Thursday, June 3, 2010
Thursday, May 27, 2010
More dispatches from the Renewable Energy front
Bloomberg/BusinessWeek
Numbers
By Tara Kalwarski
Americans are using less renewable energy as a share of their total energy consumption than they did in the early 1980s. And the oldest forms of renewable energy, water and wood, are in decline. Since 2000, alternative-energy companies’ shares have risen far less than those of traditional energy companies.
http://www.businessweek.com/images/ss/09/10/1001_numbers/1.htm
Managing Forward; The Reset Economy
Rewiring the Utility Business
Peter A. Darbee used to dock his three children 50¢ when they left a room without turning out the lights. Now, as CEO of PG&E (PCG), the former investment banker and high school wrestling champion is trying to save energy on a grander scale. Paradoxically, he is helping his customers buy less of his product. “When I tell big customers we would be happy if we sold them less electricity, they look at me like I’ve burned out a few brain cells,” says Darbee. But the logic is inescapable. “You are not making a lot of money anymore building large power plants,” says Jon Wellinghoff, chairman of the Federal Energy Regulatory Commission. “You have to figure out what business you are in, big time.”
How can utilities make more by selling less? Instead of spending $2 billion on a new 1,000-megawatt power plant, it can use the money to insulate homes, pay customers to install more efficient equipment, and make the grid smarter. Those steps would slash power consumption, eliminating the need for the power plant. The CEO would then ask the state public utility commission to raise electricity rates enough to pay for the $2 billion investment—plus a negotiated profit—just as he would for a new power plant. If the commission agrees, the utility gets revenue from its investment.
Continue article here
http://www.businessweek.com/managing/management_innovation/blog/archives/2009/10/utilities.html
Numbers
By Tara Kalwarski
Americans are using less renewable energy as a share of their total energy consumption than they did in the early 1980s. And the oldest forms of renewable energy, water and wood, are in decline. Since 2000, alternative-energy companies’ shares have risen far less than those of traditional energy companies.
http://www.businessweek.com/images/ss/09/10/1001_numbers/1.htm
Managing Forward; The Reset Economy
Rewiring the Utility Business
Peter A. Darbee used to dock his three children 50¢ when they left a room without turning out the lights. Now, as CEO of PG&E (PCG), the former investment banker and high school wrestling champion is trying to save energy on a grander scale. Paradoxically, he is helping his customers buy less of his product. “When I tell big customers we would be happy if we sold them less electricity, they look at me like I’ve burned out a few brain cells,” says Darbee. But the logic is inescapable. “You are not making a lot of money anymore building large power plants,” says Jon Wellinghoff, chairman of the Federal Energy Regulatory Commission. “You have to figure out what business you are in, big time.”
How can utilities make more by selling less? Instead of spending $2 billion on a new 1,000-megawatt power plant, it can use the money to insulate homes, pay customers to install more efficient equipment, and make the grid smarter. Those steps would slash power consumption, eliminating the need for the power plant. The CEO would then ask the state public utility commission to raise electricity rates enough to pay for the $2 billion investment—plus a negotiated profit—just as he would for a new power plant. If the commission agrees, the utility gets revenue from its investment.
Continue article here
http://www.businessweek.com/managing/management_innovation/blog/archives/2009/10/utilities.html
Wednesday, May 12, 2010
Bottom of the pyramid
The phrase “bottom of the pyramid” was used by U.S. president Franklin D. Roosevelt in his April 7, 1932 radio address, The Forgotten Man, in which he said “These unhappy times call for the building of plans that rest upon the forgotten, the unorganized but the indispensable units of economic power...that build from the bottom up and not from the top down, that put their faith once more in the forgotten man at the bottom of the economic pyramid.”
Green Future; A Synergistic Approach to the Triple Bottom Line (*TBL)
A project to build community and more participatory political and economic systems and a green consumer base using a synergy of people, commerce and social objectives by building a business with social justice and green metrics as bottom line.
Green Future; A Synergistic Approach to the Triple Bottom Line (*TBL)
A project to build community and more participatory political and economic systems and a green consumer base using a synergy of people, commerce and social objectives by building a business with social justice and green metrics as bottom line.
Social Entrepreneurship; The Bottom of the Pyramid (BOP) Model
Social Entrepreneurship; The Bottom of the Pyramid (BOP) Model
Revisiting the "Bottom of the Pyramid"
A few years back, CK Prahalad’s conceptualisation of “The Fortune at the Bottom of the Pyramid” woke up a large number of corporates and entrepreneurs to the huge business potential that lay dormant in the lower strata of the masses. CKP’s thesis was that 4bn people on earth subsist on less than $2/day, and therefore, collectively and globally constitute a $13 trillion market!
With all noble intentions, CKP argued that this masses at the Bottom of the Pyramid (BOP) should be viewed not as victims or a burden, but as value-driven consumers. If large corporations design and customise their offerings for this huge segment of consumers, it can change their life-style, and enhance the quality of day-to-day living for them.
CKP’s proposal, however, suffers from three underlying biases that permeate much of the contemporary management literature. The purpose of this note is not to diminish the value of the concept of BOP, but to surface these biases and reinterpret the concept, so that real the “fortune” that is embedded in the BOP can be leveraged:
Bias 1: Masses are primarily consumers, and not producers. And therefore, their life becomes “better”, if they get to consume more, and not if they produce more. This assumption, while partially correct, misses out on the entrepreneurial potential that lies in BOP. For instance, it neglects facts such as the exports from Dharavi, Asia’s largest slum in Mumbai, exceeded the total international earnings of a company like Ranbaxy in 2004.
This is allthemore more relevant in context of India where the “unorganised sector” accounts for 93% of the country’s economically active workforce. More than just being consumers, this workforce (consisting of hawkers, construction workers, domestic helps, road-side mechanics, scrap workers, etc.) account for 60% of net domestic product, 68% of national income, 31% of agricultural exports, and 41% of manfactuing exports.
The real “fortune” of BOP lies not merely in serving these low-income markets, but in organising and unleashing the under-utilised entrepreneurial potential of its inhabitants. For instance, Sri Mahila Grih Udyog (more popularly known for Lijjat Papad) mobilised the grassroot entrepreneurship of women into organising them into a Rs. 312crore business. Similarly, Aavishkar India Micro Venture Capital Fund provides venture capital to rural entrepreneurs to leverage rural innovations and appropriate technologies.
Bias 2: The quantum of profits is more important than its source. Like most contemporary management concepts, BOP primarily focuses on how corporates can create and exploit markets to reap large profits (though to be fair, along with “growth” and “profit”, CKP also added “incalculable contributions to humankind” as a benefit of focusing on BOP).
The concept of BOP, however, does not essentially discriminate among the sources from which the profits are generated. It would treat the profits from selling a Rs.5 bottle of aerated drink, or a Re.1 shampoo sachet as identical to the profits generated from making medicines or education available to this segment.
Like much of contemporary management literature, BOP also does not distinguish between the motives of “profit-making” and “being profitable”. Profit-making motive tilts the prioities away from the society to the owners of capital. It follows the dictum of the economist Milton Friedman: “there is one and only one social responsibility of business - to use its resources and engage in activities designed to increase its profits…”
Being profitable, on the other hand, is an imperative for the sustainability of any entrepreneurial venture. As Prof Mohammad Yunus, the founder of Grameen Bank (the largest bank of Bangaldesh which services almost 3mn “poorest of the poor” across more than 40,000 villages) once mentioned: “Volume of profit is not important in Grameen in money-making sense, but important as an indicator of efficiency. We would like to make more profit so that we can reduce interest rate - and pass on the benefits to the borrowers.”
Bias 3: Wealth-creation is same as making profits. Lastly, the BOP concept takes a very narrow view of wealth-creation. It neglects the fact that a society’s “wealth” is not just the income-levels of its members, but also the the sustainability of its community relations and environment. By focusing on profit making, BOP reduces the concept of wealth to just money, and the rest – i.e., the community and the environment - become mere resources which need to be "exploited".
To make BOP a viable concept for social change, there is a need to reinterpret the meaning of wealth. Take for instance, the Yasaswini health insurance scheme, pioneered by Narayan Hrudayalaya in Bangalore, which provides complete health cover (from common cold to brain surgury to 1.7mn farmers at a cost of Rs.5/month). The scheme is self-funding, but the “wealth” it creates is not money, but a healthy community of economically active people.
Revisiting the "Bottom of the Pyramid"
A few years back, CK Prahalad’s conceptualisation of “The Fortune at the Bottom of the Pyramid” woke up a large number of corporates and entrepreneurs to the huge business potential that lay dormant in the lower strata of the masses. CKP’s thesis was that 4bn people on earth subsist on less than $2/day, and therefore, collectively and globally constitute a $13 trillion market!
With all noble intentions, CKP argued that this masses at the Bottom of the Pyramid (BOP) should be viewed not as victims or a burden, but as value-driven consumers. If large corporations design and customise their offerings for this huge segment of consumers, it can change their life-style, and enhance the quality of day-to-day living for them.
CKP’s proposal, however, suffers from three underlying biases that permeate much of the contemporary management literature. The purpose of this note is not to diminish the value of the concept of BOP, but to surface these biases and reinterpret the concept, so that real the “fortune” that is embedded in the BOP can be leveraged:
Bias 1: Masses are primarily consumers, and not producers. And therefore, their life becomes “better”, if they get to consume more, and not if they produce more. This assumption, while partially correct, misses out on the entrepreneurial potential that lies in BOP. For instance, it neglects facts such as the exports from Dharavi, Asia’s largest slum in Mumbai, exceeded the total international earnings of a company like Ranbaxy in 2004.
This is allthemore more relevant in context of India where the “unorganised sector” accounts for 93% of the country’s economically active workforce. More than just being consumers, this workforce (consisting of hawkers, construction workers, domestic helps, road-side mechanics, scrap workers, etc.) account for 60% of net domestic product, 68% of national income, 31% of agricultural exports, and 41% of manfactuing exports.
The real “fortune” of BOP lies not merely in serving these low-income markets, but in organising and unleashing the under-utilised entrepreneurial potential of its inhabitants. For instance, Sri Mahila Grih Udyog (more popularly known for Lijjat Papad) mobilised the grassroot entrepreneurship of women into organising them into a Rs. 312crore business. Similarly, Aavishkar India Micro Venture Capital Fund provides venture capital to rural entrepreneurs to leverage rural innovations and appropriate technologies.
Bias 2: The quantum of profits is more important than its source. Like most contemporary management concepts, BOP primarily focuses on how corporates can create and exploit markets to reap large profits (though to be fair, along with “growth” and “profit”, CKP also added “incalculable contributions to humankind” as a benefit of focusing on BOP).
The concept of BOP, however, does not essentially discriminate among the sources from which the profits are generated. It would treat the profits from selling a Rs.5 bottle of aerated drink, or a Re.1 shampoo sachet as identical to the profits generated from making medicines or education available to this segment.
Like much of contemporary management literature, BOP also does not distinguish between the motives of “profit-making” and “being profitable”. Profit-making motive tilts the prioities away from the society to the owners of capital. It follows the dictum of the economist Milton Friedman: “there is one and only one social responsibility of business - to use its resources and engage in activities designed to increase its profits…”
Being profitable, on the other hand, is an imperative for the sustainability of any entrepreneurial venture. As Prof Mohammad Yunus, the founder of Grameen Bank (the largest bank of Bangaldesh which services almost 3mn “poorest of the poor” across more than 40,000 villages) once mentioned: “Volume of profit is not important in Grameen in money-making sense, but important as an indicator of efficiency. We would like to make more profit so that we can reduce interest rate - and pass on the benefits to the borrowers.”
Bias 3: Wealth-creation is same as making profits. Lastly, the BOP concept takes a very narrow view of wealth-creation. It neglects the fact that a society’s “wealth” is not just the income-levels of its members, but also the the sustainability of its community relations and environment. By focusing on profit making, BOP reduces the concept of wealth to just money, and the rest – i.e., the community and the environment - become mere resources which need to be "exploited".
To make BOP a viable concept for social change, there is a need to reinterpret the meaning of wealth. Take for instance, the Yasaswini health insurance scheme, pioneered by Narayan Hrudayalaya in Bangalore, which provides complete health cover (from common cold to brain surgury to 1.7mn farmers at a cost of Rs.5/month). The scheme is self-funding, but the “wealth” it creates is not money, but a healthy community of economically active people.
Tuesday, April 27, 2010
Infinite Games
A Helicopter Tour of The Infinite Games (TIG)
This site consists of an ever-growing, ever-evolving, body of knowledge — a collection of interdependent lenses, strategies, distinctions, examples, stories, tools, offerings, recommendations, forums, connections — all designed to serve those committed to the work of transforming their organizational systems. There is no lack of players who are ready and able to play important roles in this vital societal metamorphosis. As you explore the site sections described below you will find many clues as to how this movement can begin to accelerate.
http://www.theinfinitegames.org/e01/
What Are Infinite Games
James Carse, in his wonderful book, Finite and Infinite Games, suggests:
There are at least two kinds of games.
One could be called finite, the other infinite.
The finite game is played for the purpose of winning,
an infinite game for the purpose of continuing the play,
...and bringing as many persons as possible into the play.
Finite players play within boundaries;
infinite players play with boundaries.
DISTINGUISHING FINITE FROM INFINITE GAMES USING BUSINESS AS AN EXAMPLE
The purpose of business is to make a profit.
The purpose of business is to generate true wealth for all stakeholder groups.
The bottom line is supreme.
Excellent triple bottom line (People, Planet and Profit) performance is essential to ensure both organizational and global sustainability. Two out of three aren't enough.
Our mission is to be the best in the world.
Our mission is to be the best for the world.
Keep your eye on the ball. Do what it takes to achieve this quarter's financial goals.
Design for distributed resilient operational capacities, for excellence in all domains of performance, and for developing leadership's capacity to create a sustainable future—for our organization and for the larger whole.
Divide and conquer.
Connect, collaborate, co-create and co-evolve.
Corporate Social Responsibility is becoming an important compliance issue.
CSR, when approached creatively and proactively, can become a foundational ROI initiative—corporate social opportunity.
Effective leaders are able to motivate and otherwise manage the performance of their people.
Effective leaders create a context where leadership is widely distributed, where motivation is intrinsic in the work design, and where performance development is woven into the fabric of daily operations.
http://www.theinfinitegames.org/e01/03.php
Check out the "Profile" in our Community of Allies section
to see if this site is a fit for you.
http://www.theinfinitegames.org/e02/02.php
This site consists of an ever-growing, ever-evolving, body of knowledge — a collection of interdependent lenses, strategies, distinctions, examples, stories, tools, offerings, recommendations, forums, connections — all designed to serve those committed to the work of transforming their organizational systems. There is no lack of players who are ready and able to play important roles in this vital societal metamorphosis. As you explore the site sections described below you will find many clues as to how this movement can begin to accelerate.
http://www.theinfinitegames.org/e01/
What Are Infinite Games
James Carse, in his wonderful book, Finite and Infinite Games, suggests:
There are at least two kinds of games.
One could be called finite, the other infinite.
The finite game is played for the purpose of winning,
an infinite game for the purpose of continuing the play,
...and bringing as many persons as possible into the play.
Finite players play within boundaries;
infinite players play with boundaries.
DISTINGUISHING FINITE FROM INFINITE GAMES USING BUSINESS AS AN EXAMPLE
The purpose of business is to make a profit.
The purpose of business is to generate true wealth for all stakeholder groups.
The bottom line is supreme.
Excellent triple bottom line (People, Planet and Profit) performance is essential to ensure both organizational and global sustainability. Two out of three aren't enough.
Our mission is to be the best in the world.
Our mission is to be the best for the world.
Keep your eye on the ball. Do what it takes to achieve this quarter's financial goals.
Design for distributed resilient operational capacities, for excellence in all domains of performance, and for developing leadership's capacity to create a sustainable future—for our organization and for the larger whole.
Divide and conquer.
Connect, collaborate, co-create and co-evolve.
Corporate Social Responsibility is becoming an important compliance issue.
CSR, when approached creatively and proactively, can become a foundational ROI initiative—corporate social opportunity.
Effective leaders are able to motivate and otherwise manage the performance of their people.
Effective leaders create a context where leadership is widely distributed, where motivation is intrinsic in the work design, and where performance development is woven into the fabric of daily operations.
http://www.theinfinitegames.org/e01/03.php
Check out the "Profile" in our Community of Allies section
to see if this site is a fit for you.
http://www.theinfinitegames.org/e02/02.php
Sunday, April 25, 2010
Spiritual Politics
Spiritual Principles for a New Economics
© 1996 by Corinne McLaughlin and Gordon Davidson
http://www.visionarylead.org/sp_econ.htm
"From our experience and experimentation with different economic systems, and living according to the spiritual laws of manifestation, there seem to be important principles that govern economic well-being. We would like to share these with you, in hopes that they might be useful in your group or individual life. Please use your own intuition in determining their truth and relevance to your own situation - each individual is unique."
1. THE EARTH HOUSEHOLD
Economics literally means "earth household" a key image for understanding what right economics requires. If we care for the planetary economy as we would our own household, we can see that it must work for all members of the earth household, or it will not work for any part of the human family in the long term. Just as we wouldn't tear our house apart to make a fire to keep warm, or dump garbage in our living room, so we must learn to see the larger household of the earth as we do our own. And we must be concerned about the effect of our actions on future generations who will inhabit the earth.
2. CIRCULATION
The body of our planet is a living organism, (called "Gaia" by the ancients), and all economic interactions from the individual to the international take place within this body of moving energies. If circulation through the system is blocked through manipulation, hoarding, etc., then all parts of the organism suffer. When there is free circulation of goods, resources and services throughout the body, nourishing all parts of the system, then the system as a whole flourishes. Equally, when the whole is cared for all the parts within it are nurtured.
3. CREATOR/PRODUCER FIRST, A CONSUMER SECOND
As individuals develop their creative abilities connected to their spiritual Source, the need to consume from an inner sense of lack transforms into the ability and urge to create and give to the world. We then find our true creation or calling, and trust that what we put forth from our inner Self will be of value to others, and we will receive what we need to live in exchange.
4. ABUNDANCE AND SHARING
When we realize the great abundance-producing, creative energy and potential within us, we overcome the fear of lack or "scarcity consciousness." We are then able to share as we no longer fear "running out." And when we see with the eyes of unity the polarity of giver and receiver dissolves, as we realize that to receive is also giving the opportunity for others to give.
5. FAITH
As we have faith or trust in the abundance of the Life of the Universe we find greater abundance flowing to us. Faith allows us to act "as if" there is abundance and to do what we know is spiritually right for ourselves and others, trusting that it will work out economically for everyone, despite how it may appear to the rational mind. Faith eventually grows into knowing God's law works as we experience it in our lives.
6. AS WE GIVE, SO SHALL WE RECEIVE
We "prime the pump" of the universe by creating a vacuum in our lives by giving our time, money, energy and love to others. Giving is an act of faith that the abundance of the universe will circulate in return. The ancient law of tithing 10% of all income to spiritual purposes honors the Source from which all abundance emerges.
7. CUSTODIANSHIP/STEWARDSHIP
From a higher perspective, we can ultimately possess nothing on the material level, although it may possess us - (because we are too attached to and worried about it!). We can, however, be good custodians of what God has given us. The Great Economist is highly resource - and energy-efficient, and we harmonize with universal laws when we keep our resource channels clear and flowing. When we care for and improve what has been entrusted to us, and release to others things we don't use, we see a new inflow of abundance. And of course an attitude of gratitude brings plenitude.
8. DECENTRALIZATION OF CONTROL
Wealth-producing resources are the "common heritage of all mankind," as recognized by the United Nations in the Law of the Sea Treaty. The benefits of developing productive capacity through ideas, technology, labor or capital need to be shared between those who create the innovation and the social-planetary web that makes the production and wealth possible.
9. LOVE/GOODWILL
Love is the state of being that creates a positive sense of connectedness and allows harmonious economic interaction to take place. In legal terms it is called the "meeting of minds" and is the basis for all contracts, and in business it is called the "goodwill" a business has generated with customers which is assigned a dollar value in the worth of the business. It is the deeper ground of being which gives rise to the values of trust, honesty and fairness.
10. INTERDEPENDENCE
The attempt to achieve total self-sufficiency and self-centered independence emerges from the dominance of the illusory separativeness of the ego consciousness. As we participate in economic life we learn that we are part of an interdependent web of complex interactions, and changes in one part of the web affect all the participants. Thus establishing just, harmonious and honest relationships is the key to economic well-being for all.
11. A FAIR PROFIT
When an individual or business through their labor transforms material substance or provides a service which truly benefits others, without creating harm anywhere, then a fair and equitable profit for the work done is in order. Profit thus allows the service or "good" to be continued to be provided to others. Profit must include considerations of being good for the whole, on all levels both short and long term, or distortions are created.
12. MONEY AS CONCRETIZED ENERGY FLOW
Money is a symbolic medium of exchange among humanity and represents accumulated human and planetary creative energy. It is essentially neutral and its value depends on the uses to which it is put. The highest view of money is to see it as a sacred trust to be used for the good of all humanity.
© 1996 by Corinne McLaughlin and Gordon Davidson
http://www.visionarylead.org/sp_econ.htm
"From our experience and experimentation with different economic systems, and living according to the spiritual laws of manifestation, there seem to be important principles that govern economic well-being. We would like to share these with you, in hopes that they might be useful in your group or individual life. Please use your own intuition in determining their truth and relevance to your own situation - each individual is unique."
1. THE EARTH HOUSEHOLD
Economics literally means "earth household" a key image for understanding what right economics requires. If we care for the planetary economy as we would our own household, we can see that it must work for all members of the earth household, or it will not work for any part of the human family in the long term. Just as we wouldn't tear our house apart to make a fire to keep warm, or dump garbage in our living room, so we must learn to see the larger household of the earth as we do our own. And we must be concerned about the effect of our actions on future generations who will inhabit the earth.
2. CIRCULATION
The body of our planet is a living organism, (called "Gaia" by the ancients), and all economic interactions from the individual to the international take place within this body of moving energies. If circulation through the system is blocked through manipulation, hoarding, etc., then all parts of the organism suffer. When there is free circulation of goods, resources and services throughout the body, nourishing all parts of the system, then the system as a whole flourishes. Equally, when the whole is cared for all the parts within it are nurtured.
3. CREATOR/PRODUCER FIRST, A CONSUMER SECOND
As individuals develop their creative abilities connected to their spiritual Source, the need to consume from an inner sense of lack transforms into the ability and urge to create and give to the world. We then find our true creation or calling, and trust that what we put forth from our inner Self will be of value to others, and we will receive what we need to live in exchange.
4. ABUNDANCE AND SHARING
When we realize the great abundance-producing, creative energy and potential within us, we overcome the fear of lack or "scarcity consciousness." We are then able to share as we no longer fear "running out." And when we see with the eyes of unity the polarity of giver and receiver dissolves, as we realize that to receive is also giving the opportunity for others to give.
5. FAITH
As we have faith or trust in the abundance of the Life of the Universe we find greater abundance flowing to us. Faith allows us to act "as if" there is abundance and to do what we know is spiritually right for ourselves and others, trusting that it will work out economically for everyone, despite how it may appear to the rational mind. Faith eventually grows into knowing God's law works as we experience it in our lives.
6. AS WE GIVE, SO SHALL WE RECEIVE
We "prime the pump" of the universe by creating a vacuum in our lives by giving our time, money, energy and love to others. Giving is an act of faith that the abundance of the universe will circulate in return. The ancient law of tithing 10% of all income to spiritual purposes honors the Source from which all abundance emerges.
7. CUSTODIANSHIP/STEWARDSHIP
From a higher perspective, we can ultimately possess nothing on the material level, although it may possess us - (because we are too attached to and worried about it!). We can, however, be good custodians of what God has given us. The Great Economist is highly resource - and energy-efficient, and we harmonize with universal laws when we keep our resource channels clear and flowing. When we care for and improve what has been entrusted to us, and release to others things we don't use, we see a new inflow of abundance. And of course an attitude of gratitude brings plenitude.
8. DECENTRALIZATION OF CONTROL
Wealth-producing resources are the "common heritage of all mankind," as recognized by the United Nations in the Law of the Sea Treaty. The benefits of developing productive capacity through ideas, technology, labor or capital need to be shared between those who create the innovation and the social-planetary web that makes the production and wealth possible.
9. LOVE/GOODWILL
Love is the state of being that creates a positive sense of connectedness and allows harmonious economic interaction to take place. In legal terms it is called the "meeting of minds" and is the basis for all contracts, and in business it is called the "goodwill" a business has generated with customers which is assigned a dollar value in the worth of the business. It is the deeper ground of being which gives rise to the values of trust, honesty and fairness.
10. INTERDEPENDENCE
The attempt to achieve total self-sufficiency and self-centered independence emerges from the dominance of the illusory separativeness of the ego consciousness. As we participate in economic life we learn that we are part of an interdependent web of complex interactions, and changes in one part of the web affect all the participants. Thus establishing just, harmonious and honest relationships is the key to economic well-being for all.
11. A FAIR PROFIT
When an individual or business through their labor transforms material substance or provides a service which truly benefits others, without creating harm anywhere, then a fair and equitable profit for the work done is in order. Profit thus allows the service or "good" to be continued to be provided to others. Profit must include considerations of being good for the whole, on all levels both short and long term, or distortions are created.
12. MONEY AS CONCRETIZED ENERGY FLOW
Money is a symbolic medium of exchange among humanity and represents accumulated human and planetary creative energy. It is essentially neutral and its value depends on the uses to which it is put. The highest view of money is to see it as a sacred trust to be used for the good of all humanity.
Friday, April 23, 2010
Turning Hustlers into Entrepreneurs
America can reduce poverty by enabling underground businesses
by Kai Wright, from The American Prospect
Excerpted from Utne Reader here;
http://www.utne.com/Politics/Turning-Hustlers-into-Entrepreneurs.aspx
Loretta Harrison is a born hustler.
“I been making and selling things since I was about 8 years old,” says the 45-year-old unemployed mom. She buys wholesale in Manhattan—balloons, socks, scarves, you name it—then loads up a pushcart and sells at retail prices on the streets of Jamaica, Queens. She’s peddled Icees off the back of a tricycle, teamed up with her teenage son to hawk bottled water for a dollar at stoplights, and organized “passion parties” where she brings together groups of women to gab about sex and buy erotic toys. “I love sales,” she says. “For me to have something that somebody else wants and for them to go in their pocket and bring out hard-earned money to get what I have is just—it’s like a high to me.”
Harrison hasn’t worked a traditional full-time job in nearly 14 years, since her eldest son, Malcolm, had a series of seizures in the second grade that resulted in brain damage. “After that, you know, he was a paranoid schizophrenic,” she says. “He’d think he didn’t have enough sugar in his cereal, and he’d run away and tell people we were bothering him. Punch out the windows and stuff.” So she quit her job delivering mail in the neighborhood to take care of him and her then-newborn daughter. “That whole year,” she says, “my Ready Teddy bags were the only thing that kept me going.”
Ready Teddy is Harrison’s pride and joy. It’s a crocheted teddy bear–and-tote combo that she’s been making since 1992. In the past, she’s sold the bags in a Brooklyn craft store for $35 a pop but now moves them herself for $20. “When I had people selling for me, I would charge them $15. They’d sell it for $20 and take out $5,” she explains, rattling off pricing and staffing schemes that have never been written down, let alone put into a business plan.
In fact, Harrison can’t so much as give a ballpark estimate of how much money she’s made or lost year to year on all of her little businesses. She figures that between her sales and her wage jobs—as a supermarket cashier, a newspaper carrier, a crossing guard—her income has probably peaked at $25,000 in a year. “As far as keeping records and whatnot—Loretta’s not so good at keeping records,” she jokes. “Especially when you get the money and you end up having to spend the money to live.”
Whether and how Harrison can actually live off her sales schemes are larger questions than she knows—and ones that may be getting more attention in coming years, as policy makers grope for solutions to the joblessness that’s strangling cities. Unemployment was at 10 percent at the end of 2009. More families went hungry in 2008 than at any time on record—an estimated 17 million households—and the poverty rate reached higher than it has been in more than a decade.
The conventional debate over how to help families who find themselves counted among those doleful statistics focuses on the social safety net—do we boost supports like welfare, provide low-skill job training, or just force folks to try harder to find work? The assumption lurking behind all of these answers is that poor people are broken and need to be fixed, or at least propped up. But a rarely noticed industry of small-business advocates and lenders say the problem is the other way around. What we need, they argue, is an economy that values the remarkable entrepreneurial instincts that people like Harrison already have. Their research suggests that with relatively small investments for training and with loans of as little as $500, small side hustles like Harrison’s could get neighborhoods like Jamaica churning with enterprise.
Microenterprise, as it’s called, has long been associated with the developing world. The Grameen Bank’s Muhammad Yunus pioneered the idea back in 1976 with a $27 loan to a group of Bangladeshi businesswomen following a famine. A global industry has since parceled out billions of dollars in microloans, and Yunus has won both a Nobel Peace Prize and a U.S. Presidential Medal of Freedom. But while the idea owes its fame to the developing world, it has also been slowly building in America since the mid-1980s—it’s just been ignored by an economic and political culture obsessed with the pursuit of large, rapid growth.
Now, with the U.S. economy in disarray, domestic microenterprise advocates believe this is finally their moment in the sun. Both Grameen and the celebrated peer-to-peer lending tool Kiva.org have announced new U.S. ventures since the recession began. And after years of hostility from Bush-era Washington, micro enterprise development has won the support of both the Obama administration and the Democratic Congress.
The effort is thus far relatively tiny: The Association for Enterprise Opportunity (AEO), a trade group, estimates that $100 million to $150 million is invested annually in U.S. microenterprise development. But industry researchers argue that Harrison is among an estimated 10 million low- to moderate-income people who could turn their ideas and hustles into thriving, job-creating businesses—and rescue inner-city economies in the process.
America’s roughly 6 million small businesses—defined as firms with fewer than 500 workers—employ about half the nation’s private-sector workforce. Another 21.7 million people ran their own businesses without employees in 2007. Politicians of all stripes love to laud these folks. In the American political narrative, small-business owners do everything from creating jobs to building communities. And they’re the people for whom Congress is still trying to pry open traditional credit markets. As President Barack Obama proclaimed in May 2009, “The entrepreneurial spirit lies at the core of our nation’s economy and identity.” Microenterprise-development advocates say politicians and bankers shouldn’t view people like Harrison any differently.
Microenterprise is defined, officially, as any business with fewer than five employees that takes less than $35,000 to get off the ground. According to the Aspen Institute’s Microenterprise Fund for Innovation, Effectiveness, Learning and Dissemination (FIELD), the vast majority of these ventures are both owned and staffed by an individual or a family. The AEO estimates that more than 24 million such businesses exist in the United States.
The idea of building upon tiny, family- run businesses has never caught on in U.S. economic-development circles. But according to Aspen’s most recent count, at least 500 organizations around the country either lend money or provide training to people who are trying to use small business to thwart poverty. The field started off providing capital largely to residents in black neighborhoods (particularly to black women) who had been walled off from banks for decades; it has since grown and splintered into both money lending and business training. Fifty-eight percent of the clients of today’s microenterprise-development groups are people of color, according to FIELD, and about 60 percent are women.
The changes driven by microenterprise programs are incremental but nonetheless meaningful. In 2008 Aspen surveyed about 1,400 clients served by micro enterprise-development groups. Over half of those who were living below the poverty line when they joined the programs had risen above it within a year. Average household income went from just under $30,000 to $36,000.
The programs have demonstrated a clear ability to help clients build sustainable businesses. In Aspen’s 2008 survey, nearly two-thirds of people who didn’t have businesses when they entered a program successfully got one started. Those new businesses split about evenly between full-time and part-time ventures; the full-time ones generated median revenues of $40,000 in 2007. That’s not Wall Street money, but it’s enough to move a family out of poverty-wage labor. And the biggest programs show even more potential. ACCION USA—the nation’s largest microlender—spokesperson Laura Kozien says, “For every microloan that ACCION approves, 2.7 jobs are created in low- to moderate-income neighborhoods.”
Tasha Stoudymire started working in department-store photo studios in high school when she took her newborn son for a portrait and ended up applying for a job. Over 11 years, she scraped her way up from $5.15 an hour to $16.70 an hour. “I couldn’t stand it,” she says of the sacrifice demanded by earning that money. “My son said to me, ‘Mama, you work more than you stay home. You go to work and you come home and sleep and shower.’ That hurt me.”
After a series of family and medical issues kept her away from the job, Stoudymire was let go. Now, at age 30, she has a new plan: opening a combination day-care and child-portrait business out of her Queens home. Skills aren’t the hard part. She just has to figure out how to make it all work as a proper business.
One night in the late fall, Stoudymire and a dozen other mothers and grandmothers attended a child-care business-development class conducted by the Business Outreach Center Network, a group that offers training and small loans to mostly immigrant clients. The women listened raptly as a trainer walked them through the impressive array of expertise they already have. “The word just—let’s eliminate that,” the trainer chided one woman, a gray-haired grandmother with a small, informal day care who introduced herself too humbly. “You’re not ‘just’ a child-care provider. You’re a child-care provider.”
Over the next two hours the women traded hard-won child-rearing and babysitting wisdom. Throughout, the trainer nudged the women toward a business owner’s mind-set, noting their legal responsibilities, marketing advantages, and money-saving opportunities. “Start looking at things in your house right now that could be used. Take off your adult cap and think as a child. What’s a toy?” She put a shoebox face down, propped the lid on its edge like a ramp, and sent a toy car sailing downward. “You don’t have to buy this! You’ve all got on shoes.”
Stoudymire and her classmates will go through 22 sessions like this, learn how to acquire free start-up supplies, and qualify to apply for a $1,000 grant. Since 2003, the BOC Network has put almost 800 New York City women through this training and given them more than $170,000 in grants. By BOC’s tally, the businesses those women later built created more than 275 jobs.
At the previous week’s orientation, Stoudymire burst into tears of joy as she listened to the talk about the market advantage of providers who understand kids’ developmental challenges and can help navigate city bureaucracy. She had that feeling all innovators get, that conviction that they know something nobody else does. And she embraced an emotion few have found in the recent economic downturn, declaring, “I’m excited.”
Excerpted from The American Prospect (Jan.-Feb. 2010), a perennial Utne Reader staff favorite for its smart, authoritative political reporting. A 2010 Utne Independent Press Award nominee for political coverage and general excellence.www.prospect.org
http://www.utne.com/Politics/Turning-Hustlers-into-Entrepreneurs.aspx
by Kai Wright, from The American Prospect
Excerpted from Utne Reader here;
http://www.utne.com/Politics/Turning-Hustlers-into-Entrepreneurs.aspx
Loretta Harrison is a born hustler.
“I been making and selling things since I was about 8 years old,” says the 45-year-old unemployed mom. She buys wholesale in Manhattan—balloons, socks, scarves, you name it—then loads up a pushcart and sells at retail prices on the streets of Jamaica, Queens. She’s peddled Icees off the back of a tricycle, teamed up with her teenage son to hawk bottled water for a dollar at stoplights, and organized “passion parties” where she brings together groups of women to gab about sex and buy erotic toys. “I love sales,” she says. “For me to have something that somebody else wants and for them to go in their pocket and bring out hard-earned money to get what I have is just—it’s like a high to me.”
Harrison hasn’t worked a traditional full-time job in nearly 14 years, since her eldest son, Malcolm, had a series of seizures in the second grade that resulted in brain damage. “After that, you know, he was a paranoid schizophrenic,” she says. “He’d think he didn’t have enough sugar in his cereal, and he’d run away and tell people we were bothering him. Punch out the windows and stuff.” So she quit her job delivering mail in the neighborhood to take care of him and her then-newborn daughter. “That whole year,” she says, “my Ready Teddy bags were the only thing that kept me going.”
Ready Teddy is Harrison’s pride and joy. It’s a crocheted teddy bear–and-tote combo that she’s been making since 1992. In the past, she’s sold the bags in a Brooklyn craft store for $35 a pop but now moves them herself for $20. “When I had people selling for me, I would charge them $15. They’d sell it for $20 and take out $5,” she explains, rattling off pricing and staffing schemes that have never been written down, let alone put into a business plan.
In fact, Harrison can’t so much as give a ballpark estimate of how much money she’s made or lost year to year on all of her little businesses. She figures that between her sales and her wage jobs—as a supermarket cashier, a newspaper carrier, a crossing guard—her income has probably peaked at $25,000 in a year. “As far as keeping records and whatnot—Loretta’s not so good at keeping records,” she jokes. “Especially when you get the money and you end up having to spend the money to live.”
Whether and how Harrison can actually live off her sales schemes are larger questions than she knows—and ones that may be getting more attention in coming years, as policy makers grope for solutions to the joblessness that’s strangling cities. Unemployment was at 10 percent at the end of 2009. More families went hungry in 2008 than at any time on record—an estimated 17 million households—and the poverty rate reached higher than it has been in more than a decade.
The conventional debate over how to help families who find themselves counted among those doleful statistics focuses on the social safety net—do we boost supports like welfare, provide low-skill job training, or just force folks to try harder to find work? The assumption lurking behind all of these answers is that poor people are broken and need to be fixed, or at least propped up. But a rarely noticed industry of small-business advocates and lenders say the problem is the other way around. What we need, they argue, is an economy that values the remarkable entrepreneurial instincts that people like Harrison already have. Their research suggests that with relatively small investments for training and with loans of as little as $500, small side hustles like Harrison’s could get neighborhoods like Jamaica churning with enterprise.
Microenterprise, as it’s called, has long been associated with the developing world. The Grameen Bank’s Muhammad Yunus pioneered the idea back in 1976 with a $27 loan to a group of Bangladeshi businesswomen following a famine. A global industry has since parceled out billions of dollars in microloans, and Yunus has won both a Nobel Peace Prize and a U.S. Presidential Medal of Freedom. But while the idea owes its fame to the developing world, it has also been slowly building in America since the mid-1980s—it’s just been ignored by an economic and political culture obsessed with the pursuit of large, rapid growth.
Now, with the U.S. economy in disarray, domestic microenterprise advocates believe this is finally their moment in the sun. Both Grameen and the celebrated peer-to-peer lending tool Kiva.org have announced new U.S. ventures since the recession began. And after years of hostility from Bush-era Washington, micro enterprise development has won the support of both the Obama administration and the Democratic Congress.
The effort is thus far relatively tiny: The Association for Enterprise Opportunity (AEO), a trade group, estimates that $100 million to $150 million is invested annually in U.S. microenterprise development. But industry researchers argue that Harrison is among an estimated 10 million low- to moderate-income people who could turn their ideas and hustles into thriving, job-creating businesses—and rescue inner-city economies in the process.
America’s roughly 6 million small businesses—defined as firms with fewer than 500 workers—employ about half the nation’s private-sector workforce. Another 21.7 million people ran their own businesses without employees in 2007. Politicians of all stripes love to laud these folks. In the American political narrative, small-business owners do everything from creating jobs to building communities. And they’re the people for whom Congress is still trying to pry open traditional credit markets. As President Barack Obama proclaimed in May 2009, “The entrepreneurial spirit lies at the core of our nation’s economy and identity.” Microenterprise-development advocates say politicians and bankers shouldn’t view people like Harrison any differently.
Microenterprise is defined, officially, as any business with fewer than five employees that takes less than $35,000 to get off the ground. According to the Aspen Institute’s Microenterprise Fund for Innovation, Effectiveness, Learning and Dissemination (FIELD), the vast majority of these ventures are both owned and staffed by an individual or a family. The AEO estimates that more than 24 million such businesses exist in the United States.
The idea of building upon tiny, family- run businesses has never caught on in U.S. economic-development circles. But according to Aspen’s most recent count, at least 500 organizations around the country either lend money or provide training to people who are trying to use small business to thwart poverty. The field started off providing capital largely to residents in black neighborhoods (particularly to black women) who had been walled off from banks for decades; it has since grown and splintered into both money lending and business training. Fifty-eight percent of the clients of today’s microenterprise-development groups are people of color, according to FIELD, and about 60 percent are women.
The changes driven by microenterprise programs are incremental but nonetheless meaningful. In 2008 Aspen surveyed about 1,400 clients served by micro enterprise-development groups. Over half of those who were living below the poverty line when they joined the programs had risen above it within a year. Average household income went from just under $30,000 to $36,000.
The programs have demonstrated a clear ability to help clients build sustainable businesses. In Aspen’s 2008 survey, nearly two-thirds of people who didn’t have businesses when they entered a program successfully got one started. Those new businesses split about evenly between full-time and part-time ventures; the full-time ones generated median revenues of $40,000 in 2007. That’s not Wall Street money, but it’s enough to move a family out of poverty-wage labor. And the biggest programs show even more potential. ACCION USA—the nation’s largest microlender—spokesperson Laura Kozien says, “For every microloan that ACCION approves, 2.7 jobs are created in low- to moderate-income neighborhoods.”
Tasha Stoudymire started working in department-store photo studios in high school when she took her newborn son for a portrait and ended up applying for a job. Over 11 years, she scraped her way up from $5.15 an hour to $16.70 an hour. “I couldn’t stand it,” she says of the sacrifice demanded by earning that money. “My son said to me, ‘Mama, you work more than you stay home. You go to work and you come home and sleep and shower.’ That hurt me.”
After a series of family and medical issues kept her away from the job, Stoudymire was let go. Now, at age 30, she has a new plan: opening a combination day-care and child-portrait business out of her Queens home. Skills aren’t the hard part. She just has to figure out how to make it all work as a proper business.
One night in the late fall, Stoudymire and a dozen other mothers and grandmothers attended a child-care business-development class conducted by the Business Outreach Center Network, a group that offers training and small loans to mostly immigrant clients. The women listened raptly as a trainer walked them through the impressive array of expertise they already have. “The word just—let’s eliminate that,” the trainer chided one woman, a gray-haired grandmother with a small, informal day care who introduced herself too humbly. “You’re not ‘just’ a child-care provider. You’re a child-care provider.”
Over the next two hours the women traded hard-won child-rearing and babysitting wisdom. Throughout, the trainer nudged the women toward a business owner’s mind-set, noting their legal responsibilities, marketing advantages, and money-saving opportunities. “Start looking at things in your house right now that could be used. Take off your adult cap and think as a child. What’s a toy?” She put a shoebox face down, propped the lid on its edge like a ramp, and sent a toy car sailing downward. “You don’t have to buy this! You’ve all got on shoes.”
Stoudymire and her classmates will go through 22 sessions like this, learn how to acquire free start-up supplies, and qualify to apply for a $1,000 grant. Since 2003, the BOC Network has put almost 800 New York City women through this training and given them more than $170,000 in grants. By BOC’s tally, the businesses those women later built created more than 275 jobs.
At the previous week’s orientation, Stoudymire burst into tears of joy as she listened to the talk about the market advantage of providers who understand kids’ developmental challenges and can help navigate city bureaucracy. She had that feeling all innovators get, that conviction that they know something nobody else does. And she embraced an emotion few have found in the recent economic downturn, declaring, “I’m excited.”
Excerpted from The American Prospect (Jan.-Feb. 2010), a perennial Utne Reader staff favorite for its smart, authoritative political reporting. A 2010 Utne Independent Press Award nominee for political coverage and general excellence.www.prospect.org
http://www.utne.com/Politics/Turning-Hustlers-into-Entrepreneurs.aspx
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