Friday Links, Jan 14
1. The damage done by rampant credentialism. Using educational accomplishment as a proxy for skills and problem-solving ability is a deeply elitist and flawed approach.
2. Selling ideas "up the chain of command." This HBR piece has some useful advice, but the whole argument is premised on the notion that one's boss is the judge, jury, & executioner of new ideas. The prospects for innovation in this kind of system are poor, irrespective of how well you "understand your manager's insecurities." Skillful navigation of the permission gauntlet for new ideas is helpful at the margin. But organizations would be much better served by encouraging permissionless innovation.
3. Flat hierarchies, 1954 edition. As Peter Drucker wrote nearly 70 years ago "The organization structure [should] contain the least possible number of management levels." There really is no good reason for Fortune 500 companies to operate with more than 3 or 4 layers of management.
4. The price of corporate inertia. Between 2001 & 2020, Intel allocated ~$200 billion to dividends & share buybacks, more than on Capex ($168bn) or R&D ($123bn). Not surprisingly, the company is on the back foot, posing a strategic issue for the US given the growing importance of semiconductors. Myopic organizations are bad for all stakeholders.
5. M&A for ESG--really? A recent E&Y survey suggest that "strengthening ESG ranking/ performance" is the most common reason for pursuing M&A. Hard for me to believe this, but I can understand why CEOs might want to frame their consolidation plays under the virtuous banner of "social responsibility."