Apply your learning the next day in the office. This is what our current students highlight from their blended learning journey with IE. They learn new concepts, bounce ideas and leverage on solutions of their classmates. All those insights help them to create an impact in their organizations on the next day. With IE you…Details
IE Focus | By Rolf Strom-Olsen. Academic Director of Humanities Studies at IE Humanities Center
The rise of MOOCs and the fact that they are open to all and free of charge has caused great consternation in the academic world. Socrates, however, would have approved.
In the brief introductory video of my MOOC (Critical Perspectives on Management) that we put together to walk through the class syllabus, I make the point that, as a Humanities course masquerading as a strategy class, the methodological inspiration derives from those two fundamental tenets of the Socratic imperative: that true wisdom consists in knowing you do not know and that the unexamined life is not worth living.
But while these two sentiments of the Socratic imperative are certainly the best known and serve as the fons et origo of humanist enquiry, there is a third, equally critical, part of the Socratic imperative that I had to leave out (since the video was testing weary viewers’ patience already).
It’s this bit, from the Apology.Details
IE Focus | By Enrique Dans, Professor at IE Business School
Google bought Motorola for 12.5 billion dollars, invested in it to make it competitive and then sold it for 2.91 million, keeping its patent portfolio. A tale of success or failure?
Google has sold its Motorola mobile phone business to Lenovo for 2.91 billion dollars, thereby demonstrating that hardware, although it plays a crucial role in strategy development, is seen by the company as being a factor that is somewhere between marginal and accidental.
Google’s acquisition of Motorola was one of the biggest surprises of the summer of 2011. Google paid 12.5 billion for a legendary manufacturer that had come down in the world, but which had a massive portfolio of patents that could be fundamental in navigating the complex scenario of litigations the company was thinking of launching at the time.
Moreover, the acquisition posed a problem. If Google’s strategy with Android was to make itself attractive to all Smartphone producers, how would said producers feel about the fact that the company that was selling them something as vital as an operating system would also be competing against them through its own newly acquired handset manufacturer? Becoming a mobile phone manufacturer was a dangerously incoherent move by Google.Details
IE Focus | By Antonio Montes, Director of International Development, IE University This year Brazil is facing a much greater challenge than having to organize the World Cup. It also has to lay the foundations that will enable it to really become the world’s fifth greatest economic power. It would appear that all the analysts,…Details
Monika Hamori, Professor of Human Resource Management at IE Business School, explains her research findings recently published in a Harvard Business Review article “Who’s Got the Top Jobs,” which she coauthored with IE Business School Professor Rocio Bonet and the Wharton School’s Peter Cappelli. Prof. Hamori’s research focuses on the career paths and career success…Details
Did Facebook jump the gun by buying Whatsapp? After the biggest purchase to date in the technological market, two IE professors take a look at what led to this decision. In this first video, Professor and Technology Expert Enrique Dans explains the intricacies of Whatsapp and why this purchase was so costly.
IE Focus | By Pedro Letai, Professor at IE Business School
After the closure of Megaupload, all the people who used its online storage service for their personal files are now unable to access them. They are just one set of innocent parties affected by digital piracy.Perhaps it’s a bit late now to close the stable doors, as the more pessimistic tend to say with regard to piracy on the Internet. Seeing as pessimism has a habit of taking things closer to the point where you just give up, the Megaupload case has offered some of us a glimmer of light at the end of the tunnel.
On January 19, the FBI closed Megaupload’s download website and detained its head, Kim Schmitz. As I write this, the attorney general has requested that he not be given conditional bail on the grounds that he has enough resources to flee the country. After seeing photos of some of his parties and of some of his assets, the attorney general is not the only one who thinks this. Although Schmitz obviously has to presumed innocent until proven guilty, he would be an odds on favorite in a dodgy character contest.
The angry reaction of the defenders of the social ill known as free access to culture, coupled with the mass elimination of content or even closedown of other accommodation services on the Internet, are enough to make you think that the steps taken are not quite as insignificant as some would have us believe. Meanwhile, cinema revenues in the US have gone up 32% just this week, and video streaming pay sites like Filmin have doubled their traffic in Spain.Details
By Fernando Fernandez, professor at IE Business School
Forget about short cuts and soft measures: Europe’s problem is that it has lost the market’s confidence, and in order to get it back it will have to take some hard measures.It’s a well worn phrase which is why I have permitted myself a certain amount of poetic license, because it seems to go perfectly with the confusion that is rife among markets and analysts following recent events. The feeling of insecurity is such that we are desperately seeking a lifeline to cling to. Someone is always up for the job of throwing said lifeline and public opinion seems to have honed in on two specific groups: governments comprised of technocrats and the European Central Bank (ECB). The former are expected to bring the required level of sanity and the ECB is supposed to start buying up debt with no thought for expenses. But once again it’s the wrong diagnosis.
The European Commission, according to its vice president Olli Rehn, has decided that the key lies in restoring confidence in fiscal sustainability and the financial system, and in speeding up reforms that stimulate growth potential. Hence we have to change our tune or we have to take notice of the Commission, but either way we should not be looking for short cuts.
The European problem is a simple one. Investors have lost confidence in the Euro, not just in Italy. Let’s not confuse the symptoms of this particular illness. They have done it for a series of institutional reasons – the well-known design faults of the Monetary Union – and mistakes made in the way the crisis has been managed. In my opinion they include two particularly big mistakes. The first was to declare that European sovereign debt is restructurable – albeit only Greek debt, but who on earth believes that at this stage – without having the necessary financial resources or legal instruments to effect an immediate exchange, and the second was to punish banks for their sovereign debt holdings without having the necessary resources to fill the hole created. Both decisions have had consequences that were impossible to recover from in the short-term: they have made sovereign debt a credit asset, a financial instrument that competes with emerging debt, and have eroded the credibility of the European banking system, which has been forced to divest its sovereign debt.Details
By Ignacio de la Torre, professor at IE Business School
Investment banking has once again shown us the way to address the world’s enormous and recurring debt problem. It is, of course, by cheating.Although it may not have been noticed, investment banking has shown us the way solve the world’s enormous and recurring debt problem. What did the last entry in Lehman Brothers profit and loss statement show? Enormous profit. Let’s see why. The results of the third quarter of 2011 for Lehman Brothers produced “profits” as a consequence of the fall in value of the debt market of the banks themselves. In other words, if the risk of bankruptcy of, for instance, Morgan Stanley, increases, the price of its bonds falls, which means its “profits” will rise. Intuitive? That’s why the last entry in Lehman’s books was actually an enormous profit. The five main investment banks have posted “profits” totaling 15,000 million dollars obtained this way in the third quarter, which means that the position of the bank’s “own” funds is skewed by an equivalent amount, as is its solvency, measured in relative terms (value at risk) or absolute terms (leverage). In short, over 80% of the profits posted by investment banks in the third quarter of 2011 is a result of this fantasy.
Thus the profits of 6,200 million dollars posted by Bank of America contain a bonus dividend of 3,600 and a “profit” due to a fall of 1,700 million dollars in the amount of debt. Citigroup’s profits have risen by 74% to 3,800 million dollars thanks to the recognition of a “profit” derived from the drop of 1,900 million in its debt level. Morgan Stanley posted a profit of 2,150 million dollars, of which 3,400 were the result of a fall in the value of its debt, and JP Morgan posted a profit of 1,900 million dollars using the same system, beating the market with a profit of 1.02 dollars instead of the expected 91 cents (its shares fell by 4.8% – the market is not quite as simple as it looks). Unfortunately, this practice is also being employed in Europe, where UBS has posted a profit of 1,800 million Francs as a result of the fall in value of its debts. Its total profit was 1,000 million Francs, which means that if it hadn’t used the trick it would have posted losses, not profits, as a result of its trading scandal (2,300 million dollar loss).Details
By Enrique Dans, professor at IE Business School
Jobs has left us a legacy that goes way beyond technology. He has left us with an approach to life and business management based on innovation, commitment and a capacity for work.The way in which Steve Jobs’ legacy has impacted products and industries is seriously impressive. The first personal computers, the organization of windows and desktop on the computer screen, new life breathed into animation films, the revolution of the music industry with a market that everyone said could not exist, a revolution in the mobile phone industry that practically destroyed the previous leader… And more recently the reinvention of computers with the iPad, generating thousands of millions in sales, creating and destroying entire industries, while multiplying the value of the firm by a couple of thousand. And yet I believe that his greatest legacy is the way we now see business organizations, innovation, and the kind of commitment and capacity this involves.
In times when it seems that imitating, repeating, and spending your life doing as little as possible are in fashion, Jobs is the most salient example of what it means to dare, to fight, to do things better than expected. He wasn’t a technology genius. He didn’t need to be. His strength lay in understanding trends, or creating them. His products were always enormous commitments with an element of risk. But they were also born of passion, entering sectors to which he brought the values that his vision of Apple stood for: a focus on the user and ease of use, the design, the total integration between hardware and software that brings life to a device, not stopping at good, going for excellent. He entered industries where there had always been a disconnection between client and technology. In the music industry nobody had been capable of giving the customer a simple and solid means of managing his/her music.Details
Contrary to popular belief, Steve Jobs was not a great inventor, but rather a great re-inventor, capable of transforming existing products like the mobile phone or MP3 to make life easier for the user.There are certain battles we human beings know we can’t win – at least for now. We all knew that Steve Jobs was going to die: first, because although he may have seemed to be immortal, he wasn’t. And second, because the gap between cancer and technology means that cancer is still cancer, and when it goes badly, you can’t beat it, even with all the means in the world at your disposal. It is very possible that many of the obituaries we have read recently in the press were actually written months ago. When a person with a reputation for being a born worker with a vocation stays at the helm of Apple until so recently, despite such obvious physical decline, you tend to think the worst when he finally takes the decision to stop working, namely that he must be in a very bad way.Details
IE Focus | By Fernando Fernandez, professor at IE Business School
The IMF’s absurd proposal to buy debt from threatened European countries like Spain or Italy would have made it into a hedge fund, and it would have been developing countries that paid the price.Ever since the Mexico peso crisis resulted in the so called tequila effect in the early nineties, the International Monetary Fund has been trying to find the formula to prevent financial contagion. To be more specific, it has been searching for the way to stop financial market dynamics from unfairly impacting countries that have no serious solvency problems, but which will end up having them if they fall out of favor with investors, who then pull out en masse causing spiraling debt differentials coupled with a credit crunch. But what it has not done so far is to suggest that it should serve as a highly speculative investment fund that would intervene directly in the debt market, stockpiling the currencies of countries under threat. This is exactly what Portugal’s Antonio Borges, the inexperienced head of the European Department, proposed. The suggestion was only on the table for the space of a few hours, because it was such a ridiculous idea, so out of synch with the nature and functions of the IMF, that he had to withdraw it before the end of the day.Details
Words are human, substantially human. They link our thoughts to reality and to other thoughts. Thanks to words, others know what we are thinking or what we want to say. Depending on how skilful we are with words, we succeed or fail in reaching others, obtaining personal or collective benefits, and building the future.
No matter how knowledgeable they are, no matter how intelligent they are, people who do not express themselves very well are at a disadvantage. Words are effectiveness.
Our thoughts are made up of words. As we progress in the art of the word, we learn to think better, we acquire mental skills that we did not have previously because the brain develops with language, and if we train and teach the word, the brain increases its muscle power.
Our brain deals with images, sensations, all kinds of memories and an endless array of words. Our language brings all that together. The word and the action are what best reveal what we are and what we want to be. People who do not use words well act as if they have had their strongest member amputated.Details
Prof. Tara Wernsing, professor at IE Business School, is researching on Authentic Leadership. Find out on how this can be developed… adding a bit more to the discussions whether leadership is born or can be taught!