Recent selections from around the web that, we think, would have caught Peter Drucker’s eye:
1. Defying Skeptics, Some Business Schools Double Down on Capitalism: Many of us probably think of business school as a pretty capitalist-friendly place, but some business students are concerned it’s not friendly enough. Amy S. Choi reports in Bloomberg Businessweek that a group of MBAs at Duke University formed a chapter of what is called the “Adam Smith Society,” devoted, according to its website, “to promoting on-campus debate and discussion about the moral, social and economic benefits of capitalism.” Since last fall, students in 14 schools have followed suit. The effort, notes Choi, comes in the wake of increased “criticism of laissez-faire economic policies” in recent years, even in business school.
2. When It Comes to Tech Investing, VCs Are Venturing Forth Cautiously: It’s been a heady several years for Silicon Valley, but venture capitalists are getting a little slower to throw money at startups, observes Farhad Manjoo in Fast Company. Given that tech investors are such reliable optimists, why the sudden shyness? Manjoo suggests it’s because everything is so up in the air, even by Silicon Valley standards: “Which app platform will prevail? How well do mobile and social ads really work? Can we differentiate between innovations that are truly captivating and those that are fads? When examining the trends governing the industry, it’s hard to escape the sense that uncertainty reigns.”
3. Make Your Best Customers Even Better: Most of us know the Pareto principle, also called the “law of the mighty few,” or the “80/20 rule,” which describes the phenomenon of a small minority in a group accounting for the majority of the results. This also applies to consumers buying items like—well, Velveeta cheese, according to an article in Harvard Business Review by Eddie Yoon, Steve Carlotti and Dennis Moore. For most products there are “superconsumers,” and companies should target them aggressively, even when it seems silly. “Common sense might suggest that there would be little ROI in trying to sell someone who owns eight staplers a ninth or a 10th one,” they write. “But the analysis proves that selling those additional staplers to superconsumers is a smarter growth strategy than simply selling replacements for broken or lost staplers to ‘normal’ consumers.”
4. Dx Comment of the Week: Yesterday, when we asked what to make of the unfolding crisis in Ukraine, reader Ajay Reddy had this to say:
Drucker wrote, ‘The gravest indictment for a leader is for the organization to collapse as soon as he leaves or dies.’ Russia should know better than to follow Putin, knowing what happened when Stalin died.
This is the danger of vested power in a chief executive and the argument against any executive taking their power too far. Of course there are the pretentious who get their ‘approvals’ from their parliaments or worse just indiscriminately change laws.