funds and ETFs. The third is based on preferred stocks. The goal is to figure out how much money an investor would have to allocate to each investment type in order to generate $1,000 per month ($12,000 annually) of retirement income.
(Photo credit: Wikipedia)
To keep it simple, let’s use recent yields and pricing as well as some easily recognizable investment holdings.
Dividend Stocks
Dividend paying stocks are a time-tested way to generate retirement income. Having selected three popular stocks that pay their dividends in sequential months, let’s determine how much money an investor would have to allocate to each in order to generate the desired income amount. Kimberley Clark (KMB) pays its dividend in January, April, July, and October. AT&T (T) pays in February, May, August, and November. McDonalds (MCD) pays in March, June, September, and December. As you can see, those distribution schedules ensure that a retiree receives a dividend check consistently throughout the calendar year.
KMB’s current annual yield is 3.08%, which means an investor would need $130,000 worth of the stock (roughly 1,222 shares) to generate a quarterly payment of $1,000.
At 5.33%, AT&T has a higher yield, so an investor would need to invest only $75,500 (2,187 shares) to generate a $1,000 quarterly payment, or $4,000 annually.
MCD’s current annual yield is also 3.24%, which requires another $123,000 (approximately 1,316 shares) to generate $1,000 quarterly, or $4,000 of annual income.
In total, an investor would need to spread about $328,500 across these three stocks to produce roughly $12,000 of annual income. The average yield of these three securities combined would be 3.88%.
Bond ETFs
Bonds are generally considered less risky than stocks but they come with their own challenges, particularly in a low interest rate environment like our current economy. Putting three well-known bond investments into the same process used with dividend paying stocks, we find that Pimco’s Total Return Bond ETF (BOND), Vanguards High Yield Fund (VWEHX) and iShares Investment Grade Corp Bond ETF (LQD) produce a combined yield of 3.2%, which would require a retiree to invest $376,00 to generate the same $12,000 of retirement income.
Pimco’s current annual yield is 1.79%
Vanguard’s High Yield Fund offers an annual yield of 4.48%
iShares Investment Grade Bond pays 3.56% annually
That’s a slight increase in the outlay required to generate the desired amount of income, although a more conservative investor might prefer the reduced volatility typical of bond holdings. Each of these funds pay monthly but come with one additional caveat: Bond fund and ETF payments can be inconsistent, changing from month to month, and even tumbling during a major market correction.
Preferred Stocks
Preferred stocks are a hybrid, combining traits of both traditional stocks and bonds. They’re generally known, and used specifically, for income purposes as their long-term growth prospects and trading range are generally muted. Using three preferred stocks with popular features including a cumulative dividend and an investment grade credit rating, we’ll go through the same process.
Health Care Reit Preferred J (HCN-J) carries a current yield of 6.23%
Public Storage Inc., Preferred Y (PSA-Y) maintains a current yield of 6.37%
Realty Income Corp., Preferred E (O-E) has a current yield of 6.38%.
(Each of these securities are currently trading at a premium and therefore paying less than the stated coupon / interest rate)
While these three names will not offer a level monthly payment like the dividend names above, O-E does pay-out on a monthly basis with HCN-J pays in January, April, July and October and PSA-Y disburses in March, June, September, December.
Assuming an equal amount is invested in each holding, an investor would end up with an average yield of 6.32%, a significantly higher yield when compared to the other two scenarios. Thus, an investor would have to contribute only $190,000 to generate the required $12,000 per year.
That’s a fairly significant difference compared to the other two options. That’s not an endorsement for preferreds (or any of the other options). It’s just a look at how different types of securities and varying yields can affect your retirement income.
While there is no single best way to invest, new retirees and soon-to-be retirees should take the time to understand what their financial situation may look like month-to-month during retirement.
In case you’re interested in what all three scenarios would look like combined, the average yield overall would be roughly 4.45%, which not only provides diversification into various investment types but requires only $270,000 to put $12,000 per year in your pocket … and that’s without touching your principal.
Disclosure: I am long PG, T, BOND, VWEHX, LQD, PSA-Y, HCN-J
Gallery: 7 Tips For A Better Retirement 7 images View gallery
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https://www.forbes.com/sites/robertlaura/2014/09/26/retirement-worries-and-concerns-are-a-privilege/
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Retirement Worries And Concerns Are A Privilege
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Retirement Worries And Concerns Are A Privilege
Each and every week a new study comes out that highlights the new or biggest concern people have heading into retirement. Depending on the time of the year and source, some of the most common fears include:
Running out of money Health and/or healthcare Stock market crash Becoming a victim of fraud or abuse Identity theft Losing their work identity Losing touch with family and friends
While it’s just a short list, many of the issues can create a noose around your retirement neck if you let them. Turning a time that is supposed to be happy and joyful into one filled with worry, concern, and worse yet, paralysis from doing the things that will make your life more enjoyable and memorable.
Which is why I want to attack the topic in a fashion you may not have considered before. One which suggests that every single fear and stress associated with retirement is a privilege. The cost to be in an exclusive club… something you worked hard to achieve and therefore should be embraced. Not portrayed as bad, negative, or a siphon of the time and energy you’ve put into retirement.
I realize it may seem a bit contrived to try and spin a string of retirement problems into a personal blessing or opportunity, but if you’re willing to turn your situation over and look at it from a different perspective (one that I see on a regular basis) the benefits of this observation are fairly obvious.
stressed and worried: Wikipedia
Imagine for a moment that you could never retire. That you were so far behind in savings that it wasn’t even a remote consideration. As a result, you wouldn’t be worried about a stock market crash, rising interest rates, someone stealing your money, or being bored in retirement. You’d have a host of other things to worry about instead. That suggests stress, anxiety, and worry permeate every aspect of life. Therefore, since there will always be something to worry about, isn’t it better to be dealing with one set of worries over another?
Whether you realize it or not, we’ve all come to this conclusion at some point in life. Most notably, a visit to the hospital where upon arrival, our own condition and fears are put into perspective as we learn the person in the next bed or down the hall is much worse off. It's a realization that may not completely erase the pain or fear, but prompts you to see it, and appreciate your dilemma, in a much more positive fashion.
Reality is, it's not easy to be disciplined and save diligently for retirement. In fact, people who actually make a successful transition into their golden years are in the minority of people, not the majority. One AARP survey supports this dynamic, stating that 65% of respondents worry they won't have enough to retire, and 72% believe they will have to delay retirement.
That puts those who are financially prepared to retire in an exclusive club… one that may come with some additional worries and concerns, but the fact that you have the opportunity and capacity to acquire them actually says something positive about you.
It should also clear a path for ways in which you can begin to address them. By simply shifting your worries and concerns from the dark side of retirement into the light, you can focus your intentions on actions that will help you sleep better at night.
By doing things such as developing new healthy habits and activities that will reduce or lessen the role health care costs and doctor’s appointments play in your retirement. Steps that may include turning a passion or hobby into a small part-time business that generates income which is not tied to what’s going on in the stock market or Social Security. Educational undertakings such as attending workshops or reading financial newsletters and books that empower you with the financial know-how to avoid fraud and abuse. Taking the time and energy to plan beyond the dollars and cents of retirement so that as you make your retirement transition, your body, mind, and spirit are prepared as well.
Simple steps that will allow and new and soon-to-be retirees to see common retirement worries and concerns as assets, opportunities, and a privilege they’ve earned.
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ca3c9ffcb2b2b4f1ce4d730c51668e5b
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https://www.forbes.com/sites/robertlaura/2015/02/23/what-diy-investors-get-right-and-wrong/
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What DIY Investors Get Right And Wrong
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What DIY Investors Get Right And Wrong
Having immersed myself in the world of DIY investing over the last couple months, I’ve garnered a firsthand look at a number of DIY portfolios with carte blanche access to ask the tough questions. As a result, I wanted to share some of the common portfolio factors that DIY investors get right as well as wrong.
Strong Foundation But Not Always Prepared To Succeed
Although many DIY investors have a solid portfolio foundation, they’re handicapped because they can’t quantify the risk they are taking, or explain how adding or removing an investment will impact their portfolio. That’s not a big deal for beginning DIY investors but a potential red flag for those who have already accumulated wealth to the point where they worry more about losing what they have than earning more. Essentially, they’ve been so focused on growing their portfolios it never dawned on them to develop a plan for what to do once they actually reach their investment goals.
That can be both good and bad news. The positive is that it is possible for current and future DIYers to go out on their own and hit their investment goals. The downside is that DIY investors need to invest more time, energy, and even money into learning how to manage the other side of the investment equation – the risk side. Instead of simply relying on financial ratios or technical analysis as a means of selecting and managing their portfolio returns, DIY investors need to integrate risk metrics like beta, standard deviation, correlation, draw down, and stress tests to protect what’s been accumulated, or to convert savings into income.
The nice thing is you don’t have to pull out the old slide rule to figure this stuff out. There are plenty of websites and software programs to make the job easier. Some of my favorites are available at Morningstar.com. Kwanti.com, and DividendPaycheck.org. Each offers a distinct set of reports and analyses designed to help DIY investors take their investments to the next level. I must confess, I developed the DividendPaycheck.org software (currently available at no cost) to help DIY retirees understand the trade-offs between yield, dividend stability, inflation protection, and stock valuation when building a retirement income portfolio.
Guilty Feelings About Part-time Success
Most of the DIY investors I worked with were either completely retired or at least semi-retired. As a result, something that came up in our conversations was that investing wasn’t their “full-time job.” Many pick at it occasionally … some weeks or months committing more time and energy to it than others … but very few are constantly glued to the financial TV programs, economic releases, or earnings reports. The fact that DIY investors don’t necessarily have to spend 24 hours a day, 7 days a week, on this stuff should be reassuring.
However, many of these DIY types admit they feel guilty, worried, or anxious about the time they think they should be devoting to their portfolio management. Factors such as time of year, weather, family dynamics, and personal health all play a role in how much time they commit to the process. Many were also cognizant of the fact that the recent bull market made DIY investing easier. Most agreed they were “investing for the long-term” but, as a group, they were growing weary of the markets’ run. That makes developing a routine an essential part of the DIY investment process. On the whole, this can be accomplished by simply subscribing to news feeds or insightful newsletters, using stock or investment alerts on your trading platform, and scheduling specific dates and times to comb over your portfolio and other reports.
Planning For Now But Not Later
A major void facing many DIY investors is what happens when they’re no longer in the driver’s seat. Be it death, illness, or some degree of incapacity, you need a plan for someone else to step in and take over. This is particularly important for married couples, who could be faced with some difficult decisions if something happens to the spouse handling the DIY investing. A spouse suddenly left holding a basket of stuff they don’t know what to do with is unlikely to know who to trust or where to turn for help.
Any advisor who has dealt with such situations knows how truly disconcerting it is for the spouse unfamiliar with DIY investing. In one case, a woman whose husband told her, “Never sell these stocks!” didn’t for 10 years. However, as her income stream withered away, she struggled both financially and emotionally by refusing to go against her late husband’s wishes. It’s a harsh reality many DIY investors haven’t considered, which makes aligning with a professional advisor essential to one’s overall plan. Fortunately, there are a growing number of fee-based or hourly-rate advisors that DIYers can turn to for developing a plan. It’s usually well worth a flat fee, or hourly meetings, to keep them abreast of what’s going on, and what needs to happen in the event you don’t make it back to the next meeting.
In Need Of A Colleague
The most enlightening part of my DIY discovery process was the in-depth conversations about investments. Whether we were talking about current holdings, ideas they were considering, or battle scars and wounds from the past, what DIY investors want and desire most is a sounding board; a person on the inside that can either confirm what they are thinking or help them see their ideas from a fresh perspective. And, as always, they want it done without being asked to buy something. Most DIY investors are comfortable buying and selling stocks and doing some of the research … and that’s a positive … but they also want a second opinion from a resource who is on their team but not a “yes” person who simply agrees with their ideas in order to earn a commission or fee.
Unfortunately, this is still a grey area within the financial services industry. For the most part, investors are either totally dependent on an advisor or completely independent. It’s one reason I believe that the greatest growth in the financial services industry will not be robo-advisors, or mergers and acquisition among small and mid-sized firms, but the ongoing development of interdependency. Do-It-Together (DIT) models, where professional firms and advisors will help DIY investors strike a better balance between time commitments, research and other back office functions while allowing DIY investors to maintain control of their assets.
Overall, DIY investors have a lot of positives working for them, and with some simple adjustments, they can eliminate some of the common issues they face. All it takes is learning to manage the risk side of the investment equation, developing a routine for keeping on top of one’s portfolio, having a contingency plan for “what if” situations, and seeking out a like-minded professional to use as a sounding board and trusted colleague.
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5d76bbb537b90e6cdac0c01a6bcc6227
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https://www.forbes.com/sites/robertlaura/2015/03/17/what-you-need-to-know-about-volunteering-during-retirement/
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What You Need To Know About Volunteering During Retirement
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What You Need To Know About Volunteering During Retirement
Many people plan to do some form of volunteering after they retire. It’s such a popular topic that I spend more time discussing it during my Naked Retirement workshops than many of the other, more traditional hot topics including health care costs, adult children, and running out of money. It all starts with a very unassuming question from our retirement perceptions quiz:
A local organization is in desperate need of help. You’re touched and call to offer one of the following items. Which one are you most likely to provide?
a. Money, food and clothing
b. Knowledge and other information
c. Personal skill
d. Physical labor
It’s a pretty basic question but its true intent becomes clear when I ask participants why they selected their answer. Typically, most respondents lack any real feeling or oomph. Oftentimes, the answer du jour is, “Well, that’s what I have always done,” or “I’ll figure it out when I have more time.” The problem is too many people go into volunteering with only general assumptions or vague thoughts about how their work skills will transfer. They’re fuzzy on how rewarding, or in some cases unfulfilling, it can actually be. In fact, not all forms of volunteering are fun, enjoyable or rewarding. That’s a nice way of saying all forms of volunteering are not fun, enjoyable or rewarding, and those who are unprepared may find themselves feeling guilty, drained, and even like they’d rather be back at work than “helping out.”
A volunteer reads to a resident of a retirement home (Photo credit should read WILL OLIVER/AFP/Getty... [+] Images)
It turns out, the very things you did while working don’t always translate into volunteer success. For example, a social worker in one of my workshops had recently retired. She felt compelled to do so because she was burnt out from all the heartache and stress caused by her job. Yet, after six months of retirement, she was bored and decided to put her people skills back to work by volunteering in - of all places - social work. Guess what? Within three months she was burnt out again … and this time she didn’t get paid for her aggravation. Worse yet, she felt trapped and guilty about quitting because they were understaffed.
Another case-in-point demonstrates the flip side of the story. A retiring school administrator who planned to volunteer with Habitat For Humanity made her intentions clear from the beginning. In retirement, she was determined to be a part of something that had definitive start and end dates, and a finished product to see and touch. This contrasted with her work life. Whether it was curriculums, school policies, or one of a hundred other responsibilities, there was always something to update, review, or improve. She never felt anyting ever got finished.
The difference between these two examples is that the administrator took the vagueness out of volunteering by having a specific purpose. She filled a void that was present in her career; whereas the social worker simply acted out of boredom and tried to match old skills to new needs.
Other examples include retirees who stood ringing a bell in freezing temperatures without much Christmas cheer; those who got yelled at for calling attention to the poor quality of the food they were packing and preparing for others; and the top-notch professional who couldn’t help transform a local non-profit because of cost constraints and other obstacles. While volunteering shouldn’t be perceived as an easy path to feeling better about yourself by helping others, there are several things retirees are encouraged to do in order to make the experience and opportunity more satisfying:
Begin With The End In Mind
Set realistic expectations for your role with the organization. That means asking about an exit strategy in case you feel uncomfortable or if it doesn’t match your skills, causes a physical challenge, or doesn’t meet other expectations. By having a process to either communicate these issues or, if necessary, resign your position, both staff and retirees can get on the same page instead of allowing assumptions to dictate the direction of the relationship.
Figure Out What Distresses You
One way to better define how and where you want to spend your time is to ask yourself, “what disturbs you?” What stresses you out and causes you to think, “I need to do something about that.” Answers to these questions can give your volunteer efforts more feeling and purpose. With these key points in mind, retirees will be positioned to seek out organizations that fit their needs.
Be Realistic
Volunteer organizations are like most other groups. They’re not perfect. They’re often run on tight budgets, with grants that come and go year-to-year. There will be issues with staffing, space, and equipment. You should be able to see the flaws, challenges and other deficiencies without looking too hard. However, by acknowledging the challenges, preparing yourself to adapt, and helping the organization manage those factors, the time and energy you put into it won’t seem wasted if things don’t go as you hoped. With realistic expectations and a mindset to work through any issues at hand, you can have an impact right away … precisely when it’s needed most.
Overall, retirement can be the ideal time to become a resource and guiding light for people in need. While every little bit counts, don’t think you have to maintain an 8-10 hour work schedule, or jump at every opportunity to be busy and useful. By developing an exit strategy, figuring out what distresses you, and being realistic about the role you play within the organization, you can make volunteering a great way to replace your work identity, fill your time meaningfully, and have a positive impact on others.
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37df125fc0f8733f4847b87612506446
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https://www.forbes.com/sites/robertlaura/2015/12/31/top-dividend-stocks-for-retirement-income-in-2016/
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Best Dividend Stocks For Retirement Income In 2016
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Best Dividend Stocks For Retirement Income In 2016
This year my theme for dividend stocks in 2016 is big, strong and steady. In other words, I’m looking for stocks with a great personality and that are not only defensive in nature, but also carry useful competitive advantages to weather price / consumer storms as well as the ability to maintain (and even raise) their dividends.
My screening process for dividend stocks and retirement income (dividendpaycheck.org) suggests a sluggish start to 2016. For that reason you will notice many of the stocks I have selected have a tendency to zig when the market zags and vice versa. Additionally, I opted to sacrifice some higher yields for dividend stability and brand recognition.
It’s important to point out that I don’t share these stocks with readers for fun or to capture the latest headline. These are actual investments we already own for clients or plan to accumulate. I don’t sit in an ivory tower screening stocks that will make for a good story. I sit knee-to-knee with clients on a regular basis and share factors like these with them. Therefore, it’s important for investors and retirees alike to use this information as a starting point for their own research and to develop their own process for monitoring and selecting income oriented investments.
After the list, you’ll find is a short summary of why I like each company. It’s designed to be a short and sweet sound bite with as little financial jargon as possible.
Walmart (WMT)
The retail price leader is my top pick simply because it’s trading at 20% below its fair market value. In other words, this stock is on “Rollback.” Inside jokes aside, in addition to an attractive price, it sports an inflation beating 3% dividend yield and has a proven track record with 40 years of dividend increases. Despite concerns about labor costs and its ecommerce strategy, a pay-out ratio below 50% offers income oriented investors’ confidence that their dividend checks will continue to come in. Furthermore, I feel Walmart’s proximity to consumers is underappreciated and should prove valuable to its long-term its ecommerce efforts.
Consolidated Edison (ED)
There isn’t much sex and sizzle when it comes to this utility behemoth. It’s old, been around the block several times, and won’t “Wow” anyone when you bring it up as a top investment consideration for 2016. But that’s also the beauty of it. With 41 years of dividend increases, a welcoming 4% dividend yield, and low correlation to major indices, ED can be a great friend when the markets lose their luster and your other investments turn on you.
British American Tobacco (BTI)
This lesser-known tobacco player makes the cut because of its potential to play a multi-purpose role. First, it’s a double dip on Tobacco. It maintains its own presence with brands such as Lucky Strike but also owns a large stake in fellow tobacco manufacturer Reynolds America. While both are smaller than well-known rival Phillip Morris, we feel ongoing stimulus from the European Central Bank and a growing presence in emerging markets offers investors an international income stream that helps diversify the group without sacrificing yield.
Apple (APPL)
While Apple isn’t the typical retirement income stock, its current share price offers retirees the opportunity to make up for the low yield with long-term growth. Trading at just 10 times future earnings and with a conservative future value of $125 a share, that level of potential growth could more than make up for what you see dribble in each quarter. While iPhone, iPad and Mac sales may not rise to the mind boggling rates of the past, their industry leading operating systems, security features, customer retention levels, cash rich balance sheet, and ridiculously low pay-out ratio offers investors the combination of growth and income.
T. Rowe Price (TROW)
Fidelity, Schwab, and Vanguard get a lot of media attention, but I’m a fan of TROWs impressive history of dividend increases (28 years) and positioning with aging baby boomers. Through solid performance and a reputation for providing no-load, low cost equity funds they’re positioned to outpace other, more fixed-income oriented firms, who may get hit with performance issues and outflows as interest rates rise. Furthermore, their target date funds have been a solid source of growth in recent years and looks poised to continue to grow as baby boomers reach milestones and want a single source for diversification and/or income.
Overall, my 2016 dividend picks may not be as fun, loud, and sexy when compared to other lists, but looks can be deceiving. That’s why my focus will continue to be on dividend personalities which can include a strong balance sheet, discounted price, low pay-out ratio, and solid history of payment increases. Cheers to you and your income efforts in 2016!
Stay on top of dividend news, cuts, & increases with Div.News, download our free guide 8 Wall Street Words Every Retiree Needs To Know and check out our dividend screening tool at DividendPaycheck.org
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dec4ec18447fa84c66cbf52bee45daa1
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https://www.forbes.com/sites/robertlaura/2017/04/18/why-some-people-become-cheapskates-in-retirement/
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Why Some People Become Cheapskates In Retirement
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Why Some People Become Cheapskates In Retirement
Many people don’t realize it, but when you get that final paycheck, it is one of the most important financial events of your life. The idea of no longer working for money and having access to a paycheck can do weird things to some people. In many cases, it can turn them into a penny pinching, wheeling-dealing, cheapskate who will go out of their way to save a buck or get a better deal.
On the surface, it's admirable and illustrates good financial responsibility. But deep down it can actually be a bigger problem for their social life, family, and friends, not to mention physical health.
The harsh reality is, going to extremes to save money can take over and dominate a person’s life. It can leave those around them frustrated, burdened, and likely to avoid both personal and social interactions that involve money. In other words, it can push people away.
Shutterstock
The root cause for these actions and behaviors are two-fold. The first is fear. Whether we want to admit it or not, we are all afraid of something. No matter if it's losing a loved one, public speaking, or being broke and dependent on hand-outs from others, we all harbor fears about life that drive our thoughts, behaviors, and decisions.
On top of that fear, we all have ghosts that we carry with us. Some people may refer to this as “baggage” but I think the term ghost more accurately reflects how things that happened to us in our past can still haunt us today.
For some cheapskates, there may have been a point in their life where they didn’t have much. They had to go without or were left out because they couldn’t afford to participate or do certain things. And it hurt. It wasn’t fun and they don’t want to return to that point in their life. There was no lifeline or security blanket to fall back on and fix or remedy the situation.
The challenge that many cheapskates face is that more money or savings won’t resolve those fears. No matter how much money they have in their bank accounts or how much of a deal they can get on something, that fear won’t go away unless they run toward those fears and start to work through them.
Additionally, many people have ghost triggers that can cause them to feel threatened or anxious. For example, growing up poor, you may have witnessed your parents opening the mail and getting into an argument for a bill. You may have been embarrassed at the grocery store when your mom or dad had to put some things back or maybe you couldn't go to camp or didn’t have a bike like the other kids. Whatever the case, you learned to associate something negative or hurtful with a lack of money or savings. Things that are engrained in you and not easy to shake off.
However, here is the great thing. You can absolutely move on from this situation and get a new lease on your financial life. It starts by identifying those fears. Now, most adults don’t walk around saying I’m feeling insecure or threatened by my spouse's spending habits. But behind your desire to hide money or refuse to pay extra for a fun time, are real feelings that need to be addressed. So identify what your biggest financial fears are and what causes you to feel that way. Think about your past and examine what was different then compared to now. Often times, the idea of you or your family reliving the financial hardships you may have experienced in the past are unfounded and not worthy of the stress you cause yourself and those around you.
Next, it’s important to identify the ghosts and become more aware of those triggers. Is it when bills come in? Is it when a bank statement arrives or when someone unexpectedly asks for or needs money? By being more aware of what causes the fear or stress to rise up, you can take steps to address it. That may mean not opening mail until a specific date or time, or having a mantra to repeat in order to minimize an emotional response.
Overall, on that final day when you receive that last paycheck, you don’t have to let it turn you into a cheapskate. By being aware of your financial fears and ghosts you can take steps to make the most of your retirement savings and income.
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9810a1be7394be28c0908c4491cea155
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https://www.forbes.com/sites/robertlaura/2017/10/26/what-really-happens-to-people-when-they-retire/
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What Really Happens To People When They Retire?
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What Really Happens To People When They Retire?
Recently, I spoke at the Retirement Coaches Association conference and had the opportunity to ask retirement coaches from across the US about their experiences with clients transitioning into retirement. The discussion highlighted several trends taking place in the undercurrent of retirement that need to be brought out from the shadows and into the light as baby boomers continue to make the transition.
When I asked the group, “What are your client’s biggest fears and frustrations?” There was a laundry list of factors including some more common ones like loss of identity, declining health, failed relocation, and shrinking social network to name a few. But three other factors caught my attention.
Don't end up like this in retirement! (Photo credit: Shutterstock)
First, some coaches report that clients are experiencing a Ground Hogs Day, type life in retirement. If you remember the 1993 movie with Bill Murray, his character Phil Connors is essentially required to re-live the same day over and over again. For many retirees, the same thing is playing out in a very mundane way. They wake to the same things day in and day out, craving for the opportunity to step outside this realm, but are unable to break the cycle.
Others shared their client’s struggled with the early part of the transition because they used their parents as role models. The idea that boomers are changing retirement and popular slogans like, this isn’t your parent’s retirement, resonate on a bumper stick or fancy brochure, but people tend to do what they know. Some approached retirement assuming everything would be okay and fall into place like their parents. The issue of course is that older generations were more self-reliant. They didn’t talk about their problems or let people know what was going on. As a result, more and more boomers are waking up to the reality that they need to have plans to replace their work identity, stay relevant, strengthen their social network, and keep mentally active.
Another stumbling block for new retirees is finding a suitable outlet for achievement. Most of our lives leading up to retirement was about achieving good grades, results at work, and checking things off the list. However, as people lose their identity, have less mental stimulation, and fewer social interactions, they lose their focus on climbing higher and position themselves to fall into the Ground Hogs Day type lifestyle. The rules change in retirement, meaning people can’t use the same parameters they used during their work years to gauge whether or not they are making a successful transition, and it’s not easy to adapt to without someone explaining it or guiding them through it.
As our discussions continued, two interesting themes emerged when I asked the group what their clients have tried to do to remedy their challenges but hasn’t worked. One cultural shift became very apparent: Senior centers will not exist in another 10 years. Many retirees report that they have explored their local senior center as a last resort to connect with people and find things to do, but frankly they don’t like the label a senior center projects and feel they are too young and capable to ever join one.
Another unexpected trend that came up was that an increasing number of boomers are intimated by the gym. The combination of technology, half-dressed young people, and a headphones atmosphere where no one talks to each other, suggests several things. New age-based gyms are likely to begin popping up. Locations where members will be 50+, be greeted by name, have their own locker, and will serve as a social outlet. It's also likely to spur more age based communities to enhance their work-out facilities to attract outside members, causing a drain on mainstream gyms who benefit from older members signing up but not showing up.
Overall, as retirement coaching and planning continue to evolve, and boomers reshape it, more conversations on topics like these will not only need to take place, but also need to be ingrained into the more traditional retirement planning process. By making people more aware of the impact the non-financial aspects can have on their life in retirement, the better prepared they can be to address and manage them. After all, a successful retirement isn’t one without problems, but rather one in which you are able to overcome them.
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31f295e1941e182e514becec1d43e1c0
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https://www.forbes.com/sites/robertlawton/2018/10/21/answers-to-your-top-10-401k-plan-questions/
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Answers To Your Top 10 401(k) Plan Questions
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Answers To Your Top 10 401(k) Plan Questions
For more than 30 years I have helped employees from companies like Apple, IBM, AT&T and John Deere with their 401(k)s. I have found that some of the questions employees have about their 401(k) plans pop up frequently. You probably have the same questions about your plan.
Following are the top 10 questions I receive along with answers.
1. How much should I contribute?
This question is easier to answer than you might think. Studies indicate that American workers should be adding at least 15% to their 401(k) accounts each year. Savers who commit to this level of contributions can expect to build account balances at retirement allowing them to retire without reducing their standard of living.
Want to live better in retirement or retire early? Save more.
2. What should I invest in?
Nearly all 401(k) plans provide participants with at least one option to obtain investment advice at no cost. Either participants have access to the investment adviser working with the plan, robo suggestions based on an algorithm, or a platform like Financial Engines.
Use whatever method you have available to generate an initial recommendation that will be based on your age, gender and ability to bear risk. Make adjustments to the recommendation until you feel comfortable with your allocation. Then stick with it, whether the market goes up or down!
3. What type of contributions -- traditional pre-tax 401(k) or Roth 401(k) -- should I make?
Roth 401(k) contributions are made after-tax while traditional 401(k) contributions are made pre-tax. So there is no immediate tax benefit from making Roth 401(k) contributions. However, there may be huge tax benefits at retirement.
If a Roth 401(k) contribution account has been in existence for five years or more and if funds are withdrawn due to retirement, the entire account balance may be distributed tax-free.
Whether a Roth 401(k) contribution strategy will be more tax-efficient than making contributions pre-tax is unknown, since the answer depends upon future tax rates.
As a result, I believe everyone should be splitting 401(k) contributions between their traditional pre-tax 401(k) and Roth 401(k) accounts. The real question is what the split should be, and that is dependent upon the contributor's age.
I believe individuals in their 20s should make 100% of their 401(k) contributions to Roth 401(k) accounts for as long as they can -- their entire careers if possible. The opportunity to build a huge, tax-free balance is just too good a deal to pass up.
Conversely, everyone in their 60s and 70s, because of their higher tax rates and fewer years to retirement, should probably make the majority (80% to 90%) of their contributions to traditional pre-tax 401(k) accounts to take advantage of the immediate tax savings.
All ages in between will benefit from a split that is close to 50/50.
4. How do I know if I am on track?
Virtually all 401(k) plans have a feedback system to let participants know how they are doing with their savings plan.
Some 401(k) plans use color coding (red bad, green good), some display projected income replacement ratios on participant statements and nearly all have tools available on a website that participants can use to model different savings and investment rates.
To find out which approach your plan uses, visit your plan's website.
5. Is my 401(k) plan a good one?
Maybe. There are seven factors that I recommend using to determine whether your 401(k) plan is one of the best. They are:
Availability of low-cost (non-index fund) investment options. Prevalence of index funds. Availability of investment advice. Availability of projection tools. Feedback on how you are doing. Senior management's support for your plan. How well you understand your plan.
6. Should I take a 401(k) loan?
No, never. It is probably the worst investment you can make.
Plan participants are seduced into taking 401(k) loans by two factors: 1. It is easy (the plan can not reject your loan request because there is no underwriting), 2. Participants are in love with the concept of paying interest to themselves. Let's look at why both of these factors are bad.
Many plan participants who should not be taking a loan, because of their financial condition, end up taking 401(k) loans. The 401(k) plan often becomes the lender of last resort. This only makes their bad financial situation worse.
Gambling (or other) addiction and need some cash? Please don't take a 401(k) plan loan. Want to take that dream vacation, buy a new car or boat? Please don't get the money from your 401(k) plan. Trying to avoid bankruptcy? Please, please don't take a 401(k) plan loan. Your balance is protected from attachment by creditors in the event of your bankruptcy and should only be used for your retirement!
Every time I talk with participants about 401(k) loans, they mention the tremendous advantage they see of paying interest to themselves.
Couldn't be further from the truth.
Once you take $10,000 for a loan out of an investment that was earning 12% you turn it into an investment that now earns 5% or 7%. That's right, your loan is part of your 401(k) plan account investment portfolio. The interest you pay is what that $10,000 investment now earns. Should you feel good about paying a low interest rate?
And finally, the interest on a 401(k) loan is not tax-deductible. There are still ways of generating tax-deductible interest payments from a home-equity loan. It is worth looking into.
7. Should I roll over prior employer 401(k) plan balances?
Yes, but not into a rollover IRA. Roll it over into your current employers 401(k) plan. Your costs will be much lower.
Your prior employer 401(k) plan balances are likely invested in very low-cost institutional or R6 mutual fund share classes and you can get investment advice for free.
The broker that is calling you to get you to rollover your account balance will likely charge you 1% for investment advice and invest your balance in retail share classes costing twice as much as the institutional or R6 share classes.
Broker rollover IRA sales practices are under investigation by the Department of Labor. I wonder why.
8. Can I get my money if I need it?
Yes. Nearly all 401(k) plans allow participants to withdraw their account balances in the case of financial hardship. Your definition of hardship probably differs from the IRS', so you may wish to visit their website.
9. How does vesting work?
Vesting refers to the percentage of the employer account balances you are permitted to take with you if you leave your employer. You are always 100% vested in your traditional pre-tax 401(k) and Roth 401(k) contribution accounts.
If your employer has a vesting schedule for its employer accounts, you will see the vested percentage that is yours increase with your length of service. If you work for the employer long enough, you will become 100% vested in the employer accounts.
Most vesting schedules are five years. That means participants accrue a 20% vested balance after one year, a 40% balance after two years and so on until they become 100% vested after five years.
10. Is my employer required to make contributions?
No. However, that does not mean that most employers don't. In fact, just the opposite is true. Most employers make matching contributions. The most common matching percentage is 3% -- usually expressed as 50% of the first 6% of employee contributions.
You should make sure that you capture the full matching contribution from your employer. This is free money. There is no better investment that you can make.
I hope this Q&A has helped you understand your 401(k) plan better.
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c7b1611a024363b4206108825fb43db5
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https://www.forbes.com/sites/robertlenzner/2011/03/30/the-economic-equivalent-of-tunisia-egypt-libya-yemen-syria-et-al/
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The Economic Equivalent of Tunisia-Egypt-Libya-Yemen-Syria Et Al.
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The Economic Equivalent of Tunisia-Egypt-Libya-Yemen-Syria Et Al.
There are a multitude of economic and financial issues spreading across the globe that are parallel to the political unrest, civil war, pressure for democracy and just radical change that are not seen daily on cable television.
1. The first is unemployment of educated young people in North Africa and the Middle East which is not yet a political movement or social upheaval in the US or Europe- but which is in the forefront of public policy and partisan politics. Just look at the number of young people demonstrating all over North Africa and the Middle East. There must be serious economic ramifications.
2. The disparity between the rich and the poor, which Harvard economist Kenneth Rogoff believes will create "serious social unrest" in the U.S. In oil dominated economies like Libya, Iran, Venezuela, Nigeria and Saudi Arabia, the citizenry are not participating in the spoils. The sudden public welfare giveaway programs by the Saudi monarchy are a desperate attempt to pacify economic unrest. The WSJ says today that India is a "flawed miracle" because the benefits of capitalism not trickling down to the masses.
3. The boom in commodities of all kinds, agriculture, metals, energy is like a global freight train hurtling in see-saw motions across our consciousness. It encourages speculation and leads to bubbles of all variation, which none of us can see with any certainty. Just like the popular street uprisings that take root and spread like wildfire from nation to nation. They also contribute to economic inequality as the insiders(the business oligoply) benefit over the outsiders.
4. The spread of radioactivity from Japan to China, and across the Pacific to the US is most unsettling as it may impact food prices, the ability to supply cheap energy through nuclear power and the supply chain of automotive and electronic goods to the US and other developed economies. This spread of a problem globally is not well understood yet.
5. The housing bubble in China may burst just as it did in the US, where home prices in Phoenix, Atlanta, Las Vegas,and Cleveland are back to 2000 levels. In Minneapolis and Charlotte they are back to 2001; in San Francisco, Denver,Miami and Tampa back to 2002. In London, the bubble has not burst but will due to the government's austerity program.
6. Yes, austerity is very evidently a necessary letting of blood across developed economies. No doubt it will have enormous political, social and economic ramifications.
All-told, maybe these themes are the backdrop to investment activities on stock markets declining as volume drops off and saving must rise, but not saving ast risk as in stock market activities. Let me know what you think of all these points please.
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c8204f0d035f5cbfe7ea2d16748fc6f2
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https://www.forbes.com/sites/robertlenzner/2011/09/13/there-is-no-cure-and-little-money-to-solve-alzheimers-disease/
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There Is No Cure And Little Money To Solve Alzheimer's Disease
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There Is No Cure And Little Money To Solve Alzheimer's Disease
Moses Chao, one of the wisest men I know, and a leading NYU neuro-scientist, has been warning me for 2 years about the danger of not finding a cure for Alzheimers, a debilitating disease of the brain that currently affects some 5 million Americans over the age of 65. He fervently believes that someday 50% of Americans over 85 will have some form of Alzheimers-- and the cost of caring for them could bankrupt the nation.
Some half of all patients with Alzheimers are expected to be in the severe stage at a cost of $20 trillion over the next 40 years. They make up about half the residents of nursing homes in the US and relay on Medicaid to help pay for their nursing care.
Chao is President of the American Neuroscience Association and a key decision-maker as to which scientists are able to get research money to study the brain from the National Institute of Health. Chao's greatest anxiety is that research funds could be reduced just as the projections of older Americans with Alzheimers is expected to rise close to 15 million by 2050. The impact of aged relatives with some form of dementia-- and no cure-- is horrific.
In truth, when compared to federal funding for other diseases, Alzheimers is getting very short shrift. It is terribly underfunded. Last year cancer research obtained $7 billion for research; heart disease got $4 billion, HIV research was awarded $3 billion-- and bringing up the rear, the debilitating Alzheimers disease-- a measly $420 million.
This shocking example of underfunding comes at a time when The Alzheimer's Association says "There are currently no known treatments to prevent, cure or delay the progression of Alzheimer's disease."
Chao was extremely moved by attending the "ONE MIND For Research" Conference in Boston last May, where brain specialists, drug researchers, psychiatrists and neurologists gathered to promote the "Next Frontier of the Brain Forum," sponsored by Patrick Kennedy, a son of the late Senator Ted Kennedy.
Chao tells me that the conference underscored the lack of insight in preventing Alzheimers or even to be able to predict its onset. "We don't know the normal function of the protein that causes neuro-degenerative diseases. Our knowledge is inadequate. We need more information-- and it takes more money to get more information," Chao insists. "Everyone wants to extend their life and we need vastly more money for research into the brain."
Yes, t here are many groups and labs at medical schools testing various drugs in clinical trials in the hopes of slowing down the progress of the illness. Nothing has been proven to work in humans yet, which means that older Americans wit the disease must be cared for on almost a 24 hour 7 days a week basis. This expense jacks up the ante on the nation's health costs and strains our budget. Only 5 drugs have been approved by the FDA for use in merely slowing down the progress of the disease.
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1ab5633df6afbd5522ebcd4cefa010d2
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https://www.forbes.com/sites/robertlenzner/2011/10/23/the-u-s-wont-be-able-to-grow-again-until-2016-18/
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A $1.2 Trillion Infrastructure Plan Creates 27 Million Jobs In 5 Years
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A $1.2 Trillion Infrastructure Plan Creates 27 Million Jobs In 5 Years
I have just read the most thoughtful, precise and thorough analysis of the American Economy; "The Way Forward, Moving From the Post-Bubble Economy To Renewed Growth and Competitiveness" by Nouriel Roubini (NYU economist), Daniel Alpert(Westwood Capital) and Robert Hockett,Cornell Law Professor)
There is a clear and present danger; that protracted stagnation of the Japanese variety in both the US and Europe will "undermine the living standards of an entire generation of Americans and Europeans, and would of course jeopardize America's position in the world." These 3 authors view the most recent 2008 bubble and bust as more dangerous for the global economy than anything previous since The 1930s Great Depression. Everyone should wake up to this reality now! Let me know personally if you do not accept this notion.
The reason is that monetary and fiscal policy "have reached the limits of their effectiveness."
There is no plan to deal with the millions of Americans whose debt overhang on their homes "will weigh down consumption for many years to come." And this debt overhang will damage the banks that hold these mortgages as the value of assets continue to fall.
The consequence is that the world economy is now being slowed by "excess supplies of labor, capital and productive capacity relative to global demand." If the US is not the world's consumer of last resort, and China slows accordingly, where will the engine of growth be?
Indeed, the debt-delevering that must continue its process until well into this decaded will be a drag on aggregate demand and economic growth-- because households MUST consume less in order to pay down debt. As home prices won't return to old peak levels, the thrust of wealth creation must necessarily rest on the stock market.
And if aggregate demand is down then corporate income levels cannot rise as they once did. The onus of the future of global demand rests on China and other emerging nations. Have you faith?
If the household deleveraging takes another 5 to 7 years-- as predicted in this paper from the New America Foundation, then employment won't return to normal, global demand won't be in balance and we must create a brand new 5 to 7 year plan for first a 5 year $1.2 trillion infrastructure investment program that is bound to create 23,000 jobs for every $1 billion of investment. That would create 5.52 million jobs in each year of the 5 year program-- or 27 million jobs. I'm for this as well. Keynesianism is not dead. It will work and we can bail ourselves out by fighting for this bold plan.
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5cc0b9a524f3395e1e517c8fc407c75e
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https://www.forbes.com/sites/robertlenzner/2011/11/22/1-7-billion-customers-money-missing-from-mf-global/
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$1.7 Billion Customers' Money Missing From MF Global
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$1.7 Billion Customers' Money Missing From MF Global
The amounts of customer funds missing from MF Global have multiplied from $633 million to $1.2 billion yesterday-- and now $1.7 billion today, according to Vincent (Trace) Schmeltz III , the attorney for the 80 member Commodity Customers Coalition. Schmeltz is a member of the Barnes & Thornburg law firm in Chicago
This new figure is the result of the inability by the Trustee and the CME (the Chicago Mercantile Exchange) to find more than $3.7 billion in customers funds rather than the $5.4 billion projected just after MF Global filed for bankruptcy on October 31.
Apparently, on October 31, the CME reported segregated funds totalled $5.4 billion. The next day-- on November 1st, the CME suggested that $633 million was lost and unaccounted for. But, by yesterday, November 21, the Trustee reported that he could find only $3.7 billion in assets. Neither Schmeltz nor Koutoulas can understand why the CME declared only $1.2 billion missing yesterday-- because if only $3.7 billion has been found of the original $5.4 billion segregated accounts-- this suggests that the missing amount of segregated funds now totals $1.7 billion.
Click to enlarge
Both Schmeltz and James L. Koutoulas, the 30 year old CEO of Typhon Capital Management, told me at breakfast this morning that they have been told that as early as August MF Global was reported to be using segregated customers accounts to "meet margin calls" and bolster their trading positions.
However, it is not known if the segregated accounts were actually transferred MF Global's books-- which would be a violation of the CFTC regulations. One possible explanation for the missing funds is that MF Global grew by acquisition and never fully integrated their bookkeeping systems, Schmeltz told me at breakfast.
Click to enlarge
There have been many ramifications from the MF Global scandal. For one thing, the market capitalization of the CME shares have declined by several billion dollars. The volume of trading on some regional commodity exchanges has declined significantly.
That is because many commodity brokers are missing significant funds from the $1.7 billion that can't be found. Typhon Capital, for example, is missing $55 million.
The unsecured creditors of MF Global are headed by JP Morgan Chase, which lent the firm over $1 billion, Goldman Sachs, Harris Trust and other banking concerns. Some of the MFG customers who are missing money are furious that Hughes Hubbard, a law firm that has represented JP Morgan in the past, is the legal representative of the Trustee in bankruptcy.
"This is another example of Wall Street favoring Wall Street over Main Street," Koutoulas told me this morning.
Even amidst all this confusion about MF Global's segregated accounts, distress investors have been paying 85 cents on the dollar for claims against MF Global, 30 cents on the dollar for MF Global's publicly traded bonds, and 9 cents a share for the firm's common stock.
Schmeltz and Koutoulas will be the guests of Bloomberg TV's Margaret Brennan this morning.
Click to enlarge
Follow me on Twitter. Read my Forbes blog here.
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81691209e9df24400322ff163de10ba3
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https://www.forbes.com/sites/robertlenzner/2012/01/10/the-u-s-cannot-have-a-private-equity-president-mitt-romney/
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The U.S. Cannot Have A Private Equity President, Mitt Romney
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The U.S. Cannot Have A Private Equity President, Mitt Romney
I can give you several gritty reasons why former Bain Capital private equity czar Mitt Romney is not the person to become President of the U.S. in November.
First, is just one tale of a Bain deal under Romney. Bain Capital invested just $30 million to take over a company. It then arranged for this company to pay Bain and its investors a special dividend of $180 million-- or six times the amount of equity capital Bain invested to take control. This technique of forcing your prey to pay back your original investment or more, as in this case, is to ensure that the Private Equity Firm is assured of a profit. It is an exploitative way to strip the company of its spare cash and is indefensible corporate rape. It is one selfish and destructive way to play the Private Equity game. For the average holding period by a PE firm is somewhere between 3 and 5 years-- in and out with little thought as to the long term performance of the company or the protection of its employees.
Second, Gov. Romney goes about blaring that only he and he alone knows how to create jobs. What utter malarkey, as political pros have evidence prepared some time ago in 1994 for the late Sen Edward Kennedy by a very close relative of mine that nails Romney squarely for firing more people than he hired. You will see these tv ads come the fall, I guess.This is the fundamental nature of the way Private Equity works. It is a nicer polite way of describing company stripping, the classical ruthless way for a raider to exploit a weakened prey for its own profit. Period.
Third, the number of deals by Bain Capital under Romney were slightly more than a handful of the dozens that ultimately went bankrupt. The nature of Private Equity is to be ruthless, and only care about using as much borrowed money as possible in order to gin up the potential return on equity. That's the only way Blackstone and Apollo and Carlyle and KKR and TPG and the rest can go around claiming investment returns of 30% to 45% a year. It's game to make a handful of executives named Schwarzman, Rubenstein, Kravis, James, Bonderman and their ilk very rich using other people's money, namely state and local pension funds. They are the suckers paying PE 2% just to hold their money, and then 20% of the profits from these investments. This PE compensation racket is the very sweetest in all finance.
In fact, Carlyle has just disclosed that the three top execs at Carlyle made $134 million each in 2011-- or some $400 million that I bet will not be taxed more than 15% on the major part of their compensation. By contrast, people were outraged that in 2007 Goldman Sachs CEO Lloyd Blankfein took home $67 million.
Favorable treatment by the IRS taxes that $134 million at roughly 15%-- or $20 million. Retaining $114 million. One of the greatest tax deals in all American history. Twould be illuminating to find out what Romney's total take at Bain Capital was -- less the tax rate he paid on it. Take note Obama campaign researchers.
I say you don't want a Private Equity bigwig in the White House. It will appear to the world that Wall Street owns the White House and dictates the tax advantages for a small exclusive group of fatcats. And dear readers David Rubinstein, el numero uno at Carlyle, is quoted in the FT yesterday urging the White House and Congress to "quickly cobble a credible debt-reducing package." Otherwise, Rubinstein warns in stentorian tones; "the markets' harsh solutions will be borne disproportionately by the low income and disadvantaged. This is not acceptable, nor is it good for capitalism."
It's not neccessarily beneficial for capitalism that the three Carlyle partners are each getting $134 million and paying a 15% tax. Looks like a small group of financiers getting special treatment.
Know that Warren Buffett, CEO of Berkshire Hathaway has sworn in every annual shareholder letter that he will never, ever buy a division or a company from the private equity jugglers who buy and then sell on the company they have leveraged up with professional managers in it just for the soils of the deal-- and certainly not the family or long term management devoted to the company's historic role. Think the farce of RJR Nabisco or EMI or Texas Utilities.
I can assure you that so far public shareholders of publicly traded Private Equity firms have not made money themselves. . I have the tawdry lesson of Blackstone in mind. Issued to the public at $31 a share, BK bumped up to $35 a share when Private Equity was all the rage and young dudes were all hot and bothered in 2007 to get in and get rich quick. Remember that; quick. But, from the fantasy times of 2007 BK shares were roiled all the way down to $5.00 a share in 2009-- a sweet paper loss of 85%, and are still 50% below their original offering price at $15, well below supposed book value. KKR and Carlyle are drooling at the expectation to liquidate insider and founder positions-- and the public be damned. Think how much they could contribute to the inauguration festivities for Romney in 2013.
I believe the halcyon days of Private Equity are over. Let's stop being naive fools. The only accomplishment you can depend on Romney to create is the continuation of the 15% capital gains tax on the "carried interest" of the earnings from successful transactions-- a tax that President Obama and others are determined to remove so as to collect fair and proper revenues from the private equity industry.
Vote for Romney if you want to keep the low tax on "carried interest." That's one job he should be able to achieve.
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0b98ab6d72a97425ff4c4e379b467008
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https://www.forbes.com/sites/robertlenzner/2012/05/20/what-jp-morgan-chase-forgot-about-2008/
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What JP Morgan Chase Forgot About 2008
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What JP Morgan Chase Forgot About 2008
1. JP Morgan Chase's chief investment office accumulated a huge bet-- maybe $100 billion-- in a so-called "weapon of mass destruction" (as in self-destruct) in a very risky credit default swap contract that was a bet on corporate credits improving despite a soft economy-- a kissing cousin to the credit default swaps in mortgage backed bonds that imploded in 2008, and cost markets everywhere many trillions of dollars.
JPM tried to hedge oranges with apples, but apples come to harvest in the fall, oranges in the winter. You cannot count on selling apples to hedge oranges, because they are different fruits, come to market at different times and subject to mixture pricing risks.
2. This $100 billion bet was supposed to be a "hedge," that is protection against a serious decline in the value of another credit default swap of an entirely different species of investment asset. In other words, JPM was trying to "hedge" without having the availability of an investment asset that was truly a hedge on the first bet.
3. Shocking to think that JPM may have taken a $100 billion wager on more than 25% of the CIO's acknowledged $37 0 billion of assets. This kind of exaggerated concentration is just not prudent for any major financial institution. And it is proof positive once again that significant parts of Wall Street are still a gambling casino.
4. This was 15% of JPM's balance sheet that was being wagered in order to gear up substantial investment profits. In my opinion, the frustration at earning zero in short term government securities should not be used to make gigantic wagers with poorly understood investment techniques that are at best murky-- and at worse-- not be played with in such size-- because liquidity can disappear in a minute, leaving you with an illiquid assets depreciating in value. These CIO traders were not masters of the universe. They should have their bonuses taken away. And no foie gras for the rest of 2012.
5. Here's another shock to end all shocks; Some 70 odd regulators from the Office of the Comptroller of Currency and maybe the New York Federal Reserve Bank were all over JP Morgan's headquarters while CIO was making hedges with murky CDS contracts-- and had no ideas or understanding of the trouble brewing. Wake up Washington; these chaps and ladies have neither the background, nor the sophistication to understand what is going on here.
6. Thanks God this was not a systemic happening. For JPM seems to be suffering from internecine warfare, a faulty reporting systems,m a weak tracking ability on risk control and holes galore in its risk management edifice. You can't keep minute-by-minute track of $370 billion when it is being used in markets you can't see and where valuation is not a science but an art.
7. Please Jamie; bring all the money back to New York. House it on the next floor to you physically, and put your toughest conceptual numbers man on the CIO beat with instructions to report to you and the bank's CFO twice a day. Don't try to make make a killing with this money. This is your capital and needs to be treated with kid gloves, not to go to the lost and found. These are unsafe times. Don't trust your hedge fund clients not to trade against you.. Avoid concentrated bets that are illiquid. Look like you're in control. Be in control. And the first chance the lawyers give you, best explain all this to us so we can parse it for Aunt Sadie.
8. At least you won't have to move to California as a way of avoiding the condemnation about and around about another major bank, where you once worked, that saw its shares fall from $48 a share to 97 cents a share.
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bb9b82d2d75aeb6ea537ba2cf3582c6b
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https://www.forbes.com/sites/robertlenzner/2012/06/02/the-2008-meltdown-and-where-the-blame-falls/
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The 2008 Meltdown And Where The Blame Falls
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The 2008 Meltdown And Where The Blame Falls
(Image credit: Getty Images via @daylife)
Note: This blog is based on my notes for a speech at the Harvard Class of 1957 55th reunion in Cambridge, Mass. on May 22nd.
Armageddon was threatening the financial system on Wednesday, September 17, 2008. The largest bankruptcy in American history, that of investment bank Lehman Brothers on Monday, September 15, had roiled global markets, accelerating the stupendous decline in values of every possible investment vehicle-- common stocks, corporate bonds, real estate, commodities like oil, copper and gold, private equity and hedge funds alike. In the midst of the chaos Merrill Lynch, the firm that had brought Wall Street to Main Street, was absorbed in a shotgun marriage by Bank of America .
Only days earlier came the recognition at the New York Federal Reserve Bank and the US Treasury that AIG, the largest insurance company in the world was running out of money. This required an immediate injection of $85 billion in bail-out funds. And later another $100 billion, still not paid back to Uncle Sam.
That day, Sept 17, an even greater crisis was pending. All day long the chairman of General Electric, a company recognized across the globe as a leading industrial giant, was calling the Secretary of the Treasury, Hank Paulson to warn that the next day, Sept. 18, that GE would no longer be able to roll over its short term debt. The American business system was on the cusp of faltering mightily. The US economy was on the brink of a precipice into the unknown.
Messrs Paulson and Bernanke, at the Fed, knew the nation could not suffer the risk of a total breakdown in industry and finance. So, they decided to instantly guarantee the $600 billion commercial paper market, which is widely used to finance day-to-day operations of all major firms. This guarantee became part of the total cost of bailing out Wall Street, which totaled over $7 trillion-- when you added guarantees to loans, investments and outright grants. The bailouts were key to raising the Fed's balance sheet from $1 trillion to $3 trillion-- and to upping the nation's total amount of debt some $5 trillion to a record $15 trillion.
Conversely, the household wealth of the nation, measured by losses in financial markets and the historic drop in residential real estate-- was reduced by a sickenly humungus $12-$14 trillion at the very bottom of the whole process in March, 2009. You take that money-- $12-14 trillion away from the asset side of the ledger and add another $5 trillion in debt--- and you are bound to experience a decline in the nation's GDP and a very much slower rate of recovery from such a trauma. A recovery that could take 10 years or more according to Harvard economist Kenneth Rogoff. That brings us to 2018. Need I say more?
How did we reach this very near call on a total systemic breakdown?
Firstly, there were no cops on the beat. Laissez-faire free market economics was the prevailing public policy. Federal Reserve chairman Alan Greenspan spoke of irrational exuberance but took no steps to cool off markets in the late 1990s. In fact, he was asked by Loews chairman Larry Tisch and former Goldman Sachs co-chairman John Whitehead to raise the margins on trading, and refused, claiming falsely that such a move was up to the SEC-- and not the Fed. Not true.
In 1999 the Glass-Steagall Act-- which had separated commercial banking from investment banking for 66 years, was overturned-- a move that opened the door to more speculative trading on the part of Wall Street firms.
Then, in 2000 Messrs. Greenspan, former Treasury Secretary Rubin and his successor Lawrence Summers pressed to pass a bill that would prohibit the regulation of derivatives-- the fastest growing and most complicated and murky new financial product. This was an incredible mistake, as derivative contracts like mortgage backed bonds and credit default swaps mushroomed in across the globe without any oversight, strict capital requirements and on an organized exchange where buying and selling were handled daily.
The result of this vacuum; no one anywhere knew who owed what to whom across the world. Despite the danger lurking in the rapid depreciation of these contracts, Bernanke publicly stated the absurd amount of sub-prime mortgages being sold to unsuspecting buyers would not spread to a much wider, deeper crisis. He didn't know what he was talking about, sadly..
Lastly, in 2004 the major firms convinced the SEC to let them value certain assets on their balance sheet at values they chose-- rather than marking them t o market-- which would reveal what losses they were carrying. This added another dangerous laxity to financial regulation. The system was falsifying its accounts believing the investments would bounce back.
The entire catastrophe's underlying theme was summed up later by this admission from former Fed chairman Greenspan . " I made a mistake," he admitted in a hearing, "in presuming that the self-interests of organizations, specifically banks and others, were such that they were best capable of protecting their own shareholders and their equity in the firms." And we made this man into the wise parental guardian of American capitalism for 18 years. We journalists, that is.
Pressed again later on, Greenspan admitted to "shocked disbelief, (because his whole) intellectual edifice had collapsed." Naive at minimum. At worst, locked into a narrow limited ideological viewpoint that set t he stage for the meltdown. Let Goldman Sachs and Citigroup master their own appetite for profits. So much for reining in animals spirits.
Secondly, the banks and investment banks were using reckless amounts of leverage. They borrowed,in many cases, $30 to $40 of debt for every dollar of capital they had. In truth, this was a recipe for disaster, since a decline of only 4% in their capital put them on the road to insolvency. It was as if you bought a million dollar house, put down a payment of $30,000 and borrowed $970,000. What sense of irrational optimism allowed this mad way of doing business.
By the fall of 2008 the decline in the value just of subprime mortgage backed bonds-- which lost up to 80% of their value in the market--meant that Fannie Mae, Freddie Mac, Lehman, Merrill Lynch, Citigroup, Bank of America, Washington Mutual and Wachovia were in a state of peril. The only way to make money in bank stocks was to short them. My favorite day trader told me after it was all over that I should be worth $50 million. With the run on Lehman Bros. both Morgan Stanley and Goldman Sachs were in danger of experiencing a run on their accounts.
Perhaps AIG is the most extreme example of leverage as financial hari-kari. It had sold protection to banks and insurance companies across the globe by issuing $540 billion of credit default swaps, which meant AIG promised to make good on any losses in value of their mortgage holdings.
AIG did not hedge $1.00 of the derivative contracts; in other words it bought no insurance against potential losses. Nor did it have any capital in the holding company that sold these financial insurance policies. It was banking on its Triple A credit rating to protect its holdings. Nor did its top management understand the danger of this gargantuan liability. AIG Financial was 100% leveraged. And it had written risky business since the managers of this unit were paid 30% of the group's revenues-- not 30% of its profits. A motivation for private profits and public losses.
The AIG mess, then, is the result of denial about the level of risk, arrogance that the triple A credit rating is an absolute safety belt, greed about compensation that leads to reckless behavior and overall, a level of irrationality that approached insanity. No one was watching the store, and the system was threatened with disintegration. Nothing less. Nothing more. A despicable performance.
Lastly come classic instances of rotten character, a sickening virus of entitlement and careless grandiosity.
Dick Fuld, former Chairman of Lehman is a classic example. He refused to let another Lehman employee ride in his private elevator up the Lehman executive floor. He asked Treasury Secretary Paulson to call the Russian authorities to let him fly his private jet over their airspace to return to the US and face the expanding crisis. Paulson rightly said No.
And Fuld never revealed t o the public,to his shareholders that Lehman hid $50 billion in debt several reporting period in a row so as to make its balance sheet look less leveraged. In fact, to this day Fuld claims he didn't know about this ruse. The regulators inside Lehman apparently never wised up to this swapping the debt for a few days and then bringing it back on board. All told-- a shabby story.
Then, there's the Bear Stearns chairman who did not leave his bridge tournament outside New York to attend to t he crisis of potential bankruptcy. Or the Goldman Sachs director who bought more shares of Goldman in the late fall of 2008 though he was also chairman of Goldman's chief regulator-- the New York Federal Reserve Board.
Or the former Goldman partner who was acting as chairman of Wachovia, a failing bank, and demanded a premium in Goldman shares and the power to succeed Lloyd Blankfein as chairman-- though Wachovia was on the verge of filing bankruptcy. Even though the Treasury Secretary had requested Goldman chairman Blankfein to perform a public service by absorbing the broken bank, the antagonized Goldman chairman told the Wachovia executive to get thee to a nunnery. Some Masters of the Universe have such rotten hubris, such selfish, self-aggrandizing drives they act like primitive warriors from a more violent time.
So, where do we stand today? We left our 315 million citizens the distinct impression that the powers that be in Washington are the handmaidens of finance-- coming to the rescue of Wall Street by means of a most costly bailout to avoid Armageddon. The auto industry in Detroit was stabilized as well with federal funds. A very clear message that Big Business is the priority of the nation for it cannot be alloswed to fail no matter the public largesse required.
The roles of financial institutions too big to fail is multiplying from 6 to 30. Take notice taxpayers of America.
The Dodd-Frank bill to regulate Wall Street is an unholy mess.
There is no centralized regulatory system in the world.
There is no rational solution for dealing with the interrelatedness of the global financial system.
And we have been lately treated to evidence that little has changed in the mores of Wall Street. Shocking is the only possible reaction to the lack of proper risk controls in the Chief Investment Office of JP Morgan Chase, where over $300 billion was being leveraged into huge casino bets on illiquid derivative contracts in Europe I didn't know about.
Then, there was the utter greed shown in the Facebook in the initial public offering, which imprudently reached for a $100 billion valuation and thus its initial ordinary investors holding shares with an immediate paper loss. Only the insiders, the top execs, the private equity firms that dumped shares, got to sell to the unsuspecting public at $48 a share, when the stock was maybe worth $20-$25 a share.
As the famous British economist John Maynard Keynes said many years ago: "When the capital development of a country becomes a byproduct of the activities of a casino, the job is likely to be ill done." It is the threat we could face again that makes the 99% view financial markets as a rigged game. Go see the documentary film, "Inside Job," which won the Academy Award 2 years ago-- if you don't believe me.
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6e9a7eec91b161bc4e3b8996ba9724db
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https://www.forbes.com/sites/robertlenzner/2013/04/18/you-can-grow-your-tax-free-retirement-plan-beyond-obamas-3-million-limit/
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You Can Grow Your Tax-Free Retirement Plan Beyond Obama's $3 Million Limit
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You Can Grow Your Tax-Free Retirement Plan Beyond Obama's $3 Million Limit
There is one saving grace in President Obama's attempt to put a limit on how much money you can set aside in your tax-free 401k retirement account. Thanks to the aid of Janet Novack, Forbes Media Washington Bureau Chief and veteran chief tax guru, we now understand that your 401k can grow beyond the $3 million level from "investment earnings and gains" in the stock market-- meaning that astute investment decisions like concentrating on stocks like Berkshire Hathaway or other steady gainers can drive up the value of your retirement cache.
This the path to go beyond the Obama proposal which recommends that "If a tax payer reached the maximum permitted accumulation, no further contributions or accruals would be permitted." In other words neither you nor your employer could make new contributions on your behalf.
There is one other meaningful and sensible proposal that would limit the length of time you can pass on your tax-free account to your children and allow them to continue to aggregate assets without paying taxes on them or the income they provide. Under Obama's plan, your heirs would have to withdraw the money within 5 years of your death from the tax-free IRA or 401k and pay taxes on it. It could not be extended without limit from generation to generation.
Here is our Janet Novack's take on the matter: " I say don't cap IRAs, but eliminate stretch IRAs. If we want to defer tax on all savings as long as possible, we would need to go to a graduated consumption tax. But that's not where we are. Instead, this is a tax break specifically for retirement-- and that's my argument against stretch IRAs.... You either cap IRAs, or you make sure Uncle Sam gets his money within the saver's lifespan. I vote for the latter."
Gallery: 12 Tips For IRA And 401(k) Heirs 13 images View gallery
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f9c92b1ab6e5cbeb7f4e33ced3502ccb
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https://www.forbes.com/sites/robertlenzner/2013/05/02/blue-chip-stocks-fetch-ridiculous-valuations-but-dont-sell-just-because-its-may/
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Blue Chip Stocks Fetch Ridiculous Valuations, But Don't Sell Just Because It's May
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Blue Chip Stocks Fetch Ridiculous Valuations, But Don't Sell Just Because It's May
Clorox at 24 times earnings? (Getty Images via @daylife)
Croesus is fortunate to be on the receiving end of timely insights into the stock market. The ever wily and tough-minded Barry Ritholtz of Fusion IQ just sent me his May missive that goes quite shockingly against the grain of that facile simpleton advice handed out every spring by wiseguys who don't seem to be careful students of history.
Ritholtz just told me that "Sell in May and Go Away" can be utter malarkey. Over the last 63 May to October periods-- Ritholtz has discovered that 37 of those periods were up-markets and only 25 were down-markets. What's more, if you factor out lousy September-October collapses like 1987 and 2008, you find that most of the negative bias for May to October just plain disappears. Wow! I gotta get word to my favorite day trader who just disappears to St. Tropez every June to chase bathing beauties on the Riviera.
"So far we see no data supporting the most extreme negative views," opines Ritholtz. "As such we continue to give this bull market the benefit of the doubt."
I'm puzzled by the recent outperformance of well-known value stocks selling at fairly rich price multiples. "Reformed Broker" Joshua M. Brown agrees with me, nicknaming Kraft (KRFT) "Kraft Wireles" for its lofty 19 P/E. Colgate Palmolive (CL) is over 24 times earnings, a multiple that Brown, tongue-in-cheek, calls "Global Flossing," in a reference to the manic rush into ultimately doomed Global Crossing more in the late 1990s tech bubble. Still, Brown says, the low volatility of the VIX suggests that market players do not anticipate a sharp downdraft anytime soon.
Here are some of the other household-name stocks with high P/E multiples for which Brown has come up with soubriquets that combine phonic elements of bubble stocks of days gone by.
The Hershey Company(HSY), at 29 times earnings, discounts a hell of a lot of chocolate sales in the emerging markets. New name; "eChocolate.net"
Johnson & Johnson shockingly is priced at 23 times earnings. Call it "Broadband-aid."
Kellogg Company (K), which sells Cornflakes, is up at the exalted height of 24 times earnings and is now being called "Applied Cornflake Devices."
The JM Smucker Co.(SJM), a jam purveyor, is 22 times earnings. New name; "JellyComm."
Clorox (CLX), a P&G spinoff, sells at 20 times earnings and earns the new monicker of "Clorox Logic." McCormick & Co.(MKC), which I sold ten days ago after a sharp run-up, is at 23 times earnings. Its "Spiceline.com."
CVS Caremark, (CVS), a chain of drugstore and health products, is priced currently at 19 times earnings. Call it "CVS Uniphase." Campbell Soup (CPB) almost 20 times earnings, is now "Soupon."
I'm shocked that these boring old blue chip companies that sell basic food and household activities, are selling at 20 times earnings at a time the economy here is growing by 1.5%.
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e6cb748b84016d387e6c6c4fdcc86dc7
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https://www.forbes.com/sites/robertlenzner/2013/06/10/how-union-muscle-made-detroits-workers-the-highest-paid-in-the-country/
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How Union Muscle Made Detroit's Workers The Highest Paid In The Country
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How Union Muscle Made Detroit's Workers The Highest Paid In The Country
One of the stunning revelations in the new documentary film, "Brothers on the Line," is the determined brutal fight led by the three Reuther brothers, Walter, Victor and Roy, to raise the pay and benefits of auto workers at General Motors , Ford and Chrysler during the 1950s. Their victories against the Big Three gave Detroit the highest per capita income level of any industrial city in the nation, according to this poignant documentary film presently in distribution.
From the Great Depression onwards, the movie recounts the hard, painful path interrupted by violence and sudden sit down strikes that finally helped make a vibrant Detroit where the blue collar workers of Ford, GMand Chrysler turned into middle class Americans with homes, cars, vacations.
Walter Reuther
They could thank the always ebullient and broadly smiling Walter Reuther whose infectious enthusiasm for his crusade is so evident in the old footage of that long ago period, with the singing of the old labor song, " Which Side Are You On Boys," being sung in the background. There were many black faces of the African Americans who went north after World War II to work in the huge mills and production plants of what was then America's first industry.
"Brothers on the Line," the line being the picket line of a striking union, recalls for me John Kenneth Galbraith's important 1952 book, 'The Concept of Countervailing Power," which ranks the trade union movement as becoming an equalizing power toward progress in the industrial economy. Today, hardly anyone knows the name of any national union leader, as they seem to have been replaced again by the establishment business executives and financial princes who are more evident at the Obama White House.
The number of UAW members has been reduced from 1.6 million members at the peak to a lowly 400,000 today, and the restructuring of the auto industry in Obama's first administration severely reduced compensation and benefits that the Reuther brothers won for their members in earlier decades when the auto companies chose not to take a strike from the auto workers and to agree to many of the generous terms proposed by Reuther.
The film, produced by Victor Reuther's grandson, Sasha, underscores just how far the auto workers progressed in American society from a horde of poor, badly clothed, grim employees going to work before the crack of dawn in huge auto plants in the Detroit area. Victory was achieved despite violence that included the late 1940s shooting of both Walter and Victor Reuther that seriously wounded them while sitting in their homes. No one was ever convicted of those attempted assassinations shortly after Walter became UAW president.
"Brothers on the Line" also reflects the political power that the United Auto Workers once enjoyed. Tellingly, the day after John Kennedy was assassinated, Lyndon Johnson placed a call from the White House to Walter Reuther, UAW President, strongly urging Reuther to pay him a visit to discuss matters that could be of mutual benefit.
Sasha Reuther also plays the recorded phone call where LBJ reaches out to the liberal Reuther to not join the opposition against the President on the Vietnam War.
The film also portrays an emotional era when white labor leaders joined in allegiance with black leaders like Martin Luther King to combine their fierce dedication for broadening opportunities and advancing the political and social power that could be forged.
Today, it's popular to say that it was partly Reuther's ability to win such generous compensation terms, limited work hours, liberal retirement benefits and lifetime health plans that were responsible for disadvantaging the domestic auto giants compared to Japanese and other foreign competitors.
In his breakthrough work, "The Reckoning," the late David Halberstam concludes that the failure of the U.S. auto industry to prepare for the competitive onslaught by Japanese car manufacturers like Toyota and Honda was due to Detroit's inability to gear up for this shocking challenge to its long supremacy as a much admired and envied industrial oligopoly.
Luckily for the attempt at recovering its former greatness, the automakers no longer have to deal with a foe as determined as the UAW under Walter, Victor and Roy Reuther.
Gallery: 10 Things To Know About Detroit 10 images View gallery
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c6264078b94bbc7517365567c5ffe011
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https://www.forbes.com/sites/robertlenzner/2013/07/28/goldman-sachs-actually-holds-close-to-25-of-the-us-aluminum-supply/
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Goldman Sachs Won't Tell Me How Much Aluminum They Hold in Detroit Warehouses
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Goldman Sachs Won't Tell Me How Much Aluminum They Hold in Detroit Warehouses
Goldman's claim that it held only 3% of the world's aluminum supply was utterly misleading. I now have determined that it holds in its own warehouses--the Metro subsidiary of Goldman Sachs some amount of aluminum that is more than its 3% of global supply, perhaps under 25%, but unknown if you add its warehouses registered with London Metals Exchange and non-LME warehouses.
But, and hold your breath on this one, it could be that Goldman Sachs is holding extensive supplies of aluminum in non-Metro warehouses, warehouses it does not own itself, but belong to other owners. I have asked Goldman to give me the total amounts of aluminum it holds if you add the Metro warehouses to the non-Metro warehouses. To be blunt, I've got a feeling they aren't going to tell me. They are trying to make up their minds right now. So, I am going to venture a guess that when you add the aluminum stores in wholly owned Goldman Sachs warehouses to other warehouses in Detroit that are not owned by Goldman Sachs, it's possible that Goldman Sachs is storing well over 25% of the aluminum available for delivery in the U.S. That's a hell of a lot more meaningful for aluminum prices than 3% of the world supply. Let the investigations intensify.
Okay. Mea culpa. I fell for the 3% of global supply instead of pressing to get the percentage of aluminum in the U.S., a far more meaningful number when you consider how holding that much of the American market might possibly, probably, effect the price of aluminum. This is to correct the impression I left on July 25 when I posted "Goldman Sachs Makes $255 Million Storing 3% of Global Aluminum Production." In fact, now that I think of it, there is the possibility that if you add the daily fee of 48 cents a ton at Goldman's wholly owned warehouses to those not owned by Goldman, the stream of annual revenues becomes a great deal more than $255 million.
So, 20% plus of the aluminum supply in the U.S. is not "minor" or measly as I wrote in my original piece published yesterday. I pride myself on accuracy, ruthless honesty, and I'm not happy at having been, shall we say, "fiddled" on this important story.
This morning, in fact, I was warned to "stay tuned" for further developments, which suggested that maybe Goldman Sachs was going to emulate the House of Morgan, J.P. Morgan Chase, and dispense with its hard commodities trading business. Hard to believe because it might involve the whole of J. Aron & Co, a commodity trading house, purchased in 1981 for I think $100 million. J. Aron was the largest trader of coffee in the U.S. and has expanded into metals, gold, oil and other agricultural products, much to the profits of the investment banking firm. When you get caught with your hand in the cookie jar, the first instinct is to panic and flee the scene of the crime. Wouldn't that be a pretty picture. I don't think the CFTC or the Fed will let them get away scott free. Pony up again. It's the American Way.
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907aeb52bb35009cc5be76e66ba822ad
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https://www.forbes.com/sites/robertlenzner/2014/12/13/wall-street-reverses-ban-on-trading-derivatives-backed-by-uncle-sam/
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A Christmas Present For The Banks From The Omnibus Bill
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A Christmas Present For The Banks From The Omnibus Bill
Wall Street banks like Citigroup and JP Morgan Chase have flexed the power of their influence to pressure Congress and the White House into a key change in the law that will allow the trading of risky financial derivatives in bank operations that are insured by the Federal Deposit Insurance Corp. This means the nation's largest banks used the deadline for passing the Omnibus spending bill as pressure to reverse a key section of the Dodd-Frank bill of 2010 that was meant to prohibit a federal government bailout of swaps entities.
It was the existence of over $500 billion of Credit Default Swaps on the balance sheet of AIG in 2008 that threatened to bankrupt the largest insurance company in the world. So, in effect, six years later, the same Wall Street banks that were bailed out by federal largesse, are being given a legislative gift that will enable them to freely trade the securities that brought Lehman Bros down in 2008 -- and obtain access to the benefit of insurance and loans from the federal government.
Behind the scenes, unbenownst to the media or the public, the nation's Too Big To Fail banks used the Omnibus spending bill that is necessary to finance federal spending in 2015 to undo this little-known Dodd Frank provision that might have restricted the volume of trading in financial derivatives that have been a major source of profits as well as controversy since the 2008 financial crisis. Most financial derivatives will be able to be traded in entities holding deposits guaranteed by the Federal Deposit Insurance Corp. and subject to borrowing at the Federal Reserve's discount window. This is a key advantage for the banks that will enable them to increase their activity in these securities.
Former Rep. Barney Frank, who was a key sponsor of the Wall Street reform legislation, attacked the change in Dodd-Frank as "a road map for further attacks on our protection against financial instability." Frank was incensed that the last-minute procedure was "inserted with no hearings, no chance for further modification, and no chance for debate into a mammoth bill in the last days of a lame-duck Congress."
If President Obama signs the Omnibus spending bill, he will have effectively rewarded Wall Street by reversing a provision that prohibits any federal assistance from being provided to "swaps entities," including registered swaps dealers, security-based swap dealers, major swap participants and major security-based swap participants, according to information obtained by Forbes. This measure required banks to remove their swaps dealing from the bank itself and do its trading in non-bank affiliates not eligible for deposit insurance. Access to the Fed's discount window would also be denied in case of a financial crisis in the markets.
The net effect of the changes in the Omnibus spending bill would be to expand permissible swaps activities within a bank and to only exclude swaps based on asset-backed securities that are unregulated and not of a credit quality.
All very technical, but the net result is to allow Citigroup, JP Morgan Chase and others to use the Fed's discount window to borrow money in case of a crisis that roiled the derivative market for credit swaps again as took place in September 2008. In effect, it means the major banks need not limit their trading of financial derivatives to non-bank operations that the market will never be fooled into thinking some future risk of danger has just been avoided. It is a complex holiday present for Wall Street. And it is a warning sign that other sections of the Dodd-Frank Wall Street reform may also be vulnerable to political rollback.
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793b7aea354b3240683ea69c9cb91207
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https://www.forbes.com/sites/robertolsen/2013/01/08/hong-kong-billionaire-too-sick-for-corruption-trial-but-prosecutors-say-otherwise/
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Hong Kong Billionaire Too Sick For Corruption Trial, But Prosecutors Say Otherwise
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Hong Kong Billionaire Too Sick For Corruption Trial, But Prosecutors Say Otherwise
Chinese Estates' Joseph Lau
The trial of Chinese Estates Chairman and CEO Joseph Lau was delayed for the second time on Monday after his lawyer said the billionaire was too unwell to stand trial.
South China Morning Post reported that Lau's lawyer produced medical documents to support the claim, but Macau's prosecutors opposed the move, pointing out that Lau had appeared in recent media reports attending social events and other activities.
Judge Mario Silvestre asked for more details before setting a new trial date. The trial had been delayed since September when the presiding judge, Alice Costa, had to be replaced due to the illness.
Lau and fellow tycoon Steven Lo, the chairman of BMA Investment, stand accused of bribery and money laundering. Prosecutors allege the pair offered a $2.6 million bribe to acquire land in Macau that was later developed into a luxury residential project called La Scala. The Macau government has already invalidated the land concession for the site.
The allegations came to light during the trial of Ao Man-long, Macau's former secretary of transportation and public works. Ao is currently serving a 29-year prison sentence.
Chinese Estates' developments include retail and office projects in prime locations on Hong Kong Island and nearby Tsim Sha Tsui, such as Windsor House and The ONE. Lau was ranked No. 5 on the 2012 Hong Kong Rich List with an estimated net worth of $6.5 billion. This year's expanded rankings with updated valuations are due to be released by Forbes on Thursday.
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9b753da56f5d700a9207bd192b1ad8c5
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https://www.forbes.com/sites/robertolsen/2013/01/14/billionaire-brothers-sourcing-firm-warns-core-profit-to-plunge-40-shares-tumble/
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Billionaire Brothers' Sourcing Firm Warns Core Profit To Plunge 40%, Shares Tumble
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Billionaire Brothers' Sourcing Firm Warns Core Profit To Plunge 40%, Shares Tumble
Li & Fung's Chairman William Fung
After the market closed on Friday, Li & Fung announced that last year's operating profit was expected to fall 40%. The global sourcing company blamed ongoing restructuring costs and provisions at its business in the U.S. All other parts of Li & Fung are said to have performed as expected.
The Hong Kong-based company also reported that its net income for 2012 was unlikely to exceed its earning of $681 million from the previous year.
Li & Fung's shares tumbled 15% to close at 11.74 Hong Kong dollars ($1.51) on Monday.
As the world’s largest supplier of clothes and toys to retailers like Walmart and Target, Li & Fung is viewed as a bellwether of global consumer sentiment. The U.S. accounted for 62% of the company's revenue in the first half of the year, while China supplied 56% of its products.
In August, the company had warned the turnaround in its U.S. business had been "slower than expected," but reaffirmed its three-year target of hitting $1.5 billion in operating profit in 2013. After the 40% drop, Li & Fung's core profit is likely to be around $530 million.
The company said its net profit jumped 33% to $313 million for the six months ended June 30, but most of that was attributed to write backs from earlier acquisitions. The fees for the companies Li & Fung acquires depend in part on the future performance of those business units. The company expects that "there will be write backs of several contingent considerations," indicating that some of its recent acquisitions are failing to meet expectations.
Li & Fung is controlled by the billionaire brothers Victor and William Fung, ranked No. 9 on the 2013 Hong Kong’s Rich List with a combined net worth estimated at $6 billion.
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a6a1e2b22577b8c60e393a1e0f99efd3
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https://www.forbes.com/sites/robertolsen/2013/02/25/tibets-growing-tragedy-self-immolation-protests-reach-105/
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Tibet's Growing Tragedy: Self-Immolation Protests Reach 105
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Tibet's Growing Tragedy: Self-Immolation Protests Reach 105
Protesting Monks with Tibetan flags (Photo credit: SFTHQ)
Reports emerged on Monday that a Tibetan man had set himself on fire in protest against Chinese rule in his homeland. According to Radio Free Asia, Phakmo Dhondup, self-immolated a day earlier in Amdho (Qinghai in Chinese) Province in eastern Tibet. He was rushed to hospital for treatment, but the extent of his injuries is unclear.
At least 105 Tibetans have set themselves on fire in the past three years in protest against Chinese rule in Tibetan-populated areas and calling for the return of Tibet's spiritual leader, the Dalai Lama. The protests have resulted in at least 88 deaths, according to the Central Tibetan Administration (CTA), the self-proclaimed Tibetan government in exile based in Dharamshala, India.
Last week, two teenagers killed themselves by self-immolation in Ngaba (Aba in Chinese) Prefecture. Ngaba has been at the epicenter of the ongoing unrest.
"The actions of these two teenagers show that despite China’s recent crackdown, this form of protest is likely to remain a feature of the Tibetan response to Chinese occupation in 2013," said Stephanie Brigen, director of Free Tibet, an advocacy group based in London. "It also highlights the plight of Tibet's children, who face all the challenges of life under oppression, and are often full participants in the struggle to resist it."
China blames the Dalai Lama for inciting the unrest and intensified its security crackdown across the Tibet Autonomous Region (TAR) and surrounding provinces. In early February, China's state-run Xinhua news agency said police in Qinghai Province had arrested 12 suspects and detained 58 others for encouraging others to self-immolate in the area. Lorang Konchok, 40, was sentenced to death with a two-year reprieve, while his nephew, Lorang Tsering, 31, was sentenced to 10 years in prison.
"We believe the world cannot remain a silent witness to this growing tragedy in Tibet," the CTA said in response to the sentencing.
See: Tibet Needs Entrepreneurs Like The Tatas And Rockefellers
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58d0761c9a4579ae191f13886b76cc6c
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https://www.forbes.com/sites/robertolsen/2013/06/23/edward-snowden-leaves-hong-kong-for-russia-final-destination-unclear/
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Edward Snowden Leaves Hong Kong For Russia, Final Destination Unclear
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Edward Snowden Leaves Hong Kong For Russia, Final Destination Unclear
A woman walks past an edition of the South China Morning Post carrying an interview with Edward... [+] Snowden on its front page on June 13, 2013. (Image credit: AFP/Getty Images via @daylife)
The Hong Kong government has confirmed that Edward Snowden left the city on Sunday "on his own accord for a third country."
Although the U.S. had earlier made a request to Hong Kong for a provisional arrest warrant for Snowden, the documents it provided did not "fully comply with the legal requirements under Hong Kong law." As the former British colony did not have sufficient information to process the request, there was no legal basis to prevent Snowden from leaving.
The South China Morning Post, which had earlier interviewed Snowden, reported that he was on a plane for Moscow, but it would not be his final destination.
An unidentified Aeroflot official was cited as saying Snowden would fly from Moscow to Cuba on Monday and then on to Caracas, Venezuela, according to Russia's ITAR-Tass news agency.
Meanwhile, WikiLeaks has said that it assisted Snowden in finding political asylum in a democratic country. The anti-secrecy group says Snowden is being escorted by diplomats and legal advisors from WikiLeaks.
Snowden, a former CIA technician and NSA contractor, had been hiding in Hong Kong for several weeks, since revealing information on the U.S. government's top secret surveillance programs.
U.S. federal prosecutors had filed a criminal complaint against Snowden in the Eastern District of Virginia, charging him with theft of government property, unauthorized communication of national defense information and willful communication of classified communications intelligence information to an unauthorized person.
Update, 1:45 p.m., EST: Snowden has arrived in Moscow and is reportedly staying overnight at a hotel in Sheremetyevo airport. WikiLeaks released a statement saying that he is bound for Ecuador, "via a safe route for the purposes of asylum, and is being escorted by diplomats and legal advisors from WikiLeaks."
Ecuador has an extradition treaty with the U.S., but Snowden could receive a warm welcome from the leftist government of President Rafael Correa, who has shown a willingness to thumb his nose at the United States. Ecuador has sheltered WikiLeaks founder Julian Assange at its embassy in London for the past year. Assange is seeking to avoid extradition to Sweden on sexual assault charges, fearing that he will be turned over to U.S. authorities seeking to prosecute him for his role in the leaking of classified documents.
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9c00e7fa78cacc942b97bf230fab8af3
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https://www.forbes.com/sites/robertolsen/2021/02/28/hong-kong-charges-47-democracy-activists-with-subversion-under-security-law/
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Hong Kong Charges 47 Democracy Activists With Subversion Under Security Law
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Hong Kong Charges 47 Democracy Activists With Subversion Under Security Law
Benny Tai speaks to members of media outside of the Ma On Shan Police Station on February 28, 2021 ... [+] in Hong Kong, China. Anthony Kwan/Getty Images
The Hong Kong government charged 47 people with one count of conspiracy to commit subversion in the largest crackdown on political opposition since the National Security Law was imposed on the city last year. The police said on Sunday that all would be held overnight and appear in court on Monday morning.
Ranging in age from 23 to 64, the former lawmakers and activists charged on Sunday had been among the more than 50 people arrested early last month for taking part in a primary election in July. The informal poll was intended to choose candidates to run for the city’s legislative body, but that election was postponed by the government.
Despite warnings from the government that the primary might contravene the newly adopted National Security Law, more than 600,000 people cast their votes in the poll, far exceeding the expected turnout of 170,000. The event was hailed by some as a clear demonstration of Hong Kong people’s desire for democratic elections.
But the government is contending that the primary is part of a plan by the opposition camp to win enough seats to paralyze the government and unseat the city’s leader, Carrie Lam.
The police had ordered the former lawmakers and activists to visit police stations across the city on Sunday, weeks earlier than expected.
Legal academic Benny Tai was among the group charged on Sunday. He was a key tactician for the primary and the wider democratic movement in the city. He said on social media beforehand that it seemed unlikely the authorities would grant him bail.
MORE FOR YOUMeet The 30 Under 30 Asia: Class Of 2021Japan’s 50 Richest 2021: Collective Wealth Jumps Nearly 50%Get To Know The Youngest Members Of Forbes 30 Under 30 Asia 2021
Former lawmaker Eddie Chu Hoi-dick said in a Facebook post before reporting to the police that he was extremely honored that he might bear the legal consequences for supporting a common ideal. He also thanked the people of Hong Kong for letting him serve the city for the last 15 years.
Chu is an environmental activist known as the “king of votes” for winning the largest number of votes when he was elected to the Legislative Council in 2016.
The European Union issued a statement on Sunday afternoon calling for the immediate release of all those arrested.
“The nature of these charges makes clear that the legitimate political pluralism will no longer be tolerated in Hong Kong,” the European Union Office to Hong Kong and Macau said in a statement. “We urge authorities to abide by their commitments to fundamental freedoms and the rule of law, as enshrined in the Basic Law and the International Covenant on Civil and Political Rights.”
Meanwhile, Chinese officials were holding a two-day forum to solicit views on how to change Hong Kong’s elections to ensure only patriots could govern the city in the future.
Last week, Xia Baolong, the head of the Hong Kong and Macau Affairs Office, said Hong Kong’s electoral system must be reformed so that people who oppose China and disrupt Hong Kong aren’t able to hold public office in the future.
Facebook page of Chu Hoi-dick
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b90692cbed3d81da1a64bddd939da77b
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https://www.forbes.com/sites/robertolsen/2021/03/14/uk-says-china-breached-hong-kong-handover-treaty-for-third-time/?sh=5c3c0ecf2cb4
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U.K. Says China Breached Hong Kong Handover Treaty For Third Time
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U.K. Says China Breached Hong Kong Handover Treaty For Third Time
Britain's Foreign Secretary Dominic Raab speaks during a joint press conference with U.S. Secretary ... [+] of State Mike Pompeo at Lancaster House on July 21, 2020 in London Peter Summers - WPA Pool/Getty Images
The U.K. government said China is in “a state of ongoing non-compliance” with the Sino-British Joint Declaration, a treaty signed by the two countries that guarantees Hong Kong’s rights and freedoms after the city was handed back to Beijing in 1997.
“Beijing’s decision to impose radical changes to restrict participation in Hong Kong’s electoral system constitutes a further clear breach of the legally binding Sino-British Joint Declaration,” Foreign Secretary Dominic Raab said in a statement on Saturday.
The Sino-British Joint Declaration, which was signed in 1984, stipulates that Hong Kong would retain its high degree of autonomy, rights and freedoms for 50 years after the handover in 1997.
Raab also said on Saturday that the Chinese authorities’ continued action of ongoing non-compliance was a “demonstration of the growing gulf between Beijing’s promises and its actions.”
The statement did not indicate what action the U.K. government might take in response to the third breach of the Joint Declaration in less than nine months.
A day earlier, the foreign ministers of the G7: Canada, France, Germany, Italy, Japan, the U.K., the U.S. and the European Union issued a joint statement declaring the changes approved by the National People’s Congress (NPC), combined with the recent mass arrests of pro-democracy activists and politicians, undermines Hong Kong’s autonomy. The changes will “stifle political pluralism, contrary to the aim of moving towards universal suffrage” as set out in the city’s mini-constitution.
MORE FOR YOUMeet The 30 Under 30 Asia: Class Of 202130 Under 30 Asia: The Female Entrepreneurs Leading Asia-Pacific’s Promising Retail And E-Commerce StartupsBy The Numbers: Get To Know The 30 Under 30 Asia Class Of 2021
The Chinese embassy in the U.K. issued a swift rebuttal to what it described as "groundless slanders."
"The U.K. has no sovereignty, jurisdiction or right of 'supervision' over Hong Kong after the handover, and it has no so-called 'obligations' to Hong Kong citizens,” a spokesperson said on Saturday. “No foreign country or organization has the right to take the Joint Declaration as an excuse to interfere in Hong Kong affairs, which are China's internal affairs."
Chinese officials have said that the changes are “improvements” aimed at ensuring that only "patriots" are in control of Hong Kong. Beijing has sought to exert more control over the city following widescale protests in 2019 and 2020 that were triggered by a highly controversial plan to allow extraditions to mainland China.
In November last year, Raab said Beijing’s move to impose new rules that disqualified four opposition lawmakers in Hong Kong was also a “clear breach” of the Sino-British Joint Declaration. The NPC passed a measure at the time that stipulated the four opposition members would immediately lose their seats in Hong Kong’s legislative council, which prompted almost the entire pro-democracy camp to announce their resignations.
In July the same year, Raab said the National Security Law which China had imposed on the people of Hong Kong was also a “clear and serious violation” of the Joint Declaration. He expressed particular concern over provisions that gave mainland Chinese authorities the power to assume jurisdiction over certain cases and try them in the mainland. He also noted that the security law does not provide legal and judicial safeguards in those cases.
The U.K. responded to the passing of the security law by offering Hong Kong residents a path to British citizenship.
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e1af15f0fe2e88d5149bfd66dbf87678
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https://www.forbes.com/sites/robertpagliarini/2013/10/09/6-asset-protection-strategies-to-shield-your-wealth/?sh=7bfb1d53199a
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6 Asset Protection Strategies To Shield Your Wealth
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6 Asset Protection Strategies To Shield Your Wealth
Have you heard of the homeless man who was sued for $5.5 million? Of course you haven’t. Lawsuits aren't filed against those with few assets; they are filed against those with “deep pockets.” If you have substantial assets or are coming into a windfall from a sudden wealth event such as an inheritance, lawsuit, stock options sale, business sale or from a sports/entertainment contract, there are several money moves you should consider to best protect your new wealth against lawsuits and from others.
1. Increase your liability insurance. Your first line of defense in litigation should be insurance. Call your insurance broker and increase your liability limits. Make sure your personal umbrella liability coverage is for an amount at least equal to your new net-worth. For example, if you are going to receive $3 million from your Aunt Jane’s estate, tell your insurance broker that you want a $3 million umbrella liability policy. Rates are inexpensive – often $200 or $300 per $1 million of coverage. Bruce Givner, a Los Angeles tax attorney, recommends that his clients have a minimum of a $5,000,000 umbrella policy, and most of them opt for $10,000,000.
Tip: It’s best to make this five minute phone call before you receive the inheritance or windfall.
2. Consider keeping assets separate. Depending on the state in which you live and the source of your windfall, if you deposit the money into a joint account with your spouse, this money could instantly become half theirs. For some, this isn’t an issue, but for others, this could pose a problem. For example, if you have children from a previous marriage and commingle an inheritance you receive with your new spouse, your children may get less than you expect when you pass away. This problem becomes even more damaging if you are contemplating a divorce.
Tip: If you don’t want your spouse to have ownership of your windfall, talk to an attorney and keep the assets in a separate account.
3. Protect yourself from renters. If you have rental property or expect to invest in rental property after receiving your sudden wealth, create a business entity such as an LLC or corporation to shield your other assets from a disgruntled tenant. By doing this, if your renter sues you for $5 million, they can attack the assets in the entity that holds the real estate but the rest of your personal assets are protected.
Tip: Create a separate business entity for each rental property or consider a Nevada or Delaware Series LLC, which is designed to protect each property within a single LLC.
4. Review all jointly held accounts. Any money you deposit into a joint account with your children, elderly parents, roommate, or business partner is at risk. If the joint owner files for divorce, incurs a tax lien, or lawsuit judgment, the entire account could be wiped out.
Tip: If there is a need for a joint account, keep the balance as low as possible.
5. Formalize informal partnerships. Business partnerships are ticking time bombs. Why? Just like joint accounts, you are responsible for the actions of your partner. But unlike a joint account, a lawsuit against your partner can put all of your assets at risk. For example, suppose you and a friend have an informal agreement to partner and provide consulting services. If your partner is involved in an accident on the way to a client, your personal assets can be in jeopardy.
Tip: Avoid partnerships. Form an entity such as an LLC or corporation to provide you with legal protection.
6. Create business entities to shield assets. If you have a small business or do part-time work on the side without having a formal business structure such as an LLC or a corporation, you are operating as a sole proprietorship. The “sole” means it’s just you, so unlike a partnership, you don’t have to worry about a partner's actions . . . but all of your personal assets are at risk if you are sued.
Tip: Create a business entity that shields your personal assets from lawsuits against your company.
Sudden wealth can be a life-changing experience that can improve your life and the lives of those around you, but only if you keep it. Those with more assets are bigger targets for lawsuits. Don’t let your sudden wealth suddenly get stripped from you. Protect your assets before you get the windfall and you will sleep a little easier knowing your assets are better shielded.
Robert’s latest book is The Sudden Wealth Solution: 12 Principles to Transform Sudden Wealth Into Lasting Wealth.
Connect with me on Twitter @rpagliarini, my financial planning blog, or email me. This discussion is not intended as financial, legal or tax advice, and cannot be relied upon for any purpose without the services of a qualified professional.
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92246fb8ed37f5e29c4cb45c49650a84
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https://www.forbes.com/sites/robertpassikoff/2014/10/20/the-2014-brand-keys-loyalty-leaders-list/
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Which Brands Have The Most Loyal Customers
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Which Brands Have The Most Loyal Customers
Bottom line: mobile, digital, and social brands continue to exhibit loyalty supremacy. New brands and categories make up more than a third of this year’s Top-100 leaders list.
Apple , Amazon, WhatsApp, Google , YouTube, and Kindle head the 2014 Brand Keys Loyalty Leaders List, the annual survey conducted by Brand Keys (brandkeys.com), the New York-based brand and customer loyalty and engagement research consultancy. This is the 18th year aggregating brand loyalty leaders, and the seismic shifts in loyalty leadership in terms of new categories and brands making appearances in the Top-100 continues.
Brand loyalty has always been driven by emotional engagement, and the rankings on this year’s list make it abundantly clear that connection, meaning, and differentiation is still everything. With 721 brands in 65 categories for consumers to rate, there’s a lot of competition for the top-100 spots. This year certain categories rose to the top because of their high levels of consumer emotional engagement. Oh, and their abilities to deliver against consumers’ increased expectations – in virtually any category you care to name.
Thirty-six of the top-100 Loyalty Leaders are new brands or categories. Most new arrivals facilitate communication and social outreach: tablets, smartphones, and social networks, with What’s App (instant messaging), Netflix , and Amazon (video streaming), Instagram, and PayPal (online payments) now representing that trend. Other, new, non-digital/social categories include Fast-Casual Restaurants (Chipotle, Panera, Chick-fil-A), Insurance (USAA), Credit Cards (Discover, American Express), and Beer (Sam Adams). Dunkin’ Donuts was the only non-digital/social brand in the top-10, up 7 spots since last year, but not surprising when you realize their customers have rated them #1 in the out-of-home coffee category for years.
This year, the top-10 on the Brand Keys Loyalty Leaders rank as follows:
Amazon: tablets Apple: tablets Apple: smartphone YouTube: social networking WhatsApp: instant messaging Amazon: online retail Google; search engines Kindle: e-readers Samsung: smartphones Dunkin’ Donuts: coffee (out-of-home)
Forty-five percent (45%) of the top-100 brands account for consumer outreach and engagement via cellular and social networks, and the phones, smartphones, computers, and tablets needed to meet ever-increasing expectations related to outreach and personal connectivity the consumer uses as a yardstick to measure brands.
Last year beauty and personal care brands accounted for nearly a fifth of the top-100 but this year represent only 13%. The emotional engagement that women share with their beauty brands can be very powerful, but again, consumers are looking harder for a reason to believe and a reason to engage with – and buy – one brand versus myriad ‘me-too’ products. Check out who were among the brands to show the greatest positive loyalty increases.
Traditional retail brands were down 50%. The inability for many retailers to provide meaningful differentiation – beyond low-lower-lowest pricing strategies – has seriously eroded loyalty levels in the retail category. That and a shift to buying online and via mobile devices. Retail brands that remain among this year’s Loyalty Leaders include J. Crew (#50), The Gap (#80), Macy’s (#88), Victoria’s Secret (#75) and T.J. Maxx (#92).
Six (6) automotive brands made the top-100, including: Hyundai (#23), Ford (#26), Toyota (#48), Jeep (#70), Nissan (#94), and KIA (#99). Ford and Toyota moved up the list +12 spots each, Jeep +11, and Nissan appears on the list for the first time
Biggest Winners
The brands that showed the greatest loyalty gains this year were:
Netflix (+79)
Estee Lauder (+31)
MAC Cosmetics (+28)
HTC smartphones (+26)
Cover Girl (+25)
The Biggest Losers
With minor exceptions, it turns out that the biggest Loyalty Leader losers were primarily categories. Certain categories just disappeared.
These included Breakfast Cereal, which shouldn’t surprise anyone. The category has seen dramatic shifts over the past few years in how and what is consumed for breakfast. And anyway, and how much loyalty can you expect when “differentiation” is defined as which flavor marshmallow is in this particular box?
Major brands – perennial Loyalty Leaders – but absent from this year’s list, included:
Pepsi and Coke. Sure, the category has shifted there too, but they’re both cold, refreshing, come in a bottle or a can, have ubiquitous brand awareness and distribution, and are each on sale alternate weeks. What is there to be loyal about?
ABC News, CBS News, NBC News, and the Today Show didn’t report this year list, some accounted for by the ascendancy of mobile. Today a tablet screen and a TV screen are regarded as two entirely different platforms engendering different loyalty and engagement levels for different programming. Certainly broadcast news is watched, but not considered an important first-source to be loyal to.
And you can search all you want, but you won’t find Bing or Yahoo on this year’s list either. When it comes to search, Google (#7) is the only one in that category that that appears.
Not surprisingly General Motors didn’t make the list this year. Where loyalty exists, consumers are six times more likely to give a brand the benefit of the doubt in uncertain circumstances. But that well of forgiveness isn’t bottomless, especially in the face of seventy-five GM recalls (more than 30 million vehicles) this year alone. Loyalty is about the strongest bond you can create between customer and brand, but even loyalty has its limits!
McDonald’s, which up till this year had appeared since the List’s 1996 inception, dropped off the top-100 list too. In another study conducted earlier this year by Brand Keys, Millennials, a critical audience for fast food chains, reported a 20% decrease in visits to them, with 42% reporting increased visits to fast-casual restaurants, a category whose brands have shown up for the first time on this year’s list. When asked to characterize traditional fast food brands, including McDonalds, 53% of this group called it “dollar food,” the result of a habituated fast food brand reliance on the ‘Dollar Menu’ to boost sales. The thing is, you can’t build loyalty on the basis of price. In the absence of brand meaning, stuff for a dollar, a new wrap, or new app, and all the social networks in the digital univers isn’t going to change things for them.
Other brands not appearing on the Loyalty Leaders List this year included Ben & Jerry’s, Canon (point-and-shoot cameras), H&M, Haagen-Daz, Skechers, Skype, Southwest Airlines, Walgreens, and Walmart.
Who had the greatest loyalty and engagement erosion?
Max Factor (-20)
Clinique (-16)
Grey Goose (-13)
Revlon (-13)
Apple Computers (-11)
Costco (-11)
Sam’s Club (-11)
OK, it’s true that some of the shifts are certainly due to the creation and adoption of new categories and brands that better meet – even exceed – customer expectations. But brands that understand that real emotional connections can serve as a surrogate for added-value, and the brands that have made loyalty and emotional engagement one of their real strategic priorities and KPIs will always show up at the top of a consumer’s list.
Methodology
The Loyalty Leaders analysis was conducted in September 2014 and includes assessments from 43,238 consumers, 18 to 65 years of age, drawn from the 9 US Census Regions, self-selected the categories in which they are consumers, and the brands for which they are customers. Seventy-five percent (75%) were interviewed by phone, 20% via face-to-face interviews (to account for today’s of the population who are cell phone-only consumers,) and the remaining consumers assessed categories and brands online. Loyalty Leader assessments examine 65 categories and 721 brands.
Unlike economic use models, which rely heavily on historical data and profitability conjecture, the Brand Keys Loyalty Model and rankings are 100% consumer-driven, and are predictive, leading-indicators of brand and corporate profitability. The good news is that brand loyalty is understandable. The better news is, it can be quantified and predicted. And, today, knowing what’s coming down the road gives a brand an extraordinarily powerful advantage.
For the complete top-100 2014 Brand Keys Loyalty Leaders List, please visit: http://info.brandkeys.com/acton/formfd/943/0011:d-0004
Or, for more information regarding this year’s Loyalty Leaders List, your brand’s position on the list, or general information about integrating predictive loyalty and engagement metrics into your marketing efforts, feel free to contact: Leigh Benatar at [email protected] or 212-532-6028.
Robert is author of "Predicting Market Success." Connect with Robert on LinkedIn.
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cd21468b1261da9fc3b06a9661878a0f
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https://www.forbes.com/sites/robertpassikoff/2014/11/06/for-retailers-black-friday-has-become-a-season-unto-itself/
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For Retailers, 'Black Friday' Has Become A Season Unto Itself
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For Retailers, 'Black Friday' Has Become A Season Unto Itself
Super-charged by increased mobile outreach, intensified consumer planning, and raised numbers of retailer mobile apps, traditional retailers will be going to work earlier, and working harder to engage consumers this season if they want their share of a projected individual $855.00 holiday spend, about 4% higher than last year. Sixteen-thousand (16,000) consumers from the 9 U.S. Census regions identified these real facts-of-retail-life in Brand Keys’ 20th annual national holiday shopping survey.
And many consumers missed Black Friday. That’s because it started last Saturday. Surprised? Well, it shouldn’t have been a total surprise. Store checks conducted by Brand Keys found retailer displays of holiday greeting cards, giftwrap and Christmas-themed gifts already on display in October. Consumers shopping for Halloween candy, actually had to sort through themed packaging, because retailers had Christmas candy leitmotifs right next to the bat wing and witches-on-broomsticks packaged candy, for the same candy!
More than half of the sample indicated that they were going to start holiday shopping in November. In last year’s Holiday Shopping survey, 54% of consumers indicated they were going to start Holiday shopping in November, a trend we’ve commented upon for a number of years. Only 25% of consumers – 10% fewer than 2013 – indicated they were going to wait until Black Friday November 28th.
Amazon and Walmart kicked off their Christmas discounts on Saturday, November 1st – 27 days before the traditional Black Friday, which had long been regarded as the start of the holiday shopping season. Amazon started its “Black Friday” Saturday with two daily deals on holiday merchandise that will run through December 22nd. Walmart’s chief merchandising officer, Duncan MacNaughton, said, “As soon as they put away their Halloween costumes, our customers start prepping for Thanksgiving buying Christmas trees and shopping for gifts.”
Ninety-eight percent of those interviewed indicated they’d buy holiday gifts online again this year, but no surprise there. And, even in light of the mobile movement, bricks-and-mortar retailers still rank high on consumers’ list of places they intend to shop:
Store Type 2014 % change from 2013
Discount Department Stores 96% +2
Traditional Department Stores 78% +2
Specialty & Apparel Stores 40% - 5
Catalogs (25%), are down again from last year by 50%. And apparently if a consumer can pull it up on a site on a mobile device, hard-copy has become superfluous.
Oh, and spoiler alert: everybody is getting a gift card this year. Gift cards have become as universal as greetings cards, with 95% indicating they’ll buy at least one for someone. All other categories remain relatively unchanged from 2013. Apps and downloads have replaced CDs, DVDs, and printed books. Consumers indicated the following categories where money was going to be spent:
Clothing and Accessories 78%
Electronics/Phones/Computer 51%
Personal Care Products/Spa 33%
Jewelry 20%
Food and Wine 20%
Home Décor 7%
Value is still paramount for all platforms and consumer expectations regarding outreach and convenience, particularly for mobile, and the shopping experience for bricks-and-mortar retail, are all up again. Retailers that can integrate the store experience with their mobile outreach will likely find it to be a winning combination. They’re just going to have to do it much earlier this year.
But given the intense competition for consumer dollars, Department stores and specialty shops will have to become more aggressive on deals, promotions, and operating hours.
Because this year they won’t be able to avoid it.
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463969061aaf2ed363a66acfa0767777
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https://www.forbes.com/sites/robertpearl/2013/12/05/domestic-violence-the-secret-killer-that-costs-8-3-billion-annually/
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Domestic Violence: The Secret Killer That Costs $8.3 Billion Annually
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Domestic Violence: The Secret Killer That Costs $8.3 Billion Annually
Designed to increase awareness and action to end domestic violence and sexual assault, the NO MORE... [+] symbol is spreading the message nationwide. It asks supporters to join in saying “NO MORE silence, NO MORE violence and NO MORE excuses.” Learn more at nomore.org.
A woman comes to the doctor with depression, fatigue and insomnia. A co-worker stays late in the office even when there is not much to do. A sales associate appears tired and distracted.
For each of these individuals, domestic violence – physical, sexual, verbal, emotional or psychological abuse against an intimate partner – could be the underlying cause of distress. Historically, domestic violence has been viewed as a criminal issue – according to police records, almost 1 in 3 female homicide victims are killed by an intimate partner.
But today we know it as a social, business and health priority, as well. Not only does it cause personal suffering, but domestic violence also reduces productivity, leads to absenteeism and drives up health care costs. And unless people are trained to look for it and ask about it, domestic violence is rarely identified.
The statistics are staggering
Domestic violence is all around us. It affects our families, our friends, our coworkers and our neighbors. Most of the time, we are not aware it's happening.
In the U.S., 24 percent of adult women and 14 percent of adult men have been physically assaulted by a partner at some point in their lives. It is the most common cause of injury for women ages 18 to 44. And it leads to an increased incidence of chronic disease: Abused women are 70 percent more likely to have heart disease, 80 percent more likely to experience a stroke and 60 percent more likely to develop asthma.
Nearly a quarter of employed women report that domestic violence has affected their work performance at some point in their lives. Each year, an estimated 8 million days of paid work is lost in the U.S. because of domestic violence.
Domestic violence costs $8.3 billion in expenses annually: a combination of higher medical costs ($5.8 billion) and lost productivity ($2.5 billion).
Addressing this issue could save thousands of lives and billions of dollars. But as long as the symptoms and consequences of domestic violence go unnoticed or overlooked, nothing changes.
Addressing domestic violence starts with raising awareness
A growing number of health care professionals and business leaders understand the importance of recognizing and addressing domestic violence. But they remain in the minority. Most doctors don’t take the time to learn about and use established screening techniques. And unless domestic violence can be identified, we can’t help victims deal with the abuse or reduce the long-term consequences.
Some businesses have taken action and seen results. Companies like Verizon, Allstate, Prudential, Avon, Mary Kay, Macy’s and Home Depot have trained their employee assistance teams to screen for domestic violence. They’ve provided necessary information to their staffs and, most importantly, they’ve seen the rate of identification increase significantly.
Several years ago, I had the chance to speak at a conference on domestic violence hosted by Liz Claiborne, now Fifth & Pacific Companies. The meeting was well attended by executives from across the industry. As part of the program’s goal to raise awareness, we heard from the victims about their experiences. Their heart wrenching tales of fear and abuse reinforced this nation's need for early intervention.
We've seen some progress since then, but the silence remains deafening.
Everyone has a role in curbing domestic violence
While there are significant differences in the roles that colleagues, health care professionals and friends can play, the secret nature of domestic violence requires vigilance from everyone.
The role of the employer
Employed individuals spend the majority of their waking hours at work. That's why employers are ideally suited to spot the symptoms of domestic violence and intervene. In fact, providing resources and support is part of a company's requirement for ensuring a safe work environment.
Senior executives can promote a culture that includes domestic violence awareness and prevention. Information about domestic violence should be shared at every employee orientation. It should be addressed at every occupational health visit. It can be incorporated into workplace wellness activities. When the issues of domestic violence are brought front and center in as many venues as possible, we have a better chance of breaking the silence.
Employee assistance counselors and human resource professionals need to be ready to respond to inquiries, refer victims to advocacy services, engage with law enforcement when appropriate and offer security assistance when necessary.
Managers need to understand that domestic violence may explain absenteeism and ongoing health problems. They should be trained to recognize potential signs of domestic violence, including signs of depression and evidence of physical harm. They should be trained to ask about it with confidence and without judgment. They should know where to refer individuals who are victims of domestic violence, including employee assistance programs (EAP) and community resources.
Without a stable job, most victims are unable to remove themselves from a dangerous domestic arrangement and escape the long-term consequences of abuse.
The role of the clinical team
The Affordable Care Act identifies domestic violence screening as a national health priority, alongside smoking cessation, exercise, nutrition, substance abuse reduction and the provision of mental health services.
Health care professionals play an important role in identifying victims of domestic violence. When women talk with their physicians about domestic violence, they are four times more likely to receive the needed services and end the abusive relationship.
Physicians need to pay attention to physical and behavioral signs of potential abuse. They should ask about domestic violence as a potential cause of unrecognized medical problems. They need to be trained to communicate in ways that are supportive and non-judgmental. And when patients ask for help, they should be aware of the available community and national resources.
The role of family, friends and colleagues
Family members, friends and colleagues are often the first to hear that someone they know is a victim of domestic violence. When people are educated about the frequency of domestic violence, they are more comfortable talking with others. Being able to offer support can mean the difference between life and death. A simple statement like “I'm sorry this is happening to you” is a start. Offering to help the victim obtain assistance – whether through the national domestic violence hotline, a company EAP or a local domestic violence advocacy organization – is a crucial next step.
Putting an end to domestic violence has broad implications
Regardless of who helps identify the problem or which agency provides the care, the majority of individuals who end violent relationships do not experience another one. The victims of domestic violence are just that: victims. They don't want to be in abusive situations. They just are. And we all need to recognize the role we can play in helping them.
When we fail to provide the training and infrastructure needed to address domestic violence, the individual suffers. But so do the individual’s children, business colleagues and all of us. As we search for ways to improve this country’s health while lowering costs, shedding light on domestic violence and protecting the victims of abuse is a great place to start.
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ca0f8ebad83d58427c40a1ba4691d11b
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https://www.forbes.com/sites/robertpearl/2013/12/19/putting-health-care-reform-in-perspective/
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Putting Health Care Reform In Perspective
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Putting Health Care Reform In Perspective
Health care policy junkies held their breath on Dec. 1, the date President Barack Obama promised the government-run exchange web site would be fixed. They followed the early returns on Dec. 15, the deadline to enroll for health insurance coverage. And, of course, they are on the edge of their seats waiting for coverage to take effect in January so they can compare the enrollee count to the president's projections.
With so many "make it or break it" moments in the Affordable Care Act (ACA) rollout, it’d be easy to think the whole thing might collapse if it misses (or misses the mark on) one or two key milestones. But no one should hold their breath for that.
Health care pioneer Dr. Morris Collen turned 100 in November. His life reminds us that health care... [+] reform didn't start yesterday. (Photo credit: Bill Horton, Kaiser Permanente)
While these milestones may hold political importance in the 2014 mid-year elections, they won’t determine the success of this major U.S. health care realignment. For that, we must wait years.
Last month, I was reminded just how important the long-term view can be when I joined hundreds of national leaders in San Francisco to celebrate the 100th birthday of Dr. Morris “Morrie” Collen.
Morrie, one of the founders of Clinical Informatics, has been recognized by multiple organizations for having had a profound influence on a variety of fields, including medical informatics, disease prevention, health care delivery and insurance payment models.
As I listened to Morrie’s remarks during the event, my view of the health care reform timeline shifted from months to years to decades. Morrie's life demonstrates that health care reform isn't about an immediate deadline. It’s about an evolution of the medical practice that started decades ago and will continue for decades to come.
The Roots of Morrie’s Legacy
Morrie was born Nov. 12, 1913, into an era that barely resembled today’s medical world – a world before antibiotics, general anesthesia and health insurance.
Finding his way into medicine, Morrie was a resident with Dr. Sidney Garfield at the Los Angeles County Hospital. Together, they provided medical care to workers in the Richmond shipyards during World War II. When the war ended, Morrie helped found the nation's largest nonprofit health plan Kaiser Permanente.
Morrie's assignment in the Richmond shipyards was running the pneumonia ward, filled with workers sleeping on cots or mattresses on the floor. He was one of the first civilian doctors in America to use penicillin – then considered a new “wonder drug.” He still marvels at how minimal doses of this antibiotic helped save hundreds of lives that would have otherwise been lost.
Morrie reminds us that medical progress can be slow, but it is continuous. Over time, the results prove remarkable.
Morrie’s Legacy Has Been Long in the Making
As he described the challenges he faced – and the solutions he and his colleagues implemented – half a century ago, I was struck by how similar they were to today’s challenges and solutions.
Preventing tomorrow's illnesses
In the 1950s, Morrie and his team saw thousands of dock workers for a "multiphasic" evaluation. With this comprehensive examination, Morrie obtained a multitude of health data, including the worker’s blood pressure, nutrition and blood chemistries. Morrie recognized that doctors had to do more than just treat acute disease. They were obligated to prevent it in the first place.
Morrie believed that health care had to start with health. As early as the 1940s, before doctors fully understood the causes of heart disease and stroke, Morrie and his colleagues were reducing these risks for their patients.
Today, the ACA requires preventive services be provided at no cost. There are prevention performance metrics included in the quality outcomes section of the Medicare Advantage Star system. And a variety of commercial insurers have implemented fee-for-performance payment systems, rewarding providers for preventing disease – not just delivering more services.
These are all the modern versions of what Morrie started. It just took our nation half a century to get there.
Data, data, data
Morrie also ensured that the data and results from the multiphasic evaluations were systematically documented not into paper medical records, but on punch cards that were stored on IBM 1400 computers.
Even in the 1960s, he recognized that computers could make medical information readily accessible for research and learning. Most importantly, he recognized that we can improve care for the individuals by studying populations of patients.
He understood that evidence-based approaches could generate superior outcomes long before the phrase "evidence-based medicine" was introduced.
Morrie embraced computers to improve health care 50 years before “Meaningful Use” criteria encouraged today’s health care providers to do the same. He just had to wait for the technology and rest of the health care world to catch up.
Making the future better through research
Morrie founded the Kaiser Permanente Division of Research in the early 1960s. At the time, most people thought of research only as basic science, conducted in a laboratory. Morrie wanted to combine the best scientific research with clinical applications in real-life health care delivery scenarios. He recognized that advances would come by correlating population statistics with health outcomes and by applying them to individuals.
Morrie wanted to bridge the chasm dividing academia and clinicians. Fifty years later, the Division of Research he founded is the largest research facility outside of a university or government setting.
Morrie insisted on a broad portfolio of projects, representing the full range of health services. They included comparative effectiveness research, vaccine testing and projects to understand the complex interplay of medical disease, genetics and the environment.
Many of the comparative effectiveness programs funded through the ACA mirror Morrie's work over the past five decades.
Morrie’s Story Puts Everything in Perspective
We can expect health care reform to expand coverage and accelerate the pace of health care change. But this acceleration hardly began with the ACA. Talking to Morrie as he celebrated his 100th birthday, I could see how much of what exists in the ACA began long ago.
For five decades, Morrie pointed out the importance of prevention. He encouraged institutions across the country to incorporate and exploit modern information technology. And he championed investments in clinical research.
As I drove home from his party, I thought about the future. Health care reform will happen, even if the exact timing shifts. The American health care system will improve, in spite of the predictable implementation challenges we are experiencing.
And I thought about the debt we owe Morrie for his visionary leadership.
Finally, I remembered a conversation I had with him prior to the ACA. I asked him whether he ever worried that our nation would fail to solve the health care challenges we faced. His response: “No, it's only a matter of time.”
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cd6501cf93d6098e95d09f796f792343
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https://www.forbes.com/sites/robertpearl/2014/01/30/hivaids-discovery-shows-how-wrong-assumptions-can-be/
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HIV/AIDS Discovery Shows How Wrong Assumptions Can Be
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HIV/AIDS Discovery Shows How Wrong Assumptions Can Be
Common wisdom is difficult to overturn, even when it’s wrong.
The astronomer Nicolaus Copernicus discovered the earth is not the center of our universe. Physician Ignaz Semmelweis recognized that unwashed hands transmit disease. Albert Einstein found that time and space are relative.
We take these facts for granted today, but each discovery was initially rejected by critics. To change the course of history, each idea had to overcome the popular thinking of its time.
Today, the fields of science and medicine continue to evolve with new evidence disproving commonly accepted theories. Scientists recently upended one such assumption on the cause of disease progression in patients with HIV/AIDS.
What We Know About HIV/AIDS
Human immunodeficiency virus (HIV) is a retrovirus that slowly replicates and weakens the immune system. Those affected become highly vulnerable to infection and disease.
Scientists recognize that HIV attacks and destroys the "CD4+ T helper cells.” These cells are essential in helping fight off various infections.
A recent discovery on the progression of disease in people living with HIV/AIDS raises new questions... [+] about health care assumptions in America. (Image credit: Wikipedia)
Once the number of functional CD4+ T helper cells decreases, the diagnosis advances from HIV to AIDS. At that point, the risk of developing a life-threatening infection rises significantly.
If left untreated, the disease can progress to Acquired Immunodeficiency Syndrome (AIDS) and eventual death.
As yet, there is no cure for HIV, though antiretroviral treatment dramatically slows its course and reduces the risk of complications
Research institutions have worked tirelessly to understand HIV and find more effective treatments. As a result of major advances over the past 20 years, the annual mortality rate from AIDS-related complications in economically advanced countries is less than 2 percent.
Yet despite these successes, an estimated 35.3 million people across the world are living with HIV and approximately 1.6 million people died from HIV-related disease in 2012.
A New “Truth” About HIV/AIDS Has Potential To Save Many Lives
Until recently, clinicians and scientists believed the human body went after the CD4+ T helper cells that were most infected by HIV. They assumed destroying the cells with the highest levels of the virus was the body’s way of trying to limit the disease.
It’s a logical conclusion. But new research contradicts this belief.
Immunologist Warner Greene and his laboratory group at the Gladstone Institutes discovered that – 95 percent of the time – the body destroys the less infected, resting cells. Researchers don't know why, but they were able to show that in the process of killing these relatively healthy cells, chemicals are released that attract more healthy cells to the scene, accelerating the destruction process.
And even though scientists can’t be sure why the body kills these relatively healthy cells, this information allowed them to identify a specific protein that contributes to this process.
This new information led researchers to recognize that an existing drug that blocks parts of this sequence could prove effective in the future. More drug efficacy testing is necessary but this promising development is an important step for patients living with HIV infection.
Ultimately, understanding this process may also provide insights into a variety of other infectious diseases and potentially cancer.
This discovery demonstrates, once again how commonly accepted concepts in science and medicine prove incorrect.
Other Commonly Accepted Health Care Theories Likely To Tumble
Commonly accepted beliefs about health care delivery are in great supply. Most of them seem reasonable on the surface but many lower the quality of health care provided while raising its costs.
For example, patients believe that more medical tests equate to better health outcomes. Seems logical. Looking inside the human body can help doctors uncover ailments, leading to quicker cures, right? Not always. Often these extra studies demonstrate insignificant findings which then lead doctors to take actions that don't add value and produce unnecessary complications.
And, of course, some conclude that more treatments and more complex procedures produce better outcomes than less-invasive approaches. Again, seems logical. But too often the outcome leads to added complications, longer hospital stays and higher health care costs. Extensive and sophisticated testing and major surgery are important for many problems, but not as often as people assume and not with the impact, they predict.
Others assume that the choice of health insurance companies is not particularly important when it comes to quality. But the difference in clinical outcomes based on published data proves otherwise – the difference is in how many preventable deaths occur.
Over the next few months, this blog will dive deeper into these and other commonly accepted health care myths.
And as we have seen throughout history, "common wisdom" seems conclusive until someone recognizes the contrary: that the earth is not the center of our universe, that unwashed hands transmit disease, that time and space are relative, and that it is the less infected cells that lead to the reduced T cell count and, eventually, deaths.
Addressing health care shortcomings will be an uphill battle. However, if we can dispel commonly accepted myths, we will take a crucial step toward improving health care delivery.
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f768578985aacdc5d5caa48203cb26a4
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https://www.forbes.com/sites/robertpearl/2014/02/20/whats-the-first-step-in-transforming-american-health-care/
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What's The First Step In Transforming American Health Care?
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What's The First Step In Transforming American Health Care?
The Affordable Care Act is designed to increase the nation’s supply of health insurance coverage. Meanwhile, America’s aging population is increasing the demand for health care services.
As a result, our nation is likely to face a physician shortage as detailed in last week’s article “Doctor Debate: Too Many American Physicians or Too Few?”
But this problem cannot be solved simply by training more physicians. If the U.S. chose to address the increased demand for medical care by adding doctors, offices and hospitals, the costs would be unaffordable. And even if we decided to do it anyway, it would be a decade before these newly trained physicians would be available to satisfy today’s increasing demand.
The only tenable option: Change the way physicians practice. Do more with what we have. And do it better. Here’s how:
Rebalancing The Ratio Of Specialists And Primary Care Providers
In general, the more medical and surgical specialists in a community, the higher the frequency of procedures performed, the greater the complexity of interventions they recommend, and higher the total cost of health care. The Dartmouth Atlas has consistently demonstrated these relationships and their consequences.
The first step in transforming health care is to re-examine the role of America's physicians. (Photo... [+] credit: Army Medicine)
In most industries, added supply leads to lower costs. But in health care it leads to supply-induced demand.
The problem is that not only do these borderline interventions significantly raise cost, but this extra medical care fails to translate to better health outcomes, as well.
One need only look back on Atul Gawande’s 2009 piece “The Cost Conundrum” for insight into the skewed cost/quality equation in health care. Through this lens, we now know that physicians in some geographies perform many more spine surgeries and hysterectomies than in others. Yet their patients don’t live any longer or any better.
In fact, the U.S. ranks first in the world in the proportion of specialists to primary care physicians but nowhere near the top in measures that deal with the quality of outcomes.
Rebalancing the ratio of specialists to primary care providers is an essential first step toward improving quality while managing costs.
Increasing the number of primary care residency spots while proportionately reducing the number of specialty training positions would be a viable start. But at the same time, we need to make the practice of primary care more attractive for medical students. To do that, we will need to shift both the pay scale for the primary care physicians and the way primary care physicians practice. The good news is that both are possible.
Primary Care Providers As Drivers Of Improved Outcomes And Reduced Costs
Primary care physicians are the first point of contact for people with undiagnosed health concerns. These physicians also provide continuing care for certain chronic medical conditions.
And for patients with complex medical problems, primary care physicians can bridge knowledge across different organ systems, avoiding the likelihood of patients “falling through the cracks” as they are handed from one specialist to the next.
Primary care physicians are also skilled at providing preventive care services. In America, 7 in 10 deaths every year are caused by chronic – often preventable – diseases. Preventive medicine can help patients avoid the onset of or complications from these conditions.
The primary care physicians who are practicing at the top of their training have the expertise to improve health outcomes, lower hospitalization rates and reduce overall health care costs.
Redefining Primary Care Practice
Physicians have the ability to manage a patient’s medical needs in the most comprehensive and effective ways. Yet many of today’s primary care providers don’t do it.
What might surprise many patients is just how different primary care is practiced today than it was just decades ago.
Primary care practice lost some of its sparkle in the late 1980s and early 1990s when specialty payments soared and primary care reimbursements remained relatively flat. To maintain their income, primary care physicians were forced to increase how many patients they saw each day. More patients without more hours in the day meant reducing the time spent with each one. Specialty referrals became a means to save time.
But seeing more patients per day wasn’t enough for primary care physicians to keep up with their specialist counterparts. Today, across the country, annual incomes for specialists are two to three times higher than those of primary care physicians.
As salaries suffered so too did the reach of their responsibilities. In the past, the primary care physician’s unique diagnostic skills made Internal Medicine the pinnacle of medical practice, sought after by the top graduating medical students.
However, the introduction of sophisticated diagnostic machines diminished the perceived importance of taking a medical history and performing a thorough physical exam. Overall, the ease and availability of these new technologies led to exponentially more diagnostic testing and, of course, additional expenses.
For some patients, these advanced imaging techniques and complex laboratory studies are essential. But from a cost-benefit perspective, the pendulum has swung too far. Many diagnoses can be made without these sophisticated and expensive technologies. Instead, additional time and attention from a primary care physician could solve many of these clinical problems with excellent quality at a lower cost.
Addressing the income disparity and empowering primary care providers to practice at their fullest capacity will be essential steps to restoring primary care practice to the specialty it once was – and still can be.
Further Enhancing Primary Care Delivery
Working alone, a primary care physician can’t meet the needs of an expanded number of patients. The solution requires that patients be supported by teams of clinicians – both licensed and non-licensed staff – to complement the primary care physician’s expertise.
Pharmacists can help physicians manage medications, nurses can provide assistance for people living with chronic conditions, and other staff can review patient records and encourage individuals to obtain the cancer screenings and immunizations they require. The result is higher quality and more time for physicians to focus on the aspects clinical of care only they can provide.
Revising Clinical Practice
To reduce dependency on specialty physicians while maintaining excellent clinical outcomes, practitioners must stop doing things that don't make a positive difference for the patient.
For example, routine screening of all men for prostate cancer using the PSA test leads to unnecessary invasive diagnostic procedures and surgery. Add to that the associated risks of impotence and incontinence with no improvement in mortality.
The most commonly performed orthopedic procedure in the United States is arthroscopy and shaving of the meniscus. A large study of patients has shown that the operation plus physical therapy is no better than physical therapy alone and adds major costs and risks.
Although national specialty groups have begun to tackle these areas, clinical practice remains only minimally different than it was in the past.
Leveraging Technology
Readily available health technologies – like video consultations and mobile services – offer the potential to support primary care services and provide immediate specialty consultation at a reduced cost.
This already is being done in some underserved rural areas but expanding this approach would allow primary care physicians everywhere to coordinate care in the most cost effective ways.
Today, this approach proves difficult to implement since most physicians – primary care and specialists alike – are required to see the patient in person to be paid for their services.
Hopefully, Medicare and commercial insurers will modify these rules in the future for the benefit of the patient and the health care system.
The Journey To A Better System Starts With One Step
The main milestone of the Affordable Care Act was expanded coverage. That’s behind us now. But the journey to attain the desired impact of the legislation still lies ahead.
If we are serious about raising the quality and lowering the cost of American health care, we will need to drastically change medical practice.
In any setting, transformative change is complex and requires a catalyst. Shifting the ratio of primary care to specialist residency programs would be a great first step.
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c46f0caec453cef4e17d50dd335d22e5
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https://www.forbes.com/sites/robertpearl/2014/03/06/malcolm-gladwell-on-american-health-care-an-interview/
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Malcolm Gladwell On American Health Care: An Interview
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Malcolm Gladwell On American Health Care: An Interview
Malcolm Gladwell hasn't written much about American health care. But that doesn’t mean he hasn’t been thinking about it. And it sure hasn't stopped many of his powerful ideas like “tipping point,” “outlier” and “blink” from gaining entry into the national health care debate.
In his most recent book, “David and Goliath,” Gladwell reshaped our perspectives on the underdog and highlighted our tendency to over-value certain strengths. In the health care world, this concept helped expand our understanding of the role of mobile devices and big data in health care.
As our nation confronts the challenges of American health care, there’s a lot we can learn from Gladwell. I recently met with him at his house for two hours on a cold, clear day in lower Manhattan. We talked about the Affordable Care Act and what physicians can do better in providing health care. We spoke about Canadian health care and America’s malpractice system.
I expected him to offer insightful and novel views on these topics. He did not disappoint.
On The Affordable Care Act
“I have profoundly mixed feelings about the Affordable Care Act,” Gladwell started. “What I love about it is its impulse. It attempts to deal with this intractable problem in American health care life, which is that a significant portion of the population does not have access to quality medical care.”
While praising the Affordable Care Act for insuring those in need of coverage, Gladwell expressed sincere concerns about whether this approach could truly solve the challenges America faces.
“Part of me thinks that innovation, real innovation in health care delivery, needs to happen from the bottom to the top,” he said. “What I don’t know is whether this system encourages that kind of bottom-up innovation or discourages it.”
Gladwell may be uncertain about the system’s ability to encourage bottom-up innovation, but we know one thing's for sure: our current system rewards volume through fee-for-service payment models. And until we move to a system that focuses on value, we won’t enable the kind of bottom-up innovation Gladwell talks about.
The Affordable Care Act takes us one step in the right direction. But physician leadership will be essential to effectively drive the innovation needed to transform the system.
On Nudging American Health Care
“A lot of the things we identify as problematic with the delivery of care are simply features of the irrationality of the system itself," Gladwell lamented.
He cautioned that we have become too dependent on health insurance to pay for predictable medical problems. Rather, he said, the purpose of insurance should be to pay for the unexpected. In his mind, the current insurance system provides very few incentives for patients to live healthier lives or for physicians to encourage healthy living.
“We aren't, as human beings, very good at acting in our best interest,” he said. And noted that an appropriate role for government or other third parties is “to make it easier for us to act in our best interest.”
Gladwell is a fan of change happening through many smaller, incremental improvements. He credits Richard Thaler and Cass Sunstein’s book “Nudge” for this line of thinking. He used the auto industry as an example:
“In the ‘60s, they started nudging car makers in the direction of safety,” he recalled. First, “You've got to equip all cars with seatbelts.” Then, “In the ‘70s, we started setting standards for fuel economy.” Finally, “The automobile industry took those (nudges) and used them to create airbags and develop hybrids.”
“The automobile is a great example of how the health care system can work very well. A combination of aggressive and smart regulation and a highly competitive marketplace has combined to improve – not perfect, but improve – the quality of decisions made by consumers.”
Applying this concept to health, Gladwell questioned why governments and private organizations couldn't find more opportunities to encourage healthier behaviors.
“When I go to my health club and it’s in the basement, you have to take the elevator down. And this drives me crazy. Why can’t there be a stairway? At least make it as easy to exercise as it is to not exercise. It’s in society’s interest for me to take the stairs.”
Ultimately, Gladwell believes human beings need a little help.
“As a society we have to push them, nudge them, in the right direction.”
And just as Gladwell applied this principle to patients, I believe it also applies to how physicians provide care to their patients.
Meaningful Use regulations, which provide financial incentives to health care providers for the “meaningful use” of certified electronic health record (EHR) technology, will nudge physicians to incorporate and use 21st century technology. Increased payments for Five Star Medicare Advantage plans will nudge health care organizations toward a greater focus on prevention. Reduced payments for hospitals responsible for patient complications will nudge them away from medical errors. And incentives for the creation of Accountable Care Organizations will nudge physicians and hospitals to embrace greater collaboration, coordination and integration of medical practices and clinical care.
While these changes themselves will not eliminate the problems of today’s health care system, they will nudge the industry in the right direction. And the result will be better care for patients.
On American Vs. Canadian Health Care
While it’s tempting to compare the failures and successes of U.S. health care with other nations, Gladwell warns that underlying societal differences make those comparisons difficult.
“There are many things that are exceptional about American health care but there are two things to consider above all else,” he said. “One of them gets a lot of attention and one doesn't get enough at all.”
A lot of attention, according to Gladwell: U.S. technology. Not enough: America’s social dynamics.
In terms of U.S. technology, he pointed out the complexity of evaluating its impact. On one hand, Gladwell said, technology has resulted in significant advances. On the other hand, technology has created an enormous economic burden.
“If you are the technology pioneer, you’re going to generate higher costs than those that follow. Those that follow have many advantages. They can sit back and cherry pick what they like. They avoid the high cost of technology that goes in to prescription drug development. "
“That’s a case where the [U.S.] health care system has gained from medical advances but had to carry the economic burden for much of the world.”
He posited that technology may be a net positive once we take all parts of the economy into consideration, but that the calculation is complex. And that’s where the second factor, the one that doesn't get enough attention, comes into play.
“Our health care system is part of the very, very peculiar social dynamics of this country, which is that we are one of the most, if not the most violent of the developed countries,” he said. “And the consequences of that violence for the health care system are considerable. For example, compared to most countries, the economic consequences of the United States caring for veterans are extraordinary and its impact on overall health care costs in America is considerable.”
He noted that wars in Korea, Vietnam, Afghanistan or Iraq – along with a large standing army – placed a considerable financial burden on the U.S. health care system. In addition, he said poverty and violence in America have increased the nation’s health care challenges.
"An interesting thing about Canada is that Canada doesn't have the inner city problem that America does," he said. "It does not have a very large and entrenched underclass. That’s a huge burden on the system. So, America has some distinctive features that impact health care spending in a very considerable way. When we look at the cost of American health care and blame the health care system for it, that's not entirely fair. A lot of it is a function of who we are as a nation. We’re a country that runs up a big health care tab. We’re a country that has yet to figure out how to address the social challenges we face. As a result, the health care system carries much of the burden."
That’s why, Gladwell said, “I've never trusted cross-national comparisons of health care spending. It’s just not useful until you’ve normalized these differences.”
There’s no doubt in my mind that we have much to learn from nations beyond our borders. Providing access to health care for all residents – and access to life-saving medical services that won’t bankrupt patients – is worth further consideration.
But I agree with Gladwell that technological, social, cultural, financial, legislative and other factors make direct comparisons difficult.
On America’s Malpractice System
Gladwell described the current malpractice tort system as poorly designed for the purpose it should serve. The function of an effective malpractice system, in his mind, should be to compensate individuals and to address the underlying causes so that we can reduce recurrence. The current system does none of this. He pointed out that most problems in medical care delivery happen as a result of failed systems, not individual errors.
“The fact that only a small percentage of medical errors are dealt with in the malpractice system suggests that it’s not a system,” he said. “It deals in an incredibly inefficient way with a small percentage of the actual errors and in such a way that it does not make the performance of the overall system better. It’s not addressing why the error was made in the first place.”
The solution? According to Gladwell, we should, “Compensate more of those that suffer from errors because the system doesn’t do that now. Make it a primary motivation to reduce the source of the error. That’s what a system, a proper malpractice system, looks like. And right now our system doesn't look like that.”
Often, we as physicians are blamed individually every time something goes wrong in medicine. But rarely is any one individual responsible. That’s why many physicians feel forced to practice defensive medicine: to minimize the risk of financial and reputation damage. The result is added cost without improved outcomes – and on occasion, even greater patient harm.
But given today’s malpractice system, it’s hard to convince physicians to behave differently. And who can blame them? If we want to encourage system-wide improvement and address wasteful spending, we first must redesign the malpractice system, moving to one that focuses on care improvement, not individual blame.
On Government Regulations
Gladwell offered a provocative thought here, that parts of American health care may have way too much regulation and not enough wisdom, compassion and judgment. He used nursing-home care as an example.
“With nursing-home care we have a system which is heavily regulated right down to the specifics of every minor thing you do and at the same time the quality’s not good,” he said.
He pointed to one study in Australia. The country shifted away from stringent nursing-home regulations toward greater training and reliance on the judgment of nursing-home workers. As a result, he said, the quality of care improved.
“In an environment that’s about the quality of human interaction, it’s not appropriate to have 10 volumes of incredibly specific regulations,” he said. “What you want to do is get a system where people feel involved in providing important levels of human comfort.”
At the same time, Gladwell was firm that strict and detailed regulation remains essential in certain areas.
“If the issue is the manufacturer of pharmaceuticals, I’m all about the twenty volumes of regulations. I don’t want people coming in having a touchy-feely conversation. No, I want every single factory investigated and inspected on a regular basis because the consequences of failure here are enormous and you need rigorous regulation, not individual discretion.”
Gladwell’s focus on the human element in the midst of a challenging and expanding regulatory environment was refreshing. Yes, some aspects of care require a clearly defined processes to avoid medical error and improve quality outcomes. But when restrictions dominate how care is delivered then compassion and personal relationships erode. Unfortunately, that can lead to compromised medical care and unnecessary human suffering.
On End-Of-Life Care
Gladwell provided a balanced perspective on the importance of both a rules-based and an individualized approach to patient care during this time of acceptance and choice. He believes in an approach that honors dignity:
“Helping people live their lives with dignity means very, very different things at different stages of their life. If I’m 18 and I’m in a car accident, that means picking me up with a helicopter and giving me access to the greatest trauma care known to man. If I’m a soldier in Afghanistan, that means get me out of there to the best medical facility in the world. And if I’m a 40-year-old woman with breast cancer, it means providing access to the highest quality care imaginable.
“But if I’m an 85-year-old bedridden person with Alzheimer’s, that means giving me nurses who are motivated and compassionate. It means allowing me to avoid aggressive and futile interventions. Maybe it’s just helping the health care system understand that there are different ways to provide people dignity.”
As much as half of health care spending is estimated to be spent in the last year of life. Gladwell's model would help people maximize their health throughout their life.
Surprise Twist Leaves Us Wanting More
As we began to wrap up our conversation, I asked him what else he would like me to cover in my blog. His answer surprised me. Next week’s article will focus on his request.
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https://www.forbes.com/sites/robertpearl/2014/03/20/a-doctors-take-on-the-anti-vaccine-movement/
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A Doctor's Take On The Anti-Vaccine Movement
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A Doctor's Take On The Anti-Vaccine Movement
There is nothing more disheartening for a physician than watching a patient die from a preventable cause. And, of course, the loss for the family involved is unimaginable.
But it’s important, especially for parents, to understand the potential consequences of preventable, infectious diseases.
Here's a scenario doctors across the country are witnessing first-hand: A 2-year-old girl develops what seems like a cold. Over the next several days, her breathing rate increases. At times, she stops breathing altogether for several seconds, followed by severe coughing spells and terrifying whooping sounds as she struggles to get air into her lungs. In spite of the best medical care, she experiences an uncomfortable and tragic death.
A century ago, this experience was common. Pertussis, commonly known as whooping cough, terrified parents and cost children around the world their lives.
Today, there are safe and effective vaccines to prevent these types of diseases in the first place. Yet a growing number of parents choose not to vaccinate their children, resulting in long-term disability and unnecessary deaths.
It Does Not Have To Be This Way
When my father was a child, his sister died of measles. Her death stayed with him throughout his life. That was before we had a vaccine to prevent measles. If she had been born in the 21st century, she might not have died at age 6.
In the U.S., new measles cases have tripled as of 2013, with reported outbreaks in 8 American... [+] communities. (Photo credit: Wikipedia)
Outside of the U.S., approximately 1.5 million children die each year because their families can’t afford vaccines.
Here in the United States, we’re much more fortunate. Nearly all Americans today have access to a broad range of highly effective and safe vaccines. But a growing number of children aren't getting them.
We need to ask ourselves this: If economics are not the deterrent, why would a parent put their child's life at risk by voluntarily foregoing a life-saving preventive measure? The answer is a combination of false science, outdated anecdotes and fear mongering.
The Birth Of Vaccines
The concept of vaccination was pioneered by Edward Jenner more than two centuries ago.
In the late 1700s, Jenner discovered that individuals who had previously contracted cowpox, a disease with very mild effects on humans, were at little risk for becoming ill with smallpox, a disfiguring and often fatal disease.
He concluded that inoculating individuals with cowpox would prevent children from acquiring smallpox in the future. From that observation, the first vaccine was born.
Since Jenner's discovery, many other vaccines have been developed, refined and introduced into clinical medicine. Many of these vaccines are mandated for children beginning school, including measles, polio and tetanus.
The global impact of these advancements is tremendous. The overall incidence of vaccine-preventable diseases declined dramatically during the 20th century. Smallpox has been eradicated worldwide. And thanks to the efforts of many groups, including the Bill and Melinda Gates Foundation, polio has been nearly eliminated.
Through the “Decades of Vaccines Collaboration,” 200 countries have endorsed a shared vision of a world where all individuals and communities enjoy lives free from vaccine-preventable diseases.
Extending the full benefits of immunization to every person worldwide by 2020 would prevent an estimated 20 million deaths – mostly in children – and untold suffering for millions more.
The Rise Of The Anti-Vaccine Movement
In the United States, we are witnessing the scientifically ignorant and sometimes deadly impact of an anti-vaccine movement. Individuals who support the movement continue to question the safety and necessity of vaccines despite extensive medical literature to the contrary.
When laboratory-produced vaccines were first introduced over 50 years ago, there were legitimate concerns about their safety. Many vaccines in their older forms were associated with the risk of rare but dangerous reactions.
The vaccines we use today have minimal risks and an extremely safe track record. They have undergone rigorous testing and scrutiny by the scientific community and have proven their effectiveness in large-scale clinical trials.
As a result, the days of school closures for measles and pertussis outbreaks have become a relic of the past. The side effects from vaccines are almost always mild. And even in the extremely rare case of a more serious allergic reaction, physicians and their staff are trained to deal with it.
Simply put, the benefits of vaccination substantially outweigh the risks.
Yet for the last two decades, fear mongers associated with the anti-vaccine movement in the U.S. and other developed countries have convinced some parents to refuse to vaccinate their kids.
The result is an erosion in health gains, both individual and collective. And in some parts of the country, we are witnessing a reversal of what many believe is one of the greatest advances in medical science in the last century.
The Fear Mongering Behind Measles And Whooping Cough
Measles and whooping cough are very serious, highly contagious respiratory diseases spread through the air by breathing, coughing or sneezing.
Although their clinical symptoms are different, both carry risks of long-term problems and even death.
Measles begins with fever, runny nose, cough and a rash all over the body. Before the introduction of a measles vaccine in 1963, hundreds of thousands of people in the U.S. contracted the disease annually. Thousands were permanently disabled and between 400 and 500 people died. But since 1963, reported cases fell to less than a thousand a year.
Things started changing in 1998 when a British physician published a study in "The Lancet" medical journal that falsely asserted a connection between autism and the combined measles-mumps-rubella (MMR) vaccine.
An investigation into the work revealed the research was unethical and rife with conflicts of interest. The article was filled with false and fraudulent data, and the health care risks described have been completely discredited. In 2010, the paper was fully retracted from "The Lancet," a remarkable event in the world of peer-reviewed journals.
But the damage was done. Vaccination rates in the UK plummeted and reported cases of measles soared. In the U.S., new measles cases have tripled as of 2013, with reported outbreaks in eight American communities. The recent outbreak in New York City has sickened at least a dozen people.
Meanwhile, whooping cough, a highly contagious bacterial infection, has seen a huge increase in the number of people infected each year.
The incidence of whooping cough was relatively low in the U.S. – around 5,000 cases annually – when vaccination was the unchallenged standard of care. But the impact of the anti-vaccine rhetoric and associated fear has contributed to several outbreaks across the United States and Europe, resulting in multiple infant deaths.
In 2010, three were 9,000 cases of whooping cough reported in California alone, causing the deaths of 10 infants under the age of 1 – the most in the state since 1947.
The first whooping cough vaccine was developed in the mid-1920s. By the mid-1940s, it was used widely and often administered in combination with the diphtheria and tetanus vaccines.
In 1991, a combination vaccine called DTaP reduced the frequency of side effects and eliminated nearly all major adverse reactions from whooping cough immunization.
Unfortunately, California is now one of 19 states that allow "personal belief" exemptions for parents before their children enter school. As a result, non-medical exemptions in California have tripled between 2000 and 2010 with some schools in affluent communities reporting rates as high as 84 percent.
And as the 2010 outbreak demonstrated, clusters of whooping cough appear most frequently in these communities with higher than average non-medical exemptions.
Even if this exemption did not exist, there will always be some individuals who will not be vaccinated and others who will lose their immunity decades after the vaccine is given. Protecting these folks requires what health experts call "herd immunity."
If a single parent does not immunize a child, the risk to that individual is low. But as the number of unvaccinated children grows, the risk of numerous people contracting and spreading the disease multiplies, creating a public health risk for a large segment of the population.
For highly contagious diseases like whooping cough and measles, herd immunity is dependent on having 95 percent of the population in a community immunized. When the immunization rate falls, the danger to both the young and elderly increases dramatically.
A Plea To Parents
We have highly safe and effective vaccines readily available to prevent many of the most dangerous childhood diseases. Yet despite decades of research that demonstrate their overwhelming positive impact on the health of our children, we are losing ground.
Before parents decide not to vaccinate their son or daughter, they need to consider the scientific evidence. They need to imagine how they will feel should their child die or experience long-term disability from an easily preventable disease.
And as a society, before we allow misinformation to threaten public health, we must recognize that vaccines today are safe and effective. Anything less is irresponsible. We owe it to our children and our communities to make vaccination universal.
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https://www.forbes.com/sites/robertpearl/2014/06/05/more-health-care-is-better-health-care-medical-myth-or-reality/
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More Health Care Is Better Health Care: Medical Myth Or Reality?
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More Health Care Is Better Health Care: Medical Myth Or Reality?
The U.S. spends nearly $3 trillion a year on health care, significantly more than any other nation.
In fact, America’s annual health care spending is greater than the total Gross Domestic Product (GDP) of every other country except China, Germany and Japan.
Yet our measurable health outcomes – from infant mortality to life expectancy – aren't any better than nations spending much less.
I've written about this paradox before, pointing to a few factors that drive up health care costs. They include the perverse financial incentives of health care's fee-for-service payment model, the unjustifiably higher costs of devices and drugs in the U.S. and our systematic investment in specialists over primary care physicians.
But these are just a few of the reasons.
In the coming weeks, I will write about four common myths that contribute in powerful ways to our high health care costs and lagging clinical outcomes. Each represents a major opportunity to improve quality, personalize medical care and make health care more affordable.
Let’s kick things off with myth No 1: More visits, tests and procedures lead to better health.
It seems logical that doing more would lead to better clinical outcomes. Sometimes that’s true. But more often than not, that assumption is far from factual.
Here are three common clinical practices that reveal the surprising truth behind this myth:
Annual physical exams are standard practice in many doctor's offices, but are they necessary? (Photo... [+] credit: Wikipedia)
1. Annual Physicals Exams
Beginning in the 1940s, the annual comprehensive physical examination was created as a “routine check-up” for patients with no visible symptoms or specific complaints.
These once-a-year exams have been standard medical practice ever since. In these face-to-face visits, the doctor asks about the patient’s health history, checks vital signs, listens to the heart and lungs, and examines the head and body.
The intent is to help physicians identify medical problems early and treat them immediately. Many swear by them. In fact, these routine check-ups are among the most common reasons adults see a physician. They account for nearly $8 billion in annual health care spending alone.
But, in practice, the doctor almost never finds anything wrong when there are no symptoms present.
As a result, many professional groups and researchers have concluded the annual physical exam adds little or no value. What’s more, experts have uncovered a number of serious drawbacks to such yearly visits. Studies show they can lead to false-positive results, triggering a series of unnecessary tests. Or worse, they can give patients false assurance that everything’s OK, leading them to ignore new symptoms later on.
While a physical exam for a symptomless patient may be a waste of time and money, there’s a great deal of value in periodic laboratory testing – for blood lipids and glucose, for example – based on a person's age and sex.
And for patients with a specific health problem such as diabetes, ongoing in-person and lab evaluations are essential. However, for patients without a specific medical condition, physicians could order the recommended screening studies electronically and discuss each patient’s results by phone without an in-person visit.
Why don’t they? Most insurance carriers refuse to pay the doctor for this service unless it is part of an office visit.
The result or more office visits and thus more health care spending: zero measured improvements in patient health.
2. Prostate Cancer Screenings
Physicians conduct the prostate-specific antigen (PSA) screening to detect prostate cancer early and allow for early treatment. It is commonly assumed that early detection saves lives.
But two large clinical trials show no overall benefit from mass screening for prostate cancer. And the United States Preventive Services Task Force recommends against PSA-based screening, finding that for every 1,000 men screened, at most 1 man avoids prostate cancer.
Certainly, the thought of saving one human life is reason enough to give such an exam, right? Not so fast. Of that same 1,000-man sample, up to 120 men walk away with e a false-positive test result – wrongly indicating the presence of cancer.
A positive PSA test is typically followed by a biopsy to confirm the presence of cancer with a major risk of a complication.
And even when the set of tests rightly identifies a patient with cancer, rarely does the cancer lead to health problems.
Unfortunately, in most cases, doctors can't differentiate between cancer that will become harmful and cancer that won't. So, when tests suggest the presence of prostate cancer, most men pursue treatment.
The most common treatment options are surgery, radiation therapy, hormone therapy and chemotherapy. Each option exposes men to possible surgical complications, along with erectile dysfunction and incontinence.
All of this might be worth it if the outcome was an increased cure rate. But that has never been shown. Instead, the impact on survival and life expectancy remains unchanged based on the largest research studies.
Once again, more is not better.
3. Surgery For Patients With Back Pain
There are numerous treatment options for back pain: medication, physical therapy and surgery.
Surgery is by far the most risky and costly option. And, strangely, it’s a lot more popular in some parts of the world than others.
The rate of back surgery in the U.S. is five times higher than in the UK. And certain counties in the state of Washington boast 15 times more back surgeries than in neighboring counties.
This raises the obvious question: Are higher rates of back surgery tied to higher incidences of back pain or other medical problems?
There’s no evidence to indicate there is. So then, perhaps these locations with higher rates of back surgery are able to achieve superior clinical outcomes? Wrong again.
Studies have shown little difference in long-term outcomes for patients who undergo back surgery compared to those who select non-surgical treatment.
There are a few situations where surgery is essential and beneficial, such as when there is nerve compression. But for an overwhelming number of patients with low-back pain, non-surgical treatments prove just as effective.
How can we explain the higher incidence of patients undergoing a complex and often ineffective procedure? Welcome, once again, to America’s perverse fee-for-service payment model.
In America, health care providers are rewarded for the quantity of patient visits, tests and procedures. Achieving the exact same result without surgery pays dramatically less than performing a risky intervention.
Surgeons and hospitals make much more money from surgical intervention than from conservative treatment. Clearly, they act accordingly.
Why Do We Think More Care Is Better For Us?
In a word: culture. That applies to both American culture and the culture of medicine.
We want to believe that doctors have all of the answers. We want to believe physicians can cure almost anything. And we want to believe that a routine check-up, prostate exam or back surgery adds value.
We love anecdotes about a surprise diagnosis leading to a life-saving treatment – or about a patient who was miraculously cured by a procedure. But we often leave out stories about patients who experienced only temporary relief or, worse, suffered serious complications.
Of course, doctors should never withhold necessary and effective care. There are many problems for which invasive procedures lead to the best outcomes and we need to encourage their use. But we should examine the scientific evidence first and not make decisions based on fairytale anecdotes or the potential for higher reimbursements.
In the United States, there are so many health problems that suffer from lack of attention. High blood pressure, for instance, is a leading cause of death and disability in the U.S., but physicians only achieve control of their patient’s elevated blood pressure levels half of the time.
If we want to improve the health of our nation, we need to reduce the cost of medical treatment and stop wasting money on care that adds no value.
Until we reward doctors and hospitals for the quality of care – rather than the quantity of care – we’ll continue to lead the world in spending. But, at the same time, we’ll never lead in superior clinical outcomes. And until we bust the myth that more is better, little is likely to change.
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47ec34e06ede21014dd50790ed63e12e
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https://www.forbes.com/sites/robertpearl/2014/08/14/the-4-biggest-obstacles-acos-face/
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The 4 Biggest Obstacles ACOs Face
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The 4 Biggest Obstacles ACOs Face
In a recent interview, business guru and best-selling author Clayton Christensen described American health care as “sick and getting sicker.”
He criticized the system’s administrative overhead, perverse payment models and lack of leadership for failing to incite meaningful reform.
Christensen thrives on examining complex topics. So, when I asked him what topic he’d like me to cover, he picked one that’s as complex as they come: Accountable Care Organizations (ACOs).
“A lot of the thinking behind the Affordable Care Act, how it can improve quality while lowering cost, relies heavily on ACOs,” Christensen said. “Most health care players would say that ACOs have helped. I’d argue they’re not yet fixing the problems."
To date, ACOs have accounted for measurable quality improvements and a reported $380 million in savings. Despite some movement, progress remains slow and inconsistent.
In response to Christensen’s request, what follows is an examination of the obstacles ACOs face. As you’ll see, solutions are possible but far from painless.
Barack Obama signing the Patient Protection and Affordable Care Act at the White House. (Photo... [+] credit: Wikipedia)
What are ACOs, anyway?
ACOs are groups of primary care physicians, specialists and hospitals that join together to provide care to a population of patients. In general, the participating physicians and hospitals take joint responsibility for the quality and cost of patient care, and they function under a variety of risk-sharing arrangements.
ACOs were designed to address two shortcomings in U.S. health care: (1) the inconsistent and uncoordinated care delivered by independent primary care physicians, specialists and hospitals, and (2) the dysfunctional and inflationary “fee-for-service” payment system, which rewards care providers for the quantity of services they provide – not the quality or value of those services.
When they’re successful, ACOs decrease health care costs, avoid unnecessary duplication of services and reduce medical errors.
But reaching these outcomes is proving more difficult than initially imagined.
Are ACOs structured to succeed?
There are an estimated 500 to 600 ACOs in the U.S. providing care to 15 to 17 percent of the population. ACOs exist within three different models: Medicare Shared Savings Programs, Pioneer ACO models and commercial ACOs.
Born out of the Affordable Care Act, Medicare Shared Savings Program ACOs use a combination of fee-for-service payments and calculated cost savings. Both are based on the past performance of the designated physicians and hospitals to reward participants. The hope was they would help save $940 million over the first four years. Of the initial 114 Medicare Shared Savings Programs, 54 achieved savings in the first year. Just 29 have generated enough savings to offset the necessary investment costs.
Medicare Pioneer ACOs are the product of the Center of Medicare and Medicaid Innovation (CMMI) skunk works. They were designed to attract more sophisticated medical groups with existing prepayment experience and with much of the necessary infrastructure already in place. Of the 32 original pioneer participants, almost a third left the program after a year, citing how additional investments dwarfed the added incentive payments they might receive.
Commercial ACOs represent a variety of arrangements between hospitals, health plans and medical groups. Approximately half of the ACOs in the country fall into this category. Overall, they have improved quality outcomes but have experienced mixed results in lowering costs.
The Promise and the Challenges of ACOs
The concept of the ACO model seems straightforward enough: coordinate care, reduce redundancy, focus on prevention, improve clinical outcomes and make health care more affordable.
But no model has demonstrated consistent success.
That’s because moving from fragmented, fee-for-service, paper-based health care is difficult. Care providers in ACOs face four main obstacles. Each obstacle is tricky yet possible to overcome.
Obstacle 1: Perverse Payment Model
The prevailing fee-for-service payment model rewards volume of services, not superior clinical outcomes. The more procedures performed, and the more complicated the treatment, the more providers are reimbursed.
In practice, it’s easier to generate more volume and immediately increase revenue than it is to redesign the health care delivery process, creating greater value over time.
For many providers, the thought of moving toward an evidenced-based reimbursement system is frightening. They recognize that delivering more effective and efficient care would decrease total revenue in the short-term. And though they may understand the inherent flaws of the current system, they fear their fixed costs and high overhead wouldn't allow them to sustain an income reduction for long.
It comes down to a battle between what’s best for the patient and what’s best for the bottom line. There is a solution here, but it’s one that requires ACO providers to “go big or go home.” Going big means getting aggressive: converting their practices and revenue streams from fee-for-service to a prepaid model as rapidly as possible. Going home is giving up on meaningful changes and trying to hold onto the past for as long as possible. Taking small, incremental steps toward a new payment model is the riskiest strategy of all. Organizations that do will find themselves trapped between the past and the future – ultimately failing in the latter.
Obstacle 2: Wrong-Sized Medical Staff
The typical community hospital has doctors from all specialties on staff. But their staffing numbers are somewhat random. There may be eight orthopedic surgeons and six cardiologists who hospitalize patients. But once they redesign care delivery, what if all they really need is five of each?
The day a hospital excludes unnecessary specialists under a newly formed ACO is the day those specialists export their patients to a different hospital.
The sudden loss of patients and revenue would offset any cost savings from improvements in operational efficiency and impact the bottom line negatively. As a result, hospital-based ACOs tend to keep entire medical staffs, failing to eliminate unnecessary care or to improve productivity.
The solution requires rapid improvements in care delivery and a willingness to reassess pricing based on projected increases in volume.
Obstacle 3: Technology Platform Incompatibility
Different groups of physicians often use a variety of Electronic Health Record (EHR) systems in their offices. And most of them are not the same as the hospital's EHR system. Some of the more advanced Meaningful Use requirements in the HiTECH legislation reward interoperability, but getting systems and organizations to work together isn’t as easy as it sounds. Major technical obstacles stand in the way.
Redundancy of care is inevitable without comprehensive medical information or the ability to share patient data across an entire ACO.
Consider a woman who is about to undergo surgery. Her primary care physician, cardiologist and anesthesiologist all want to see her EKG at the same time. Each will obtain their own if they can't access someone else's. And without a single EHR system, there’s no way to know if this patient might also be due for a mammogram or has had a colon cancer screening. Without a single EHR system, there’s no way to coordinate the best patient care.
The solution is both simple and difficult. ACO providers must invest in connecting their information technology systems early on.
Obstacle 4: Lack of Physician Leadership and Management Structure
Even under the best circumstances, it’s challenging for physician organizations to accurately compensate each physician and improve systems of health care.
That challenge becomes nearly impossible without a well-defined physician leadership structure that can implement clear reporting relationships and individual accountability.
In general, hospital partners in ACOs are the primary source of investment capital for new facilities and technologies. But without a medical group CEO, an ACO can’t make the operational changes necessary to benefit from those investments or produce the expected results across the board.
When the main measure of leadership is increasing a facility's volume and top-line revenue, hospital administration can typically achieve success with little physician input.
But strong physician leadership and self-governance are essential when success is dependent on major improvements in operational performance.
The solution requires hospital administrators to embrace physician leaders as equals while investing in physician leadership development.
Where Will ACOs Take American Health Care?
ACOs offer great promise for the future. And when the pieces are in place, they have the potential to achieve the Institute for Healthcare Improvement's triple aim: better quality and satisfaction for patients, improved health of populations and greater affordability.
But creating an ACO on paper is the easy part. Delivering on the promise of an ACO is much harder.
It’s not easy for organizations to move from fee-for-service to bundled payment or full capitation, to have the courage to right-size their staffing model, to invest in the necessary technology or to develop the requisite physician leadership.
But these changes ultimately distinguish success from failure.
In many ways, the ACO movement is at a cross roads. As Christensen pointed out, either ACOs will figure out how to overcome the obstacles they face or they’ll just end up using their size and market power to raise prices and resist change.
The path they choose will have a major impact on the future of healthcare in the United States.
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7b303ea0c174e5108fb35e26e7137741
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https://www.forbes.com/sites/robertpearl/2014/09/04/5-megatrends-with-the-potential-to-transform-u-s-health-care/
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5 Megatrends With The Potential To Transform U.S. Health Care
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5 Megatrends With The Potential To Transform U.S. Health Care
Recently, Cisco chairman and CEO John Chambers told me that U.S. health care is at a tipping point. A positive one, he hopes, but the truth is no one knows for sure which direction the system will tip.
At the close of our interview, I asked Chambers what health care topic he’d like me to cover in the future. He asked me to answer two questions. And they happen to be the two questions weighing most heavily on the minds of just about every U.S. health policy expert:
Question 1: “How will the health care world move from operating in silos to working together seamlessly?" And question 2: “How will (doing that) help patients achieve the health outcomes that are possible and most important to them?"
Predicting the future is impossible. But these five health care megatrends offer reason for hope – and for concern, as well.
1. The Formation Of Accountable Care Organizations (ACOs)
ACOs are groups of health care providers (primary care physicians, specialists, hospitals, etc.) who band together voluntarily to look after a patient’s total health. ACOs promise to eliminate silos, improve patient outcomes and lower overall health care costs.
At least, that’s the concept.
President Barack Obama and senior staff applaud as the House passes the health care reform bill.... [+] (Photo credit: Wikipedia)
ACOs were built into the Affordable Care Act (ACA), also known as “Obamacare,” and carry both incentives for better clinical outcomes and the backing of many commercial insurance carriers.
If successful, ACOs could move American health care from its historically fragmented structure to one that provides substantially higher levels of integration and collaboration.
What that means for patients is that fewer will fall between the cracks at the point of care. When a primary care physician is sharing patient information and collaborating with a heart specialist, the probability of error decreases.
What’s the catch? Getting health care providers to work together is no easy feat.
Health care silos have been around for decades. Few doctors are quick to cede their independence or autonomy for the sake of greater collaboration. Meanwhile, hospital administrators don't like having to share authority with clinicians. They've been trained to fill beds, not improve the effectiveness of care.
Most newly formed ACOs have demonstrated the ability to improve the quality of patient care. But few have been able to reverse the rising costs of health care delivery.
Overcoming the cultural issues is likely to prove harder than policy makers would hope.
2. Moving Away From Fee-For-Service Payment Models
Health care’s traditional fee-for-service payment model is flawed. Physicians and hospitals get paid based on volume and complexity of their services – not based on clinical outcomes.
Through these perverse incentives, physicians make more money by doing more tests, seeing patients more frequently and performing high-priced, complex procedures. Under fee-for-service, keeping patients healthy and avoiding major diseases would be relatively unprofitable for doctors and hospitals.
America spends nearly $3.8 trillion a year on health care. That’s 17.6 percent of the gross domestic product (GDP) and significantly more than any other country. Yet our measurable health outcomes – from infant mortality to life expectancy – rank nowhere near the top of developed nations.
Some health care delivery systems are adopting viable alternatives called prospective payments. These include bundled payments – a single payment for an entire episode of care (a start-to-finish treatment for any given patient). They’re also exploring capitation – a negotiated payment for a given period to cover the costs for a group of patients with clear expectations around quality and service.
Both approaches seek to shift financial incentives away from volume to providing total care for the patient. They’re about moving from sick care to health care.
And there have been some successes here. Take Pacific Business Group on Health (PBGH). Rather than generating a bill for hundreds of individual tests and procedures, PBGH is requiring hospitals and doctors to charge a single, all-inclusive price. In 2008, the purchasing group limited what it would pay for total joint hip replacements to $30,000. As a result, participating hospitals dropped the price of the procedure.
What’s the catch? Before we can generalize about the efficacy of this approach, we must recognize that total joint surgery is a procedure performed by only one group of medical specialists. And their outcomes are consistently good.
What happens when we introduce patients with more complex problems, like those with multiple chronic diseases? With bundled payments and capitation, physicians and hospitals will need to figure out how to distribute revenue among care providers from different specialties.
And this may prove more difficult in practice than theory.
3. Rewarding Better Health Outcomes and Quality
Medicare Advantage is an alternative to the fee-for-service (traditional) Medicare program.
Under Medicare Advantage, the Centers for Medicare & Medicaid Services (CMS) contract with private health plans to provide Medicare beneficiaries with medical coverage.
Patients enrolled in Medicare Advantage agree to obtain care from a specific group of physicians and hospitals. In return, subscribers enjoy lower out-of-pocket expenses.
Participating organizations must report quality and patient satisfaction data to CMS on an annual basis.
Based on this information, each Medicare Advantage program is awarded one to five stars. The Medicare stars program rewards the highest-rated organizations – the ones with superior quality, the greatest success in prevention and the highest levels of patient satisfaction – with additional payments.
What’s great about this program is that it aligns incentives and puts more power in the hands of patients. If the doctors and hospitals don’t perform, the health plans with which they contract receive a lower rating. And each year, patients get to assess which Medicare Advantage provider is right for them.
This program shows a lot of promise. It has demonstrated improved clinical outcomes and increased patient satisfaction. As a result, nearly half of all newly enrolled Medicare members select a Medicare Advantage plan.
What’s the catch? In spite of this success, most Medicare beneficiaries are still in the older fee-for-service payment model.
The Medicare Advantage model may be the future’s preferred approach. It combines many of the elements for success: choice, accountability and transparency. And it could well provide the force needed to tip the U.S. health care system in the right direction.
4. Health Information Technology (healthIT) Incentives
The year is 2014. Technology drives nearly every American industry. But look behind the reception desk at your doctor’s office and there’s a good chance you’ll find a maze of file-folders stuffed with patient information – just as it was 20 years ago.
As part of the recent HiTECH legislation, physicians were offered $44,000 to purchase, install and demonstrate “meaningful use” of modern information technology systems.
These computer systems can provide doctors with important clinical information and help them coordinate with other medical colleagues. As a result, physicians will be able to make better clinical decisions and avoid duplication of tests or procedures.
What’s the catch? Lack of connectivity.
You’d think that doctors and hospitals would share a single technology platform or would, at least, be able to achieve connectivity between their systems.
That’s not the case. Progress in linking disparate technology systems has been slower and more difficult than previously imagined.
Meaningful Use “Stage 2” will provide incentives for interoperability (the ability of making systems and organizations work together). But it remains to be seen whether these federal incentives will be enough to offset the cost required to connect these systems.
Having taken the original dollars, physicians must now deliver on the "meaningful use" requirements. But to net a positive ROI on the IT investment, physicians will need to modify their practices – something they have not been interested in doing in the past.
5. A New Generation Of Physicians
The new generation of physicians are tech-savvy. They can't imagine their lives without mobile devices or constant connectivity.
And in school, they were trained to work in teams – unlike their elder colleagues. As a result, a majority of new docs prefer to be employed by an established organization (a hospital or an integrated health care system, for example) rather than launching their own private practice.
Their backgrounds and predilections align well with what will American health care will need in the future.
What’s the catch? Many Gen X and Y physicians value and expect greater work-life balance than physicians who came before them. And their enthusiasm may wane once they realize how sluggish the profession has been in embracing new technology.
On the other hand, when patients begin choosing this next generation to care for them, the world of health care may tip rapidly.
Will Change Happen?
Physicians and hospitals are moving forward in each of these areas. They are forming ACOs, accepting new forms of payment, focusing on preventive services, reducing medical errors, and learning to benefit from computer systems.
Still, many providers are hedging their bets.
Some of their practice is bundled and prepaid, but much remains fee-for-service. Some patient information is available through their computers, but much remains on paper. Some are hoping that the prevailing megatrends in health care are just fads. Some will continue to resist change.
What many don't recognize is what John Chambers emphasized heavily in our interview. The economics will drive change in health care, whether we like it or not.
Change will happen one way or another.
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3367ec493a6b946deaa6e63f621ad86f
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https://www.forbes.com/sites/robertpearl/2014/09/25/will-narrow-networks-strike-out-in-the-exchanges/
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Will Narrow Networks Strike Out On The Health Care Exchanges?
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Will Narrow Networks Strike Out On The Health Care Exchanges?
Baseball fans like me take great joy in studying the way general managers assemble their rosters.
The variations are fascinating. Some teams focus on pitching strength. Others go for speed or power-hitting. Each approach carries distinct advantages and disadvantages on the field.
That same level of variation and strategic decision-making applies to health plans, as well.
With the health care marketplaces reopening for enrollment on Nov. 15, anyone evaluating their coverage options should take a very close look at the different “rosters.”
That’s because more and more health plan “general managers” are assembling narrower networks of physicians and hospitals than in the past. And while these narrow networks can help lower premiums, they might also limit choice, access and potentially even quality.
Assessing Your Health Plan’s Roster
In the past, insured Americans got their health care from one of two types of health plans: the “network” model and the integrated delivery system.
Under the network model, physicians and hospitals are generally reimbursed on a fee-for-service basis. Meaning, insurance companies reimburse network doctors and hospitals for each service they perform, including office visits, tests and procedures. When subscribers of this type of health plan become sick, they can visit any of the many doctors or hospitals in the network.
In contrast, the integrated delivery system consists of physicians who are part of a multi-specialty medical group. Instead of getting reimbursements from an insurance company based on services, medical groups are capitated or paid through some form of prospective payment. Individual physicians are often salaried and paid based on their quality and service scores.
This latter form of reimbursement is known as pay-for-value. Integrated systems tend to include fewer doctors than the larger networks. However, these doctors have been selected by clinicians in their specialty for their medical expertise and quality of training.
A Third Option: The Narrow Network
In 2014, health plans participating in the public exchanges introduced a somewhat different choice.
From a coverage and reimbursement perspective, “narrow networks” are structured much the same as the traditional fee-for-service model, but they offer a much smaller selection of physicians and hospitals.
McKinsey & Company reports that narrow networks include between 30 to 70 percent of all hospitals in the area participating.
Narrowing the choice of in-network doctors and hospitals is designed to help insurance companies control costs and manage care.
Now that we get the gist of narrow network structure, let’s explore how people can choose their coverage.
The health care exchanges offer four levels of coverage: platinum, gold, silver and bronze.
Subscribers of the platinum and gold tiers pay higher premiums but have fewer out-of-pocket costs. Those who choose a silver or bronze option pay less up front and have more exposure to out-of-pocket expenses. It’s similar to choosing deductible options when buying car insurance.
Narrow networks were constructed to limit health care expenditures and thereby allow insurance companies to offer lower prices, particularly in the bronze and silver metal tiers.
In the past, some insurers offered low-priced options and kept their medical-loss ratios low by “cherry picking” relatively healthy members and “lemon dropping” individuals with pre-existing medical conditions.
The Affordable Care Act outlawed these discriminatory practices, forcing insurers to invent new ways to reduce their costs and offer lower-priced health insurance products.
And thus, the narrow network was born.
Exclude high-cost doctors and hospitals and your average insurance price drops significantly.
But many subscribers had difficulty identifying their network’s “roster” in the first year of the exchanges and faced a rude awakening. There was no way for them to know which doctors and hospitals had been dropped. They learned the hard way just how narrow their choice of doctors and hospitals was when they sought care.
In some states, patients faced with unexpected medical bills for newly out-of-network doctors were extremely disappointed in their experience. Some enrollees sued the insurance companies that failed to let them know.
And in the first year, some of the rosters offered through the narrow networks were not selected based on quality and service data. Instead, the list of doctors was created based on the prices they charged insurance companies and their willingness to accept steep reductions in fees.
It does not necessarily mean there is a problem with these physicians. It does, however, mean that it will be important for people to closely examine the full network roster before selecting a particular health plan.
How Should You Decide?
Similar to major league baseball, the quality of players on a health care team usually determines the results.
Some health care exchanges say they plan to include quality data on their websites in the future, allowing consumers to make more informed decisions. In California this fall, for example, the state's insurance exchange "Covered California" will feature quality star ratings next to health plans as part of the site's popular "shop and compare" tool, making it easier for consumers to use the ratings in selecting a plan.
For now, subscribers who believe they can figure out which physicians and hospitals provide the best care may prefer the traditional, broad network, fee-for-service model.
For those who’d rather see clinical experts to assemble their team for them (based on the training, quality performance and interpersonal skills of the players) an integrated, multi-specialty medical group may be the better choice.
And for those who care about the price of their monthly premiums above all else, a narrow network may be the right choice – assuming the price is right. But before making this selection, consumers should research exactly who is "on the team" and on what basis they were chosen.
Those who don’t may find themselves reciting this common baseball refrain: “Well, there’s always next year.”
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95b3567afbec9b21d57a6524ff71502d
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https://www.forbes.com/sites/robertpearl/2015/03/05/healthcare-black-latino-poor/?sh=257a16aa7869
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Why Health Care Is Different If You're Black, Latino Or Poor
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Why Health Care Is Different If You're Black, Latino Or Poor
The country is in a state of health care denial. Politicians, pundits and executives proudly declare America’s medical care is the best in the world. But it isn't.
The U.S. lags behind other industrialized nations in many important health measures – partly because citizens of certain races, ethnicities and incomes experience poorer versions of U.S. health care than others. The disparities are glaring. The solutions aren't nearly as obvious – but we'll explore some of the best ones in this article. First:
U.S. Results Shoddy Compared To Global Counterparts
The U.S. ranks dead last in life expectancy for men and second to last for women among the 17 wealthiest nations. Infant mortality in the U.S. ranks last among the most advanced countries in the world. And worse, among the 34 most developed countries, U.S. health care outcomes fell from 20th to 27th from 1990 to 2010.
The world’s richest economy scores dismally no matter which health care measures we examine.
Why So Bad?
One reason the U.S. ranks so poorly globally is that health outcomes for certain racial, ethnic and socioeconomic groups fare so poorly domestically. African-Americans, Latinos and the economically disadvantaged experience poorer health care access and lower quality of care than white Americans. And in most measures, that gap is growing.
“Your health care depends on who you are,” according to a 2014 report from the Robert Wood Johnson Foundation, the nation’s largest philanthropy dedicated to health. “Race and ethnicity continue to influence a patient’s chances of receiving many specific health care interventions and treatments.”
The foundation estimates Latinos and African-Americans experience 30 to 40 percent poorer health outcomes than white Americans. This disparity leads not only to shortened lives and increased illness, but also costs the nation more than $60 billion in lost productivity each year.
Access to care remains a prevailing problem. From the most recent National Healthcare Disparities Report: 35 percent of Latinos and low-income individuals reported difficulties getting the care they need, compared to 25 percent of white Americans and 15 percent of high-income earners.
America's growing health care gap puts African American, Latino and low-income patients at a sizable... [+] disadvantage. (Photo: Wikipedia)
And while overall access has improved over the past decade, the rate of improvement across the U.S. has been slower for African-Americans, Latinos and low-income individuals. For proof, look no further than in the treatment of these common conditions:
Diabetes, Breast Cancer And Heart Disease
In low-income neighborhoods, patients with diabetes are 10 times more likely to undergo limb amputation than those in affluent areas. Compared to white Americans, the rate of hospitalization for patients with diabetes is twice as high for Latinos and three times higher for African-Americans.
The death rate from breast cancer for African-American women is 50 percent higher than for white women. Racial and economic inequities in screening and treatment options contribute to this divide. In the U.S., 60 percent of low-income women are screened for breast cancer vs. 80 percent of high-income women. But even within the same economic stratum, white women have higher screening rates than African-American and Latino women.
We see the same variations revealed in the treatment of breast cancer. In over 80 percent of cases, women from higher-income households are treated with a combination of breast-conserving surgery and radiation. These less deforming approaches are used only 70 percent of the time among low-income women. The same pattern of inequity emerges among different races. African-American and Latino women on average undergo more radical breast cancer surgeries than white women.
Heart attack and stroke data are equally concerning. Not only do 25 percent of African-Americans have elevated blood pressure compared to 10 percent of white Americans, but black patients are 10 percent less likely to be screened for high cholesterol than white Americans. The result is higher rates of heart failure and strokes for African-Americans.
Among health care officials, there’s broad agreement that these inequities exist. There’s less agreement about the reasons for them or how to narrow the gaps.
Widespread Challenges Need Creative Solutions
The availability of health insurance has no doubt played a role in all of this. Before the implementation of the Affordable Care Act, African-Americans and Latinos were more likely to be uninsured than white Americans. Of course, a variety of other factors contribute to disparities in clinical outcomes. Among them: conscious and unconscious bias, limited access to healthy foods and inadequate community-wide health care resources.
Because the problem is multifaceted, the solutions must be, as well. The expansion of health insurance and coverage through the Affordable Care Act will help, creating much-improved access to free preventive screenings and services for all. Meanwhile, help in the form of creative solutions are coming from the community level.
For example, Better Health Greater Cleveland and the Greater Detroit Area Health Council are working to raise the rate of successful blood pressure control among African-Americans. The Crossroad Health Center in Cincinnati is tackling diabetes management in the Latino community. And Harlem Hospital made breast cancer screening free and added patient navigators to address the cultural barriers that limit residents from trusting or using the health care system. As a result, the hospital reports raising its five-year breast cancer survival rate from 39 to 70 percent.
Eliminating disparities has been a major priority for Kaiser Permanente for more than a decade. As CEO of The Permanente Medical Group, I’m proud of what we've accomplished for our nearly 4 million U.S. members. Today, Kaiser Permanente ranks in the top 10 percent nationally for all racial groups across a number of clinical areas, including cancer prevention, blood pressure control and the treatment of cardiovascular disease.
While there’s no one way to reach a solution, here are five approaches that have proven most effective in providing culturally inclusive care:
1. Using comprehensive electronic health records to measure, track and design interventions specific to the individual needs of our members. This allows physician leaders in Kaiser Permanente to measure progress, provide physician-specific feedback and learn from those who achieve the best outcomes.
2. Making this information readily available to all of our 8,000 physicians and rewarding those who achieve the best clinical outcomes.
3. Developing innovative, culturally appropriate health education tools for each segment of our diverse membership.
4. Investing in high-quality translation and interpretation services for our diverse membership. For the largest populations we serve, Latino and Chinese, we created bilingual, bicultural modules so patients can receive care in their preferred language.
5. Partnering with community organizations, leaders and churches to bring health care to all patients, especially those who can't miss work or obtain transportation.
Applying these success factors nationally will require a broad commitment to eliminating the disparities that exist in U.S. health care today. The first step is recognizing these disparities exist and agreeing that it’s unacceptable for anyone to experience poorer health outcomes based solely on race, ethnicity, geography or income level.
Once we've acknowledged the problem, we need to ensure physicians have the necessary medical and cultural information required to provide exceptional care to all. Additionally, physicians need to be recognized and rewarded for closing the biggest care gaps.
We still have much to learn about the cultural barriers that prevent some patients from obtaining the best possible health care. But that alone won't be enough to make a difference. We must agree that unequal care is unacceptable. Only then can we make all of the improvements our nation needs.
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f834119d4623e57deecd8b58e789b8dd
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https://www.forbes.com/sites/robertpearl/2020/05/11/preventing-post-coronavirus-depression/?sh=dc890174665b
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Six Ways To Make The U.S. Economic And Health Care Systems Stronger After The Coronavirus Pandemic
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Six Ways To Make The U.S. Economic And Health Care Systems Stronger After The Coronavirus Pandemic
These medical workers are holding steady during the pandemic, but what happens next? Cindy Ord/Getty Images
While health experts continue to debate the timeline for an effective coronavirus vaccine, one certainty looms over the horizon: There will come a day when the greatest threat from COVID-19 is not medical, but financial.
How the United States navigates the coronavirus recession will depend largely on government policies enacted (or not) in the months to come. Current stopgap efforts—including the CARES Act and other stimulus proposals—have done little to ease the financial concerns of Americans families. Amid double-digit unemployment figures, the U.S. business outlook remains bleak.
Legislators must therefore seize every opportunity to drive efficiencies. Nowhere is that opportunity greater than in healthcare, which by 2027 will consume nearly 20% of the U.S. Gross Domestic Product unless government leaders act urgently.
Let’s start with these three uncontroversial actions:
1. Boosting virtual visits
Video-based platforms have been connecting people safely and reliably since 2003. But as recently as last year, less than 8% of Americans had experienced a “telehealth” visit with a doctor.
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That’s old news now. Amid the pandemic, video visits have replaced in-office appointments for thousands of doctors and millions of patients. At St. Elizabeth in Cincinnati, for example, clinicians have provided more than 5,000 virtual visits per week since outbreak hit Ohio in March. Prior to that, the hospital provided about 20 telehealth visits, per month.
This nationwide surge in video-based care was made possible by two temporary measures: The relaxation of HIPAA regulations and the willingness of The Centers for Medicare & Medicaid Services (CMS) to waive its once-strict billing requirements.
A few years back, I predicted virtual visits would replace 30% of all medical services currently provided in a doctor’s office. The coronavirus pandemic has convinced me that number could be 40% or more without any sacrifice in overall quality. From an economic standpoint, video visits save us time and money. That’s why the federal government and regulators must turn the temporary video policies into permanent laws.
2. Spreading vaccines
On March 9, President Trump correctly noted that seasonal influenza kills tens of thousands of Americans each year. And yet, despite the devastating death toll, fewer than 45% of adults get their annual flu shot.
Americans are gradually coming to grips with the reality that COVID-19 will not go away without an effective vaccine. Though early trials have been promising, Americans will spend all of 2020 rooting for a vaccine and, likely, much of 2021 trying to push their way to the front of the line to receive it.
To capture this pro-vaxx momentum, Congress must fund additional vaccine-development laboratories and manufacturing plants. Not only will these investments serve as a first defense against the next deadly virus, but they could also accelerate the development of vaccines for stubborn diseases like Herpes, which is a $1.2 billion annual burden on the U.S. economy, and HIV/AIDS, which cost the federal government a whopping $35 billion last year alone.
Manufacturing and stockpiling PPE is crucial for addressing the next pandemic. Noam Galai/Getty Images
3. Prepping for the next pandemic
During the first few weeks of the coronavirus outbreak, the internet erupted with images of American doctors and nurses donning garbage bags for smocks and salad lids for facial shields. Our nation’s “frontline soldiers” looked more like a ragtag militia than a well-equipped army.
The same lack of preparation was evident in our slow response to testing. Though the United States and South Korea confirmed their first COVID-19 cases around January 20, the two nations reacted very differently thereafter. By March 6, the U.S. had completed just 2,000 tests whereas South Korea had conducted more than 140,000.
In today’s well-traversed world, viral pandemics are not Black Swan events. They are predictable, periodic occurrences. Should our nation experience another one without adequate preparation, the U.S. economy will plummet into a depression, not just a recession. Now is the time to arm ourselves.
Stockpiling is how the U.S. military readies itself for war. Our current war, against the invisible enemy, has highlighted the need to stockpile—at a federal level—enough pharmaceuticals, medical devices, protective equipment and testing supplies for the next pandemic.
If you have any doubt about the potential cost savings of a federal stockpiling strategy, consider this: Congress appropriated just $7.65 billion in 2008 to prep for (and successfully fight) H1N1, a deadly pandemic flu that health officials were able to quickly contain. Already in 2020, Congress has had to pass four coronavirus relief packages, totaling nearly $3 trillion.
The next trio of government measures would provide the U.S. economy with an even greater long-term boost. However, each change will anger the healthcare establishment and face stiff resistance. Now, more than ever, is the time to fight these battles:
4. Fixing the electronic health record
Americans are quickly realizing that without timely data, physicians and research scientists can’t effectively address epidemics like COVID-19. Although today’s doctors have electronic health records (EHRs) in their offices, these clunky IT systems lack “interoperability,” making it impossible for (a) physicians to quickly share patient information with each other and (b) for researchers to access national health data.
In March, the U.S. Department of Health and Human Services (HHS) finalized a proposal that requires EHR companies to open up their Application Programming Interfaces (APIs), a way of ensuring healthcare professionals can safely and securely access patient info across various EHR systems.
These rules, which are slated to take effect in 2022, will continue to be appealed and attacked by EHR manufacturers. That’s because theirs is multi-billion-dollar industry, which sees higher profits when hospitals and health systems cannot easily switch systems. Blocking interoperability laws would help preserve revenues for some companies, but it would also cost our nation more lives and more money. This legislation needs to reach the finish line without further delay, no matter how badly the opposition wants to stop it.
5. Lowering drug prices
At the start of 2020, Congress was finally grappling with the drug industry over the ever-rising price of prescription medications. Then the coronavirus intervened and the debate died.
The U.S. government, which pays for nearly half of all medical spending, has had its hands tied for years.
The Medicare Modernization Act of 2003 (MMA) prohibited CMS from attempting to negotiate medication prices with drug companies on behalf of seniors. Congress must repeal this ban despite the massive political influence of Big Pharma, which represents the largest political lobbying group in the United States, spending nearly $4.5 billion in the past two decades to ensure the government keeps its hands off U.S. drug prices.
6. Battling chronic disease
“After two and a half days in the hospital, I feel great,” said Sen. Bernie Sanders following an angioplasty in October 2019 that only briefly interrupted his run for the presidency.
His quick recovery reminds us that steady medical advances over the past several decades have lulled the American public into a false sense of confidence. We often believe that doctors can reverse nearly any life-threatening condition.
The coronavirus is toppling that misconception. Studies suggest COVID-19 kills 88% of people who end up on a ventilator. The people most likely to end up on a ventilator are those with multiple chronic diseases. In New York City, which was hit hardest by the virus, 94% of hospitalized COVID-19 patients had at least one chronic disease and 88% two or more.
According to the Centers for Disease Control and Prevention (CDC), chronic disease accounts for approximately 75% of the nation’s $3.6 trillion aggregate healthcare spending. As our nation begins to confront the realities of a recessionary economy, we simply can’t afford to treat chronic illness as we have in the past.
Part of the solution is simple in concept: We need more primary care physicians who specialize in preventing and helping to control chronic disease.
Overall, primary care physicians have a 250% greater influence on life expectancy than the specialists who deal with the consequences of chronic illness. And yet, over the past decade, the primary care workforce has been in decline.
Residency training programs throughout the country are paid for by Medicare, which apportions equal dollars to hospitals, regardless of whether that money is used to train a primary care resident (who will bring in minimal revenue) or a specialist (whose services yield top dollar).
CMS needs to modify its funding for these training programs and increase dollars allocated to primary care physicians. Doing so will encourage medical students to pursue this vital field of medicine. Of course, the surgical specialty societies will object, as will hospital administrators. Yet, without this shift, healthcare costs will continue to soar and the health of our nation will plummet.
Right now, our nation is focused on winning the medical battle against the coronavirus. But if we don’t simultaneously address our biggest economic threats, we will lose the war.
Full coverage and live updates on the Coronavirus
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https://www.forbes.com/sites/robertpearl/2020/10/12/why-half-a-million-americans-will-die-from-covid-19/?sh=56bd6feb1736
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Why Half A Million Americans Will Die From Covid-19
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Why Half A Million Americans Will Die From Covid-19
Among the questions I’m asked most often as host of the podcast Coronavirus: The Truth are: “How have other nations effectively contained the pandemic?” and “Why can’t the United States copy their success?”
For months, health experts have answered these questions by pointing to a combination of science and strategy. Other nations, they say, test more frequently, impose tighter social restrictions and boast stronger national leadership. Indeed, the American response has fallen short in each of these areas.
But neither science nor strategy, alone, explains why the United States accounts for more than 20% of the world’s Covid-19 deaths while making up just 4% of the world’s population. The problem isn’t that Americans lack the scientific knowledge or strategic ability to match global best practices. Rather, the problem can best be summarized with a phrased originated by management guru Peter Drucker: “Culture eats strategy for breakfast.”
To understand how other nations have effectively contained (or radically slowed) the coronavirus, it’s necessary to recognize the influence culture has over our thoughts, attitudes and behaviors.
When we contrast American culture with that of other nations, we can confidently predict that the United States will never tolerate the kinds national strategies that have worked elsewhere. And as a result, our country will lose 500,000 total lives before this pandemic ends. Here are two examples of those cultural differences:
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South Korea’s collectivist culture helped slow the spread
In February, both South Korea and the United States faced similar Covid-19 challenges. Cases were surging, little was known about the virus and public health officials were in a panic. Both nations had confirmed their first COVID-19 cases around the same time, around January 20, but the two nations responded very differently thereafter.
Testing played an important role in South Korea’s effective response. By early March, the United States had conducted just 2,000 tests whereas South Korea completed more than 140,000.
But testing, by itself, is a fairly weak containment measure. Thus, it South Korea’s next step that truly kept the virus in check. Unlike in the United States, South Korea adopted a rigorous national contact-tracing program that linked large databases of cell phone information, credit card transactions and closed-circuit TV with a so-called Immediate Response Team (IRT), which was called in to stamp out potential flareups and super-spreader threats.
South Koreans sacrificed their personal privacy and allowed the government unfettered access to their personal data, which enabled health officials to identify and isolate all potentially infected individuals. Although 50 countries worldwide have since adopted some form of digital contact tracing to help prevent the spread of the disease, Americans view such tactics as unacceptably Orwellian. In a study of 2,000 Americans, 71% said that they would not download a contact-tracing app because of privacy concerns.
Therein lies a critical difference: Though many factors distinguish South Korea’s successful response from the ineffective and scatter-shot approaches taken in the United States, none has influenced overall mortality more than culture.
Throughout South Korea, cultural values include obedience to family, acceptance of authority and acting on the good of the nation. These collectivist orientations enable the kinds of tradeoffs necessary to contain the virus: People forfeit their desire for privacy in return for a fast, effective and comprehensive pandemic response. Though it would be inaccurate to attribute South Korea’s success solely to cultural differences or societal homogeneity, there’s no denying that people’s willingness to put the public interest above individual rights aided mightily in its battle against Covid-19.
By contrast, the idea of ceding electronic privacy to public agencies simply won’t fly in the United States. As a result, South Korea has reported fewer than 500 deaths in a nation of 50 million compared to 210,000 dead among 300 million Americans.
New Zealand’s faith in government shaped its success
New Zealand is about the size of Colorado with a similar population (between 5 and 6 million). In part because of its small footprint and geographic isolation, the Pacific Island nation has experienced only 25 total deaths from Covid-19.
There are, in general terms, sweeping cultural similarities between New Zealand and the United States. Cultural atlases describe the people of New Zealand in much the same way they describe Americans: affable, social, and individualistic. However, there’s one important cultural nuance that helps explain New Zealand’s incredibly low death rate. Its people boast a high level of public cooperation and compliance with the government, and they are more willing to relinquish individual freedom for the common good.
According to one poll, 88% of New Zealanders trust their government to make the right decisions about Covid-19 compared to just 59% of citizens from G7 countries (Canada, France, Germany, Great Britain, Italy, Japan and the United States).
This consistent outpouring of public trust gave New Zealand’s Prime Minister Jacinda Ardern significant leeway and latitude when enforcing a stringent national containment response. The strategy, called “go hard, go early,” traded weeks of lockdowns for the promise of swift and a near-universal reopening. It is very hard to imagine a government-mandated, six-week lockdown taking place in a state like New Hampshire, where the emblem reads “Live Free or Die.”
Ultimately, without a citizenry willing to compromise personal privacy or sacrifice individual freedom, it is impossible to control this virus. New Zealand and South Korea have such cultures. The United States does not.
Culture: Why the U.S. will experience 500,000 Covid-19 deaths
Science and strategy are vital to effective coronavirus containment. However, science and strategy are not the biggest barriers to progress in the United States.
After all, Americans are not inherently anti-science. Polling suggests most people in this country respect science and see it as a positive force in society. And the United States also has no shortage of strategic thinkers in healthcare or public policy, either.
The reality is that we know what to do. We just won’t do it. Americans lack the cultural commitment to doing what is necessary to slow the spread of this particular virus. If this were an outbreak of Ebola, a virus that kills 50% of all people it infects, the risks of the disease would overpower any stubborn cultural norm or value that might stand in the way of keeping Americans safe. But with a mortality rate closer to 0.5%, Covid-19 doesn’t pose the level of threat necessary to keep Americans masked, socially distant or indoors as scientists recommend.
Likewise, if it were easy to detect infected people, we could eliminate the virus through approaches that Americans could easily accept (temperature screenings, symptom checklists, etc.). But with as many as 80% of Covid-19 infections mild or asymptomatic, people are capable of spreading the disease before they experience a sore throat, fever or other telltale signs of infection.
Alas, with its “acceptable” death rate and surprisingly high rate of asymptomatic transmission, Covid-19 presents an unsolvable problem in a nation known for the words “give me liberty or give me death.” Phrased differently, the same freedom-loving individualist values that we Americans cherish—the ones that gave us rock-and-roll, the Civil Rights movement and Silicon Valley’s startup culture—are the same national virtues that will make it impossible for us to control this insidious virus. Americans simply would not tolerate the same concessions as people in South Korea and New Zealand.
A powerful example of the influence of culture on the U.S. pandemic response is taking place in Iowa, a bellwether state in the upcoming presidential election. There, surveys show only 28% of residents wear a mask when they go out. According to a recent KHN report, Iowa health officials joined forces with Iowa University back in April to model the impact of the outbreak. They found that more than a thousand Iowans could be saved by adopting a universal mask policy. Researchers presented this the data and their recommendations to Republican Gov. Kim Reynolds who concluded that a statewide mask mandate would be “not enforceable.”
As a cultural principle, the governor understood that Iowans, like tens of millions of Americans, will refuse even modest infringements on their civil liberties or personal privacy, except under the direst of circumstances.
Given our national culture, the United States will continue to experience consistently high rates of cases and deaths until a safe and effective vaccine is broadly administered. And that time is a long way off. In a recent interview, the CEO of Moderna, a leading vaccine developer, told the Financial Times he doesn’t expect to have approval until spring of 2021. Meanwhile, CDC Director Robert Redfield told the Senate Appropriations Committee it will take six to nine months to get the American public vaccinated once a vaccine is approved. That takes us into the fourth quarter of 2021 at the earliest. And, according to leading immunologist Dr. Anthony Fauci, the chances of a first-round coronavirus vaccine being highly effective are “not great,” which means nationwide viral control won’t happen until even later.
By that time (late 2021 or early 2022), the math indicates the U.S. death toll will reach half a million. Assuming the current count of 720 deaths a day in October holds steady and projected timelines for a vaccine prove correct, then anywhere from 260,000 to 320,000 more people will die over the next 12 to 15 months, bringing total death count to half a million.
Of course, I hope I’m wrong. And I’d be remiss not to recognize that almost anything can occur, including a miraculous medical discovery or a helpful viral mutation. But hoping for a “Hail Mary” solution isn’t a viable strategy. The one thing we can say with full confidence is that there won’t be any meaningful changes in American culture over the next year and a half. And as a result, the death toll from the current coronavirus will rise far longer and to far higher than most Americans recognize or are willing to acknowledge.
Full coverage and live updates on the Coronavirus
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https://www.forbes.com/sites/robertpearl/2021/01/18/five-technologies-that-will-transform-medicine-in-post-pandemic-america/?sh=f4d8cd7a4248
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Five Technologies That Will Transform Medicine In Post-Pandemic America
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Five Technologies That Will Transform Medicine In Post-Pandemic America
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When medical historians write about the coronavirus pandemic, they’ll likely focus on the slow U.S. response and failures of leadership that led to a tragically high death toll. But that will be only part of the story. From the wreckage and devastation will emerge something few contemporary observers would expect: a brighter future for American healthcare.
Five technologies, all previously underappreciated and underutilized, will help our nation move past the coronavirus crisis into a new, golden era of medicine. Like the seedlings of the eucalyptus tree, which sprout only after a forest fire, these technological solutions will blossom in the aftermath of the Covid-19 pandemic—turning U.S. healthcare’s outdated and broken system into one that is more convenient, effective and affordable.
1. Telemedicine
Until the 1920s, the overwhelming majority of doctor-patient meetings took place in the home. But as medicine became too sophisticated and complicated for house calls, doctor’s offices began sprouting up in cities and towns across the country. Soon, little brown buildings, filled with doctors, all practicing independently of one another, became the epicenter of care delivery. This fragmented approach to healthcare has stood in place, largely unchallenged and unquestioned, for nearly a century.
Telemedicine (virtual care) has been around for decades. Yet, until physicians faced a viral pandemic that forced them to close their offices, less than 1% of doctor-patient meetings took place virtually. As the pandemic spiked in summer 2020, that number ballooned to 69% and turned companies like Docs on Demand and Teledoc into major players in American healthcare. As the deadly virus spread, video allowed physicians to deliver effective healthcare without the risk of being in the same room (and potentially infecting) patients. This experience opened the eyes of doctors and patients alike, helping them recognize that telemedicine is more convenient, more affordable and more capable of high-quality outcomes than a single physician seeing patients in an office.
Video-based telehealth allows physicians in one location to provide medical care to patients at a distance. It thereby grants people access to care 24/7, without delay and without overwhelming individual doctors. As a result, patients don’t unnecessarily wind up at the emergency department, waiting hours for routine care that costs multiples more than it should. And with the ability to call on specialists across the country, virtual care can connect patients with the most knowledgeable physician, not just the nearest one. After the pandemic is over, telemedicine will continue to serve as an essential part of a value-based system of healthcare—a major improvement upon the fragmented, fee-for-service approach of today.
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2. Drug development
No industry felt a greater sense of urgency during the coronavirus pandemic than drug makers. As a result of kickstart efforts like “Operation Warp Speed,” vaccine-development technologies accelerated at an unprecedented pace. In the past, the traditional biologic approaches for creating vaccines required at least five years of development and testing prior to receiving FDA approval.
Pfizer and Moderna’s Covid-19 vaccines were created in a matter of weeks, after researchers in China published the exact genetic code for the virus. Scientists quickly figured out a “shortcut” of sorts, using a lab-created messenger RNA to deliver a unique set of instructions to the human body. Those instructions led to the production and replication of specific virus-associated proteins—similar to the way a computer virus instructs an operating system to make copies of itself. In response to these foreign proteins, the patient’s immune system creates antibodies, which lead to immunity.
Though Moderna had been working on mRNA drugs for a decade, it hadn’t produced an approved or effective product until now. Having achieved success, it won’t take 11 months for leading drug developers to produce and manufacture the next life-saving vaccine. As it happens, we may not even have to wait for the next pandemic to apply this technology. Recently, epidemiologists identified a major mutation in the coronavirus, one that could have a sizable impact on both the effectiveness of current Covid-19 vaccines and the number of people who will need to be immunized to achieve herd immunity. Should this mutant strain be even partially resistant to current vaccines, drug makers like Moderna expect to be able to alter the composition of the vaccine and modify the injected mRNA, accordingly. Based on its previous approval, the FDA could grant emergency use authorization sooner, saving thousands of lives in the process.
3. Data analytics
The coronavirus shined a bright and uncomplimentary light on chronic disease in the United States. According to mortality reports, 94% of people who’ve died from Covid-19 had a chronic disease and 88% had two or more. Health experts have long understood the consequences of chronic diseases like diabetes and heart disease. In the United States, they account for 7 in 10 deaths and nearly 75 percent of aggregate healthcare spending.
And yet, prior to the pandemic, these types of illnesses were seen as something Americans just had to live with, like gravity or traffic. That misperception is started to change as a result of the current pandemic. The United States is on pace to reach its grimmest milestone yet—500,000 Covid-19 deaths—by this summer. The mounting death toll is helping Americans see chronic illnesses not as a common nuisance, but rather as a coconspirator, as guilty of death and destruction as the virus itself.
Fortunately, technology provides a solution. To explain, consider the threat of hypertension, the No. 1 cause of stroke and kidney failure. Doctors are capable of helping 90% or more of patients control the problem and reduce the chances of life-threatening complications. In fact, the nation’s leading medical groups are 35% more effective than the national average at helping patients control this deadly disease.
How do they do it? Technology and science play key roles. Most physicians, particularly specialists, focus on treating the strokes, kidney failures and heart attacks that result from high blood pressure (through surgery or expensive drug-treatment programs). But the most effective approaches involve prevention and optimal disease management, both of which are facilitated by comprehensive electronic health records (EHRs) and powered by evidence-based treatment algorithms. In these settings, EHR data is rigorously analyzed, giving doctors clear and effective guidelines for treating patients with chronic conditions.
In the past, pandemic planning and preparedness focused primarily on how to treat the virus itself. In the future, should another pandemic threaten the health of millions, data analytics will allow more doctors to maximize the health of patients with chronic illnesses, thereby reducing mortality before a vaccine is available.
4. Patient decision tools
In 2020, our nation applied a one-size-fits-all approach to managing the coronavirus. As a result, we over restricted some groups, like elementary school children, and under protected others, particularly people in nursing homes. The consequences were lethal.
This kind of assumptive error happens in healthcare settings, too, where doctors fail to personalize their clinical approaches and treatments for patients. As a result, they overtreat some and undertreat others. Whether patients have high blood pressure or atrial fibrillation, their physicians are likely to see all of them on a routine basis, usually every three or four months. That model makes no sense.
What patients with a chronic disease need to know is whether they should continue taking the same medications at the same doses or alter them. If nothing needs to change, they may not need to see their doctors more than once a year. In contrast, if something is askew, they should be seen in a matter of days, not months. Technology offers a better and more precise approach.
Today’s health-monitoring devices can reliably measure blood pressure, heart rate, blood oxygen, blood sugar and other physiological signs. But without interpreting the data for the wearer (and without dispensing medical advice), the information is of little value.
The next generation of home-monitoring apps will solve this problem by comparing the patient’s data with the most up-to-date treatment recommendations, thus informing patients whether everything is fine (and there’s no need to see a doctor) or whether their problem needs immediate medical attention. Why doesn’t this already exist today? It’s not that Silicon Valley’s largest companies lack the technology or knowhow to manufacture such a device. They simply don’t want to accept the medical liability should a deadly error occur. In the future, the opportunity to drive quality up and costs down will be too great for companies to resist. What remains is to be seen is who will have the courage to be the first.
5. Artificial intelligence
Like the other technologies, artificial intelligence (AI) has been talked about for years as a “game changer” in medicine. And yet, AI has not improved American healthcare so far.
It won’t stay this way for much longer. The Covid-19 crisis highlighted a problem for which AI offers a unique and powerful solution. There is a false perception among doctors that they treat all patients the same. The pandemic has proven otherwise. Throughout 2020, Black patients’ chances of dying were three times higher than that of white patients.
Part of the problem began in the diagnosis stage. When two patients came to the emergency room with symptoms equally likely to be Covid-19, the white patient was tested far more often than the Black patient, according to national studies. Biased treatment is not a new phenomenon in medicine. For decades, studies have shown that white physicians regularly undertreat Black patients for pain, prescribing less medication than they do for their white patients.
Research has shown that part of systemic racism in healthcare results from “implicit bias,” a set of prejudices and stereotypes doctors carry around without even knowing they’re there. But even when they’re subconscious, biases have a direct affect on a person’s thoughts, actions, and decisions.
AI can help identify and address this problem by assessing each doctor’s patterns of diagnosis and treatment. When AI determines the care provided to any group is discriminatory, doctors can be alerted in real time and, consequently, learn from their mistakes. With the shift in presidential and Congressional leadership, healthcare equity is likely to be high on the national agenda.
In the era before Covid-19, technology was used as a tool to attract patients, generate income, and maximize billing opportunities. In the post-coronavirus world, the United States will be reeling from the economic consequences of the pandemic. Healthcare technology can and will provide cost-effective solutions that improve our nation’s overall quality of care.
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7491fc35842b117a171da5b704e29328
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https://www.forbes.com/sites/robertpearl/2021/03/01/how-health-insurance-became-americas-biggest-hustle/?sh=51448d34476f
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How Health Insurance Became America’s Biggest Hustle
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How Health Insurance Became America’s Biggest Hustle
The game is three-card monte. Maybe you’ve seen it on a street corner (or, more likely, on the big screen). It looks easy. A dealer hunches above three playing cards—two jacks and a queen—each resting face down. He shows you the cards, mixes them up and tells you to “find the lady.”
You’re confident you can’t lose. The dealer knows you’ll never win. That’s because this is a “short con,” a quick swindle guaranteed to leave you dumbfounded and emptyhanded.
Because people have gotten better at spotting (and staying away from) from illegal cons like these, three-card monte has all but disappeared from city streets. However, there’s a similar hustle happening all over the country, drawing in more than half of all U.S. workers—and this one is perfectly legal.
The game is called high-deductible health insurance. Just like three-card monte, what you think you see isn’t what’s really happening. To understand how it works, you need to know the players involved: the dealer, the shill and the mark.
The dealer: health insurers
There’s one important rule health insurance has in common with three-card monte: the dealer always wins. Even in 2020, when every other sector of the U.S. economy struggled amid a raging pandemic, the nation’s top health insurance companies—UnitedHealth Group, Anthem and Humana—were doubling their profits.
These companies are used to winning. But believe it or not, money wasn’t always the endgame in health insurance. In fact, the original goal was to make sure hospitals didn’t go bankrupt (while also sparing patients from the financial devastation of a major medical crisis).
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Until the 1990s, insurers spent a whopping $0.95 of every $1 on medical care, taking a scant 5% from enrollee premiums to cover their overheads, with just enough left over for a small profit.
But as medicine became more sophisticated and lucrative, insurers shifted focus from protecting patients to maximizing profits. Before long, health insurance was a massive enterprise, one in which execs earn tens of millions of dollars for delivering strong financial results.
By the 2000s, however, everyone was getting in on the healthcare money grab. Doctors and hospitals began raising prices so aggressively that the cost of healthcare began outpacing overall inflation by a large margin, rising at a rate of nearly 6% annually.
Insurers, fearful that American businesses could no longer afford to pay high annual premium increases, had to figure out new ways to generate big profits. One approach would have been to force doctors, hospitals and drug companies to work more efficiently so as to lower the cost of medical care, but insurers knew that would be an extremely tough task.
So, instead, they designed an ingenious con of their own: high deductible health plans (HDHPs). Rather than asking companies to foot the higher premiums, insurers helped employers shift much of the financial burden to unsuspecting employees. The hustle worked brilliantly.
In 2007, HDHPs accounted for just 5% of all employer-based plans. By 2013, the number had jumped to 20%. Today, 51% of all U.S. employees are enrolled in an HDHP. As a result, Americans now pay more out of their own pockets than ever before—up to $6,650 for an individual or $13,300 for a family.
The shill: U.S. employers
In three-card monte, the dealer’s impressive sleight of hand is just one part of the scam. The other essential part is making the game look winnable. That’s where the shill comes in. Shills are the folks gathered around the dealer. Their job is to get onlookers excited to play (without making it obvious that they’re part of the con).
Just as dealers need shills in three-card monte, insurers need the help of the employers to make the HDHP hustle work. After all, U.S. employers provide coverage to more than 150 million Americans, representing the largest customer base in a $1.32 trillion health insurance industry.
Rather than risking the loss of a business customer to rising premiums, the insurer offers an ideal solution: “I’ll raise your premiums by only 3% this year if you agree to increase the employee deductible by $500.” And here’s the best part, “Your employees will be motivated to lower healthcare costs because now they’ll have more skin in the game.”
Like the shills in three-card monte shill, the employer helps generate excitement for this new plan. The benefits manager or HR lead points out that people can end up paying far less than in the past, provided they make smarter healthcare choices. It sounds too good to be true. And it is.
Most Americans assume they’ll stay healthy and, hopefully, save money. Insurers know that statistically, the average American will have paid enough out-of-pocket to reach their max deductible by May 19.
No matter whether patients avoid medical care or require it, HDHPs give insurers the revenue they need to keep profits up. Employers also do well for themselves by sidestepping a sizable portion of the premium. And all of the other healthcare system players—from doctors to drug makers—get to keep charging higher and higher prices year after year.
Just like in three-card monte, everyone wins except the mark.
The mark: American workers
In 2020, a study found the average annual deductible for single person coverage was $4,364 while families paid $8,439. Health insurers continue to defend these outrageous out-of-pocket expenses by insisting that employees are being more judicious with their healthcare spending. But behind closed doors, they know full well that patients have minimal control over the cost of medical services.
U.S. healthcare isn’t nearly transparent enough for patients to compare prices, bargain shop for services or significantly reduce the total cost of their care. Thus, it’s absurd to think that Bob from accounting will drive around town, bargain shopping for the best deal on his emergency appendectomy. It’s equally ridiculous to think Peggy from sales could negotiate with the pharmacy or drug company over the price of her new, life-essential medication.
Research shows that as out-of-pocket costs rise, patients don’t make better healthcare choices. They just go without. High deductible health plans have been proven to result in delays for breast cancer diagnosis and treatment. Similarly, research from Harvard on Medicare patients demonstrates that a $10 increase in the out-of-pocket expense of a prescription causes a 23% reduction in people taking their medications and a 33% increase in deaths.
Ever since the introduction of HDHPs, employees have had far more “skin in the game” and far less money in their savings. It’s not their fault. That’s just how the game is played. Everyone knows it’s rigged, except the workers.
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2bba0d59ccb804905bda46f2bde5d82b
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https://www.forbes.com/sites/robertpearl/2021/04/01/revisited-5-things-that-could-go-wrong-with-a-coronavirus-vaccine/?sh=50b996fa6a87
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3 Things That Went Right With The Covid-19 Vaccines—And 2 Problems To Watch
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3 Things That Went Right With The Covid-19 Vaccines—And 2 Problems To Watch
Photo by Sergio Flores/Getty Images Getty Images
Some of medicine’s greatest moments—the ones that fill us with joy, tears and hope—are the ones that occur when people defy the odds.
A man with a devastating spinal-cord injury walks again. A woman with a terminal diagnosis becomes a 10-year cancer survivor. A group of vaccine researchers (with no prior record of success) develop an effective vaccination that reverses the course of a deadly pandemic.
Everyone loves an underdog story, especially a physician like me who doubted that companies like Pfizer and Moderna could manufacture vaccines that exceeded all expectations.
The Joys Of Being Wrong, The Anxieties Of Not Knowing
A little more than seven months ago, I wrote an article on the “5 Things That Could Go Wrong With A Coronavirus Vaccine.”
The column drew tremendous interest and continues to drive thousands of clicks each week (hundreds of those from people on Google searching for “reasons not to get covid vaccine”).
Although some questions about the virus and the vaccines remain, scientists have far more answers now than they did last summer. With nearly 2.8 million doses being doled out each day, and with the finish line now in sight, the time has come to revisit each of the five concerns I raised in August and provide a timely update on where things stand now.
1. My concern then: ‘Americans might not take it’
Throughout summer 2020, a little more than half of Americans said they’d be willing to receive an FDA-approved Covid-19 vaccine.
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Who could blame them for their hesitancy? After a bungled federal response to testing, and with drug-makers toiling under the intense pressure of Operation Warp Speed, most Americans were fearful of a rushed vaccine—one rubber stamped by government agencies with low trust scores.
Now: Most Americans plan to get vaccinated or have been already
According to a Pew poll earlier this month, 69% of the public intends to get a vaccine or already has. This spike in intent reflects the proven efficacy and safety of the three FDA-approved vaccines: Pfizer, Moderna and Johnson & Johnson.
At the same time, one-third of Americans surveyed in March 2021 said they don’t plan to get a shot—with resistance strongest among Republicans and people in rural areas. Even 30% of healthcare workers remain unconvinced, according to a recent Washington Post/KFF poll.
This persistent skepticism could have serious consequences. Though the rate of vaccination is outpacing expectations, our nation’s hope for herd immunity is still at risk. Between those who are reluctant to get vaccinated and those who aren’t yet eligible (including Americans under 16), it may be impossible to eradicate the virus before year’s end.
2. Then: ‘Immunity might not last’
Early studies on Covid-19 immunity were inconclusive but troubling.
Results of a study published in Nature back in June observed that antibody levels fell off just two to three months after infection. Likewise, a New England Journal of Medicine report noted people who recover from the disease could be left without any antibodies within one year.
Now: Long-lasting immunity looks promising but still unproven
To date, the most hopeful data suggest that coronavirus immunity lasts years, perhaps decades, following infection or vaccination. However, that research, published online in December, has not been peer reviewed.
A more recent indication of long-lasting immunity came from NIH-funded research published in Science earlier this year. It concludes: “The immune systems of more than 95% of people who recovered from Covid-19 had durable memories of the virus up to eight months after infection.”
In the coming months and years, researchers and epidemiologists will follow the tens of millions of American for evidence of infection—both after Covid-19 recovery and post-vaccination. So far, reinfection after recovery is extremely rare (1 in 1,000), based on U.S. and Israeli research data. Those cases have been very mild, often asymptomatic, and have not required hospitalization.
3. Then: ‘The vaccine might not work’
The history of vaccine development is notoriously fraught with failure. Success stories (think: smallpox, MMR, HPV) are exceptions, not rules. After all, despite decades of trying, there is still no HIV vaccine, no universal flu vaccine, nor any vaccines with long-lasting protection against global killers like malaria, tuberculosis or a host of other infectious diseases.
Last August, health experts expressed sincere doubts about a Covid-19 vaccine that relied on messenger RNA to kickstart the immune response. I pointed out that major drug companies like Pfizer, Moderna and others vying to create a Covid-19 cure are relying on a method that has not produced a safe or effective mRNA vaccine against any viral infection in more than two decades of research.”
Now: The Covid-19 vaccine works
Fortunately, despite long odds, Moderna and Pfizer’s approach of encapsulating the mRNA inside a fatty envelope (and J&J’s placement of it inside a harmless adenovirus) proved successful beyond any reasonable expectation.
As a result, hospitalizations among elderly people—the most vulnerable population—are declining rapidly, with death totals plummeting even faster.
To date, the only common side-effects from the vaccine are temporary soreness at the injection site, along with fatigue, headaches and muscle pains in some people (the result of the body’s normal immune response). Allergic reactions in people with known allergies and a prior anaphylaxis have occurred. Most scientists blame the vaccine’s lipid envelope for this rare but severe outcome. They point out that a similar lipid layer protects the active ingredient in many other drugs known to produce similar reactions in a small percentage of people.
4. Then: ‘The vaccine gets approved but might be only 50% effective’
Many vaccines aren’t designed to deliver lifelong or universal protection. Each year, the CDC conducts studies comparing the seasonal flu shot against various strains. The agency has found these vaccines are typically between 40% to 60% effective at reducing the risk of flu-like illness.
Given how little scientists knew about the coronavirus last summer (and with the death toll rapidly rising), the bar for vaccine efficacy was set low—consistent with flu vaccine thresholds. I worried that a vaccine with 50% efficacy would save lives but couldn’t end the pandemic.
Now: Leading vaccines are 90% effective in preventing symptomatic infection
According the latest federal health research released last week, “The coronavirus vaccines made by Moderna and Pfizer-BioNTech are proving highly effective at preventing symptomatic and asymptomatic infections under real-world conditions.”
The two-dose regimens prevent 90% of infections two weeks after the second shot. The J&J vaccine is estimated to be over 80% effective, even against the more transmissible mutant variants.
5. Then: ‘Something unexpected happens’
“Immunologists have observed that the virus has exhibited no major or concerning mutations since reaching U.S. shores,” I wrote in August 2020. “But, theoretically, it could. And a virus that mutates significantly over time could render an approved vaccine ineffective.”
Now: Something unexpected is happening
Unfortunately, this concern proved prescient. Variants in the UK, South Africa and Brazil all feature spike-protein changes that heighten the risk of the virus spreading from person to person. In addition, these new variants appear more lethal and their growing prevalence may undercut the efficacy of current vaccines.
Fortunately, the messenger RNA technology used to develop the Covid-19 vaccines is capable of being altered to produce a new vaccine that boosts immunity. And it can be created in a matter of months, not years. Vaccine researchers would need only add a small piece of messenger RNA: the code need to replicate the variant’s modified spike protein.
Conclusion: Most Concerns Unfounded, Some Worries Remain
If asked to complete a self-assessment of my five-point article from August 2020, I’d score the concerns as follows:
1. Americans might not take it: Ongoing concern
2. Immunity might not last: Not likely a problem
3. The vaccine might not work: Unfounded
4. The vaccine is only 50% effective: Unfounded
5. Something unexpected happens: Legitimate concern and growing risk
More than half a year later, we know the messenger RNA approach works, the vaccine is safe and effective, and immunity lasts a relatively long time. Mutant variants of the coronavirus have become our greatest threat, which is why it’s vital to get at least 70% of the adult population vaccinated ASAP.
Right now, 100 million people have received at least one dose with 60 million-plus fully vaccinated. By May 1, 2021, all 50 states are expected to make vaccination available to anyone 16 and older.
Let’s hope nearly all Americans step forward, get vaccinated and rid our country of this pathogenic threat. This way, our schools, businesses and society can rediscover a “new normal” with both speed and confidence.
Full coverage and live updates on the Coronavirus
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d9ec5f47ffce6f9d3ac017d343780b7e
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https://www.forbes.com/sites/robertreiss/2010/12/21/amicas-simple-secret-do-the-right-thing/
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Amica's Simple Secret: Do the Right Thing
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Amica's Simple Secret: Do the Right Thing
Bob DiMuccio and Robert Reiss.
An interview with Bob DiMuccio, CEO of Amica Mutual Insurance Company.
It is a rare company whose business model is actually based on “doing the right thing.” But that is the exact philosophy that has helped Amica become a quiet leader in the highly competitive auto and home insurance markets. Consider these facts: Amica has ranked highest in customer satisfaction among auto insurers in 11 consecutive J.D. Power and Associates studies. The company has also received 9 consecutive awards from J.D. Power for homeowners insurance. Amica is known for top retention among both its employees and customers… 27% of employees having worked at Amica for over 20 years, and over 30% of its policyholders having been loyal customers for 20 plus years.
Founded in 1907, Amica Mutual Insurance Company is the nation’s oldest mutual auto insurer. With corporate headquarters in Rhode Island, Amica is built on a culture and work ethic that can only be described as the best of from days gone by. I sat down with CEO Bob DiMuccio to discuss his philosophy on leading Amica.
Bob, what does Amica do differently?
I don’t know about differently, but we always try to do the right thing. For example, when there’s a catastrophe in an area, our systems can pull in the zip codes where a hurricane, a tornado or flood is occurring. We then call our customers and ask three questions: 1. “Are you okay?” 2. “Is there anything we can do to help you?” 3. And this question shocks most people, “Do you have any claims that we can help you with today?”
We’ve done it for years on a regular basis and the feedback we get is absolutely incredible. For example, one time we called a customer at his workplace. When our rep asked him the three questions, he said, “Hold on for a second.” Then our rep heard him talking to the person in the next cubicle, who was trying to contact his insurance company. He said, “Hey, my insurance company called just to see if I was okay.”
To take this a step further – especially if the catastrophe covers a wide area and there are a lot of calls to make – our reps from around the country will join in and help each other contact our customers.
So what is at the core of Amica’s model?
People ask us all the time if there’s some secret, like computer software that helps us improve customer service. But there’s no secret: It’s really the hundreds of things that our people do everyday. It’s treating our customers like we would want to be treated. It’s allowing our people to make the best judgments that are appropriate for that moment, for that customer, for that customer’s needs. It’s compassion, it’s caring, it’s simply getting back to people quickly.
In this day and age, when you talk to somebody on the phone, you don’t always expect to get that return phone call you were promised. It’s really about just thinking, being genuine and understanding. It’s all those simple things, hundreds of things that our people do every single day, that deliver and ultimately build our reputation for customer service.
How do you ensure your people deliver those “hundreds of things” for your customer?
We, in fact, don’t have extensive procedure manuals that explain how to fix the customer’s problem – our culture is all about what is the right thing to do. We encourage professionalism. We encourage an expanded thought process. When we interview, we look for people who have a strong work ethic with attitudes similar to our own. We look for dedication to people and compassion. In interviewing, it’s a sense that we get when we speak to people. And when they are hired, we train them a lot, which means six to eight weeks before one of our reps actually will get on the phone with a customer.
We also pay for college-level courses for all of our employees if it’s work related. And we consider work related in very broad terms. In some cases, it may be a course in writing or communications, which might be business related, because in all cases we’re selling an intangible product, that product is a promise to our customers, where these courses can prove valuable.
What’s the Amica corporate culture like?
Our culture is like a fabric; fabric is woven. It’s something that’s engineered and pulled together and it’s well-designed. We have a culture where people work as a team, and the longevity of our team is incredible. We have employees with more than 35 or even 40 years of experience with the company. And with that longevity, they grow to understand the true meaning of customer service as we define it, and that customer service comes out in many different ways everyday. I receive letters from customers all the time about the hundreds of small things that we do everyday. All of this, woven together, forms the fabric of our culture at Amica.
What’s an example of Amica service?
A few years ago one of our customers had a very large fire and the family’s home was uninhabitable. Luckily, no one was hurt, but it was just before Christmas, and all their presents were destroyed. A number of our claims people got together, made a list of all the gifts the family lost in the fire and then went out and bought those very same gifts and gave them to the family, because they knew the family would not be able to get to those items before Christmas day.
That’s the kind of thing we do everyday, and there’s no formula for that. We have a claims manual that has procedures that our people use, but it’s really just having compassion and thinking about your customer’s needs each time you make a customer contact.
As CEO, how do you measure customer service?
We don’t have a specific dashboard. We look at a lot of different things, but I see the CEO’s role in customer services as doing three things: 1. Reinforcing the culture of customer service, which, internally, we call “The Amica Way” It’s simply doing things the right way. 2. Making sure the environment is right and that the leadership is in place. 3. Ensuring that our employees have the tools, for example, the technology and the products, to do their jobs.
I travel around to our 40 branch offices all over the country, and I meet with employees. During the visits, very simply, I say a few words, and the leadership of claims, underwriting, human resources and our executive vice president say a few words, and then we open it up to employees. Employees tell us what they want to talk about during these visits. When I tell them that Amica always does the right thing, someone will often ask for a more specific definition, and I always say the same thing. I tell them it’s what I would do if my mother were standing there watching me to make her proud…it’s very simple and straightforward.
Robert Reiss is Host of The CEO Show, which features leaders who have reinvented industry through exceptional customer experience models. The show is nationally syndicated by Business TalkRadio Network. Click to hear podcasts of this and other CEO interviews.
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edb9bb73b5d8085cd588646471debff9
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https://www.forbes.com/sites/robertreiss/2011/01/03/mitchells-built-and-growing-on-hugs/
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Mitchells ... Built and Growing on Hugs
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Mitchells ... Built and Growing on Hugs
An Interview with Jack Mitchell, CEO, The Mitchell Family of Stores
Jack Mitchell and Robert Reiss at Richards Greenwich, CT.
In 1958, 53 year old Ed Mitchell and his wife Norma, founded a high-end men’s clothing store in Westport Ct., that was build on a different approach to business -- later dubbed, ‘Hugging Your Customer’. Today, Ed’s two sons Jack and Bill and their combined 7 sons lead the third generation family business. Mitchells is truly the clothier to the CEO, with well over 500 CEO and company president clients, as well as being a featured Harvard Business School case study. The company has recently grown through an acquisition model of leading high-end clothing stores with great brands experiencing challenging times and marrying them into the Mitchell philosophy … these include: Richards of Greenwich CT. in 1995, Marsh's of Long Island NY in 2005 Wilkes Bashford of San Francisco and Palo Alto in 2009 and Thomas Miller of Long Island in 2010.
CEO Jack Mitchell codified the concept of Hugs in 2003, when he wrote ‘Hug your Customers’ a best-seller with over 200,000 copies in print. Jack and I recently sat down and talked about the business.
Describe the Mitchell model for building customer loyalty?
Customer loyalty is about making the customer the center of the universe. We do that through famly values from Mom and Dad, something we call ‘Hugging’. I define a ‘hug’ as any large or small deed that shows you genuinely care about someone as a real person. Everyone in our stores tries to understand every customer as a complete individual. Where they work and play; what they like and don’t like, their anniversary their favorite food, wine, restaurant, sports team and hobby … and if they have kids, their kids’ birthdays and sports or instrument. If someone loves wine send them the right bottle; of course not to a recovering alcoholic. Once we know someone genuinely, we connect with them genuinely by delivering what’s important to them. It could be a handwritten note – of course with a real ink pen - congratulating them on their son being part of a championship junior high football team. Or perhaps they’re going to an important wedding, so we’ll come over and personally tie their bow tie. Anything that makes them know we understand how special they are. As a business, we are completely data driven and the computer remembers everything … and that’s our how we build loyalty, through a hugging culture.
How do you build the hugging culture?
Total 100% commitment to personalized customer service. When starting, it’s all about the hiring process. We want people who are honest …which includes being open, caring and transparent. Then they must be nice. They must be passionate to listen learn and grow. And finally, they must be competent and open to new ideas.
Which comes first, the employee or the customer?
It’s a tough question, as the two are weaved into one and are very synergistic. We’re all here to have fun and service our customers. We know our business is about personalizing customer service. And happy associates make happy customers … but of course I did write Hug your Customers before I wrote Hug your People.
What advice do you have on family business?
If it is working well through a set of guidelines or rules; stick to it. For the Mitchell family the most important thing is viewing it 1st as a business and 2nd as a family business. So family members often are entitled to equity, but not to a job. That’s why all of our 7 sons had to work for 5 years outside the family business. This enabled them to develop a specific business skill. Once they have a business skill we try to match that skill to our business needs. We give annual reviews including a modified 360. When you put the right people in the right place on the bus, you get where you’re going faster, and everyone can enjoy the ride.
How about merging with other companies
When we went into Wilkes Bashford, we knew they had a leading brand and that our role would be educating them about our hugging culture and letting them understand both strategically and tactically how we do things. So at Wilkes, as with all other acquisitions, we interviewed every person and learned about them as an individual both how they liked to conduct business and what their personal interests were. There is no cookie cutter … you want people to be themselves. We then shared with our new associates our philosophy of how to bring customers back, through Hugs. We discussed how we operate … by focusing on one person at a time and that when you have the personal relationship you build loyal customers for life.
Your culture is all about being customer centric. There must be other elements responsible for your significant success?
Of course, as our Mission Statement points out, we are a family-owned high-end men’s and women’s specialty store committed to providing exceptional customer service and high quality merchandise in an exciting, friendly, and visually dynamic atmosphere. I often say we are about C’s…commitment, Customer, Community and Cash. We learned that (C)ash is the only meaningful addition to our hugging culture (since the recession of 1989-1991). I am proud that we consistently deliver on our hugging culture.
Robert Reiss is Host of The CEO Show, which features leaders who have reinvented industry through exceptional customer experience models. The show is nationally syndicated by Business TalkRadio Network. Click to hear podcasts of this and other CEO Interviews www.ceoshow.com
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ff20f49a30d2c6cdef9118f49d6eba6d
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https://www.forbes.com/sites/robertreiss/2011/01/25/thomson-reuters-culture-of-organizational-curiosity/
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Thomson Reuters' Culture of Organizational Curiosity
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Thomson Reuters' Culture of Organizational Curiosity
Devin Wenig and Robert Reiss Interview with Devin Wenig, CEO, Thomson Reuters Markets
While over 150 years old, Thomson Reuters is a new company. The 2008 merger of Thomson and Reuters built arguably the world’s largest news and information organization for professionals in industries including legal, science, finance and healthcare, with journalists in 200 countries. And while Thomson Reuters is built on the foundation of its 150-year-old ‘Constitution’, it has become a visionary, perhaps even hip organization with cutting-edge initiatives including: Thomson Reuters Elektron, a global high speed network and hosting environment; Reuters Insider, a new video platform designed exclusively for financial professionals, and Thomson Reuters Eikon, a financial desktop platform that takes its cues from the intuitive search, engaging interfaces and seamless mobile interchange for professionals.
At the core of this dynamic change is a culture built on curiosity. I recently sat down with Devin to discuss.
What’s your view on strategic planning?
We have a strategy and a plan about where we’d like to be in three years, but we never let the plan get in the way of the first shot in the battle.
I see a lot of organizations trying to make the world fit their plan. It’s not possible. The world is changing too quickly. The ability to be nimble is the single determinant between those that are succeeding and those that are failing. Rigidity is the enemy of progress. The most successful companies embrace the world’s chaotic energy. Chaos opens up opportunities.
I understand Thomson Reuters has a constitution.
Yes. This constitution, which we call “the trust principles”, drives our DNA and ensures that we are ethical, honest, and not conflicted in the way we report news. Trustees – not the board, not our shareholders -- manage this constitution. They are in place to ensure that our news organization runs according to the values that have been in place for over 150 years.
Describe Thomson Reuters’ culture?
We really believe we’re doing something for the world. People are passionate and incredibly energetic. Bringing fact-based news to the world is a terrific mission, and great business. And at the core of our culture is organizational curiosity.
How do you drive organizational curiosity with 27,000 employees?
It’s particularly interesting because those people are in 100 countries. And what's happening today in Shanghai, Mumbai, Moscow, Chicago, San Francisco and New York are all very important inputs to our business.
So we take data from our people constantly. We read it, we listen to it. Whether that be what a client said or a competitor is doing; what the local newspaper or the Chicago Tribune wrote yesterday; what a newspaper or a television station or a blog in India is saying about our industry.
I think curiosity is an enormous determinant of organizational and individual success. Ultimately, the organization is just the people and the ability to process a lot of information that comes in, the ability to read a lot, the ability to network a lot, the ability to hear a lot of things you don’t want to hear about where you’re not doing that well. All of these things are hugely important to the ability to be adaptable.
I try to push our company out into the world. It’s very easy for companies to get introspective. It’s very easy for companies to be convinced that the actions inside are the answers. When you’re a big company, there's a lot of action inside, but we must be curious and nimble utilizing real time information. That is why rigidity is the real the enemy.
How do you build organizational curiosity with your executive team?
I do something called “deep dives” with everybody from my general council to my head of sales to my head of marketing 3 of 4 times a year. We don’t talk about results. We talk about the world and the business and strategy.
We don’t discuss, “How are you doing according to your plan?” Instead we discuss, “How are we going to be the world’s best in India?” “How are we going to double the size of this business in three years?”
And a lot of times, those are just very whiteboard-type thinking sessions which I think ultimately drive organizational curiosity.
I’ve heard you reward failure.
I believe under certain conditions it’s fine to reward failure. The hardest thing to do is to understand when to reward a failure that occurred for the right reason. If you never fail at anything, you surely are not taking enough risks as a company or your people aren’t telling you everything. You have to have an embedded rate of failure or you’re not being ambitious. We understand that in performance cultures, which is what I believe we are, you have to take some risk and with that comes failures.
What’s the future of mobility?
With mobility, we haven’t even scratched the surface. Imagine all constraints are gone and anything can be done with devices. Imagine there’s complete information ubiquity, where the screen size and bandwidth constraints are gone … and that’s probably 3 – 4 years away. That forces you to really rethink things.
Every U.S. business, and I’d argue global business, is now an information business … whether you make steel or you run a news organization, you’re an information business. And the ability to have information anywhere, anytime in any place has enormous implications for the way organizations run, and how organizations connect with their customers.
Talk about your leadership philosophy.
I try to avoid being hierarchical. I try to be optimistic and curious and encourage innovation everywhere.
Running a company is fine. Changing a company is what energizes both me personally and the organization. There's no such thing as going sideways. If you’re going sideways, people get antsy, they get miserable, the organization stagnates and you’re going backwards even if you kid yourself that you’re going sideways. So I try to help the company get into that energizing innovation and breakthrough.
Robert Reiss is Host of The CEO Show, which features leaders who have reinvented industry through exceptional customer experience models. The show is nationally syndicated by Business TalkRadio Network. Click to hear podcasts of this and other CEO Interviews at www.ceoshow.com
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e048baeb06215499f8f3ef698656de9c
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https://www.forbes.com/sites/robertreiss/2011/03/16/the-key-to-innovation-build-a-platform-like-apple/
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The Key to Innovation: Build a Platform, like Apple
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The Key to Innovation: Build a Platform, like Apple
Bob Safian with Robert Reiss
When it was launched in 1995, Fast Company magazine set a new tone in progressive business media, with a unique editorial focus on discovering the creativity and innovation in technology, ethonomics (ethical companies), leadership, and design. The publication set out to chronicle how changing companies create and compete, to highlight new business practices, and to showcase teams and individuals that were reinventing the future and reinventing business. With special editions focusing on the World’s Most Innovative Companies, World’s Most Creative People and the Most Influential Women in Technology, Fast Company has made itself a bellwether for innovation and creativity.
The publication has put its stake at the core of the cultural revolution. I recently sat down with its editor, Robert Safian, to discuss what exactly he's aiming at, and how and why?
How do you define great innovative content at Fast Company?
We cover innovation and creativity within business, and our aim is to inspire business leaders to embrace change. To do that, the content is always about the story—it has to be engaging. In our world of content, we have to realize that we’re not just competing with other print media or other digital media, we’re competing with someone watching Family Guy on their iPad. We are competing forpeople’s time, and we have got to be dramatic, engaging, entertaining.
Readers are looking for content that tells them something they didn’t know before. This is a challenge with certain kinds of media. For example, with Google, if you want something, you search for that specific thing. For a lot of other media, people are actively engaged because they want to learn about something that they didn’t know was out there to begin with.
How do you define a fast company? Do CEOs have to use social media to be effective leaders?
We view fast companies as businesses that are innovative, progressive, and creative, and that are constantly changing. These businesses have it baked into their approach who their future customers are going to be. CEOs have to think about not just their customers but their employees who have been there for one or ten years. That’s what makes running a business so hard, because that is the matrix these leaders are operating on.
I mention this because your future customers and employees are using social media. It is a critical part of the way they communicate. If you want to tap into that and understand the evolving marketplace, you have to be attuned to that. It doesn’t mean they have to be Tweeting or on Facebook everyday, but CEOs should try to be comfortable with social media and keep their eyes open to other things.
What do you think social media will look like in 15 years or so?
Well, I really don’t think anyone knows for sure. Some of the leading companies in social media today didn’t even exist five years ago. And that is the key lesson about being a fast business, recognizing that you can’t plan out that far. You have to adapt and move, and base your decision on your best guess about where you are and where things are going. That is the way it has always worked;, it just gets harder because the world is moving faster.
Fast Company recently put out a study on the Most Innovative Companies. What insight can we gain from that?
We come out with an issue every year about the 100 Most Innovative Companies. The key trend that we’re looking at this year is about how platforms that are being built enable innovation for others. For example, the No. 1 company on our list this year is Apple. In some ways that was an easy decision—they came out with the iPad, a new product that no one had seen before, and it’s been a tremendous success.
However, Apple is on our list for a larger reason; that is that the combination of the iPad and the App Store and the iPhone have created a platform for innovation that other companies are building on. There really is an ecosystem, and it has spawned a tremendous amount of creativity across a wide range of companies.
Businesses need to recognize where those platforms are and try to see how they can tap into those. Facebook is a platform as well that certain people are using, as are Twitter and YouTube. These are all platforms that if you go back five or six years, they didn’t exist at all. These are tremendous cultural changes that have happened over the last five or six years. All businesses have to recognize that it’s there, and see how it impacts their business.
What is the culture like at Fast Company, and how does your staff get the inspiration to know where to look for innovation?
Our reporters spend months trying to find creative and surprising businesses that are doing things that you might not recognize. What tends to happen in a lot of businesses and media is that people get assigned niches. You’re a technology company, you’re a technology reporter. You’re a banking company. You’re a marketing company. I think a lot of the most creative and innovative things are happening in the gaps between those silos.
The lines are breaking down. I think if you can be inspired by the contiguous areas of your business, and if you can have your employees not define their jobs necessarily in just those narrow ways, there are lots of ideas that can come up. You can find new things and new areas of growth and opportunity in that kind of creativity.
Robert Reiss is Host of The CEO Show, which features leaders who have reinvented industry through exceptional customer experience models. The show is nationally syndicated by Business TalkRadio Network. Click to hear podcasts of this and other CEO Interviews at www.ceoshow.com
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80ebf44e7ebd0f82dcd0a7963bc86ada
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https://www.forbes.com/sites/robertreiss/2011/03/18/advice-to-entrepreneurs-go-global-and-mobile/
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Advice to Entrepreneurs - Go Global and Mobile
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Advice to Entrepreneurs - Go Global and Mobile
Rafael Pastor, chief executive officer of Vistage, with Robert Reiss.
As my work is interviewing chief executives, I was particularly interested in finding the inside story with the world’s largest for-profit CEO organization, Vistage International, Inc. Founded in 1957, headquartered in San Diego, Calif., Vistage has more than 14,000 CEO members in 15 countries.
Rafael Pastor has been chairman and CEO of Vistage since 2004. Pastor’s past certainly provides him an interesting perspective. It includes: CEO, Hoyts Cinemas Corporation; president, USA Networks International; EVP International; News Corporation/Fox Television International; and CBS/Fox Video International.
Since taking the helm in 2004, Pastor has rebranded and repositioned Vistage, changing its management team, capital structure and sales and marketing, resulting in customer loyalty of 80% and almost doubling revenue--and that’s through the recent deep recession. Significantly, herevealed some fascinating insights from the company’s CEO Confidence Index. I recently sat down with himto discuss the state of the CEO.
Rafael, what are the key findings from your recent Vistage CEO Confidence Index?
Overall confidence in the economy is at its highest in more than fiveyears, and the level of confidence in our members’ own businesses in the coming year in terms of revenues, profits and hiring are also at the highest levels they’ve been in a number of years. 77% believe revenues will go up, 63% predict profits will be up, and 54% plan to hire during the next 12 months. That’s the first time in three years that a majority of CEOs stated that they planned to hire.
These findings matter for two very important reasons. First of all, small businesses are the engines of our economy: they comprise 50% of GDP and 75% of jobs in the U.S. Second and also significantly, our Vistage CEO Confidence Index has been proven to be more than an attitudinal snapshot; it’s actually a leading indicator of GDP and Employment increase (or decline) two-to-three quarters ahead. So what our latest Vistage CEO Confidence Index is saying is a very positive harbinger for our economy.
What challenges do CEOs of smaller and mid-sized companies face?
These CEOs are challenged today by how to do more with less. How they can continue to run companies that grow and prosper even when available resources are diminished. They have less access to credit, fewer employees, tighter budgets, and their own customers or clients have reduced spending. So we’re finding the silver lining of this economy is many CEOs are becoming smarter. Many are leveraging the web and mobility, expanding into new international markets and utilizing their one greatest inherent strength – being nimble.
What is Vistage’s model?
Vistage helps CEOs succeed through resources generally available only to larger enterprises. This includes: peer groups playing the role of trustees, one-to-one coaching, access to authorities, expert speakers, and the connectivity within our worldwide network of more than 14,000 members. The key is helping our members create cultures of actionability, accountability and results. Our members stay as members for as long as they do precisely because of the difference it has made in their lives and in their companies. Combining these resources with smaller companies’ inherent agility enables them to dramatically succeed. In fact, a 2010 analysis revealed during 2005 – 2009, Vistage CEO member companies grew at +5.8% in the U.S. while average comparable companies decreased at -9.2% .
In seeing trends from working with more than 14,000 businesses, what advice do you have for entrepreneurs about succeeding in this economy?
The advice I have is to do what so many are already doing to be more successful. If you look at our Vistage members and why they have been, as a whole, more successful in growing their businesses than non-Vistage members, it’s because they’ve been proactive and creative in two areas: First, they’re doing much more business than they ever did before internationally. These are small businesses. And yet almost 60% of them are doing business internationally. Twenty-five percent, by the way, are doing business in China. That’s a huge opportunity for many small businesses, the ability that they have to access new markets whether it’s to outsource, to manufacture, to export or import. In the global economy, doing business internationally presents great upsides … and, of course, great risks too. Second, which is somewhat related to the first, is the use of the web to market, sell, enhance and even deliver their products and services. Those companies that do—and again, it’s nearly 60% of Vistage members who are doing this—have a competitive advantage over those that don’t. Frankly, those 40% who aren’t using the web adequately really should be. And so my advice is go international, use the web, and if you’re already doing that, do more of it, and if you are not doing that, make sure you do.
What’s on your CEO dashboard?
In my case, four important items:
1) To continue to build the brand. Because brand awareness, brand recognition and brand value are very important in this world.
2) To continue to grow our business organically. Which means, in our case, not unlike many businesses that are membership or subscription based, we want very high retention levels. We want to continue to increase retention levels among our members and at the same time continue to grow by acquiring new members.
3) International expansion. Because you have to go abroad in order to grow your business these days, and for us, it’s part of the value we provide to our members that we can connect them internationally.
4) To constantly continue to leverage technology and to do so in all three ways that matter: To market your services, deliver your services even more efficiently, and augment what you can bring to your customers and to the marketplace.
Ultimately, my most important job is to help our 14,000 CEO members succeed … their success is leveraged and is a critical element in driving global economic growth.
Robert Reiss is Host of The CEO Show, which features leaders who have reinvented industry through exceptional customer experience models. The show is nationally syndicated by Business TalkRadio Network. Click to hear podcasts of this and other CEO Interviews at www.ceoshow.com
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4530e421a7b5174281e2d5018f6d51ff
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https://www.forbes.com/sites/robertreiss/2011/04/16/41-year-old-ceo-leading-turnaround-at-158-year-old-bausch-lomb/
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41-Year-Old CEO Leading Turnaround at 158-Year-Old Bausch + Lomb
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41-Year-Old CEO Leading Turnaround at 158-Year-Old Bausch + Lomb
Robert Reiss with Brent Saunders, CEO, Bausch + Lomb
For over 150 years Bausch + Lomb has led eye health innovation. However, the iconic company which focuses on three businesses: lenses and solutions, eye surgery, and pharmaceuticals and has more than 11,000 employees worldwide in over 100 countries, recently found itself in stagnation. To shake things up, Bausch +Lomb hired a new CEO, Brent Saunders, who at 41 years old was among the nation’s youngest CEOs. Almost exactly one year after Brent took on his new role, I spoke with him about the progress the company is making, and the challenges it still faces.
Describe your first day as CEO?
I knew my actions would speak louder than my words. So my first day on the job, I didn’t settle into the executive office building; but rather, I where went straight to the Optics Center the majority of our Rochester-based employees work. I wanted to show that I was not another corporate suit but that I was focused on people at the working level, the products and on how we get things done. Now we are in the process of moving the entire executive team and other employees located in the executive office tower to the Optics Center. This is the kind of action that builds a new culture and a ‘one team’ mentality.
And what was your initial take on Bausch + Lomb?
Bausch + Lomb is such an iconic and well known brand, but the company had lost its way. Despite having experienced many challenges around the world, I was energized by the strength and resilience of our employees who retain a passion for their work and are determined to win. While there is much to do, this is a company that could again become the world leader in eye health.
What have you accomplished in your first year as CEO?
We’ve implemented a new operating model that has radically simplified our company and brought us closer to our customers. This task wasn’t easy, but we've become much more customer oriented and competitive as a result. We have a goal of becoming ‘invited in’ by customers – meaning, becoming a trusted advisor whom they want as part of their inner circle. This takes time, but it is happening. And when you achieve ‘invited in’ status, you can be sure that financial performance improvement follows.
We also reframed how we approach R+D, which we call D+R. The thinking is simple: while discovery research is essential to innovation, the biggest investment and the most complex work is in development – the work that transforms an idea or a molecule into something new and valuable for the patient and customer.
Since innovation is the lifeblood of a company like ours, we’ve worked to transform a bare pipeline into one filled with great opportunity, including three potentially ‘game-changing’ projects in each of our three business units: lenses and solutions, surgical, and pharmaceuticals. What is remarkable is that our revitalized pipeline consists mainly of projects that were already on our shelves – we just needed to focus on a few big bets and execute with urgency. We are focused on recapturing our innovation edge and the pipeline we’re developing will help us do just that.
The most valuable asset our company has is our people, and we have placed increased focus on the importance of front line managers. The role of every manager in the company, starting with me, is to support the managers closest to our customers – not the other way around. This is a subtle but important shift.
Finally, we’re building a high performance culture at Bausch + Lomb. The key is our six High Performance Behaviors, including ‘Earn Trust’ and ‘Share Accountability’. Instilling a high-performance culture starts at the top, and so I lead by example and model these behaviors and other elements of our culture every day. In order to drive meaningful transformation, every one of us must lead by example. When I am out visiting our sites, it is great to see our people in locations as diverse as St. Louis, Missouri and Berlin, Germany all aligned around this high performance way of working.
I hear business is expanding in China?
China is a market where we are the leader in eye health. We achieved that position by recognizing that entering the Chinese market as an eye health company wasn’t as simple as just bringing contact lenses and solutions or pharmaceuticals to the country. There was no education on how to fit lenses in China. So Bausch + Lomb created a unique new ‘university’ in China to teach professionals how to fit contact lenses -- which effectively created a market for lenses and allowed Bausch + Lomb to become the company for contact lenses. In fact contact lenses are widely known as “baushies” in China.
What is one eye-health issue that keeps you up at night?
Eye-health issues are frequently caused by neglect and lack of knowledge – yet surveys show that sight is perhaps the most precious sense for people around the world. So I believe that in addition to our mission of finding treatments and cures for eye health diseases and deterioration, we also have a duty to educate about preventative measures. If people around the world took as much care of their eyes as they do of their teeth, we could save so much needless suffering.
Talk about your long term goals.
Our goal is simple: we will transform Bausch + Lomb into the world’s best eye health company. What we mean by ‘best’ is summed up in our mission: we help people to see better, to live better. By helping people see better, we will be making a huge difference in the quality of their lives. Being part of a company like this is incredibly rewarding, and if we execute well - we will deliver something very meaningful for our customers and strong results for our shareholders.
On a personal note, I want to continue learning and growing so I can be the best leader I can be. I am hugely passionate about the work we're doing every day on behalf of the people that count on Bausch + Lomb, and I am committed to doing my job a little better each and every day.
Looking forward to your career as CEO, what do you want your legacy to be?
I want to be known as someone who helped build a culture that empowered people to become their best, by instilling the right mix of skill, confidence and capabilities. The second is to be known for helping to improve eye health and well-being by championing innovation, and bringing those innovations to the patients and customers who need them.
I say ‘helped’ on both fronts because I am acutely aware that strong CEO’s do not achieve great things on their own. They open doors so their colleagues can achieve great things.
Robert Reiss is Host of The CEO Show, which features leaders who have reinvented industry through exceptional customer experience models. The show is nationally syndicated by Business TalkRadio Network. Click to hear podcasts of this and other CEO Interviews at www.ceoshow.com The CEO Show is also expanded into The CEO TV Show, which features CEOs who have reinvented the fabric of America www.ceoshow.tv
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e3ac8be9c9ee34c690cc7ff674970e9e
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https://www.forbes.com/sites/robertreiss/2011/04/25/the-secret-of-corporate-culture-higher-purpose-arkadi-kuhlmann-ceo-ing-direct/
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The Secret of Corporate Culture Is Higher Purpose: Arkadi Kuhlmann, CEO, ING Direct
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The Secret of Corporate Culture Is Higher Purpose: Arkadi Kuhlmann, CEO, ING Direct
Here's an interview I did recently with Arkadi Kuhlmann, CEO & Chairman of ING Direct. What's interesting is that when Arkadi founded the company, he set a new banking model, based on a culture with a higher purpose—bringing America back to savings. The result is that in just a decade ING Direct has become the largest savings bank in America, with close to $90 billion in assets. In this one-minute interview, Arkadi discusses common mistakes people make in building an exceptional corporate culture, as well as perspective on how to view culture.
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b49f3f6ddd7f94a0b55829419cc10fb3
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https://www.forbes.com/sites/robertreiss/2011/05/05/a-new-model-to-improve-the-healthcare-experience/
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A New Model To Improve The Health Care Experience
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A New Model To Improve The Health Care Experience
Patrick E. Connolly, President, Sodexo Health Care with Robert Reiss
Healthcare costs America $2.7 trillion a year, about 17% of the GDP. Yet patients are often not fully pleased with the results. And in healthcare, practically everything is measured; for example, HCAHPS measure the patient experience … and hospital reimbursement can be impacted by these scores. Sodexo Health Care, about a $3 billion company with 85,000 employees has created a new model where non-clinical teams positively impact the patient and resident experience. I recently spoke with its president, Pat Connolly.
What is unique about your model?
What not everyone knows is the actual customer experience in hospitals and senior living is completely connected to a patient’s and resident’s view of food service, housekeeping and maintenance staff members. The importance of this connection has been reinforced by our research, as well as third parties like McKinsey. And since hospitals are rated by a measurement called HCAHP scores, our model of providing non-clinical support services significantly enhances the patient experience as well as hospital customer experience HCAHP scores.
What drives this model?
We’re driven by our mission, which is to improve the quality of daily life for those we serve through the way we provide our service solutions. With hospitals and senior living we have 72,000 frontline employees who are the face of Sodexo. The way we deliver our services in the 1,767 client sites we serve defines us, both to our clients and in the marketplace.
So how do you actually improve the patient and resident experience?
We’ve built a deeply rooted culture based on compassion, accountability, respect, enthusiasm, and service, aka CARES. We conduct behavioral interviewing to find people with a “hospitality heart,” provide training in the CARES behaviors for both managers and frontline employees, then recognize and reward those that demonstrate them. And, our clients benefit from improved patient and resident satisfaction scores when CARES training is coupled with our customer-centered, “mass-customization” services, such as: At Your Request®-Room Service Dining which is a customized restaurant style menu for hospital patients; “To the Table” a mobile buffet service in senior communities; or our Environmental Services ENGAGE program, in which the patient receives an amenities kit upon arrival, and enables them to decide what time of day they would like to have their room cleaned, among other features.
Our team members know that they have the latitude to do whatever they need to do to make people’s lives better, whether it is taking the time to comfort a patient or family member that is upset or recreating a wedding reception dinner for a grandmother who is unable to attend her granddaughter’s wedding. Further, they understand that every job, from the dishwasher to the General Manager, is important, because what they do every day supports a healing environment, or, in a senior community, makes the residents’ home an even nicer place to live. Our CARES culture also impacts the relationships between our team members and helped us achieve “Best Employer” category engagement scores as measured by Hewitt in 2010 – 67% overall in the Health Care client segment and the highest within Sodexo. Our teams are passionate about our mission and what they do every day.
What is your leadership philosophy?
I see my role as communicating, direction setting, and creating our organization’s culture, especially around growth, retention and recognition. I spend a great deal of my time - about 25% - communicating what we expect from our teams, and listening to what they have to say. I conduct small open forums with our managers that enable me to have real conversations and get real feedback from the people in our accounts. They know how patients are feeling and what residents’ lives are like. They know our clients really, really well, and have a wealth of information that I need in order to do my job well. In addition, we hold one giant, market-wide meeting every October that focuses on recognition, celebrating our CARES culture and our teams’ achievements. I am also focused on the development of our strategy and identifying organizational goals, and I spend a significant amount of time in industry-related activities.
What were your influences in developing your leadership strategy?
My father has been my major influence. My dad worked long days, escaping his childhood in NYC’s Hell's Kitchen, and creating a future for his children. He taught us what hard work and determination could bring – he was a great inspiration. Yet, that sort of investment in time came with the sacrifice of time apart, and him having to miss many of my childhood experiences.
I learned and applied his lesson of hard work. I became a father, and my son, Jack Connolly, took me another step. One night, away on one of many business trips, I called home. Jack was very young, crying that he missed me. His sister, Erin, placed a photo of me on his nightstand to comfort him. He cried to me, "I want a real dad, not a fake one."
Since that night, I've focused on balance. I never miss my children’s sports events. I miss an occasional meeting, or I’m late to the office, but there's a balance. I share that lesson with my employees, stressing the need for them to be their genuine selves at work, finding a balance that rewards them and their families. And the end result is we have a highly engaged and motivated team doing incredible work.
Robert Reiss is Host of The CEO Show, which features leaders who have reinvented the fabric of America. The show is nationally syndicated by Business TalkRadio Network. The CEO Show airs in 40 markets and The CEO Show Minutes airs over 3,000 times a week. Click to hear podcasts of this and other CEO Interviews at www.ceoshow.com
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7d2a7a37907f153bb869e1b5af793fc8
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https://www.forbes.com/sites/robertreiss/2011/06/12/tony-hsieh-ceo-of-zappos-talks-about-overcoming-challenges/
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Tony Hsieh, CEO of Zappos, Talks About Overcoming Challenges
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Tony Hsieh, CEO of Zappos, Talks About Overcoming Challenges
In this interview with Tony Hsieh, he talks about overcoming challenges like no money, and how challenge can actually create opportunity. To see full interview go to www.ceoshow.tv
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1ea699f9af679fe0ed70576d124151dc
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https://www.forbes.com/sites/robertreiss/2011/06/22/growing-audi-across-the-atlantic/
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Growing Audi Across the Atlantic
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Growing Audi Across the Atlantic
Johan de Nysschen, President, Audi of America and Robert Reiss
Audi has publicly stated its impressive goal to have 1.5 million vehicle sales globally by 2015. Yet while the company has been the number one luxury car brand in Europe for a number of years – and is also number one in China – it does not have the same dominant position in the United States. Johan de Nysschen, President of Audi of America, has been working to change this. While the products sold worldwide are uniform, he has adapted a dynamic strategy, and key focus on the dealer network, which has resulted in 5 consecutive record setting month in sales … laying the foundation to grow the luxury brand’s popularity with American consumers.
What does the Audi brand really stand for?
Audi is to some extent an enigma because we are a high-end luxury automotive brand, but our philosophy is about understatement. It’s not about loudly proclaiming from every rooftop who you are and what you have achieved; it’s more about “being in the know,” being discerning, focusing on craftsmanship, fine quality, leading edge technology, and, of course, putting it all together in a high quality package. This is the company’s essence.
However, we are a global brand, so we need to position our brand in the consistently in all the markets where we compete. And our vehicles are the same in all the markets. Nevertheless, we have come to the realization that our brand’s understated approach to communication was not getting us on the regular screen of American consumers.
What were key changes you made at Audi?
I focused on dismantling silo thinking. Each Division used to focus only on optimizing its own area, regardless of the impact on other parts of the organization. Divisional executives now each have overriding Organizational objectives, as well as Divisional objectives, as their personal KPI's. At management meetings, executives are encouraged to voice opinions on issues outside their functional area of responsibility. We work as a team, share decisions and accept collective accountability.
What is your leadership philosophy to grow Audi?
Recruit the right people! Train them to ensure they have the right skills and get them to buy into the Vision. They need to understand how their individual objectives and roles support the Vision and set out the Roadmap with Milestones and clear KPI's. You must empower people to get on with their job, encourage risks, expect mistakes and tolerate them if it can be a learning experience. You must hold people accountable for results, no same mistakes twice and of course, reward them for achievement.
Having ensured people are equipped with the skills and expertise to justify empowerment, encourage risk taking. Calculated risks based on insight, not gambling. When the risks don't pay off, turn it into a learning opportunity. People who don't learn, don't fit in. Accountability is as essential as recognition and reward for success.
Finally, you need to walk your talk. After watching my self constantly, I make sure that I also practice what I preach. But it is by leading through example and empowering people and encouraging people to take risks that you move forward. We think that we represent the future of luxury consumption. Our product means being progressive, sophisticated, and sporty, a car for the discerning individual.
As President, what do you see as being most essential to your business?
Product is at the very core of our business. I enjoy being actively involved in product planning, and we discuss the minutest detail of future product planning, every specification item, engines, transmissions, standard and optional equipment, even the wheels and tire selections. Product defines us. It is the most tangible expression of what the company stands for. It deserves this intense scrutiny. It must be perfect.
How have you adapted Audi to appeal to American consumers?
With American consumers, I think the understated approach held back the development of the brand by impeding the recognition that you need to be a leading brand. America likes companies to be visible. The brands that they associate themselves with have to be viewed as successful. So realizing that, we fine-tune our communication messaging to be more assertive. One might even use the word provocative. If you want to get the attention of the American consumer, whether it’s for washing powder or other automobiles, you’ve got to punch him on the nose. And we’ve gone with that strategy. We have assumed the role of a challenger. We are – as I said earlier – not about being ostentatious. And we have invested heavily on the dealer network, so they can deliver this message.
What is the key to a successful dealership network?
Consistent dealer standards. The dealership is the point at which the customer physically engages the Brand. The dealer facilities, showroom, workshop, employees, tangibly represent the Brand. They must do so in a manner which supports the positioning of the Brand. I'm pretty serious about quality of representation, attitudes and skills of dealer staff. I used to engage in mystery shopping on week ends when I first arrived here I Learned a lot. Some frightening stuff too, unfortunately. It helped me to prioritize which levers to pull with the turnaround strategy. Nowadays too many dealers know me, so we have to utilize professional mystery shoppers.
So many cars seem similar, what differentiates Audi?
Audi differentiates itself from the competition in terms of its engineering and technology. For instance, the Audi A8 not only has a 372 horsepower engine that provides exhilarating driving characteristics, but it also has an aluminum space frame that lowers vehicle weight considerably versus a steel chassis. The lower weight helps provide excellent fuel economy while maintaining performance. In fact, the A8 achieves gas mileage ratings that are equal or better than hybrid models offered by our competitors within the segment and it delivers excellent performance. No compromises need to be made and our lightweight technologies offer solutions we are very proud of.
As the world becomes more and more focused on considering the environment, looking at reducing fuel consumption and lowering emissions will require changes to existing technologies and the development of new ones. Lightweight technology is one solution of many that we are continuing to develop such as building on our success with direct injection diesels, electric mobility and several others. We are very pleased to have such great thinking and innovative solutions represented in our products and to make these available to our customers.
What would your message be to the many CEOs who buy Audis?
We know that CEOs and our customer base in general are dynamic individuals who have achieved great success in their lives. They’re all, by definition, affluent individuals who seek the automobile and their brand of choice as a reward for their own success, rather than as a symbol to loudly proclaim to the world and society what they have achieved. And it is a growing circle of people who feel incredibly confident about who they are and the brands that they associate themselves with.
Robert Reiss is Host of The CEO Show, which features leaders who have reinvented industry through exceptional customer experience models. The show is nationally syndicated by Business TalkRadio Network. Click to hear podcasts of this and other CEO Interviews at www.ceoshow.com
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b0691fe9321dfd66fb73d8e42d494972
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https://www.forbes.com/sites/robertreiss/2011/10/04/how-ceos-view-the-digital-transformation/
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How CEOs View the Digital Transformation
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How CEOs View the Digital Transformation
Every day we experience how digital has transformed our world personally … I wondered, how has it really impacted corporations? To gain perspective, on September 20, 2011, I moderated a 1-hour discussion between 4 corporate thought leaders. The insights were riveting; for all of us, there are significant opportunities as well as threats. Digital is not going away, and enterprises that are not agile and willing to change will be left behind. While there is a lot of white noise in the digital environment, clearly the two most important areas successful enterprises of the future must focus on are operational models and customer offerings.
The participants were: Andrew Robertson, Global CEO, BBDO and Chairman of the Ad Council; Joseph Taylor, CEO, Panasonic Corporation of North America; Nancy McKinstry, CEO & Chairman, Wolters Kluwer; Saul Berman, Global Strategy Consulting Leader, IBM. The topics we discussed were: 1. digital today; 2. organization changes; 3. measurements; 4. financial performance; 5. operations; 6. customers; 7. future. Below are their verbatim comments.
1. Where is digital today?
Andrew Robertson, BBDO: “We don’t really see digital as a technology, or a platform, or a medium. We think of it as a language, something you use to express ideas and create magical experiences that people choose to participate in and, as a consequence, change their behavior. But it is anew language for us to work in. It has a different grammar, a different syntax. Learning a new language is very difficult. The first level you get to is understanding: “ I understand you but can’t yet speak". The second level is speaking: " I understand you and can speak to you". But you really know that you have mastered a language when you wake up one morning and realize that you had a dream in Spanish. Our goal is to get all of our people dreaming in digital.”
Joe Taylor, Panasonic: “This whole world of engineering and R&D itself is going through a transformation from very specific one plus one equals two to more creative type engineers and R&D people. We’re seeing a merger of the world of creativity in engineering and I think some of the most exciting products that have come out have been a result of that.”
Nancy McKinstry, Wolters Kluwer: “Our world was very editorially driven where we created content in almost a bespoke way. And now if you look today in the digital world, what you see is that there has been this merger between editorial folks and technology people and that team effort is now required to actually create a product. So almost all of our products today are created through a combination of editors, technology people and marketing people and that’s had a fundamental change in both the kinds of people that we have to recruit but also in terms of the product cycles. What you see in our sector is the need to continuously reinvest in the business so we reinvest eight to 10% of our revenues in product development.”
Saul Berman, IBM: “We’ve moved from digital products and infrastructure to digital distribution and Web strategy to now into more holistic transformations that clearly are based on mobile, social media, digitization and the power of analytics and we think it’s really a new era requiring new strategies.”
2. How has your organization changed?
Nancy McKinstry, Wolters Kluwer: “When I started as the CEO in 2004, about 70% of our business was still print. We served doctors, lawyers, other professionals with information. Today only about 30% of our business or less is print, 70% is online software and services. More and more what we are producing for our customers are intelligent workflow tools that are really designed to embed information in the broader process.”
Joe Taylor, Panasonic: “Historically people have viewed Panasonic as a consumer electronics company and globally about 50% of our revenue was consumer electronics. But over the last four or five years we’ve seen this trend reducing our emphasis on consumer probably in the U.S. which means most of our business here is coming from B-to-B, or what we call enterprise. And this has changed our view from hardware to software and to content.”
3. How do you measure digital results?
Andrew Robertson, BBDO: “We have built a model that means we now know that 90 positive tweets sells one more frozen meal. That’s the level of specificity that we can create nowadays.”
4. How does digital impact financial performance?
Joe Taylor, Panasonic: “It certainly improves your profitability but that entire savings has gone back into R&D to try and stay on the front edge of creating technology.”
Nancy McKinstry, Wolters Kluwer: “What we typically see is with each technology innovation, our customers added-on to the products they already buy and then over time they migrate to a set of different products. A great example of that is when we first introduced online products, customers would add it to their print product and then drop print over time. It’s more evolution than revolution in our sector.”
Saul Berman, IBM: ”In the media space where I work we talk a lot about moving, as NBC’s former CEO Jeff Zucker said, from analog dollars to digital pennies. The idea that we get to people online but they don’t expect to pay as much as they’ve paid historically.”
Nancy McKinstry, Wolters Kluwer: “Our customers who are professionals have always had to pay for information and value information. And so when the world went digital, what we found is, that we developed more sophisticated tools, not just pure information but tools the customers can use every day to diagnose patients or to complete tax returns. As customers used these tools, the retention rates went up and in fact our profitability went up. So in our world, the digital transformation has increased the value that we can demonstrate to our customers.”
5. How has it changed your operations?
Andrew Robertson, BBDO: ”It’s more important to be able to learn fast than to be first . A lot of people get hurt trying to be first. The leverage is all going to be in the quality of the content because the delta between great content and that which is just good is measured, not in percentages, but in factors of 10.”
Saul Berman, IBM: “We need to do both the operating side and the business value in terms of digitization and that creates both threats and opportunities.”
Joe Taylor, Panasonic: “If you just look at hardware itself, there was a time when categories of products were redesigned every three years. That was the product cycle. Now in the digital age the product life cycle is three to six months; so in the old days - the analog days - lead times for parts and pieces, they could be three to six months. Now it’s eight to 12 hours so the entire world of manufacturing has been transformed profoundly. Then the whole supply chain followed suit and -- Darwin’s theory of survivors in a sense -- those that couldn’t keep up with this massive transformation no longer exist in the business world today … but in the end it’s made us incredibly more efficient. It’s offered an infinite number of variations of products and technologies every day - every day new electronic devices are introduced - but it has created tremendous pressure on companies that still manufacture products.”
6. How does this impact your customer model?
Nancy McKinstry, Wolters Kluwer: “The body of medical literature doubles every 10 years so if you talk to your average physician they can’t possibly keep up so what we’re finding is that in this new digital world, the value of brands is increasing and the value of filtering and getting customers to the right information is actually more important now than just giving them access.”
Andrew Robertson, BBDO: “We have to be where consumers are and make sure that we can create work - create experiences - that change the way those consumers behave.”
Joe Taylor, Panasonic: “There’s a company called AEG, Anschutz Entertainment Group. They’re the world’s largest owner of sports and enterprise venues. One of these it was the Staples Center. They called us in three years ago to give them a review of their security requirements. Rather than view it as a security opportunity we looked at it.
We understand their competitive pressures and we gave them a proposal that Panasonic would provide all of their technologies … so from the scoreboards in the Staples Center to the LED ribbons to the broadcast cameras, the broadcast studios, the security systems, the cash registers, even the televisions in the suites, all of that technology would be provided, installed, serviced and connected by one entity.”
Andrew Robertson, BBDO: “Our belief is that observing behavior is both the richest source of insight and the only legitimate currency with which to define objectives and inform strategies. It is becoming easier to track the behavior of consumers. Without knowing their names or addresses we identify patterns of behavior that we can model in order to both predict the outcome of, and then optimize, future activity.”
Nancy McKinstry, Wolters Kluwer: “Within the medical space we have a product that doctors use after they do a surgical procedure to document what they’ve done, it attaches to images from the surgical procedure and the hospitals use that in order to get reimbursed. Well, one of the things we discovered when we built this software is that typical physician that does say a GI procedure - a colonoscopy - he or she will do that exact same procedure more or less the same every day. Now his way of doing it might be different than his colleagues but he’s going to do it the same way and so what we find is over time as our physicians use our products, the usage time that it takes to complete an activity goes down dramatically as they begin to just have to check the exceptions of how they did a procedure versus start from scratch and document the whole thing.”
Andrew Robertson, BBDO: “When you can measure better you can model better, and when you can model better you can optimize better - both the content and the delivery of our experiences and messaging. It is just fantastic and it’s transforming the effectiveness of what we do. You’re talking about double-digit percentage efficacy improvements from the kind of optimization we are doing today.”
7. How will the digital impact our future?
Andrew Robertson, BBDO: “My hope is that at some point in the future, we will get to the point where we, in our business, are paid neither for the time that we buy for our clients, nor for the time that we spend doing the work, but instead for the impact that our work has. It would mean that our interests were totally and utterly aligned with those of our clients.”
Joe Taylor, Panasonic: “There’s good news and bad news about the digital transformation. From my viewpoint the bad news is while we were the world’s most premier manufacturer, because of digitization many people can now manufacture to the same quality. Hardware is not a moneymaking endeavor any longer so we have to find other revenue streams and those revenue streams come from perhaps combining a number of products to provide a solution.”
Nancy McKinstry, Wolters Kluwer: “It’s really going global in my sector. In the sense that what you see in our vertical markets like health and financial services is that there are global standards that are emerging around the world for how you care for patients, how you deal with risk management if you’re a bank. And as a result of that, the products that we produce can be built one time based on one set of rules and then marketed across the globe.
Second thing that I would say is that our products are becoming smart applications and smart tools so our value proposition is changing from we’re experts in a certain field of law or tax and accounting to a value proposition based on we can provide you insight and we can provide you tools that make you better at your profession.”
Joe Taylor, Panasonic: “One of the interesting things I think from a technology viewpoint historically technology was always created to solve some specific problem if you go back through the industrial revolution. I think technology today has far exceeded even our capability to understand all the ways that we can use it and how we can solve problems that we don’t even know exist today.”
Saul Berman, IBM: “The question becomes how do you get your money, how do you monetize, how do you realize the value in this new environment and how do you both holistically engage around both your operations and your customer value proposition.”
Robert Reiss is host of The CEO Show which has over 600,000 listeners a week. To hear podcasts go to www.ceoshow.com
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be96dc06db69cc77da8d69c31737625e
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https://www.forbes.com/sites/robertreiss/2011/12/02/how-top-ceos-connect-with-global-customers/
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How top CEOs Connect with Global Customers
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How top CEOs Connect with Global Customers
Peter Drucker famously said, “The purpose of business is to create and keep a customer.” The question of course is, what happens behind the scenes to create a company that customers love. To gain insight on areas like measurement, social media and connection, on November 10, 2011 I facilitated a 1 hour discussion with the leaders of some of the most customer centric companies, including: Adam Goldstein, CEO, Royal Caribbean International; Steve Ridgway, CEO Virgin Atlantic Airways; Rick Davidson, CEO, Century 21 Real Estate, and Raj Mirchandani Global Leader, Interactive Solutions Services, IBM. Below are verbatim quotes, including original ideas like playing table tennis with customers, on how leaders connect with customers.
What is your primary customer metric?
Steve Ridgway, Virgin Atlantic: “Staff advocacy. How happy our staff are and what they think about where they work because if that’s right, then almost certainly, everything that we do with the customers is right.”
Rick Davidson, Century 21: “Our customer metric is what we call our QSS, which is our Quality Satisfaction Survey. The customer’s perception of our service is critical for our sales professionals and for our company as a whole. We reward quality service thru a robust recognition program for our local market companies and our agents.”
Adam Goldstein, Royal Caribbean: “Our primary customer metric is called the secured guest index. And it’s a top one out of five box on enjoyed the experience; we’ll tell other people about it; we’ll do it again. So we are looking at the percentage of people who are in the top one of each of those three.”
As CEO, how do you connect with customers?
Adam Goldstein, Royal Caribbean: “A small example of something that people would not expect from me or from the CEO is that I'm able to take advantage of my passion for table tennis. I'll spend a couple of hours playing anybody who wants to play me one after another. And it's just amazing, the response of the people. They want to try -- sometimes they're great, sometimes they're terrible. But they just want to play the CEO in table tennis.”
Rick Davidson, Century 21: “Everything that I do as a CEO of this organization is to drive CENTURY 21’s perception and growth in the local market. I spend a lot of time with our brokers and agents, in fact, I've probably spent not more than a hundred days in my office in the last 21 months because I am focused on our local market performance and the way our customers perceive our company and services.”
Steve Ridgway, Virgin Atlantic: “If you go around the company what I'm known for is always challenging the conventions, always wanting to do things differently, always trying to find new ways to innovate. My role is to make sure that, that group in the company who look after our customers remain ascendant.”
How do you view today’s customer?
Raj Mirchandani, IBM: “We look at the gen X and gen Y interactions; the under 40 is compared to the over 40. They have very different behaviors, engagement, use of channels and expectations. In the last six months what we have seen just across industry a new mantra beginning with mobile. They call it Mobile First. Analytics have also improved the level of insight and personalization that can be incorporated into interactions and customers are demanding their interactions are personalized. So we have moved from a live agent person-based interaction model to a digital, more multi-channel interaction model.
Steve Ridgway, Virgin Atlantic: “Customers want to be very much in-charge of their own destiny. So you have to actually present in a very careful way. They know perfectly well that in the case of Virgin Atlantic, we of course are trying to get them on our airplanes. So therefore, finding points of differentiation and gaining little chunks of competitive advantage are very important. Customers can be delighted when you do spring new things on them.”
How do you measure results?
Adam Goldstein, Royal Caribbean: “The iron discipline of immediate customer feedback. We get approximately a 50% response rate on the customer satisfaction survey that we hand out at the end of the cruise. The division heads and the hotel director and the captain if necessary are seeing exactly what the feedback of the customers were in detail by area for the vacation that ended in the morning and now they have to get ready for the vacation that’s starting for a new group of 6,000 people that afternoon. And that discipline has been in place for 40 plus years and it really informs the commitment to excellence that sustains the product day in and day out.”
Rick Davidson, Century 21: “I have a mantra and that is that our organization’s reputation and position within the industry and with the consumer base is really earned and measured on three very simple things. It’s the professionals we associated, our agents who serve our customers on a day-to-day basis and interact with other professionals within the industry. Secondly, it’s the companies that we affiliate. It’s our local market operator. It’s how they’re viewed within the business community. Do they give back to the communities in which they live and work. And then finally, it is the transactions that we complete as an organization.”
How do you reach out to the greater community?
Rick Davidson, Century 21: “We are highly involved in charitable giving. Easter Seals, our philanthropic partner, provides disability services for children and adults throughout the United States. I’m proud to report that over the course of our 32-year relationship, we have raised and donated over $102 million for this truly deserving charity.”
How do your view social media?
Adam Goldstein, Royal Caribbean: “The social media age, we really feel was somehow created for our benefit. And what social media has demonstrated is that people are more interested in pure opinion than anything. We really try not to come into the dialog directly. So I think at my level it's looking for patterns that suggest issues that I'm quite keen on. We ended up in a global controversy for our decision to keep the ships going to Haiti after the earthquake two years ago, what we found was that social media in general, and my blog in particular was where we were able to speak with the voice on the issue, that was unconstrained by the formalities of press releases.”
Steve Ridgway, Virgin Atlantic: “There is this very interesting space where you need to let your customers and your fans or people who are engaging with you, very much have their own turf and feel that it is their own. And certainly you can't pollute it.”
Raj Mirchandani, IBM: “Social media is a very powerful opportunity to engage your own practitioners and your own team. Bringing the teams together to be focused on new product development, innovation, time to market, it's really a powerful opportunity to drive collaboration.”
Rick Davidson, Century 21: “Social media is a way of life today. If you think you can be in business today and not have a pretty definitive strategy about how to be involved and utilize social media in your business in a day-to-day basis, you’re kidding yourself.”
Talk about your industry specifically?
Rick Davidson, Century 21: “It’s one of very few industries where every day you sit across the table from potentially your fiercest competitor in the market in order to serve the needs of customers because oftentimes you don’t have both sides of the transaction, someone is representing the buyer and someone is representing the sellers.”
Steve Ridgway, Virgin Atlantic: “Virgin is pretty legendary for the David and Goliath battle it's always had with British Airways. And we were really the first airline, about 25 years ago, that was totally driven by its product proposition, its service proposition and customers… because airlines traditionally have been all about network and technical operations. Richard didn't know or understand the technical side of airlines, but he absolutely understood that customers are getting pretty awful service and that we should do something about it.”
Talk about your global focus.
Steve Ridgway, Virgin Atlantic: “Aviation is a very mobile business and that's very interesting for us, both in terms of protecting the business during sort of transition that is going in the old world, as you might call it, and then this emerging raft of consumers in Asia and other parts of the world.”
Rick Davidson, Century 21: “We are highly focused on our global position. With 5,000 offices outside the US, our international business is a core component of our growth strategy. We are actively discussing current business dynamics; the trajectory of our global business in the future, and how we continue to leverage our unique position.”
Adam Goldstein, Royal Caribbean: “Our business is in the full bloom of transition from an industry that was principally for middle and upper middle class Americans to take 7-night cruises in the Caribbean to an industry where everybody is cruising from everywhere and traveling to cruise everywhere. One of our fixed brands called (Croisières de France), is essentially a little piece of France floating around the Mediterranean, where everything is in French language, served by French people, French cuisine, French entertainment, French everything. There are a lot of French people who prefer that environment. There are some French people who would like to be in the Royal Caribbean International global environment.”
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9c00993596a0ab8d9f77724d74dc2cf1
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https://www.forbes.com/sites/robertreiss/2012/03/05/driving-a-global-corporate-culture-of-1-4-million-employees/
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Driving a Global Corporate Culture of 1.4 Million Employees
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Driving a Global Corporate Culture of 1.4 Million Employees
David Novak with Robert Reiss
Not everyone knows the name Yum! Brands, but everyone knows their three iconic brands: KFC, Taco Bell and Pizza Hut. Yum! Brands, located in Louisville, Kentucky, does business in 117 countries with more than 70% of profits coming from outside the United States, including nearly 4,500 of its more than 37,000 restaurants located in China alone. After reading Chairman and CEO David Novak’s new book, “TAKING PEOPLE WITH YOU: The Only Way to Make Big Things Happen”, I was intrigued and wanted to find the inside story about this inspirational leader.
To what do you attribute Yum’s at least 13% earnings per share growth every year for the past decade?
We've focused primarily on getting results through people. We've said from the beginning that our formula for success is build people capability first, then we will satisfy more customers and make more money. In fact, when we first started our company, the single highest priority I had was to create a global culture where we can galvanize around the behaviors that we know will drive results in our industry.
How do you create a focused global culture with 1.4 million employees?
The behaviors in our work environment are the same for all our brands. People want to work in an environment where they know that they can truly add value. It means that you've got to be focused on the customer. We call it "Customer Mania". In addition, we have built Yum!’s global culture around the importance of recognition to drive performance. All of our leaders around the world are expected to have their own individual recognition awards. We make recognition fun giving away awards like rubber chickens, cheese heads and giant taco sauce packets. My award is an oversized set of walking teeth for employees and franchisees who “Walk the Talk” of leadership. Then we focus on going for breakthrough, take the hill teamwork and building know-how and learning from other people.
How did you develop your corporate culture framework?
I always had many ideas on what kind of team and company I’d build if I ever had the chance to do it. At a crossroad in my career, I met a man by the name of Larry Senn from Senn Delaney. He is one of the most renowned corporate culture experts in the world. He taught the mood elevator, accountability ladder, and to understand the shadow of leadership one casts every day. We worked to cascade these insights to build the culture we have today globally. My personal belief is it's hard to make customers feel good unless employees feel good. So, if you have an environment where your team members are feeling good and they're working well together, they're going to have a lot easier time making customers feel good.
What prompted you to write “Taking People with You”?
One of the things I've enjoyed over the last 15 years is personally teaching a program called "Taking People With You". My primary responsibility is to develop leaders because I believe, "Show me a great leader and I'll show you a great business." I have our leaders come to this program and I ask them to bring the single biggest thing they're working on that will have the biggest impact on our business. I ask them, "How many of you can get it done by yourself?" The answer is, "No one can. We all have to take people with us." I share with them everything I know about taking people with you to get results starting with the mindset that you should have, how you develop a plan, and then how you follow through to get results. That’s why I wrote the book, so I could share the insights with everyone. I also have a personal stretch goal of ending world hunger. All of my proceeds from “Taking People with You” will go to the United Nations World Food Programme in conjunction with Yum! Brands global hunger relief efforts.
Where do you go personally to learn?
I like learning directly from other top CEOs. For example, I visit with Warren Buffett every year as well as many other top CEOs who share insights with me about business models and personal leadership philosophy.
How do CEOs become smarter about innovation?
I think the biggest thing you need to do is to make sure that you're externally focused, not internally focused. It’s important to really look outside for all sources of inspiration that you can find. I call this "pattern thinking" and say, "Hey, if they're doing this over in this industry, how could we apply that same kind of thinking to our industry?" When you do that, you can pick up all kinds of ideas.
Cool Ranch Doritos is a great example of product innovation.
I think a lot of times, you can get a lot of great ideas if you get outside of your own area of so-called expertise and look for other areas of inspiration. So, one of the things I did with my team when I was head of the Frito-Lay account at my ad agency was take them to the grocery. However, we didn’t go to the snack chips section. We went to the salad dressing section and studied the popular flavors at the time. We realized that the single hottest flavor at the time was ranch dressing, a mainstay today. And so we said, "What if we brought ranch flavor to Doritos?" We went to Frito-Lay and recommended they develop a ranch flavor Doritos. Then we went back and looked at nacho cheese Doritos and said, "Hey, they brought a unique image to a known quantity with the nacho and the cheese." I thought, "Okay. How do we describe our ranch Doritos? Let's call them Cool Ranch Doritos."
Talk about how you addressed the challenge of Taco Bell where people had perceived it as messy.
I think one of the things you have to do is get inside the minds of your customers and understand what the issues are. I always believe in answering the question, "What perceptions, habits or beliefs do you have to change, build or reinforce to grow your business?"
For Taco Bell, we started thinking about how we could bring forth portable foods. So we introduced quesadillas at Taco Bell, the hottest new handheld because you could eat it very easily. We introduced a big burrito and called it the Grilled Stuft Burrito, the heavy duty portable. Then we introduced the product of the year which is the Crunchwrap. These products were geared around portability and that innovation carried Taco Bell's success for about two to three years.
What has helped Yum be so successful in China?
We found in China and other international markets, success starts with a great local team that understands the customer base and understands how to do business in that particular country. We've been blessed in China to have a tremendous leader, Sam Su, and his leadership team. They've been together for over 15 years and they’ve built the business from scratch. In addition, we have category-leading brands, a highly educated workforce, best-in class operations and logistics capability, a huge real estate and development team and our own distribution system in China. We have become the leading retail developer there, opening a record 656 new restaurants in the country in 2011. We've taken Western brands like KFC and Pizza Hut and offer Original Recipe chicken and Pan Pizza but also made it relevant for the Chinese consumer by extending our menus with innovative products to fit local taste preferences. KFC was actually the first quick-service restaurant chain to enter China in 1987 and today is the leading QSR with more than 3,700 restaurants in over 700 cities. Pizza Hut is also the leading casual dining brand in China with more than 620 restaurants.
And you have hearing impaired restaurants in India?
A company should do good for the world. In India, we have this great group of passionate Indian leaders who said, "We want to help, especially hearing-impaired people." We have 12 restaurants now that are run by the hearing-impaired in major cities in India. Our customers in India really appreciate the restaurants. Employees want to be in a growth company and in a company that knows there's more to life than just making money. We want to be a company with a huge heart.
Any advice to franchisees?
Franchisees are leaders just like everybody else. You need to own your team. You need to own the spirit. If you've got a restaurant that you walk into and see positive energy, you have to pat yourself on the back. One of the reasons why you've got that is because you’ve set the right tone. If you walk in and you have lethargy and your team members aren't hustling and there is apathy, look in the mirror first before you start criticizing somebody else.
Robert Reiss is Host of the nationally syndicated radio show, The CEO Show. To listen to this and other interviews, go to www.ceoshow.com
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b14a0a54ce43aa3fbc5b2dc9ebecb0fc
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https://www.forbes.com/sites/robertreiss/2012/04/02/how-top-ceos-succeed-at-business-model-innovation/
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How Top CEOs Succeed at Business Model Innovation
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How Top CEOs Succeed at Business Model Innovation
Innovation may well be the defining characteristic of successful companies. Jim Collins in Built to Last cited 3M as the most likely enterprise to be around longer than others because its core was, in fact, innovation. In today’s ever evolving digital, connected and real time economy where industries blur, the price of lost opportunities in innovation can be devastating. To gain insight, I recently held a live roundtable with leaders from four companies who have proven significant success in business model innovation.
The participants were Neil Smit, CEO & President of Comcast Cable Communications, a $37 billion company with 85,000 employees the largest provider of residential internet and developer of cloud TV; Thomas J. Quinlan III, CEO & President of RR Donnelley who broadened a company of 58,000 employees’ focus on print to encompass content creation, management and distribution; Chip McClure, Chairman, CEO & President of Meritor, who led the transformation of a hundred year old Fortune 500 company to leave their legacy business and engage their employees as shareholders; Dr. Saul Berman, Global Leader, Strategy and Transformation Consulting at IBM, the company who built the blueprint for an interconnected world where we become a Smarter Planet. Here are some of the insights shared:
Talk about a recent business model innovation
Neil Smit, Comcast Cable: “We've changed the way we go about delivering video. We put a lot of our billing information and digital rights management information up in the cloud so we can change the way the guide looks or things appear on television screens real time. Now we can change it in a week or two versus what used to take about a year-and-a-half. And we're able to put new apps up there so it's a two-way conversation. For example when I leave for work I look at the weather and traffic on an app on the TV screen. This process enables us to speed up the pace of innovation, deliver more of what customers want in a more personalized manner and a seamless and fluid experience for the customer.”
Tom Quinlan, R.R. Donnelley: “We saw that our customers wanted to be able to use their data in order to create and share more personalized messages with their customers. We didn't see commercially available digital printing press units that would enable them to achieve all they want. So our R&D team and IT teams worked with every facet of the organization. The result is a press called ProteusJet, which is RR Donnelley's own high-speed digital printing press. We put that to work in a variety of segments from direct response to trans promo to producing books on demand.”
Chip McClure, Meritor: Chip McClure, Meritor: “Five years ago, we realized we couldn’t be all things to all people so we put a strategy together to transform our company – which has a 100-year-plus heritage – from a business involved in a variety of products and services in the automotive and commercial vehicle space to one focused solely in the commercial vehicle arena. In the end, this resulted in us divesting almost two-thirds of the company. In the middle of the transformation, we, like every other company in the world, had to take the appropriate actions to weather the great recession. I’m pleased to say that we accomplished both without missing a beat…a real credit to our team.”
How do you build innovation into your culture?
Chip McClure, Meritor: “It starts with communication, communication, communication. Personally, I walk around our plants and engineering centers a lot, and I always advise our teams to diversify because it is fundamental to strengthening a culture of innovation. Also important is to communicate our strategy internally and externally so everyone understands what’s happening. During the depths of the crisis may have been the first time our people really understood the importance of free cash flow because they were seeing what was happening at other companies. Also, every employee in the company, including myself, has an element of variable compensation – so everyone understands EBITDA and cash flow metrics. I am proud to say that today close to 9% of the company is owned by our employees.
Tom Quinlan, R.R. Donnelley: “With 58,000 employees in nearly 40 countries and 14 different time zones, it’s important to signal that innovation is important. We recently had a ribbon-cutting at our new R&D facility that brought our imaging scientists and other innovators together under a single roof. That sent a signal to everyone associated with RR Donnelley that new ideas are valued and that we want to be able to accelerate the process of monetizing them. We set up our Custom Point Solutions organization within RR Donnelley. They look at technologies and innovation company-wide to help accelerate good new ideas and get them to market faster.”
Saul Berman, IBM: “To align our organization around innovation, we hold “jams” where we invite all our employees and their families, and our business partners and suppliers , to participate in conversations on our innovation efforts.”
Neil Smit, Comcast Cable: “It begins with our founder Ralph Roberts who just turned 92 and still comes into the office. We finished the NBC deal and he said, "Okay what's next?" We like to win; we tend to move fast, there's a real sense of teamwork. We put out more new products last year than we did the previous two years combined and the field organization really begins to like that. It's very much a part of the culture here to be entrepreneurial and to try new things all the time, and it's a great environment to be part of.”
What is the role of the cloud in business model innovation?
Saul Berman, IBM: “We started looking at the drivers of innovation that are enabled by cloud’s potential and identified six major factors: First, cost flexibility is a major driver -- the ability to shift your costs and make more of them variable and ‘pay-as-you-go’. Another key cloud attribute is scalability. For example on the media side, how do you scale up quickly enough to be responsive to that peak demand? When you start a new concept and don't know whether it's going to take off a cloud solution, particularly if it is shared, offers you the ability to do that. Next is market adaptability -- you can get there faster by experimenting without major investments in fixed infrastructure. Cloud’s capabilities also help to mask complexity. Today a lot of focus is on making it simple -- to integrate the content, the hardware and the software and mask any complexity from the end user. A cloud environment also enables you to tailor it to the end user, which is what we call context-driver variability. And finally, cloud computing also offers ecosystem connectivity, which is the ability to team with new people, bringing them into your system quickly to innovate with them.”
Tom Quinlan, R.R. Donnelley: “Cloud computing is offering new ways to think about your IT infrastructure. Data mining is probably one of the biggest changes for us over the years. Big data is a term that describes what is being created from tracking consumers' mobile and other online activity. Organizations are collecting enormous amounts of data and they will want to use this data to communicate with the customers to frame what they're going to offer to them and to speak to them in a way that is even more relevant. Big data is going to create demand for even more relevant communications delivered through multiple channels. For example, every financial services company wants to increase its wallet share with its clients but about 70% of the cross selling occurs as accounts are opened, so financial institutions to a large extent are locking in their relationships the first time the consumer sets up an account. That is a pivotal moment for highly personalized print, web and mobile communications.”
Neil Smit, Comcast Cable: “We’ll be offering more personalized services. We used to think about the customer as a household. But now we’re transitioning to the point where it’s the individual. So you could imagine within a house you’d have four different preferences for what television programs you watch. And we could serve up that programming to whoever the individual is via the Cloud. We’re also working on what we call TV everywhere. This means you can experience your television experience wherever you are whether it’s mobile, your iPad both home and away. We just launched a home security product where the front door opens, a camera might go on, and that camera you might want that alert sent to your iPhone. That camera picture also shows up on your iPhone. So we’re leveraging both our wire networks as well as the home network solution to provide new products, more personalization, and television everywhere.”
Chip McClure, Meritor: “Meritor Mobile, an Apple iPad application we launched last year, has been a tremendous help to our North American sales team and customers. Rather than traveling to customer or prospect locations with piles of hard-copy technical information, all of this content is now managed centrally and updated via the iPad application. There is also a public version available for customers to access relevant materials.
Meritor also uses SaaS (Software as a Service) applications – such as Concur for travel and expense reporting, and we are evaluating a number of additional cloud-based alternatives in the infrastructure and application space in conjunction with technology refresh cycles. Some of the commercially available options in the public cloud area, however, are not good fits for Meritor due to ITAR (International Traffic in Arms Regulations) compliance requirements we follow in conjunction with our military business.”
What’s your role as CEO?
Tom Quinlan, R.R. Donnelley: “To me you also have to be a good listener and be open to hearing new ideas, even if those ideas might be in conflict with some of what you’re trying to accomplish today. The pace of change is just accelerating. So you have to recognize that you need to move more quickly to identify, develop, and monetize new concepts. You have to challenge your employers and vendors to think about new ways of doing things. You have to really listen to what customers want to accomplish and create an environment where the people in your organization can solve those problems for your customers.”
Neil Smit, Comcast Cable: “I view my role as pushing the pace of innovation, making sure the strategy is set out far enough so that we can execute effectively and keeping the organization focused on the priorities. It’s essential for me to be in touch with the customer and competitive trends so I’m able to start a clear strategy and motivate people to rise to the challenge. We work now in smaller teams. We’ve restructured engineering teams. And I think it’s important to continuously align the organization so everyone’s moving in the same direction.”
Chip McClure, Meritor: ”I help the set the vision and company direction with our board and senior leadership team, provide resources and direction to our people, and as I mentioned, communicate, communicate, communicate. It’s important to share our successes. And then sometimes, quite frankly, I’ve got to get out of the way and let them get their job done. In the end, the responsibility of the CEO is to make sure you provide the kind of culture where diversity of thought fosters successful innovation within the company so people feel good about being part of the company and about contributing to the success of the company.”
In summary, back in 1899 the U.S. patent chief declared that all new innovations had already been invented. A century later, clearly the opposite is true. While the business economy is hard to predict, one certainty is – the most successful companies of the next decade will be those who master business model innovation.
Robert Reiss is host of The CEO Show. To listen to interviews go to www.ceoshow.com
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67ae6173b445d6c926c733fc39ec0bda
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https://www.forbes.com/sites/robertreiss/2012/07/14/what-ceos-can-learn-from-r-a-dickey/
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What CEOs Can Learn From R.A. Dickey
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What CEOs Can Learn From R.A. Dickey
R. A. Dickey (Photo credit: Wikipedia)
By Robert Reiss with insights from Jim McCann, founder and CEO of 1 800 flowers.com
During the past five years I’ve probably watched 500 Mets games, and have interviewed about 250 CEOs, and these two have unexpectedly merged … through R.A. Dickey! As most know, Dickey is a 37 year old Mets pitcher who reinvented himself at 32 years old to become the only active knuckleball pitcher in the major leagues; and with a 12-1 record, he is arguably the best pitcher in baseball right now. But Dickey’s greatest contribution is perhaps not to baseball, but to the CEOs who lead enterprise. So, in this article, I outline the 3 key lessons I believe CEOs can learn from Dickey, and then I discuss R.A. Dickey with Jim McCann. Jim is founder and CEO of 1 800 flowers.com, and is such a Mets fan that he recently invested to become a part owner of the Mets.
First, here’s some background on R.A. Dickey. He was born without an ulnar collateral ligament of elbow joint and still became a 1st round draft pick in major league baseball. But his first years were non- remarkable and at 32 he reinvented himself by learning the knuckleball. (The knuckleball is a rarely used pitch that is more like a shot-put than a pitch because the ball generally rotates less than 2 times throughout its 60 feet six inch journey from pitcher’s mound to home plate.) In Dickey’s first start pitching the knuckleball he gave up a record 6 homeruns in just 3 ½ innings. He ultimately changed the way the knuckleball is pitched using slightly higher velocity.
Throughout his career, Dickey has overcome remarkable challenges and has continued to move forward because of an even more remarkable fortitude and strength of character. And now at 37 years old, he just participated in his first All Star game. As baseball is a numbers game, consider that Matt Cain who started the All Star game for the National League has a 2.62 ERA, 118 strikeouts, a WHIP (walks + hits per inning) of .096 and had 9 wins and 3 losses; Dickey has better numbers in each category with a 2.40 ERA, 123 strikeouts, 0.93 WHIP and a record of 12 wins and only 1 loss. So perhaps the greatest testament to R.A. Dickey is that his pitch is so difficult to hit -- and catch -- that Dickey didn’t start the All Star game really because there was concern that the All Star catcher wouldn‘t be able to catch his pitch!
Lesson 1: Be authentic
I was reading R.A. Dickey’s book, Wherever I wind up: my quest for truth, authentic and the perfect knuckleball, and realized that his one immutable strength is being true to himself. Regardless of exceptional challenges Dickey would never capitulate on his character, love for family and authenticity. Great companies focus first on their authentic core – their culture. I remember Tony Hsieh, CEO of Zappos telling me how they had two sets of interviews and the most important was about if the person fit into the Zappos culture. A CEO that leads a company by being true to values leads a company that can weather any business storm.
Lesson 2: It’s never too late to reinvent yourself
While this seems opposed to being authentic, it’s actually very similar. Reinvention is about staying true to your values but expanding them to new applications. Dickey learned the knuckleball late in his career and then created a new type of faster knuckleball. This is so effective perhaps because of Dickey’s unique physique without a ligament. Certainly perceived weaknesses can uncover opportunity. And it is never too late to reinvent. I remember interviewing Bernie Marcus and him telling me how at 49 years old he didn’t have a job, but had one idea – The Home Depot. And Col. Sanders didn’t start Kentucky Fried Chicken until he was 65 years old. So a great lesson to CEOs is to reinvent, because the first career can be surpassed by a great second wind.
Lesson 3: Don’t impose limitations
The 3rd sentence of Dickey’s book, R.A. says, “I will never be a Hall of Famer and will never lead the league in strikeouts”. That is because it wasn’t until after the book was written that another change emerged … R.A. Dickey became the world’s first knuckleball strikeout pitcher. The knuckleball is much slower than a fastball; in fact Dickey’s fast ball is only about 82 mph, while most strikeout pitchers have focus on fast balls that are generally about 95 plus mph. And yet, at the All Star break Dickey’s 123 strikeouts were only 2nd to league leader Steve Strasburg’s 128. And even with Dickey’s new unexpected success in strikeouts, in post game interviews he doesn’t try to explain or discuss how far he can or can’t go … he just works hard and continues to see what emerges. In business, back in the late 1990s few envisioned that Apple would experience such a remarkable level of growth, reinventing at least 4 industries along the way. Clearly Steve Jobs did not impose any limitations. The message to CEOs is clear: don’t impose limitations, because the future can have more opportunity than imagined.
Robert Reiss: Jim, what lessons can CEOs learn from R.A. Dickey?
Jim McCann, CEO 1-800-flowers.com: Know yourself, adapt and have perseverance. The reason R.A. has been able to reinvent himself is that he has such a strong set of values as a foundation, and that’s what allows him to adapt. Think about it, he was born missing ligaments and he turned lemons into a lemonade stand and became a remarkable pitcher. It’s a classic example of turning adversity into opportunity, which is a hallmark of a successful CEO.
The knuckleball is unpredictable, which is why it's so effective and hard to hit. Talk about unpredictability in business.
The idea of the knuckleball was actually to expand his career. What R.A. will tell you, it’s not unpredictable for him; it’s unpredictable for the hitters. Predictability can be your friend or your enemy. He has several different knuckleballs in a variety of speed, so for him it’s very predictable. The lesson for us CEOs is, try and get yourself on the right side of predictability.
Dickey reinvented himself when many would say his career was close to over. What can we learn from this?
Business and opportunities are always changing. As circumstances change our skills often have to change. An entrepreneur may enter with one set of skills, but the skills that got you there may not be the skills to get you to next level.
Dickey has emerged from more challenges than most. You always say Jim, everyone gets knocked down, but the champions come up quicker. How have you used this in your business?
Everyone has adversity in their life. Most entrepreneurs have made more mistakes than most. They may get hit more often, but winners recover quicker. And often challenges hold the seeds for opportunity. For example, in our business as florists we saw fruit baskets as a business where we might have been losing money of potential flower sales. So we realized that beneath the challenge was actually an opportunity. We already had many of the skills, solid distribution, the right technical, and a deep expertise in design … so we took the negative and actually went into business of fruit bouquets of flower arrangements, and it’s been a great business for us that our customers love.
As a CEO of a prominent brand, why did you invest in the Mets?
It’s a blessing that we’ve succeeded in business and live near where I’ve grown up. So what a great opportunity, not as a CEO, but as a kid from Queens to be involved with the Mets. Business afforded me the opportunity. The Mets brand is aligned with my core business beliefs. The Mets are a scrappy , up from nothing, brand of people who perform. And what a wonderful opportunity for my family. Friday night we made plans for the whole family to go to the game and my grandkids, Abigail and Liam were there looking great and having fun. How can you not love the Mets!
Special thanks in the article to my son James Reiss, who has watched many of those Mets games with me and provided valuable insight to me in writing this article. To hear original interviews of Jim McCann and other CEOs, go to www.ceoshow.com
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3b4604d380d2e309fee969f810f20d9e
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https://www.forbes.com/sites/robertreiss/2012/08/01/what-ceos-can-learn-from-tim-tebow-a-conversation-with-sap-co-ceo-bill-mcdermott/
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What CEOs Can Learn From Tim Tebow: A Conversation With SAP Co-CEO Bill McDermott
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What CEOs Can Learn From Tim Tebow: A Conversation With SAP Co-CEO Bill McDermott
Tim Tebow is introduced as a New York Jet in March 2012. (Image credit: Getty Images North America... [+] via @daylife)
On practically every sports radio show I listen to, I hear announcers, callers, and even NFL Hall of Famers bash Tim Tebow and the Jets. “It will be a three-ring circus.” “It’s just a publicity stunt to sell tickets.” “There’s no way this will work on the football field.” I listen to all this as both a longtime Jets fan who has waited since the Joe Namath days of 1969 for a championship and as someone who has interviewed several hundred CEOs, and my gut tells me that not only can Tebow and the Jets succeed, but that Tebow actually offers exceptional leadership lessons that can help CEOs win in business.
As background, for those who don’t know, Timothy Richard Tebow was born in the Philippines, the son of Baptist missionaries, and was home schooled. He was allowed to play high school football because of 1996 legislation allowing home-schooled children to play high school sports. He displayed exceptional character, in one instance lasting through the second half of a game with a broken fibula and actually rushing for a 29-yard touchdown. Then in college he was the first sophomore and first home schooler to win the Heisman Trophy, and his team won national championships in 2006 and 2008. As a pro in 2011 he took over as lead quarterback for the 1 – 4 Broncos, who he quickly turned into a team that could make the secondround of the playoffs. His whole life has been characterized by his winning, toughness, and faith.
To me the Tebow bashing comes from a belief among some that different is bad. Tim Tebow has even said, “When you do things different than other people sometimes do them, and you don’t settle for just being average, you open yourself up to criticism.” But in football as in business, differences and diversity are good and actually the keys to opportunity. It’s no coincidence that the company just cited as the No. 1 diversity company in America, Kaiser Permanente, is also America’s leading health care company. And we all learned from Steve Jobs and Apple that being different is a driver of innovation and business success. It is actually a business’s greatest, well, differentiator. In fact, I recently wrote a book, The Transformative CEO, that outlines what makes certain CEOs top performers, and the key tenet is Transformative CEOs recognize that differences and challenges are often the key to uncovering their greatest business successes. So when we view Tim Tebow’s differences as strengths, we recognize at the core is his intuitive understanding of winning through hard work, which is led by his higher purpose and unwavering faith. And top CEOs don’t settle, in Tebow’s words, for being average. They win.
I was clearly intrigued and wanted deeper perspective on what CEOs could learn from Tebow, so I reached out to Bill McDermott, Co-CEO of SAP. I’ve always been highly impressed with Bill’s thought leadership and performance as a top CEO who has helped SAP grow to 60,000 employees with $20 billion revenue and 200,000 customers; and, I’ve also known Bill as an avid Jets fan who understands football deeply. In fact, back in 2010, Bill had told me something no one else had said, that the Jets were going to make a run for the Super Bowl -- and he said it publicly on my radio show, The CEO Show, to 600,000 listeners. Against all odds, Bill proved correct as the Jets came closer than any expected to a Super Bowl presence. Below are Bill’s powerful albeit somewhat counter-intuitive insights at how to win in business… and perhaps even in football.
Robert Reiss: What can CEOs learn from Tim Tebow’s personality?
Bill McDermott: Tim Tebow is authentic. He knows who he is personally and doesn’t hide his faith and belief. Also, Tebow is a non-traditional quarterback. But that unique style is actually his strength. It allows him to do things others can’t. In business, people tell you to fit in, but it’s far better to be yourself, be different and contribute whatever unique talents you have. Most CEOs and executives have a “secret sauce”that makes them successful. It’s critical to stay true to who you are. People follow authenticity… and in a transparent social media world, anyone who is not genuine will be exposed.
What is the relationship between Tebow’s faith and belief and business?
It’s all about higher purpose. Tebow is clear about his faith and purpose in life. The concept of having a higher purpose is also what makes companies great. At SAP, in addition to our mission to help every customer become a best run business, our vision is to help the world run better and improve people’s lives. The leading enterprises have purposes higher than just profit. They become brands whose purpose galvanizes employees, customers and communities. A higher purpose creates broad commitment and winning teams.
Are there any lessons that CEOs can learn from Tim Tebow from his being a non-traditional quarterback?
Absolutely. Tebow creates unpredictability. He presents a triple option where he can run, hand off, or pass, and it becomes difficult for teams to prepare against him. In business, unpredictability can also create opportunities. The CEO is the quarterback of the organization, and in football terms the CEO must see the whole field. Great leaders see around corners so they can identify and capture new opportunities that others might not see. Great CEOs are prepared and think about every possible outcome. This helps leading companies preempt the market and capture new markets with innovative products. Defensively, being unpredictable makes it hard for competitors to plan against and beat you to new markets. It keeps the competition off balance.
Does Tebow’s intense personality negatively impact others on the team, and how does that concept play out in business?
Actually, it’s the opposite. Tebow makes the whole team better. Tebow starts with himself, setting the example with intense preparation both physically and mentally. Then he inspires the team, so everyone elevates their game. He’s done exactly that in high school, college and already with one professional team. Just consider that the Jets’ starting quarterback Mark Sanchez, who deserves a lot of credit, already has put on 12 lbs. of extra muscle. Tim Tebow’s grounded and powerful character and sheer hard work and preparation help everyone else get better, which helps build a sustainable winning team. In business, great executives never let themselves get out-hustled. They set the example and inspire others to follow. This builds accountability, which is critical. To create a high performance organization, each player has to get better at his or her position. If all the people in a company really want to win, culture becomes a very powerful multiplier.
Tebow has always been a winner … how can a CEO win in business?
Tebow understands that you get no points for second best. The lesson to CEOs is the pain of sacrifice is better than the pain of regret. Top CEOs have a relentless will to succeed. It’s the soul of an organization. There is a joy in winning. CEOs should put winning in the minds of their associates and define what winning is because it becomes a self-fulfilling prophecy. In business you are your record. Do you inspire people, are your customers loyal, do partners trust you and your word, do you give back to society? For a company, culture is the foundation, and a culture focused on long-term sustainable winning is unbeatable.
While you’re a professional executive in business not football, as a longtime Jets fan how do you think Tim Tebow will impact the Jets?
Acquiring Tim Tebow says a lot about the Jets. They want to win and understand the bigger picture of building a sustainable winning organization. And with Tebow, the Jets will become a team that is unpredictable… and potentially lethal. He might get 20 snaps as quarterback, but be on the field for 30 – 45 plays. He is unorthodox, and has potential to wreak havoc either in wildcat, triple option or improvisation, especially in third-down situations. The NFL average is about one-third on third down conversions, while great teams convert close to half of the time. With Tebow, if the Jets are on the 45 yard line with short yardage, they can go for it almost every time. The Jets might even use Tebow to return kickoffs or punts. He is hard to take down because he has the body of a linebacker and the speed of a wide receiver. Potentially, Tim Tebow can help elevate the Jets to become a perennial winner.
Any final thoughts, Bill?
Sure. Mentors have a great opportunity to grow talent. And that’s why I believe the real credit goes to Tim Tebow’s parents, who gave him the greatest gifts: faith and humility.
For more CEO content, go to www.ceoshow.com
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6d322804106e4cc3ffb8961762cb44b3
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https://www.forbes.com/sites/robertreiss/2012/09/21/the-age-of-mass-intimacy-ceos-share-secrets-of-connecting-with-customers-in-a-digital-world-like-performing-personalized-songs-to-respond-to-tweets/
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The Age Of Mass Intimacy: CEOs Share Secrets Of Connecting With Customers In A Digital World
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The Age Of Mass Intimacy: CEOs Share Secrets Of Connecting With Customers In A Digital World
A decade ago, in the earlier days of digital, I remember debates that the growth of digital would lead to the decline of the human touch. Today, it has become clear that the opposite is true. As we have witnessed, the digital world unleashes new methods for organizations to connect with customers 1-on-1 in ways previously not possible.
To dig deeper, on August 31, 2012 I held a 1-hour conversation with top leaders from industries like healthcare, energy, telecommunications, the internet and technology. These included: George Halvorson CEO Kaiser Permanente the leading integrated healthcare system with 180,000 employees representing 9 million customers and 35 hospitals and cited as America’s # 1 diverse organization; Joe Rigby CEO Pepco Holdings who is responsible for energy in our nation’s capital and in fact handling issues like cyber security; Dan Jauernig CEO Classified Ventures representing leading websites like cars.com and apartments.com with almost 30 million visitors a month; Mary Dillon CEO U.S. Cellular, who as former CMO of McDonald’s uses creative ways to connect with customers in a digital world; and Stephen Hasselmann, Leader of Strategy and Transformation for IBM. Below are their insights on smart meters, becoming paperless, consumer generated content, consumer trends, the shift from back office to front office, mass intimacy, and how CEOs can approach personal blogging.
1. How has the digital world enabled you to connect with customers in a new way?
Mary Dillon, U.S. Cellular: “Smartphones are the most important consumer products people have in their lives right now but many consumers are dissatisfied with their carrier. We recently launched our Hello Better marketing campaign to show customers that we provide a better experience and to drive switching, and created “Call Someone Who Cares” to highlight the passion that our associates have for our business and our customers. First we had an internal contest to identify 10 associates who were also exceptional singers and performers. Then we found Tweets from people across the web complaining about their phone service. We wrote them a personalized song to the tune of “Call Someone Who Cares,” sent them the video and posted it on YouTube. We had a lot of fun producing more than 70 videos and then Tweeting them to unhappy wireless users. It generated a lot of real conversation in the market. Everyone, especially the original Tweeters, love it.”
Joe Rigby, Pepco Holdings: “For the first time across the industry, we're going to know when our customers are out of power through smart meters. And that may seem like a small step forward, but I'm always amazed when I'm out talking and meeting with customers that they just assume we know when the power's out. But through the technology we're putting in place through the advanced meter reading system, we're actually going to be able to know when your power's out. This will create a more efficient restoration process and provides a portal where we can dialogue with our customers depending on how much they want to dialogue with us. Interestingly enough, for our industry, I sometimes think we're like baseball umpires. We're doing a really good job when people don't necessarily notice us.”
George Halvorson, Kaiser Permanente: “We have no paper inside KP and all the data is available so our doctors have complete information about all of the patients in real-time all of the time. We've completely computerized our electronic medical records in our clinics, our hospitals, our pharmacies. They also have complete medical science, medical libraries, all the data. We had over 100 million e-connections with our patients last year. We sent out 68 million lab results to our members electronically. And now, over 40% of our primary care visits are now being done at the patients' choice electronically. As a personal example, we issued our new iPhone app and I had my blood drawn the other morning at the clinic and by about 11 o'clock I had my lab results on my iPhone app. When we introduced that app, we had over a million users in the first month.”
Dan Jauernig, Classified Ventures: “On our websites we’re using a lot of consumer-generated content. For example, if someone is looking for a car, house, or apartment and they're in the middle of the shopping process and have a question – say about a particular neighborhood when looking for a place to live - they can ask in real-time online and get other consumers to respond directly to their questions and to their needs while they're actually shopping.”
2. Any insights on personal or company involvement in social media?
George Halvorson, Kaiser Permanente: “We have a big response team who tracks social media, all of the contacts, blogs, relevant information, tweets. Personally I spend about 4 – 6 hours a week where I blog internally, and I'm also a Huffington blogger and I do a health plan blog. And then every Friday afternoon I send a message to our 180,000 people who work for KP that's a blog from me about something that we've done as a company in the last week or something we've done overall. So I have a continuous feedback from employees anywhere from 20 to a couple hundred responses back to what I blog and I tend to respond to those as well.”
Dan Jauernig, Classified Ventures: “I spend a few hours a week on social media. Externally, I'm connected through LinkedIn and Facebook. I use LinkedIn quite a bit - it's a great way for us to recruit new hires and interact with potential employees. In fact, all of our senior managers are on LinkedIn and we actively encourage its use by all employees to help build our recruiting brand. Internally, we use Salesforce Chatter to connect our entire workforce so they can ask questions and get real-time information about best practices, the organization or customers or issues that they may be involved in.”
Joe Rigby, Pepco Holdings: “We're using Facebook as a way of being able to manage and monitor the competition of energy usage across a community to the benefit of a local school. And it's interesting how you can start from something that may be as uninteresting as consumption of energy to something that may be as exciting and can help draw the community together as helping a local institution like a school."
Mary Dillon, U.S. Cellular: “We're also encouraging our associates to use their own social media networks to tell our story. We have a social media toolkit that we give to U.S. Cellular associates so they can post content and spread the word on their own social media space about what makes us a better wireless carrier."
3. How can companies capitalize on big data?
Steve Hasselmann, IBM: “The first step is to make sure that somebody in their organization has the mandate to know and serve customers as individuals and to manage that relationship at a personal level, at scale to achieve some of level of mass intimacy. So the first thing is make sure somebody has the mission. Most often it's the chief marketing officer and the CIO as a pair. The second thing is that they have to prepare the organization for a shift in spending on technology to create a meaningful next best action for every individual customer. It takes a lot of investment in analytics and software and services. So there's a net shift from the back office to the front office in terms of spending. And the CEO has to preside over that shift and understand, and prepare the organization to recognize that it's going to happen.”
Mary Dillon, U.S. Cellular: “We’re improving the return on our marketing spend by leveraging data and our customer insights to better understand the needs of potential customers who are shopping around for a new carrier and reaching them with relevant messages and targeted offers that encourage them to switch to us.”
Dan Jauernig, Classified Ventures: “It's really all about knowing more about your customers and customers' behaviors. Everything that a consumer does on our website can be tracked, it can be followed, and it's instantaneous feedback we get so we can constantly improve the services and products we provide to shoppers on a real-time basis. We learn more as technology advances, as well. We've done some studies following customers’ eye movements in terms of what they're looking at on the website and what they're actually doing. The more we study and understand the user experience, the more we can have our sites meet shoppers’ and advertisers’ needs.”
4. Talk about how customers will change over the next few years?
George Halvorson, Kaiser Permanente: “I think health care needs an industrial revolution in order to become more affordable, higher quality and more accessible and we're trying to lead that revolution. We believe care delivery will evolve into four sites of care: the traditional hospital which will be incredibly electronic and linked with tools; the clinic; the home where sitting down and having remote face-to-face contact with your doctor remotely saves a lot of transportation issues, and the Internet and electronic care where we’re tracking care, reminding people to do things, and remote monitoring of different kinds of devices. And we think that the care delivery interaction is going to be transformed.”
Mary Dillon, US Cellular: “I think about it as this mosaic of old and new media and, face-to-face interactions and pulling it all together to create a great experience.”
Joe Rigby, Pepco Holdings: “If Edison had come back and looked at the delivery system, he'd probably say not much has changed in 100 years. But we are actually at the tipping point, a real sea change in the deployment of technology. Customers will want and expect more information and be more connected. That’s why we're opening a portal that our customers have never had. Just one little example is during this tremendous storm the mid-Atlantic got hit with, we had 75,000 downloads of our outage map application over the course of a day and a half. So we saw just like an avalanche of use on this type of technology and a real thirst for this kind of information.”
Dan Jauernig, Classified Ventures: “One of the big transformations I think we're going to see is the huge migration of users using mobile devices to access our websites. That's going to mean completely revamping the way we present information so that it's much easier and relevant to use on mobile devices than it is today on wired sites. We’re seeing it now in our traffic reports, but clearly it is a trend that is going to grow at an explosive pace.”
Steve Hasselmann, IBM “There are inefficiencies baked into industries that can be liberated through mass customer intimacy. By pursuing detailed knowledge of customers, patients or clients behavior patterns and history, organizations can present offers or devise diagnostic or treatment more accurately and with greater impact. Middlemen, brokers and other facilitators used within various customer relationship and delivery processes have less value and can be designed out when intimacy with customers and patients can help produce the right offer at the right time and place. Doing this at scale - mass intimacy - can disrupt entire industries.”
… In summary, a powerful wave is emerging where big data will enable companies to connect with customers at a new level of individually. This will create a sea of change in business and usher in, as it was cited in this ar
ticle, the age of mass intimacy.
Robert Reiss is host of The CEO Show, nationally syndicated on AM/FM radio by Business TalkRadio Network. You may listen to over 250 CEO interviews commercial-free at www.ceoshow.com
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5d1528af58d5168cfb36f3cb9796899b
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https://www.forbes.com/sites/robertreiss/2012/10/10/for-top-ceos-culture-drives-value-creation/
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For Top CEOs, Culture Drives Value Creation
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For Top CEOs, Culture Drives Value Creation
According to Larry Ackerman, the father of identity based management, "The most powerful cultures spring naturally from the identity of the organization - the value-creating core of the enterprise." This direct link between "value-creating" cultures and organizational success intrigued me and led me to explore perspectives from top CEOs.
On September 18, 2012 I facilitated a roundtable to gain insight from leading CEOs across industry. This included: Steve Kaufer the founder and CEO of TripAdvisor which has quickly become the world's largest travel website with more than 60 million unique monthly visitors: Curt Anastasio, founding CEO of NuStar Energy from its start in 2001 already has $6.5billion revenue and was ranked #15 Best Company to Work for in America; Lori Dickerson Fouché, CEO of Fireman's Fund founded 150 years ago as an original societal brand; Dan Mead, CEO of Verizon Wireless, the largest wireless carrier in US with $70 billion revenue 78,000 employees and 94.2 million retail customers; and subject matter expert Eric Riddleberger, Telecommunications and Media Leader, IBM , a company transformed by culture. Below are their insights ...
1. What does culture mean to you?
Curt Anastasio, CEO, NuStar Energy: "Culture is everything. The culture is the number one most important thing about a company. And the success of the company really depends on having the right culture and keeping it strong."
Lori Fouché, CEO, Fireman's Fund: "Culture is the glue that holds an organization together. It helps guide all the decisions, how you behave and act. You can pick whatever strategy you want but how you go about doing it is the difference between, oftentimes, success and failure."
Steve Kaufer, Founder & CEO, TripAdvisor: “Culture is the style or the method by which the employees are working each day to fulfill the mission of the company.”
Dan Mead, CEO, Verizon Wireless: "Culture is the very core of what we do. It starts with integrity, earning the trust of customers and following through."
2. Talk about culture and your organization
Steve Kaufer, Founder & CEO, TripAdvisor: “The key to our culture is speed. At every moment we're striving to get whatever we're working on done faster. New folks that come into the company are genuinely amazed at all the stuff that we accomplish. People that thrive here want to be in a small, nimble, empowering environment. And we feel that this kind of focus is a great way to drive productivity throughout the organization.”
Dan Mead, CEO, Verizon Wireless: Dan Mead, CEO, Verizon Wireless: “We created a Credo -- our culture put into words -- of who we are very early on and made that a foundation of what we do. It outlines the importance of team work and, especially, being outwardly focused on the customer. We invest about 6 million hours a year in training to keep our employees knowledgeable and confident in explaining our products and helping customers choose what best meets their wireless needs. As we add breadth to our business, and as the mobile lifestyle expands, that's going to continue to be our focus.”
Curt Anastasio, CEO, NuStar Energy: “We have a very strong corporate culture which puts employees first. And I know a lot of people say that, but I think we actually walk the walk on that. We have a no layoff policy. We've never had a layoff in the history of the company, and we're not going to have one either. It's really a sacred trust with our employees. We had an independent consultant study our pay and benefits and concluded they were number one in our sector of the energy industry. We have an all employee bonus, so I don't get a bonus unless everybody gets a bonus in the company. And we have a long list of employee programs. All of these things are strong parts of our culture, which is putting employees first.”
Lori Fouché, CEO, Fireman’s Fund: “In 1863 our founding underlying mission was to give a portion of our profits to widows and orphans of fallen firefighters. Today the fire hat is our logo and our brand values are very clear around being caring, courageous, inspired and dependable. They all work together and we haven't met a firefighter yet who cares but is not courageous or who is dependable but isn't inspired in what they do. For example being courageous is standing up for what’s right even when it’s uncomfortable. It can be being bold in a corporate town hall to stand up and ask a question. And courageousness can drive business decisions; for example, when there were the three hurricanes that came through the South a few years ago we had questions about how to apply our deductibles. Ultimately, we made the decision to apply one deductible and not three deductibles for our policyholders. That was a courageous decision and the right one. We believe at Fireman’s Fund that we all wear that fire hat every day and must live into our values.”
Eric Riddleberger, Telecommunications and Media Leader, IBM: "We had aValues Jam where we developed our values, which today are the foundation for everything that IBM has done since then. IBM's values have guided our growth from product and hardware, to then software and services, and today our focus on solutions where we integrate services, software and hardware to solve our clients' most challenging problems."
3. What's one thing you do personally as CEO to build the culture?
Steve Kaufer, Founder & CEO, TripAdvisor: "It is a challenge to sustain the culture of a small, nimble company with over 1,400 employees globally. So one thing I try to do is to present in front of as many as I can to reinforce our culture and our mission of helping travelers around the world plan that perfect trip. I need to ensure that we're going about our work the right way no matter what size our company grows to, with a similar drive, similar focus on execution speed, a similar focus on automation, and with the most important focus being the millions of folks visiting our site.”
Curt Anastasio, CEO, NuStar Energy: “I hold employee roundtables which are not just to explain our strategy and to promote our culture but also to get feedback. I talk with employees at all of our locations without their supervisors present to mainly to hear what's on their mind. And I learn many valid points of how to immediately solve problems and make the company better. This connects me with everyone and reinforces that employees come first. And while we’ve grown from a few hundred employees as a Texas-oriented pipeline company in 2001 to 1,900 employees and eight countries around the world today, the culture has not changed.”
Lori Fouché, CEO, Fireman’s Fund: “At Fireman’s Fund, we are a company that is turning 150 years old next year and we’ve recently been through a lot of twists and turns. Employees are looking for leadership, direction on where we’re headed and how to get there. As CEO, it’s important that I provide that direction and lead by example on living our brand values and building the culture we need to succeed. The only way to know whether we as a company are doing that is to listen closely to customers and employees. It’s important to be on the front lines. I’ve listened to calls in our service centers and regularly meet with employees to not only let them ask questions of me, but more importantly to ask them questions to learn about what’s going on. I expect all my executives to do them as well.”
Dan Mead, CEO, Verizon Wireless: “I show up at stores unannounced. As I enter the store, I look outside in the shrubs, the dumpster, and I look at the first impression that customers get. Then, I go inside and check the displays, looking for fingerprints and smudges on the devices. I walk through the inventory rooms and the break rooms. Our store managers know we keep the front of the store pristine out of respect for our customers, and we keep the back rooms pristine out of respect for our employees. I note whether our employees are wearing name tags and customers are being greeted. That’s important because I believe we have just 15 seconds to communicate to the customer that we have their best interest at heart. I spend time talking with customers, our sales team, and then I have an immediate debrief with the store manager. Also, I tell our executives they should spend about 70% of their time out of the headquarters building in our 1,900 stores and call centers. We have a belief that it's the shadow of the leader that makes a difference. It's not the words we say as much as the example that we portray.”
Robert Reiss is Host of The CEO Show. To listen to commercial-free podcasts of CEO interviews, go to www.ceoshow.com
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2e5b096c17cb88340c9e87bdc52824f7
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https://www.forbes.com/sites/robertreiss/2012/11/08/from-customer-to-fan-top-ceos-share-insights-for-today-tomorrow-including-expandable-mobile-wrist-phones/
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From Customer To Fan - Top CEOs Share Insights For Today And Tomorrow
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From Customer To Fan - Top CEOs Share Insights For Today And Tomorrow
I was just watching a ball game and zoned in on the fans -- what incredible passion! I realized often the difference between a good and a great company is that customers of the latter are more than just customers … they are fans. So, I pulled together a face-to-face roundtable of leaders whose companies have true fans. This covered industries like: real estate, television, phones, technology, automobiles and retail. I asked what specifically they do today, how they see customers changing … and even asked what they look for from top producers. The leaders were:
Dan Hesse, CEO, Sprint Nextel
Phil Griffin, President, MSNBC
Joe Taylor, CEO, Panasonic N.A.
Steve Hasselmann, Leader Strategy and Transformation, IBM
Jim Gillespie, Global CEO, Coldwell Banker
Tom Fricke, CEO, HMSHost
David Archibald, President, Rolls-Royce Motor Cars N.A.
1. How does your organization turn customers into fans?
Phil Griffin, MSNBC: “About 7 years ago, we had significant challenges, in fact, the powers that be were thinking of turning out the lights. And, last month we had our best month ever, by far. It’s all about customer satisfaction. That starts with: know who you are. If you know who you are, everything falls into place. You can target the audience you want. You have to accept that you cannot be all things to all people. And, every time we focus smaller and smaller, our audience grows. The more we define who we are, the more we make an emotional connection with the viewer.”
Tom Fricke, HMSHost: “We constantly develop new ways to enhance our customers’ travel experience. For instance, we have a new app, B4 YOU BOARD, which allows travelers to order their meals from the airport gate, using their smartphones, and have it delivered to them in 20 minutes.”
Dan Hesse, Sprint: “In high-tech, customers crave simplicity. We eliminated 85% of rate plan combinations. And almost all of them are unlimited … unlimited text, unlimited voice, and unlimited data. Unlimited is about as simple as you can get. When smart phones emerged, people were intimidated by the complexity, so we were the first in the industry to do one-on-one phone set-up, where we’ll set up the phone the way the customer wants it, including email, Bluetooth, or whatever the customer may want help with.”
David Archibald, Rolls-Royce: “We give our customer a really intimate one-on-one experience. We are not in the taste police business. We have the capability to build 44,000 different exterior colors. For example, a Russian gentleman came in and wanted to propose to his girlfriend. “When she says yes, I want to give her a Rolls-Royce Phantom and I want the interior to be this color”. Then he pulls out of his pocket a bright pink lipstick, her favorite color of lipstick. The Bespoke nature of our business means that 95% of all the cars we sell have some form of individualization. Many use their family crest. Our mantra came from Henry Royce himself, ‘take the best that exists and make it better. If it doesn’t exist, design it.’ And that’s our mantra for the whole company and the way we manage all our associates. “
Joe Taylor, Panasonic: “Frankly, I think we as companies have to first define more clearly who we’re going to be in the next decade. Panasonic, for example, has been in the process of reinventing itself as a Business-to-Business solutions provider, but most customers still know us as a TV company. Just five years ago almost 50% of our revenue in North America was from consumer electronics. But, after five years of transitioning; it now accounts for less than 20% of our total business. Panasonic is one of the world’s great technology leaders. In fact, just in the last two years Panasonic has received more patents than any other electronics company in the world. We must do a better job in leveraging this great “library” of intellectual property into great solutions. So, if five years from now our customers still think of Panasonic as only a TV company, we’ve failed. To make customers into fans you need to communicate relentlessly.
Jim Gillespie, Coldwell Banker: “A few years ago we partnered with Google and You Tube to create our On Location YouTube channel. It is a unique competitive advantage for our agents and their clients. This allowed us to implement video prominently at every online touch-point including mobile. We just hit 4 million views and now have more than 40,000 videos up. Of course a challenge is getting all our sales people comfortable enough with video to participate. About 15 percent of all Coldwell Banker listings have a video, which is great news but shows we still have opportunity but are thrilled with where we are headed.”
Tom Fricke, HMSHost: “We have roughly a million transactions a day with people going through more than 110 airports and nearly 100 turnpike locations. So for us it’s the quality and value of the food we serve and the in-the-moment interaction between our employees and our customers. Our goal is to make the traveller’s day better. And the customer who has a five hour delay has different goals than the customer rushing for a plane. So we spend a lot of time training and developing our employees to make them confident and empowered to solve problems at a local level. At the end of the day there’s something universal about the customer service.”
Dan Hesse, Sprint: “Number one, you focus on your people. We put every employee from me on down on the same compensation metrics like churn, (how many customers leave); or on CSAT metrics like calls to customer care, because customers call when they have a problem. We’ve trained 2,200 employees who’ve volunteered to be “social ninjas” who communicate with customers via social media. They know to introduce themselves as a Sprint employee. Our PR department has moved from paper to digital. But one “retro” thing we do is employees write handwritten letters to customers. We have “Thank You Thursdays” where our employees have already written letters by hand to thank well-over half a million customers year-to-date.”
Joe Taylor, Panasonic : “Panasonic has been steadily shifting into the comprehensive solutions business. We study your market and your place in the market and then create a solution for what we perceive as a competitive problem you face. For example, AEG is the world’s largest owner of sports and entertainment venues. They called us for a security analysis because we have one of the most sophisticated security camera businesses in the world. But the team I sent wasn’t just made up of technical specialists; it also included creative business people. We ended up solving a bigger issue they had – how to use the venue itself in order to elevate the fan experience ensuring their return. We did that, in part, with the world’s largest high-definition indoor scoreboard at the Staples Center. We ended up handling all the campus’s technology, bundling hardware and software in a customized comprehensive solution that anticipated the customer’s needs, installing the equipment, maintaining the equipment and, in the process, saving them money. That kind of customer solution can only happen where there is a seamless merging of creativity and technology.”
2. How will the customer experience change over the next few years
Dan Hesse, Sprint: “Technologies like flexible screens are emerging. You’ll be able to wear bendable screens around your wrist. There’s going to be a wireless chip in just about everything. Your clothing will be able to monitor your heart rate. If you’re driving, your blood sugar will be monitored to see if you’re getting tired. There will be a tradeoff between utility and privacy. Many users will want to see advertising custom-tailored to their interests. But to protect customer privacy, we’ll ask customers to opt-in if they want to see advertising that is tailored to their interests.”
Tom Fricke, HMSHost: “From a food standpoint clearly the trend is towards fresh and local. In airports you’ll see more celebrity chefs.”
Steve Hasselmann, IBM: “You have to understand 10 million customers as individuals. So the question is how do we take advantage of all the data – structured and unstructured – in a way that’s repeatable, where we can drive personal interactions - at scale. . Anyone can know one customer. The challenge is to know a million customers or 20 million customers as individuals. And then understand what journey you want them to take with you, and then build those relationship points. It’s what I call mass intimacy.”
Phil Griffin, MSNBC:“I love the digital world. It extends the experience. For us it’s all about what we call TV everywhere, web, phone, i-pad, even viewing parties at theaters. We want our audience to always be able to connect with us. We’re about creating community. We’re about connecting emotionally, and creating loyalty.”
Joe Taylor, Panasonic: “With so much changing, I believe customers don’t really know what they want yet. We have to show them what they want. Whoever figures that out first and makes it simple, elegant and intuitive will be the winner.”
Jim Gillespie, Coldwell Banker: “10 years ago everyone said real estate agents would go the way of travel agents and that people would buy and sell over the Internet; in fact the reverse is happening. It’s because housing is not a commodity. While interactions will include more digital elements, the individual connection will actually increase in value.”
David Archibald, Rolls-Royce: “We’re going to have many more younger, and many more female buyers. Our buyers are generally ultra-high net worth and the good news is for us across the planet is that over the next years it’s estimated that the category will grow by between 15 – 20%. “
Tom Fricke, HMSHost: “The biggest challenge is that the amount of information flowing to and from customers is exploding. Companies will need to have an effective system of engagement where they digitize the relationship, while also keeping it personal, and can attract customers and be an authentic brand. To some degree it becomes an arms race because everyone’s competing for that same customer.”
Dan Hesse, Sprint: “Because of social media, people will make many decisions based on what their friends or people they know tell them. Word of mouth will matter more than ever, so metrics like Nielsen’s Net Promoter Score, which is a measure of your advocates less your detractors, will take on increased significance.”
Joe Taylor, Panasonic: “You have what’s called metadata now, which is immensely important. It will enable virtually everything electronic to transmit data. Your appliances, your light bulbs, anything that plugs in will communicate data. What do you do with all this data, and how do you manage it to delight your customers? Whoever figures out how to make the data useful will be also a really big winner.”
3. What do you look for in top producers?
David Archibald, Rolls-Royce: “You have to understand each person and what they respond to. We had a guy we called 5 Car Freddy because he only sold 5 cars a month. One day his manager saw a picture of his two granddaughters and he said, I’d do anything for them. He said, ‘OK if you sell 10 cars this month I’ll put money into an education fund for them’. 5 Car Freddy became 15 Car Freddy the rest of his career.”
Jim Gillespie, Coldwell Banker: “Our biggest producers want to be number one. They want to get up there and get that award. My wife and I met in the business and she didn’t care about their checks. I did. She wanted the recognition every month.”
Dan Hesse, Sprint: “Passion, hard work, and results.”
Joe Taylor, Panasonic: “When I size up top performers, I look for both raw and emotional intelligence first. There must also be intensity in how they approach solving problems, an uncommon ability to collaborate, competitiveness and of course a sense of urgency. In particular, I look for a willingness, no, an expectation, to be given tough assignments with full expectation of successful implementation. And the last part is there must be an ability to listen and understand what our customers really want.”
Phil Griffin, MSNBC: “The key to finding the right anchors, the right hosts, for us: be smart, really smart, know how to explain things, and be passionate about everything you do. In the last few years we’ve evolved into a pretty unique place. Our people are authentic, unafraid to dig deep into ideas, even wonky. Who knew that would ever work? By the way… that confidence comes from experience, so I always look for people with experience and a real drive to figure things out.”
…. In summary, as I think about the insights from these top leaders it becomes clear the companies who are succeeding are those who understand their customers as individuals and predict what service those customers will want. And just as every trend generally has a counter trend, the more digital we become, the greater the value of genuine individual connections.
Tom Fricke summed this concept up, “It’s interesting, with all our talk in this discussion of technology, we’re all talking about the value of handwritten letters. So ultimately, the most important thing we have still today is that human interaction. Whatever we do, we cannot lose the personal connection with the customer.”
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4692ff617835ef7ea2a12b52f59bef0a
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https://www.forbes.com/sites/robertreiss/2012/12/20/why-apple-stock-can-hit-2000-a-share/
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Why Apple Stock Can Hit $2,000 a Share
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Why Apple Stock Can Hit $2,000 a Share
When on September 18, 2012 Apple broke $700, a growing crowd questioned, “Can Apple hit $1,000?” Then the drop. Today Apple is at $526. And yet, in studying Apple’s long-term potential, to me it becomes clear that Apple can not only hit $1,000 -- but potentially over the next 5 years the unthinkable -- $2,000 a share. How?
Steve Jobs baked into Apple’s DNA something powerful … a culture of innovation. This culture has the ability to capture and dominate new markets through products and services that anticipate and deliver exactly and simply what future consumers want. Here are three steps of a potential strategy that Apple is in a unique position to implement:
Step 1: Own the laptop market. The ongoing battle between PC and Mac historically favored PC because Mac’s operating system was frankly a foreign language the average laptop user didn’t want to learn. Starting June 29, 2007 when the iPhone was introduced and then expanded by the 100 million iPads users, a new generation of middle-aged consumers learned Apple’s operating language. So the value of these sales to Apple was not just the revenue, but the democratization of the ‘secret’ Apple language. Now hundreds of millions of potential buyers are ready for Apple’s new value proposition – the simplicity of having your iPhone, iPad, and Mac laptop all synced up automatically through the cloud. Everything seamless, safe and easy. Case in point, I’m writing this from a MacBook.
Step 2: Eliminate the lap top market. Once millions of new users are comfortably in Appleland using laps tops, a new value proposition can emerge. Apple can ask the market, “Why do you need 3 devices? Wouldn’t it be nice if just one small phone size device handled everything?” The new device would be all three devices in one where consumers could just give a simple voice command to Siri like, “expand to 8 x 13”. Perhaps Apple could even make the device hip and fun so it wraps around your wrist. Imagine the excitement of consumers to have just one device that customizes to whatever size they want. … a potential game changer, and blockbuster.
Step 3: Own banking. Once Apple has driven the device path, it could capture The Holy Grail of business – financial transactions. Apple is the one non-finance company who can legitimately pose the question, “Wouldn’t it be nice to manage and organize all your financial transactions with this new, easy Apple application?” Now Apple is at the heart of billions of banking, insurance and investment transactions … as said by Willie Sutton, “That’s where the money is”. Obviously this 3rd strategy is more complex involving significant regulatory issues … but if successful, it leads to the dramatic value creation comes from massive volume of small transaction fees.
When I consider Apple’s potential, I think about the indelible lesson I learned when interviewing hundreds of CEOs to co-author The Transformative CEO -- dramatic growth occurs by creating new value. So above are three strategies Apple might take, but the real potential is that Apple has placed itself in a unique position and stands alone to create new value that drives unprecedented growth … perhaps $2,000 a share.
Robert Reiss is host of The CEO Show. www.ceoshow.com
Image via CrunchBase
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a25ffeef4c77a42df72f507481556b88
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https://www.forbes.com/sites/robertreiss/2013/03/04/how-top-cmos-connect-with-customers-in-a-digital-world/
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How Top CMOs Connect with Customers in a Digital World
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How Top CMOs Connect with Customers in a Digital World
In 1954, Peter Drucker was famously quoted as saying, “The purpose of a business is to create and keep a customer”. Five decades later this timeless message is stronger than ever. In our digital world where 2.5 quintillion bytes of data are created every day and practically everything we’d want to know about customers is now available, the corporate owner of ‘creating and keeping those customers’ has increasingly become the Chief Marketing Officer.
To uncover insight on how top companies connect with customers in a digital world, on February 6, 2013, I convened a dialogue between leading CMOs. They were: Juliene Conway, CMO, Fireman’s Fund Insurance Company, Betty Noonan, SVP Marketing, Panasonic Corporation North America, and Chris Gabaldon, Chief Sales and Marketing Officer, Ritz-Carlton Hotel Company, L.L.C. My co-host was Matt Preschern, Vice President, GBS North America Marketing, IBM. We all talked about what makes for a great customer focused brand, how to manage social media and what the future holds.
What’s at the heart of your customer experience?
Betty Noonan, Panasonic: “Many people don’t know that Panasonic is really a B2B2C company in North America where 80% of revenue comes from B2B solutions. The magic in the customer experience comes from leveraging our deep and broad global experience in audio-visual, display and eco technologies into B2B environments like cars, airplanes, retail outlets, sports stadiums and universities.”
Juliene Conway, Fireman’s Fund: “It is our goal to understand our independent insurance agent and broker customer preferences in all types of interactions in all channels. It’s essential to identify and understand their moments of truth - those critical interactions that truly are important to a great customer experience. And today this is increasingly from a digital standpoint to understand those preferences. In terms of measurement of customer sentiment, we’ve found Net Promoter Score as an important tool. So we do a lot slicing and dicing of that information to better understand the behavioral drivers.”
Chris Gabaldon, Ritz-Carlton: “A great brand is obviously the sum of al its parts. What is important is authenticity. We believe that stories around guest interactions, especially personalization and unique experiences, have to be told because that’s what’s real and true about the Ritz-Carlton.”
What are your thoughts on social media and online video?
Juliene Conway, Fireman’s Fund: “Social is essential to dialogue with our agents and brokers. We find many engage on LinkedIn, so that’s an important channel for Fireman’s Fund. We measure social sentiment monthly and keep tabs on it on a daily basis. Additionally, we are starting to use video to engage with our customers. This year Fireman’s Fund celebrates its 150th anniversary, so we currently have a video in production and it will be launched shortly.”
Chris Gabaldon, Ritz-Carlton: “We try to determine our power alleys so we know what we can dial up and engage in the conversation. Naturally, a lot of what we do in social is experimental. We will try something. If it tends to be attracting followers and influencing the conversation, then we’ll try more of it. And everything changes quickly; for example, many of our younger audience are now using Instagram more than Facebook. We certainly see social and mobile as the fastest moving medium. Video enables those without the large enough marketing budgets for TV spots to convey message in a compelling way. Video really levels the playing field.”
Betty Noonan, Panasonic: “I put digital at the core and changed the entire marketing planning process around it. This is important because Customer Engagement starts with SEARCH...in the consumer electronics category over 85% of consumers research product and services online before they buy. And recent data from Google showed that over 90% of those seeking B2B solutions use search engines to explore options before they buy as well. With social, it’s a great way to measure real-time brand sentiment. We like to see sentiment in the "neutral" to "positive" range. As for video, the emerging opportunity is, we don’t have to be held to 30-second format anymore…content can be as long as its interesting ... and that’s a big deal to marketers."
What’s next?
Chris Gabaldon, Ritz-Carlton: “Our customers’ expectation is that we will use the increasing amount of information they provide to us to create individually curated and personalized customer experiences. So we are focusing on aggregating all the information we know about consumers today.”
Betty Noonan, Panasonic: “On the consumer side, as the smart TV category starts to take off, you’ll see dramatic changes, just like when smartphones took off several years ago. On the business solution side, Panasonic is focusing on connected environments outside the home that allow new consumer new experiences, especially in the automotive and avionics categories.”
Juliene Conway, Fireman’s Fund: “Our ability to build and strengthen relationships with our brokers and agents will to be integral to the success of our customer service. We will continue to identify what communication technologies – both current and emerging – are effective and that complements our customer service model. It will also be critical that we begin to understand the needs of the agents and brokers now entering the insurance industry as they are more technology savvy and want to interact differently with their insurance carriers.”
… In summary, top companies recognize this new world of big data will ultimately elevate how we connect with customers. But it’s clear, this is a long road and the journey has just begun. Matt Preschern, from IBM gave a glimpse of what’s ahead: “The days of push marketing are over (and they are not coming back). Today, customers visit your company via search, research your web-page on their personal networks and they do so on their terms." As marketers, we need to think about "pull" or Inbound Marketing and make sure to capture customer data at the various digital touch points. Those Marketers who analyze and use these customer insights to reach and serve clients not only as categories, but as individuals, will win by creating massive transformative opportunities for their companies.”
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c97ea953e4d0f386231017c123d0b447
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https://www.forbes.com/sites/robertreiss/2013/03/26/top-financial-service-ceos-share-best-practices-in-customer-experience-including-creating-customer-advisory-councils/
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Top Financial Service CEOs Share Best Practices in Customer Experience . . . Including Creating Customer Advisory Councils
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Top Financial Service CEOs Share Best Practices in Customer Experience . . . Including Creating Customer Advisory Councils
Financial services drive our economy. Consider this, the unrealized capital gains in the equity of Americans' homes is now $10 trillion and the aggregate retirement pension and mutual funds now amount to $18.5 trillion, almost 20% bigger than the $15 trillion GDP of America. Being that personal financial security has a macro-economic implication both individually and for our country, I wondered what specifically leading financial service companies did to best serve their customers.
I found that the leaders use some unconventional approaches like removal of scripts from call centers, establishing designated teams to work with the elderly, and creating client advisory councils to both gain insight and elevate clients into true partners.
These insights came from a discussion I convened on February, 2013 with top leaders: Keith Banks, President, U.S. Trust, the company who pretty much founded the private client business in 1853; Gary Bhojwani, Chairman of Allianz a leader in retirement planning; and Bob DiMuccio, Chairman, President and CEO of Amica Insurance, which has won 13 consecutive J.D. Power and Associates awards for customer satisfaction among auto insurers and 11 awards for homeowner insurers. Also joining as an insight expert was Scott Lieberman who is Financial Service Strategy and Transformation Leader for IBM.
1. What is at the core of your customer experience model?
Bob DiMuccio, Amica: “It’s all about people. And to us it’s about the two groups – the customers and the employees. Our mission statement is, very simply, one sentence: to create peace of mind and build enduring relationships. We sell an intangible product. It's a contract. You can't touch it and feel it. But your judgments are made based on relationships, and how our reps make you feel. So for example, while you can sign up on our website, we always want to talk to you just before you make the final binding decision. As an example, we just had a large claim, and the wife said, ‘I called Amica, and the first question that was asked of me was, ‘Are you and your family okay?’ And she said, ‘From that moment, I knew we were going to be okay.’ So that's our thought process in relationship building.”
Keith Banks, U.S. Trust: “The nucleus of our model is a private client advisor who partners with a private client manager. That team’s job is to intimately know the families we serve as clients and their needs. Once they begin to understand, they slowly and deliberately build a team of experts around that family. These experts are locally based so they're right there in the community. And the experts can consist of people like trust officers, wealth strategists, portfolio managers, whomever it is but usually 5 - 7 people who are dedicated to that family. And their job is to deliver the full power of U.S. Trust but in a very high touch customized boutique like way. And that's really a big part of our value proposition.”
Gary Bhojwani, Allianz: “Our two main operating businesses in the United States are Allianz Life Insurance Company which is life and annuities and Fireman's Fund which is property and casualty between commercial and retail. So our model is about making sure that our agents who are independent contractors deeply understand and believe in the way we do business and the way our products really work.”
2. What unique practices do you have to connect with customers?
Gary Bhojwani, Allianz: “Since our annuities can be sophisticated products that respond to a host of market cycles and our clients may be elderly, we want to make sure our clients really understand what they need to know. So we created a special team that is trained specifically to help our consumers and perspective consumers who are 75 or older. We walk them through a host of analyses and illustrations to make sure they really understand what it is they're buying. That type of dedicated team that's specially trained to call out to perspective consumers, age 75 and older is something that to my knowledge nobody else does in our industry.”
Bob DiMuccio, Amica: “One unique practice that we employ is to make outgoing calls to our customers in areas affected by catastrophes. And the first question is, ‘Are you okay? Is there anything we can do to help you?’ Another unique practice is that we don't actually have scripts for our folks on the front lines. Instead, we have guiding principles for them to follow. And we also give our employees the latitude to make the best decision in that moment because – especially when you have a claim – speed is always important. For example, a family recently had a loss and the roof was blown off the house. And at that time in their area, there was a major athletic event going on, and there were no hotel rooms available. So our adjuster spent several hours on the phone finding a safe and appropriate place for this family to stay because their house was exposed. It would have been easy to say there were no rooms available, that we couldn’t help them. However, this adjuster wouldn’t settle for that. It was personally important to him to find them a place to stay. The homeowner was interviewed and he said, “My family was safe. It meant so much to me that an insurance company worried about getting a good hotel room for my family. I knew someone was on my side.” To us, it’s all about doing the right thing. And there's no script for that.”
Keith Banks, U.S. Trust: “Three years ago we formed something called a client advisory council. The idea emerged when I traveled around meeting with clients and getting important insight from them on how we're doing, what we could do better, things they were interested in. My management team would do the same types of meetings and it became apparent that we needed to find a more systematic way to not only get that insight, but capture it and then do something with it. And so we came up with this client advisory council concept. The first meeting we had 25 clients from around the country council. Now we have five of these client advisory councils, upwards of 120 clients, currently working with us providing solutions on elevating services and growing the practice.
We also do a wealth and worth survey where we actually survey non-U.S. Trust clients to make sure there’s no disconnect with ultra high net worth individuals who are not our clients currently. We have a big philanthropic group within U.S. Trust that works with both individuals on their philanthropic needs as well as non-profit organizations. We do a very well regarded philanthropic survey in conjunction with Indiana University. And we use all the information to stay ahead of the curve and anticipate future needs of current and prospective clients. And we get a lot of good press because people want to see what ultra high net worth individuals are thinking about philanthropy. As a credible thought leader this also gets us in front of new potential clients.”
3. How do you create a customer centric culture?
Keith Banks, U.S. Trust: “I think one of the hallmarks of the company since 1853 has been the client being the center of our universe. It really has been part of the fabric of the culture. Anyone who works here must have in their DNA that our work begins and ends with the client. And if somehow you snuck through, we'll find you and get you back out because we just can't afford to have people in this company that are operating any other way.”
Gary Bhojwani, Allianz: “When I explain culture to people, the simplest way to define it at least for me is how are your employees going to act when nobody's watching. There are three ingredients to our culture. First is making sure we have the right people where the interview process is essential. Not surprisingly we get our best hires as referrals. Second is the environment because the best people want to be in an environment that they love whether it's subsidized lunches or a workout facility or a daycare center. Third since we don't have a tangible product we need to make sure people understand this business from a broader perspective. I tell people all the time we don't sell insurance. We make and keep promises. And I find that when you get the right people, put them in an environment that they love and give them a mission that they can relate to that's about helping others, you create an unbelievable culture.”
Bob DiMuccio, Amica: “We have a unique culture. It's customer-focused. It's customer-centric. It starts with hiring the right people into this culture, and then we spend a lot of time on training, starting with an initial formal training program and then offering long-term leadership development programs. And we emphasize outside learning, whether it's CPCU or CLU designations, and we also assist employees in furthering their education with MBAs and business-related education. We spend a lot of time making certain that people understand our culture, and we are a ‘promote from within’ culture. We're looking for people with experience in building networks within a company.”
4. Talk about the future
Gary Bhojwani, Allianz: “There are a handful of key trends developing. The United States demographics shows 10,000 boomers retiring every day. There's a trend of digitalization. There's a trend for specialization. The fourth big trend we're seeing is what I'll call democratization of power. We can look across different places in the word and see as these younger generations in particular have a fundamental distrust of power. Now what we're most interested in as we look at these trends and how they come together, we're very focused on what's happening with the demographics and how these solutions are going to be brought to bear particularly in the United States. If we think about 10,000 boomers retiring every day and the absence of real tangible retirement assets that they've already had, these are big problems that our governments won't be able to solve because our governments don't have the wherewithal. So we're doing everything we can to make sure that we've got products and services that we can offer that are going to help aid these consumers to retire whether it's using digital technologies, whether it's making the minimum size of our annuity purchases as little as $2500. We're trying to do a number of different things because we see these trends coming together in a real way.”
Bob DiMuccio, Amica: “Customers want to be able to access your products when they want, where they want and how they want. And I think customer experiences are going to change even further because of technology, which we see as a tool, but not the end of the process. There's a quote that I first heard years ago that still sums up customer service for me: ‘People won’t remember what you do or what you say, but they will remember how you made them feel.’ ”
Keith Banks, U.S. Trust: “I think more and more in this increasingly complex world clients will want access to comprehensive solutions. What we've increasingly heard from clients who are also business owners, is that they want access to the expertise within Bank of America, not just U.S. Trust."
… In summary, today’s customers are armed with data, information and access. The winning companies –especially in highly competitive industries like finance -- will be those companies who can understand, in fact predict, what customers really want. Scott Lieberman, from IBM codifies the new customer mandate, "Even in a B2B world it's really about understanding the individual and using preferences to drive meaningful interactions based on specific behavior. The use of Big Data analytics can help organizations to create and drive new models for customer engagement.”
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