Irving Wladawsky-Berger

Social Business Entrepreneurship

The other day, as I was driving back home from MIT, I turned on the radio, and by pure chance happened on an absolutely mesmerizing talk by Muhammad Yunus at one of the National Public Radio (NPR) stations in the Boston area.  The lecture I was listening to - “The End of Poverty: Because Poverty Is the Absence of Every Human Right” - was originally given at Boston University in October 2007.

Dr. Yunus is a Bangladeshi economist and the founder of the Grameen Bank, which he created in 1974 to help impoverished borrowers start small businesses and obtain an education.  He first loaned $27 to a small group of very poor Bangladeshi women, and gradually increased the number of loans.  He pioneered the revolutionary concept of micro-loans to help the poor in developing countries.  With these micro-loans, the poor are able to start very small businesses, and they can gradually improve their economic situations and start moving out of poverty.  Grameen Bank now has more than 7.5 million borrowers, and about 2/3 of the families receiving loans have risen above the poverty line.   

The banking system pioneered by Muhammad Yunus is now being used in more than 100 countries.  For his innovative economic and social development work, Dr. Yunus, along with Grameen Bank, was awarded the 2006 Nobel Peace Prize.  The prize announcement by the Nobel Peace committee said:

"Muhammad Yunus has shown himself to be a leader who has managed to translate visions into practical action for the benefit of millions of people, not only in Bangladesh, but also in many other countries.  Loans to poor people without any financial security had appeared to be an impossible idea.  From modest beginnings three decades ago, Yunus has, first and foremost through Grameen Bank, developed micro-credit into an ever more important instrument in the struggle against poverty.  Grameen Bank has been a source of ideas and models for the many institutions in the field of micro-credit that have sprung up around the world."

Final Thoughts on the Evolution towards a Knowledge Economy

In the last two weeks I have been writing about my feeling that 2008 might be a key year in the transition to an IT-based knowledge economy.  In the first post, I focused on the emergence of the advanced technology platforms needed to deliver a diverse set of information-rich services to a very large number of people.  In the subsequent post I wrote about the critical importance for a business to stand out and differentiate itself from competitors by providing consistent, first-rate customer service and thus building a loyal customer base.

In my third and final post on the subject, I want to focus on business values - in particular, on the critical importance of trust, responsibility and accountability in our increasingly integrated, global knowledge economy.  This subject keeps coming up over and over, from the extreme malfeasance that we saw with Enron, Worldcom and other companies when the dot-com bubble burst; to the use of lead-based paints in children’s toys and incidents involving contaminated pet food; to the evolving controversies surrounding subprime lending.

These and other incidents raise serious questions.  Just about all of us would agree that trust, responsibility and accountability are absolutely vital to the smooth functioning of open societies and free markets.  This has always been the case.  It is a major part of the culture of just about all nations.  It is, for example, a major theme of the Western movies that I so much enjoy watching - the transition from the wild, unruly, lawless West to a civilized society that protects its citizens not just from the individual bad guys but from rapacious business interests.

For individuals it is typically not very hard to tell the good guys (or gals) from the bad ones.  But for companies the line between what is and is not acceptable behavior in the process of wealth creation is often more subtle.

More on the Evolution towards the Knowledge Economy

Last week I wrote about my feeling that 2008 might be a key year in the transition to an IT-based knowledge economy.  I focused that post on one of the key indicators of that transition, namely the emergence of the kind of global technology platform that is needed to support an information-rich, knowledge-based future. 

A sophisticated IT infrastructure - with the vast amounts of information and services it makes possible - is necessary but not sufficient for a business to succeed in our global, knowledge economy.  The biggest challenge, even bigger than building the advanced IT infrastructure in the first place, is figuring out how to put it to work for competitive advantage.  This is particularly critical given an environment where competitors with innovative business models can now much more easily show up from anywhere in the world.

Given all the possible innovations a business can focus on, is there any one in particular that stands out above the rest?  I think so.  I have become increasingly convinced that consistently strong customer service is the key way for a business to differentiate itself in our increasingly global, commoditized and hypercompetitive knowledge economy.  With more choices than ever, we want those companies and brands that have won our allegiance to deal with us as if they really care about having us as customers.  This isn’t easy to do. In fact, it’s one of the hardest tasks facing any business. 

I recently read a very good column by Joe Nocera in the New York Times that nicely illustrates the value of customer service in a very personal way.

Towards the Knowledge Economy

This is the time of year when you traditionally review key events of the past year and think about your expectations for the one that is just starting.  Two years ago, I reflected on blogging, why I did it and where I thought it was heading.  It was all still very new to me - having started this blog several months earlier in May of 2005.  No longer a novelty, for me personally or for the world in general, blogging is now a part of the general environment.  Blogging has achieved liftoff, that is, it has made the transition from being used primarily by leading-edge adopters to being embraced by a wider marketplace. Technorati is now tracking over 1102 million blogs.   

Last year, I wrote about virtual worlds as a key trend that would similarly take off and become more widely accepted in the marketplace as the year progressed.  While the level of activity and marketplace experimentation is increasing, we are not quite at the liftoff stage yet.  I am convinced that highly visual, collaborative platforms and interfaces - which is what virtual worlds are all about - will become increasingly important to help us deal with IT applications in a much more human and intuitive way.  But as is often the case, it is much easier to predict that something will happen than it is to predict when it will happen.

So, for 2008, what do I find as intriguing as blogging two years ago and virtual worlds last year?