Weekly Digest #5 [ Facebook, Science, Recession, Advertising, Communication & Purpose]
A snapshot of article summaries that we enjoyed reading ( Dec 3— Dec 8)
“The Seven Social Sins are:
Wealth without work.
Pleasure without conscience.
Knowledge without character.
Commerce without morality.
Science without humanity.
Worship without sacrifice.
Politics without principle.”
— Frederick Lewis Donaldson
Spotting the next recession: The current expansion after the Great recession is one of the longest in the century. One indicator is the junk bond spread -the difference between the US Treasury bonds and the returns on the junk bonds. As spread increases, the riskiest investments become riskier which could indicate a coming recession. Another indication is the yield curve. Yield curve is the difference between the ten-year treasuries and the two-year treasuries. The idea is that the long-term investments are riskier than short-term investments so the returns are positive. If the returns are negative, it means that two-year treasuries are paying better than the ten-year treasuries. This is called the inverted yield curve. The quits rate and the hires rate is also a good indicator. When the economy is booming, people quit their jobs due to better opportunities. When the rate plateaus or reduces, it precedes a downturn. The rate at which companies are hiring if on the increasing side, indicates a healthy economy. When temporary employment rate dips, it is a warning sign that the economy is on the brink of a recession. If the rate of layoffs also increases, then it is time to worry. Another measure is the number of people applying for unemployment benefits. Jobless claims keep falling as expansion continues and rises shortly before the recession. These indicators act as early warning indicators. There could be simmering reasons that could boil over to cause a recession. The likely suspects are corporate debt, student loan debt, etc. The current indicators suggest that economic growth is increasing for the moment and we can relax for the moment.
Diminishing returns on science: While news headlines are dominated by politics, economy, and gossip, it’s science and technology that underpin the long-term progress of human civilization. It’s difficult to measure scientific progress in meaningful ways. A survey was designed by asking scientists to compare Nobel prize-winning discoveries in their respective fields. The results of the survey for different fields of physics, chemistry, and medicine painted a bleak picture in total. Over the past century, there has been an increase in the time and money invested in science, but in scientists’ own judgment, we’re producing the most important breakthroughs at a nearly constant rate suggesting science is becoming lesser efficient. Such results are dismissed by few citing recent discoveries like Higgs boson and gravitational waves as evidence that science is in better shape than ever. They also refer to technologies like Artificial Intelligence and CRISPR gene editing technology. These technologies are important but have taken a lot of time, money and effort to generate results. Science has become expensive without producing commensurate gains in our understanding because scientists need to know more and research longer to make important discoveries. Scientific research includes more collaboration with researchers. As science is understood as the exploration of nature, it needs to explore more remote territories in tougher conditions. A different point of view explores science as a frontier where there are new phenomena to be discovered and new questions to be answered. Thus evolves the idea of emergence which includes exploring new phenomena which give rise to new layers of inquiry in an open-ended manner. An optimistic viewpoint would be science remaining an endless frontier which will continue to discover or create entirely new fields. The reason why returns on science have diminished is that it has focused on established fields where it’s harder to progress. The diminishing returns on science are contributing to what economists call the Productivity Slowdown. Productivity grows when we develop technologies and make discoveries which increases the ease of getting things done. The causes of productivity slowdown are controversial among economists, however, the authors feel that diminishing returns to spending on science are contributing to productivity slowdown. Many individuals have raised the concern on diminishing returns to science. However, there has been limited institutional response. Scientists collectively are interested in increasing research funding by portraying science in a positive light however the reduction of per dollar or hour spent on science goes against their interests. This argument requires a large scale institutional response as a subject of public policy, in grant agencies and universities in order to identify the causes of this phenomenon and reverse it to improve our future.
Business Communication: There is one skill that truly determines the capability of a leader to build successful teams and organization — communication. History is filled with examples of leaders who left an indelible mark in the business chronicles and corporate excellence with their eloquent and powerful communication skills. Communication is a fine art which needs to be polished with constant learning and practice. While leaders may have a crystal clear vision and exceptional strategizing prowess, they may still find it difficult to put their plans into actions if they fail to clearly communicate the corporate goals and individual responsibilities to various team members. Effective business communication has the power to enhance overall team performance and encourages team members to achieve success for the organization. The article discusses some of the possible channels to be used for effective communication. First is Motivation — through direct and one-on-one communication, leaders can ensure that their teams have absolute clarity of the goals that they must work towards. The second channel is Innovation — When team members feel motivated and appreciated, they develop a keen perception to identify opportunities for innovation and feel confident to share the same with their leaders. The third is Collaboration — To ensure that the unique skills of each team member are fully tapped and put to the best use, effective organizational communication for fostering teamwork is a must. Open communication channels ensure free flow of critical information among the team members along with a clarity of their role in the success of a project. The fourth channel is Empathy — direct communication with team members who are facing challenges at their work offering them relevant advice and helping them to overcome their limitations improves the overall efficiency of the team. Team sessions to discuss issues and resolve conflict will help each member develop a sense of understanding and camaraderie to help each other with bringing their best version to the table. The last channel talked about is Trust — office grapevine and tinted perceptions adversely affect employee morale. By being transparent in all dealing with team members, a leader gives his team the confidence that they are kept aware of all important information crucial to their success. An organization can achieve phenomenal growth and success when its team members have faith that they are valued by their leaders and where they rely on each other to work in tandem towards common goals.
Facebook & The Content Blueprint: Facebook has been criticized many times for hate speech, misinformation, terrorism, sexual exploitation, etc. These problems persist maybe because the platforms are not interested in solving them. However, the problem is more fundamental. Content moderation by social media platform is a flawed idea because it is done by the platform on our behalf. Platforms cannot separate the job of governing the platform from the need to profit from it. Decisions which affect the community must be discussed in public, by the public. Mark Zuckerberg proposed that going forward content decisions would be taken by an independent body whose decision would be binding and transparent. A new model for content moderation could be a counterbalance to the techno-utopian mindset at Facebook and other major platforms. The three core challenges for this model would be — Who will take this on? How and when will it work and intervene? What will be their authority? To answer the first question, Facebook should seek out independent accomplished judicious minds focused on the entire community. As Facebook is global, the members of such a council should also be global with diverse representation across gender, professions, and nationality. For smooth functioning, the council should be reserved for disputes that represent decisions which need to be publicly contested. Facebook can even consider deliberation in public. The autonomy of the council and their decisions being binding would be a powerful change. This would reshape individual decisions and also serve as an input to Facebook’s policies and processes. Making the decisions binding would enhance the public legitimacy of the council. Independent oversight would represent a significant shift in how Facebook operates as a company. The idea of independent oversight is meant to bolster trust in the platform. It will only work if we trust the platform for careful implementation.
Surveillance Capitalism & Targeted Advertising: Facebook, Google, Twitter, and other social media platforms sell access to our attention. This advertising-based business model drives company decision making which is toxic to society. Social media platforms have morphed into advertising companies. Contextual advertising existed in print and broadcast media for decades. What went wrong is the new economic arrangement of surveillance capitalism by the growing user base, data gathering, analysis, and targeted advertising. Surveillance capitalism is commodifying reality by tracking what people do online, predicting what they can do in the future, devise ways to influence behavior for shopping, voting, etc. and sell that power to whoever is willing to pay. Instead of being used for product development, this behavioral data was directed towards the goal of shaping user behavior. The targeted advertising business model incentivizes companies to amass as much information as they can about users and their preferences. Advertising’s shift to digital has cannibalized news media’s revenue weakening the public sphere. Linking advertising to page views incentivizes media companies to produce articles that perform well than producing content that keeps vigilance over powerful authorities. Targeted Advertising provides tools for political advertisers and propagandists to micro-segment audiences in a way that inhibit a common understanding of reality creating a platform for authoritarian populists to seize power with dire consequences for human rights. Surveillance capitalism turns a profit by making people more comfortable with discrimination leading to practices like digital redlining, differential pricing, racist search results, and social media filter bubbles. This is not a recipe for a fair, equal and just society. The onus is on Silicon Valley to demonstrate that firms can guard against surveillance capitalism’s harms without uprooting their business models or find new revenue streams that don’t rely on commodifying people’s behavior. The only way to root out targeted advertising is by regulation. Policymakers globally are aware that privacy and data protection are intimately linked to the basic structure of society. Status quo cannot be an option.
Organization & Sense of Purpose: Most executives realize that to motivate employees and improve productivity, they cannot rely on financial incentives alone. People need to understand the higher purpose of their jobs. Where most organizations realize the relevance of purpose, very few seem to get it right in practice. Research suggests that most companies try to impart purpose in the wrong way — addressed by senior leaders at “town hall” meetings — creating a backlash, and leading to greater concerns. This seems extremely superficial and a forced proclamation of purpose. To make employees feel and live the organization’s purpose, the following points must be paid attention to. First, Purpose Must be Plausible. Companies often assume they have to motivate employees by appealing to some higher altruistic purpose. However, a feeling of purpose does not necessarily come from higher societal goal — for most people, this is too far removed from their daily reality. A feeling of purpose arises when employees are aware of the impact their job has on other people and the environment. The second important thing to note is that Purpose Must Be Permanent. Company leaders often treat ‘purpose’ as a special ‘one-off’ conversation — a senior presentation at a meeting, a video of customer testimonials, or a scheduled outing to a clients’ premise. These special occasions are all well-intentioned but are unlikely to have a lasting impact. To have a structural influence on the work, purpose needs to be part of the daily routine rather than a temporary disruption or occasional reminder. It is only when people experience the impact of their work on a continuous basis, their work habits and routines adapt; and organizational performance begins to align with its purpose. The third point refers to Purpose Being Practical. Giving a sense of purpose is not just about motivating employees — it is also about providing direction. Employees have to want to do something; they also need to grasp what to do. When the purpose is plausible, permanent and practical, it can be more powerful than many business leaders realize. A clear sense of purpose motivates and encourages employees to change their behaviors — and find solutions outside their normal routines. This triggers creativity and innovation. Contrasting a purpose with all three elements can achieve much more than most managers realize — purpose becomes progressive, improving how an organization functions.
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The link to the original articles is hyperlinked in the title of each summary.
