Quality Articles of Interest

Over the past few days, a number of articles have been published that may be of interest. If nothing else, if you don't currently read the following publications, you should:

The Geography of Jobs
Stanford Business School

Americans frequently debate why wages are growing for the college-educated but declining for those with less education. What is less well-known is that communities and local labor markets are also diverging economically at an accelerating rate.

A closer look at the 300-plus metropolitan areas of the United States shows that Americans with high school degrees who work in communities dominated by innovative industries actually make more, on average, than the college graduates working in

communities dominated by manufacturing industries, according to research by University of California, Berkeley economist Enrico Moretti, the author of The New Geography of Jobs, a book that Forbes magazine called “easily the most important read of 2012.” In the San Jose metropolitan area, for example, a high school graduate averages $68,009, compared with the $65,411 that is average for a college graduate in Bakersfield, Calif.

Some places have always been more prosperous than others, but these differences have increased more rapidly over the last 30 years as the gross domestic product and patents for new technologies have concentrated in two to three dozen communities that Moretti identifies as “brain hubs” or “innovation clusters.”

Read more here: http://www.gsb.stanford.edu/news/headlines/enrico-moretti-geography-jobs

Your Company Is Only as Good as Your Writing
Harvard Business Review – Harvard School of Business

Good writing: Businesses claim to practice it, support it, and value it. But more often than not, their money isn't where their mouth is. Poor grammar and jargon-riddled writing are rampant. We're great at inventing terms — the instruction manual for my toaster refers to the lever that pops up the toast as the 'Extra-Lift Carriage Control Lever' — but poor at communicating what we actually mean.

We could learn a thing or two about communication from our forefathers. One of the most effective speeches of all time, Lincoln's Second Inaugural Address, was only 701 words. Of those, 505 were words of one syllable and 122 had two syllables.

Great leaders consider communication a core competence, so why don't more businesses? Manufacturers spend millions on safety training to get people to wear hard hats, but spend very little to make sure their safety critical work instructions are written clearly.

That's not good enough. Effective writing must be a company-wide endeavor.

Read more here: http://blogs.hbr.org/cs/2013/07/your_company_is_only_as_good_a.html

Measuring the full impact of digital capital
McKinsey Quarterly – McKinsey & Co.

On July 31, 2013, the US Bureau of Economic Analysis will release, for the first time, GDP figures categorizing research and development as fixed investment. It will join software in a new category called intellectual-property products.

In our knowledge-based economy, this is a sensible move that brings GDP accounting closer to economic reality. And while that may seem like an arcane shift relevant only to a small number of economists, the need for the change reflects a broader mismatch between our digital economy and the way we account for it. This problem has serious top-management implications.

To understand the mismatch, you need to understand what we call digital capital—the resources behind the processes key to developing new products and services for the digital economy. Digital capital takes two forms. The first is traditionally counted tangible assets, such as servers, routers, online-purchasing platforms, and basic Internet software. They appear as capital investment on company books. Yet a large and growing portion of what’s powering today’s digital economy consists of a second type of digital capital—intangible assets.

Read more here: http://www.mckinsey.com/Insights/High_Tech_Telecoms_Internet/Measuring_…

Sustainable Finance: 7 Steps in Managing Reputational Risk
MIT Sloan Management Review – MIT Sloan School of Business

Banks and insurers have a special role to play in the health of our global ecosystem over both the short and long term. Their decisions about what projects and organizations to fund essentially make them gatekeepers for sustainable development. And that means assessing, managing, and reporting on the risks involved in all those decisions. But how do they develop their decision-making policies and procedures — the framework that will guide how they make decisions and satisfy all their stakeholders?

According to Olivier Jaeggi, co-founder of ECOFACT, a consultancy specializing in risk management analysis for commercial and investment banks, translating the “how” can be summed up in a set of 7 best practices. The firm developed these recommendations for banks and insurers concerned with managing environmental and social risks, but are worth consideration by any business.

Read more here: http://sloanreview.mit.edu/article/sustainable-finance-7-steps-in-manag…