More Than Money

In a curious piece in the New York Times, Andrew Ross Sorkin questioned why there was no public record of Apple founder Steve Jobs' philanthropy.  Despite a net worth in the billions, Jobs and his wife appear to leave no trace of charitable giving to any organization. They do not belong to the exclusive "Giving Pledge" group led by billionaires Warren Buffett and Bill Gates, and a whispering campaign is now audible about Jobs' commitment to philanthropy.

I'm sure the opinions of other billionaires and the media are far from Steve Jobs' psyche these days as he battles for his life and continues to fret over his company's fate from the chairman's office.  Whatever money Mr. Jobs chose to give (or not) to worthy causes is a personal matter between him and the good Lord. If he never gave a dime to a down-on-his-luck panhandler on the corner, Jobs could still rest easy for all the good he has caused in this world through his works.

We should keep in mind that several of the fabled 20th century robber-barons and industrialists cleansed their hands and souls by establishing huge endowments to aid the public good. Today their foundations carry on their legacies by doing good throughout the land in their names.  Steve Jobs may end up bequeathing a well-funded foundation or something of the sort, which would cast him into posterity.  On the other hand, he may very well  let his marvelous products, and the joy they bring to hundreds of millions of people, quietly extol his virtue.  

Netflix Just for Kids

Recent news by Netflix that it will launch a "just for kids" tab on its online offerings is cool, but wrought with landmines.  The company must be careful to safeguard the data and privacy of its underage users.  It should proceed step-by-step with self-regulatory privacy enforcement, and shore up its data security mechanisms.  If Netflix can perfect this model, it could be come a strong competitor in the online children's content space.  Stay tuned.

Save the Children

Children under the age of 13 are inherently vulnerable to marketing messages.  That is the rationale behind the Children's Online Privacy Protection Act (COPPA), which  requires, among other things, that online marketers get parental consent before engaging these young consumers.

When the FTC found out that a company was using a mobile app to collect the data of thousands of kids, and did not notify their parents, it filed a case and compelled the company to stop the practice and pay a fine. That was the right thing to do.  Although the choice of communications platforms have expanded, the basic principles remain the same.  Children are a special and protected category, and responsible marketers should go the extra mile to take care of them, even as they employ new and cool ways to connect.

Day-to-Day Leadership

"Any idiot can face a crisis.  It's day-to-day living that wears you out," Anton Chekhov, the noted Russian physician and playwright once said.  

So it seems with the state of business in America these days.  We move from one crisis to another, each coming much too quickly in succession.  For the most part, though, leaders rise to the occasion, as evidenced by the debt ceiling debate (debacle), the Standard & Poor's downgrading, and the chronic and continued joblessness.

What our business and political leaders have significantly less success addressing, however, is the day-to-day drudgery that saddles most Americans.  Making the ends meet is a constant and consistent challenge for the average family. Whether it is paying the mortgage, coming up with college tuition, or handling higher gas prices, the day-to-day living is wearing the public out. 

Now that business leaders, especially the big guys, know these things, we all must wonder what they can do on a day-to-day basis to help their employees, staffs, small business partners, vendors and suppliers weather the daily storm.

(c) 2011 Adonis E. Hoffman

Corporate Integrity and Transparency

"It's Not the Crime; It's the Cover-Up."

So goes the adage decrying the tendency by wrongdoers to deny, deceive and deflect the truth when things go awry.

The re-emergence of integrity as a watchword in the realm of corporate affairs is long overdue.  As consumers, government and media uncover the deeds of a few corporate miscreants, the case gets stronger for greater transparency in the business and financial practices of (especially big) corporations.

While all of us should bristle at the notion of intrusive government, there is something to be said for better oversight and control when it comes to business.  In lieu of that, companies should just take it upon themselves to be more transparent.

Innovation as Leadership

"Innovation distinguishes between a leader and a follower. To turn really interesting ideas and fledgling technologies into a company that can continue to innovate for years, it requires a lot of discipline." 

This advice from Steve Jobs provides a key insight into the philosophy that drives a company like Apple. 

Apple's innovation in consumer technology has outpaced almost every other competitor in the marketplace. Remarkably, Apple's leadership has been accomplished by sheer performance. It is not known for its philanthropy, or for its political influence, or for its corporate sponsorships. Apple's solid reputation as a good corporate citizen emanates from  its ability to deliver what consumers want, even before they know it.

This form of social leadership through innovation seems to be a model that new technology companies are most comfortable in following.  The challenge for other companies, however, will be to remain as innovative as Apple in the long run.  Otherwise, they should be prepared to bolster their leadership through more recognized avenues of corporate citizenship.

Leadership by Legerdemain

What happens when a leading company is found to be a cheater?  Does it shake the confidence of investors, employees, partners and customers?  Will it suffer legal consequences?  Will it lose market share or go under altogether?

I do not know the answer to these questions, but I am sure that Rupert Murdoch and his team of advisors are pondering these and more.  The success of Mr. Murdoch's media empire is virtually unrivaled, bur rumors of foul play--or at least hard checking-- have been whispered for years by those in the know.  

If the allegations in England hold true, and the transgressions there were done in the U.S.too, then the much-heralded Murdoch leadership legacy may be overshadowed by a few sleight of hand shortcuts that were completely unnecessary to beat the competition.

Value and Values

The late senator from California, Alan Cranston, once remarked: "Unless you have a sense of values that's shared by people and turns them loose to do certain things on their own within those sets of values, the organization, whether a nation or citizen or group, just doesn't work very well."   Average customers today are looking for value, but they also are looking for values from companies they patronize.  One of the challenges for business leaders is to marry these two offerings.  Those who succeed develop loyal and enduring customers who come to see the organization as something more than a purveyor of goods or services.

Business and the Needs of Society

"Many business leaders are asking fundamental questions about what business they're in, why they're doing it and how it can be used as a means of healing human and natural communities."  This statement by Amory Lovins, an influential advocate for sustainable energy and a cleaner environment, and CEO of the Rocky Mountain Institute, summarizes a new and pressing mandate for today's entrepreneurs and business initiators.  I suggest that whatever business or industry a company is involved in, it can be instrumental in meeting the needs of society without veering from its corporate mission.

(c) Adonis Hoffman

China, Taiwan and the Prospects for American Business

World in View, Journal of International Affairs, recently published my article, Will America's Hot New Courtship of China Leave Taiwan in the Cold?  In the article, I ask a few questions about the complicated relationship between the U.S., mainland China, and Taiwan and the implications for American business and public policy.

Not a day goes by without a glowing report on the new bond between China and the United States.  From panda bears to people-to-people exchanges and more, America’s hot new courtship of China is in full bloom, and President Obama is leading the charm offensive. As the BBC suggests, "almost everyone is animated by the idea that we are witnessing an historic shift."

Before, during, and after the heralded visit of Chinese President Hu Jintao, the U.S. was abuzz about China.  In fairness, much of this is owed to China's own progress -- or liberalization -- in economic, cultural and trade affairs.  To be sure, today's China is not the same country Presidents Nixon, Carter, Reagan, Bush, Clinton or Bush II encountered.  China today is a much more benign behemoth.  It is far less menacing and mysterious.  It is a land of boundless aspiration and energy, as evidenced by the 2008 Beijing Olympics, where showmanship was eclipsed by scale.  But those descriptions only go so far.  While there are many words apt for the new China, "democratic" is not one of them.

Amidst the fanfare, Taiwan--one of the most critical issues in U.S. - China relations--has received remarkably little attention. Yet, since 1949, America has not had a more reliable or stable economic partner in Asia.  Taiwan is an unwavering bastion of Western-style democracy.  As such, it presents an enigmatic policy decision for Obama, as it has for his predecessors.  The President must preserve the "one China policy"  which means formal recognition of the mainland, while relegating U.S. contacts with Taiwan to the   "unofficial" category, as required by the spirit of the Taiwan Relations Act enacted in 1979.

But balancing two Chinas is no small feat of policy or diplomacy, and it will become more, not less, challenging in the future.

On the one hand is the Peoples Republic.  With a youthful population exceeding 1.3 billion people, and the world's largest army, China cannot be ignored.  Because its citizens yearn for Western accoutrements long denied, it is the mother lode of markets for American products.   Money is being made, consumerism is on the rise, and the future looks bright for any company that can crack the Confucian code to doing business there profitably. 

According to a recent Pew study, nearly half of all Americans say Asia is more important to U.S. interests than any other region, including Europe.  47% say China is the world's leading economic power, and 58 % believe it is very important for the U.S. to build a stronger relationship with China.

On the other hand is Taiwan, a small nation of 23 million people, also known as the Republic of China.  A model of multiparty democracy and free market capitalism, Taiwan's rapid economic growth in the decades after World War II transformed it into a developed industrialized country and one of the Four Asian Tigers. Its economic rise has been hailed as the “Taiwan Miracle,” and the IMF and World Bank categorize it as an advanced, high-end economy.  Through its sophisticated technology sector, led by consumer electronics, Taiwan plays a major role in today's global economy. It ranks 25th on the Heritage Foundation's 2011 Index of Economic Freedom, above Norway, Spain, Belgium and South Korea, as compared with China's much lower ranking of 135. 

In Taiwan, a free press and free elections thrive.  In China, by contrast, government censorship reigns supreme--both online and offline, and there are no elections.  According to the International Federation of Journalists, media coverage of such issues as domestic politics, public health, corruption, internet freedom, and developments in Korea, Vietnam and the Philippines require a government review or are restricted altogether.  China has been quick to crack down on any semblance of protest taking cues from the popular uprisings in the Middle East today. 

China considers Taiwan to be a breakaway province subject to its sovereign jurisdiction.  Taiwan sees itself as a free and independent nation.  This divergence has led to Chinese saber rattling across the Straits of Taiwan, and has prompted the Taiwanese to spend billions on advanced U.S. weaponry for self-defense.

In the comprehensive, forty-one paragraph, U.S. - China Joint Statement issued during the Hu visit, there was short shrift given to Taiwan.  Both sides "underscored the importance of the Taiwan issue."  China emphasized "the Taiwan issue concerns China’s sovereignty and territorial integrity," and expressed hope that the U.S. will honor its relevant commitments. The U.S. reiterated its support for a "one China policy" and encouraged the two Chinas to continue their dialogue.  Beyond that, not much more was said about the country. Thus, the road ahead for U.S. - China relations is clear.  America wants to balance the huge trade deficit it has with the Peoples Republic of China.  The U.S. exports $82 billion to China, but China exports $344 billion to the U.S, and holds much of America’s official debt. 

The two countries admit there are differences over human rights, but agree to continue a dialogue on the issue.  They agreed to establish military-to-military talks, and to cooperate on space exploration, law enforcement, the rule of law, science and technology, climate control, and the exchange of 100,000 American and Chinese students. With plans to institutionalize exchanges between the National People’s Congress of China and the U.S. Congress; to cooperate on global issues involving nuclear weapons, North Korea, the future of Sudan and intellectual property rights, and to expedite the pace and frequency of more dialogue, Obama and Hu Jintao have authored a new chapter in Sino - American relations.

But beware of change.

Several experts predict it will be impossible to relegate Taiwan to the margins of the U.S. - China narrative much longer.  In his earnest effort to be on the right side of history, President Obama should find a way to match America's deepening dependence  on China with more tacit assurances for Taiwan.  Anything less would be anathema to America's long-term interests in the Asia Pacific region and would dishonor the U.S. commitment to promote democracy abroad.

(c) 2011.  Adonis Hoffman