Shocked by the NSA revelations? You don’t know the whole story

A review of Big Data: A Revolution That Will Transform How We Live, Work, and Think, by Viktor Mayer-Schoeneberger and Kenneth Cukier

@@@@ (4 out of 5)

While Edward Snowden bounces from one temporary refuge to another in search of safe harbor from the long arms of the U.S. government, the American public is starting to wake up to the reality of Big Data. The National Security Agency, long one of the pioneers in this burgeoning but little-appreciated field, has been teaching us — or, rather, Snowden, The Guardian, and the Washington Post have been teaching us — about the power that resides in gargantuan masses of data. Now here come Viktor Mayer-Schoeneberger and Kenneth Cukier with a new book that goes far beyond the headlines about espionage and invasion of privacy to give us an eminently readable, well-organized overview of Big Data’s origins, its characteristics, and its potential for both good and evil.

When we think of Big Data, we, or at least most of us, think of computers. However, the authors persuade us that the fundamentals of Big Data were laid down more than a century before the invention of the microprocessor. They point to a legendary American seaman named Matthew Maury. In the middle of the 19th Century, after 16 years of effort, Maury published a book based on 1.2 billion data points gleaned from old ships’ logs stored by the Navy that dramatically reduced the distances (and, hence, the time elapsed) in ocean voyages by both military and commercial ships. Maury used facts derived from decades of mariners’ observations to dispel the myths, legends, superstitions, and rumors that had long caused ocean-voyaging ships to pursue roundabout courses. Not so incidentally, Maury’s work also facilitated the laying of the first transatlantic telegraph cable.

If not the first, this was certainly an early application of Big Data, which the authors describe as follows: “big data refers to things one can do at a large scale that cannot be done at a smaller one, to extract new insights or create new forms of value, in ways that change markets, organizations, the relationship between citizens and governments, and more.” For example, if Maury had had available only a fraction of the old ships’ logs he found in the naval archives, his task would have been impractical, since each individual log doubtless included small errors (and an occasional big one). Only by amassing a huge store of data did those errors cancel out one another.

Now, in the Digital Age, the volumes of data that can be harnessed are, at times, literally astronomical. “Google processes more than 24 petabytes of data per day, a volume that is thousands of times the quantity of all printed material in the U.S. Library of Congress.” AT&T transfers about 30 petabytes of data through its networks each day. Twenty-four or 30 of something doesn’t sound like much, unless you understand that a megabyte is a million bytes, a gigabyte is a billion bytes, a terabyte is 1,000 times the size of a gigabyte, and a petabyte is 1,000 times the size of a terabyte. That’s 1,000,000,000,000,000 bytes. That’s a lot of data! But even that’s only a tiny slice of all the data now stored in the world, “estimated to be around 1,200 exabytes.” And an exabyte (I’m sure you’re dying to know) is the equivalent of 1,000 petabytes. So, 1,200 petabytes could also be stated as 1.2 zettabytes, with a zettabyte equal to 1,000 petabytes, and I’ll bet that not one person in a million has ever heard of a zettabyte before. Had you?

All of which should make clear that when we talk about Big Data today, we’re talking about really, really big numbers — so big, in fact, that almost no matter how messy or inaccurate the data might be, it’s usually possible to draw useful, on-target insights from analyzing it. That’s what’s different about Big Data — and that’s why the phenomenon is bound to change the way we think about the world.

We live in a society obsessed with causality. We often care more about why something happened than about what it was that happened. And in a world where Big Data looms larger and larger all the time, we’ll have to get used to not knowing — or even caring much — why things happen.

“At its core,” write Mayer-Schoeneberger and Cukier, “big data is about predictions. Though it is described as part of the branch of computer science called artificial intelligence, and more specifically, an area called machine learning, this characterization is misleading. Big data is not about trying to ‘teach’ a computer to ‘think’ like humans. Instead, it’s about applying math to huge quantities of data in order to infer probabilities: the likelihood that an email message is spam; that the typed letters ‘teh’ are supposed to be ‘the’; that the trajectory and velocity of a person jaywalking mean he’ll make it across the street in time [so that] the self-driving car need only slow slightly.”

The authors refer to data as “the oil of the information economy,” predicting that, as it flows into all the nooks and crannies of our society, it will bring about “three major shifts of mindset that are interlinked and hence reinforce one another.” First among these is our ever-growing ability to analyze inconceivably large amounts of data and not have to settle for sampling. Second, we’ll come to accept the inevitable messiness in huge stores of data and learn not to insist on precision in reporting. Third, and last, we’ll get used to accepting correlations rather than causality. “The ideal of identifying causal mechanisms is a self-congratulatory illusion; big data overturns this,” the authors assert.

If you want to understand this increasingly important aspect of contemporary life, I suggest you read Big Data.

Viktor Mayer-Schoeneberger and Kenneth Cukier come to the task of writing this book with unbeatable credentials. Mayer-Schoeneberger is Professor of Internet Governance at Oxford University, and Kenneth Cukier is Data Editor at The Economist.

A small publisher that thrives in a declining industry

By Steve Piersanti

Editor’s note: For the past year I’ve been serving on the board of directors of the remarkable little publishing company in San Francisco that will release my new book, The Business Solution to Poverty, in September. Berrett-Koehler publishes nonfiction exclusively, concentrating on business, personal fulfillment, and current affairs. Unlike so many other publishers, the company has been consistently profitable throughout the past decade, outpacing industry standards with rising sales as the book market shrinks. Berrett-Koehler was founded 21 years ago by Steve Piersanti, who continues to serve as editor and president.

In keeping with Piersanti’s inclusive style, more than 100 of the company’s stakeholders—board members, staff, authors, suppliers, service providers, customers, sales partners, and shareholders—as well as several industry experts unconnected to the company gathered on June 18-19, 2013, to participate in Berrett-Koehler’s strategic planning process. (Full disclosure: I also serve on BK’s Strategic Planning Team and helped prepare the event.) What follows is adapted from Steve’s opening remarks for the two-day event. He entitled his presentation “Secrets of Berrett-Koehler’s Success.” 

The article that follows is long (more than 5,000 words) but it’s well worth reading if you want to know what it takes to flourish in an industry—any industry, actually—that is experiencing disruptive change.

1.     Multiple Stakeholder Focus

This is really the foundational concept of Berrett-Koehler. This concept came before our publishing programs, our mission, our books, everything. It goes back to before Berrett-Koehler existed. Before founding BK, I had been president of Jossey-Bass Publishers during its challenging transition from being an independent company to becoming part of the media empire of Robert Maxwell and being placed as a division of Maxwell Communications Corporation. I quickly discovered that our new corporate parent was calling all the shots, and none of the other Jossey-Bass stakeholders really mattered. Not the Jossey-Bass employees who were central to the company’s success; not the authors with whom Jossey-Bass had longstanding relationships; not the suppliers and service providers on whom the company depended. All that really mattered was the call from my boss in New York City.

What was especially troubling about this new balance of power was that there was nothing our new corporate parent was doing that made Jossey-Bass more productive or profitable. Yet, without adding any value, the corporate parent presumed to unilaterally govern our company. It was easy to see that something was deeply wrong with this equation.

And so, when I created Berrett-Koehler’s founding document, “Vision and Plan for a New Publishing Business,” the starting place for my attempt to “rethink the concept of the publishing company” was what I called “Multiple Stakeholder Focus.” “Five ‘stakeholder’ groups – authors, employees, suppliers, owners, and communities (customer, societal, and environmental) – contribute to the success of publishing ventures. Each has a ‘stake’ or investment in the publishing business, whether that investment is time, talent, money, or other resources . . . Berrett-Koehler believes that more balance and equity is needed in the dealings among the stakeholder groups, so that the employees, authors, suppliers, and communities benefit more from the investment each makes and the value each creates for the publishing business. Berrett-Koehler also believes that the relationship among the stakeholder groups needs to be more of a partnership and more fair, open, humane, ethical, and interactive among all of the groups.”

An early manifestation of this focus was that our very first catalog in May 1992 listed many of our stakeholders by name in the catalog. We’ve done this in every catalog since then.

2.     Stewardship

This has gone hand-in-hand with multiple stakeholder focus from the beginning. We were deeply influenced by the ideas in Peter Block’s book Stewardship, which I started working on with Peter right after I began organizing Berrett-Koehler Publishers. In our first catalog I wrote: “If I were to choose one word to describe our vision, it would be ‘stewardship.’ By this I mean a deep sense of responsibility to administer the publishing company for the benefit of all of our ‘stakeholder’ groups.”

Block defines stewardship as “the willingness to be accountable for the well-being of the larger organization by operating in service, rather than in control, of those around us. Stated simply, it is accountability without control or compliance.”

So here was our role as BK managers and employees: to be accountable for serving the interests of all of BK’s stakeholders without needing to do so through control or compliance. Actually, we hope that all BK stakeholders will view themselves as stewards who are accountable for serving the interests of other stakeholders and the whole without needing control or compliance to do so.

3.     Community Engagement and Support

A couple of years into my service as president of Jossey-Bass Publishers I got a call from my boss in New York in which he said that there was a corporate-wide workforce reduction going on and all units were required to cut their headcount by 10 percent. Jossey-Bass had 68 employees, and we were instructed to reduce our headcount to 60 employees. This made no rhyme or reason for Jossey-Bass because we were highly successful and growing rapidly; we had just finished a year in which our sales were up 22 percent and our profits were up 46 percent. Moreover, our business plan of adding 8 more employees had already been approved, and now we were told that we had to instead cut 8 employees. This would have required us to lay off 8 employees, which was unjust and unjustified to me, given the circumstances.

Long story short, our management team fought this edict for two months and I refused to carry out the corporate order. On the afternoon of May 29, 1991, I was fired and told to clean out my desk. But the grapevine worked very quickly and the very next day at my home my phone started ringing with calls from Jossey-Bass authors, suppliers, and service providers who expressed their dismay at this chain of events, their belief in my work and stance, their encouragement to start a new publishing company, and their offers of support. These calls continued for many weeks, as one person who had heard the news would tell another person and encourage that person to contact me, and so on. It was through the support and engagement of all these people that Berrett-Koehler Publishers was born. Listed on the screen are some of the many people who became part of our original community in the first few months when Berrett-Koehler was being organized.

Today there are hundreds of ways that BK engages our communities and receives support from our communities. In the interests of time, I’m going to mention just one. BK authors and other community members are an army of scouts out searching for good authors and good book projects for us and recommending to those authors that BK would be the best publisher for their books. They are the most credible and influential scouts we could possibly have because they know so much about their fields and about BK.

Here’s how bestselling author Peter Block describes this engagement: “I have been a constant source of new authors. When someone comes to me about publishing a book, BK is the first place I send them. I do this partly because I know they will be treated with respect, and they will learn something about the market for their ideas. Most people I refer to BK get refused, but in a useful and sensitive way. So this publisher has a low cost feeder network for new properties, the life blood of the business.”

And here’s how bestselling author Richard Leider describes this engagement. “I have proudly referred dozens of would-be authors to BK over the years. So many that they have offered, partly in jest, to print a BK business card for me! Whether an author landed a contract with BK or not, EVERY single one of them thanked me for the care and insights that they received from BK. Now, that’s walking your talk!”

4.     Publish Books That Make a Difference

When our Editorial Director, Neal Maillet, applied several years ago to work at Berrett-Koehler, he wrote: “As a business and leadership editor whose titles frequently competed for shelf space with BK, I can only express my deep sense of admiration and, to be honest, envy, for the consistent sense of mission and values that BK titles communicate. BK books are for people who are determined to improve themselves and their organizations – not just to rely on corporatespeak or easy answers. BK titles always present a challenge and an invitation – the challenge to do the hard but rewarding work of making positive change, and the invitation to seek beyond self-gratification to community . . . More than anything, a BK book isn’t just a product to be sold. It is invariably part of a message that is consistent across the entire organization.”

It may surprise you but publishing books with a difference-making message was not part of the original concept of Berrett-Koehler. The original concept was more mainstream, which I described as “Leading-edge publications that make new contributions to professional audiences.” But this quickly changed. The books we attracted – and the books that most interested us – were books with big, path-breaking messages about changing individuals, organizations, and the world.

This started with Leadership and the New Science, which was one of the first three books BK published. When a former college advisor of mine sent me Meg Wheatley’s manuscript, I immediately saw that this was different from all the hundreds of books that I had worked on in my previous thirteen-year career as an editor and book marketer. The Library Journal review captured the difference: “Hold onto the top of your head when you read this book . . . Using exciting breakthroughs in biology, chemistry, and especially quantum physics, Wheatley paints a brand-new picture of business management . . . nothing less than an entirely new set of lenses through which to view our organizations.” A newspaper columnist called “The Lazy Literate” expressed the uniqueness of Meg’s work on her next book in a less flattering way: “Yikes! These folks have been eating too many avocados in their hot tubs!” Either way, Leadership and the New Science went on to not only sell nearly 400,000 copies but also to profoundly influence the work of thousands of other book authors, organizational thinkers, and organizational leaders.

In our 20^th Anniversary Celebration a year ago, I cited the case of how a single BK book, Future Search, has made a positive difference for tens of millions of people around the world through the many thousands of future searches in more than 90 countries that have been conducted by the more than 4,000 people who have been trained in the future search methodology.

To give a very current example, the annual meeting this month of the foreign ministers of the thirty-five member countries of the Organization of American States focused on drug problems in North America, Central America, and South America. This meeting was organized around the methodology of Adam Kahane in his new BK book, Transformative Scenario Planning. For the past year the president of Columbia and other country presidents and prime ministers have been working to develop new approaches to drug problems, and they turned to Adam Kahane and his book’s transformative scenario planning methodology to help create and articulate those new approaches.

5.     Eat Our Own Cooking

From the beginning, we have been striving to learn from the books we publish and to practice our book’s ideas in our own company and community.

For example, a central concept in Stewardship is to avoid class systems in management, employment, and compensation practices. One manifestation of class systems is that most organizations have two compensation systems, with the executive compensation system designed to pay those at the top as much as possible and the employee compensation system designed to control costs. Inspired by Stewardship, Berrett-Koehler has just one compensation system for everyone in the company, and it is designed to pay a living wage to everyone, to minimize the disparity between the lowest and highest paid employees, and to direct our company success to raising the whole boat. Accordingly, the difference between my salary and the salary of the lowest paid full-time BK employee has always been less than four to one from the beginning of our company until now. And the same benefit programs and incentive compensation programs apply to everyone.

Another example. Anyone who interacts with Berrett-Koehler soon learns that our culture is all about sharing information openly and freely, so that everyone knows everything. We are open source with authors, suppliers, customers, service partners, and even competitors. And I have always perceived my job to be continuously sharing information in many ways with all of our stakeholder groups. But you may not know the source of this culture and practice. It all started with internalizing the ideas in Chapter 6 of Leadership and the New Science, which is called “The Creative Energy of the Universe – Information.”  Read that chapter, and you’ll see what I mean.

BK has also been influenced by another of the first three books we published: Getting Things Done When You Are Not in Charge. Give up the illusion that you are ever in charge. None of us is ever in control. But we all can get things done when we are not in charge. Of course, this lesson applies to this event. We all can get important things done by acting on ideas that inspire us here even though none of us is in charge of others here.

Finally, here’s an example in the words of our tremendous Director of Subsidiary Rights, Maria Jesus Aguilo: “I was hired as a production and marketing assistant in 1996. At about that time we were publishing Managers As Mentors, so my boss at the time, Pat Anderson, took me aside and told me: I just finished this fantastic book and I really feel like I need to be a good mentor to you. Therefore, I would like us to talk about what it is that you expect from your work here at BK and help you all I can. I told her that I was very happy with my position and learning a lot, but what I would really like to do is rights licensing. A couple of years went by before an opportunity presented itself for me to do rights, but when it did, Pat offered me the position. I learned two things early on in my career at BK: that BK really walks the talk in ways that deeply affect others, and that my managers at BK really listened to my needs and acted upon them. Almost twenty years later, I still derive a lot of inspiration for my work from how the ideas in our books change lives in big and small ways. They changed mine!”

6.     Mission: Creating a World That Works for All

For the first eight years of BK’s history we were in search of a way to express our mission. A mission articulates the fundamental purpose of an organization or enterprise, succinctly describing why it exists. We tried many different ways of expressing our mission. Some are shown on the screen. All had good points, but we were not satisfied with any of them. So we made articulating our mission one of the central objectives of our strategic planning process in the year 2000. “Creating a World That Works for All” emerged from that process and has been our mission ever since.

What has happened over the past thirteen years is that “Creating a World That Works for All” has come to be shorthand for everything that BK community members love about Berrett-Koehler. It has come to signify – all wrapped up in one short memorable phrase – our multiple stakeholder focus, books that make a difference, stewardship, partnership, sustainability, and many other dimensions of BK. It has come to have great meaning for many BK community members, who use it frequently in telling others about BK and expressing their own connection to BK. It has also served to communicate to authors and others a BK point of view, and this point of view is one of our major competitive advantages, as book marketing consultant Todd Sattersten recently pointed out to us.

What does this mission mean in terms of seeking changes in the world, selecting publications that advance these changes, and striving to pursue these changes in our own company and community?

7.     Partnership

Partnership is the way we seek to run Berrett-Koehler and to interact with all of our stakeholder groups – with collaboration, invitation, dialogue, consent, respect, openness, integrity, and mutualism, instead of compulsion, force, violence, or hierarchy.

Partnership is at the heart of the relationship we strive to establish with authors. One manifestation of partnership is our publication agreement, which has many clauses that create a more collaborative relationship between the publisher and authors than is the norm in other companies’ publication agreements.

The fullest manifestation of our partnership with authors is the BK Authors Cooperative, the one-of-a-kind organization where our authors come together to help each other in many big and small ways to increase their success and impact.

We are now seeking to establish a Berrett-Koehler Foundation that would further extend our partnership approach to helping young leaders around the world put into practice systems-changing ideas and methods that help create a world that works for all.

This partnership approach extends to our relationships with our suppliers, service providers, sales partners, and other stakeholders, as I’ll describe in later examples.

8.     Quality and Value Added

All of our systems and approaches are designed to add value and create quality throughout the publishing process. For example, we create high quality in our books by forming longstanding, close, collaborative partnerships with about twenty of the best book production teams around the country, then by sending each new book to the book production team best matched to the unique requirements of that particular book, then by that production team, the author, and the BK staff all working closely together to customize and enhance the book.

Throughout the book publishing world there are constant lamentations about decades of decline in how much editorial guidance and support publishers offer to authors. In contrast, one secret of BK’s success is the extensive editorial guidance and support we provide to authors. We do this in three ways, of which only the third way is common today among other publishers. First, we do a great deal of up-front editorial coaching of authors to improve the core ideas, organization, and framing of books, even before draft manuscripts are written. Second, we send all draft manuscripts to multiple outside reviewers who provide readers’ views of how to improve manuscripts. And third, we arrange top-notch copyediting of manuscripts.

This quality pays off in helping many BK publications to be bestsellers, not just upon publication but for many years following publication. Three BK books have each sold well over one million copies: Confessions of an Economic Hit Man by John Perkins, Eat That Frog! by Brian Tracy, and Leadership and Self-Deception by The Arbinger Institute. In each case BK provided editorial guidance that made the book sell far more copies and have greater impact than otherwise would have been the case. For example, my and our manuscript reviewers’ guidance tremendously strengthened John Perkins’ messages in Confessions of an Economic Hit Man, anticipated the major challenges from critics, and helped Perkins add and clarify materials to address the challenges before the book was published.

9.     Author-Friendly Practices

When Corporate Responsibility Officer magazine gave Berrett-Koehler its award for “Stakeholder Accountability,” it told the following story in the article announcing the award. “At first, Howard Karger says, he couldn’t figure it out . . . A two-time Senior Fulbright Scholar, Karger is the author of multiple books. In late summer of 2004 he found himself working for the first time with Berrett-Koehler . . . [He said] ‘After 25 years of book publishing, I was suspicious . . . I was made to feel like a part of the organization. Almost like staff.’  He grew more wary when the publisher insisted that he travel to San Francisco to meet editorial, marketing, design, and publicity staff. Finally, he realized, ‘these were people doing what they believed in and producing books they were proud of. Democracy for Berrett-Koehler is not just a slogan.’ [The article concludes] In the rough-and-tumble world of book publishing, Berrett-Koehler stands out not only for its treatment of authors, but also for the manner in which it engages employees, business partners, readers, and community.”

This article is describing one of Berrett-Koehler’s many unique practices: launching each book with a full-day Author Day that connects the author to the whole BK staff, gets everyone excited about the book, and creates close collaboration between the author and publisher on all aspects of making books successful.

BK’s author-friendly practices include the following:

• Author-friendly publication agreement
• Collaboration in publication decisions
• Collaboration in cover and interior design
• Extensive sharing of information
• Open access to BK staff on ongoing basis
• Responsiveness to authors’ contacts and requests
• “Author Day” for every author
• “Bill of Rights and Responsibilities for BK Authors”
• and the unique BK Authors Cooperative, an independent nonprofit organization.

10. Integrity and Transparency

These are two elements of partnership. I’ve decided to feature them separately because they pull together so many other dimensions of what makes BK work, as does Jamie and Maren Showkeir’s book Authentic Conversations.

One example of the power of our sharing information openly is our how our partnerships have worked with our two principal book printers, Malloy and Hamilton. There have been times in BK’s history, such as from 2001 to 2003, when we faced severe cash flow shortages and probably could not have kept operating as an independent company without agreement from our printers to extend substantial additional credit to BK even though we were far behind in payments on previous printing jobs. Here is the explanation from Bill Upton, Malloy’s president at the time, for why Malloy continued supporting BK: “One experience that stands out is how open you were with financial information, both current and projected, as you worked with Hamilton and Malloy during the years of loans and past-due payables with us. That openness is what made it possible for both printers to hang in there and continue to support BK.” He continued: “The obvious integrity and commitment of you and the entire staff was a very important factor. We’ve had experiences with other publishers in the past where they expanded their trade credit by working with additional suppliers – our old invoices were left unpaid while the publisher worked with new suppliers on a cash terms basis. We’ve also had publishers simply throw in the towel. Those scenarios were unimaginable with BK.” Fortunately, this trust paid off both for our printers and for BK. For some years BK has been, in Bill Upton’s words, “a model of correct, prompt, complete, problem-free bill paying.”

Our focus on doing what we say we will do, not overpromising, creating systems to fulfill promises, and holding ourselves accountable is especially noteworthy in the area of sales and marketing. Publishers are notorious for making lofty sales and marketing promises in their early discussions with authors and then not fulfilling their promises. Berrett-Koehler has just the opposite approach, which begins with being straight with authors about “The 10 Awful Truths about Book Publishing” [which can be accessed by clicking on its title here]. The rubber really hits the road with the extensive systems that our Sales and Marketing Department has set up (1) to explicitly tell authors all the things we will and will not be doing to market their books, (2) to follow through on everything that we said we would do, and (3) to report back to authors that we have done what we said we would do.

We strive to create systems of integrity and transparency in all areas of the company. For example, our book production systems are set up to enable us to publish books almost always on the schedule laid out at the beginning of the production process.

All of this is extremely challenging in an industry as complex as book publishing. BK Editorial Director Neal Maillet reflects this challenge when he reports, “I once asked the manager of a publisher’s royalty department how she kept track of all the tricky contractual exceptions editors negotiated and was told ‘We don’t – we just use the boilerplate and apologize profusely when an author or agent catches the mistake.’”

BK’s approach is to only commit to things that we can deliver, to create systems that enable us to actually fulfill our commitments, and to share information with our stakeholders that show how we have performed what we promised to do.

11.  Sustainability

Here I am focusing on two dimensions of sustainability. The first dimension is the thrust of many of our books, such as those pictured here, to establish lifestyles, institutions, economic systems, environmental systems, and other ways of living and interacting that are sustainable for generations going forward. The second dimension is establishing strategies and practices that make Berrett-Koehler Publishers sustainable both in terms of being able to stay in business and in terms of the environmental and social responsibility of our own business practices.

One embodiment of our commitment to sustainability is that Berrett-Koehler is a Certified B Corporation. B Corporations meet rigorous standards of social and environmental performance. To qualify as a B Corp, Berrett-Koehler had to complete and pass a 230-question “Impact Assessment” that examined BK’s performance on measures of corporate accountability, transparency, compensation, benefits, employee training, worker environment, worker ownership, social benefit, community service, local involvement, diversity, job creation, and environmental practices.

12.  Multichannel Marketing and Sales

This has been part of BK’s formula from the very beginning. Our June 1991 “Vision and Plan for a New Publishing Business” listed 17 sales and marketing channels for the company. Today we still are active in all of the original 17 channels and have added many other channels, such as online booksellers and social media, which did not exist in 1991.

Our multichannel approach is good for authors and book sales because it increases each publication’s chance to succeed in the marketplace by giving each publication many diverse channels in which to find a market. For example, some books do poorly in bookstore sales but do well in special sales or foreign language translations.

Of course most publishers market through multiple channels. But most do not market as extensively in as many different channels as does BK.

The downside of BK’s approach is that it is very expensive. Berrett-Koehler devotes over 20 percent of our revenues to sales and marketing, which is far above publishing industry averages.

13.  Independence

In an age of corporate consolidation, BK has remained fiercely independent. Berrett-Koehler is owned by our stakeholders, including our employees, authors, customers, suppliers, service providers, and sales partners.

This independence allows us to chart our own course and to not have our unique values and practices submerged in a giant corporate bureaucracy. And it allows us to own our own future and to not be governed by short-term stock market pressures and shifting corporate edicts.

14.  Continuity, Constancy, Fidelity

One of BK’s great strengths has been our ability to keep good people and the resulting continuity of our staff. 18 of our 25 employees have been with BK for 5 or more years. And our average staff tenure with BK is 10 years. Love ‘Em or Lose ‘Em has not only been a bestselling BK book, it has also been a guide to our company.

Another secret to our success has been the constancy of our purpose, vision, and distinctive practices over many years. Our list of 11 “Guiding Concepts for Berrett-Koehler Publishers” was written 21 years ago. All of these “Guiding Concepts” are still our touchstones today – such as multiple stakeholder focus and environmental consciousness and action. This constancy increases our ability to move Full Steam Ahead!, as the title of Jesse Stoner and Ken Blanchard’s book proclaims.

When people ask me what about Berrett-Koehler I am most proud about, my answer is our fidelity to our mission and values during the many challenging periods we have had over the years. For example, when the great recession hit in 2008 and 2009, like most publishing companies we experienced a substantial revenue decline. However, we decided to respond to this crisis by doing more of what BK stands for – under the headings of Integrity, Mission and Strategies, Participation, and Efficiency and Effectiveness – rather than compromising our mission and values. Whereas Publishers Weekly reported that approximately two thirds of publishing companies laid off employees and cut back their publishing programs during this period, Berrett-Koehler did neither. Instead, we shared full information with all employees, and the employees collectively decided to take a 10 percent across-the-board salary reduction (except for the lowest-paid employees, who received smaller reductions), which the employees then lifted after revenues recovered. My hope is that our identity as a company and community is so deeply imprinted that it will be our destiny and carry us through the many other challenging periods that are surely yet to come.

15.  Continuing Innovation

The previous 14 secrets may make it sound like BK is in good shape. However, it is clear that we cannot stand still. Everything is going through continuous change around us in our business and publishing environments. Unless we are leaders ourselves in making the future, unless we do new and surprising things to leapfrog over obstacles that have constrained us in the past, and unless we continue developing new ways of doing business that bring greater value to our customers and other stakeholders, Berrett-Koehler will not survive over the long term.

Larry Ackerman, author of Identity Is Destiny, recently observed that BK is now 21 years old and that this age can be viewed as having reached “adulthood.” I think that is a good image for where we are now. At 21, it is time to turn more of one’s focus outward to contributing to a larger work and to making a bigger difference in the world through service to others. This can be true of Berrett-Koehler as well and this event can help BK reach out in new and better ways to make a greater positive difference in the world.

As we seek to innovate in new ways, it is my prayer that we will continue to be guided by the secrets named in this address. I believe that there is great power within these ideas and that they will make our innovations better and more likely to succeed. We can do more to create a world that works for all. Thank you.

Berkeley scientist questions safety of bottled water

A review of Bottled and Sold: The Story Behind Our Obsession with Bottled Water, by Peter H. Gleick

@@@@@ (5 out of 5)

Put down that bottle of water, please, take a deep breath, and listen up. It’ll only take a few minutes, and when I’m done, you may never pick up a bottle of water again.

“Bottled water? This is a problem?” Yes, to Berkeley scientist Peter Gleick, co-founder and president of the world-renowned Pacific Institute, “bottled water is a symptom of a larger set of issues: the long-term decay of our public water systems, inequitable access to safe water around the world, our susceptibility to advertising and marketing, and a society trained from birth to buy, consume, and throw away. . . Suburban shoppers in America lug cases of plastic water bottle from the grocery store back to homes supplied with unlimited piped potable water in a sad and unintentional parody of the labor of girls and women in Africa, who spend countless backbreaking hours carrying containers of filthy water from distant contaminated sources to homes with no water at all.”

Bottling water on a large scale is a relatively new phenomenon. “In the late 1970s,” Gleick writes, “around 350 million gallons of bottled water were sold in the United States — almost entirely sparkling mineral water and large bottles to supply office water coolers. . . In 2008, nearly 9 billion [author’s emphasis] gallons of bottled water were packaged and sold in the United States and five times this amount was sold around the world.” That’s a 25-fold increase in three decades, and “Americans now drink more bottled water than milk or beer.” (Betcha didn’t know that, did you? I sure didn’t!) Now, “data on beverage consumption reveals that on average, each of us is actually drinking around 36 gallons per year less tap water.”

Gleick notes that “when we do actually look, we find evidence that there are potentially serious quality problems with bottled water. . . [However], [t]he system for testing and monitoring the quality of bottled water is so flawed that we simply have no comprehensive assessment of actual bottled water quality.”

So, why hasn’t somebody done something about this? It turns out that the FDA is the culprit. Bottled water falls within the FDA’s purview. Gleick cites a study by the Government Accountability Office to the effect that “while the FDA does very few actual inspections of water bottlers, the few they conducted between 2000 and 2008 found problems a remarkable 35 percent of the time. Even this warning sign led to ‘little enforcement action.'”

OK, maybe you feel bottled water tastes better than water from the tap. But you’re probably fooling yourself. As Gleick reports, “test after test shows the same things: people think they don’t like tap water, but they do. Or they think they can distinguish the taste of their favorite bottled water, but they can’t.” Just check out “bottled water taste test” on YouTube, if you don’t believe this.

Here, then, are the Top Ten Reasons Not to Drink Bottled Water:

10. Tap water is free, and bottled water isn’t.

9. The quality of tap water is rigorously regulated, and bottled water’s isn’t.

8. Discarded plastic water bottles end up in landfills or on roadsides by the billions. For example, “Berkeley (population 114,000) sends around six tons of PET [the plastic used in water bottles] a week to plastics recyclers — much of it used water bottles.”

7. Large scale water-bottlers sometimes drain aquifers and cause wells to run dry in communities where their plants are located.

6. Large corporations such as Nestle (Pure Life), Coca-Cola (Dasani), and PepsiCo (Aquafina) own the major bottled water brands and suck in massive profits, making them even larger.

5. Most bottled waters are marketed in a misleading way. For examples, “Yosemite” brand water is actually municipal tap water from Los Angeles.

4. “Making the plastic for a liter bottle of water actually takes three or four more liters of water itself.”

3. If you live in California “and buy Fiji Water, the energy cost of transporting the water to you is equal to the energy embodied in the plastic bottle itself.” If it’s Evian water instead, the energy expended is even greater.

2. The total energy cost of bottled water, including the materials used, the production process, and the transportation, “is a thousand times larger than the energy required to procure, process, treat, and deliver tap water.”

1. Smart restaurateurs like Alice Waters are starting to ban bottled water on their tables. And who are you going to believe if you won’t believe Alice?

So, are you ready now to reconsider the balance between the convenience of bottled water and the safety of tap water? Chances are the water from your tap is a much better bet. That’s certainly the case where I live in Berkeley.

Our own personal considerations aside, Gleick draws policy implications from his study of bottled water. He advocates five major reforms: state-of-the-art tap water systems; smarter water regulations; truthful labeling; consumer protection; and lower environmental impact.

If you’ve heard of Peter Gleick, it may be because you came across his name when he won a MacArthur Foundation “genius” grant — or perhaps in connection with global warming, international development, national security, California’s water resources, or something else to do with water. Gleick, editor of the biennial sourcebook The World’s Water for many years, is widely acknowledged to be the world’s leading authority on that subject. However unfortunately, it’s a little more likely you heard Gleick’s name during the flurry of news awhile back — his true “15 minutes of fame” — that a group of right-wing climate change-deniers had caught him masquerading as a supporter on their website. That nasty little brouhaha soon boiled over, and sensible people — I count myself as one — never thought it amounted to much, anyway. 

So, what now? Are you going to finish that bottle of water, drink up any others you’ve still got around the house, and switch to using the tap? No? Think about it!

Delivering healthcare to billions of the world’s poor

A review of Pharmacy on a Bicycle: Innovative Solutions for Global Health and Poverty, by Eric C. Bing and Marc J. Epstein

@@@@ (4 out of 5)

Despite the widespread conviction that the state of the world is deplorable and getting worse by the day, the human race has made measurable, even dramatic progress in some important ways. The collective state of our health is the most telling example. In part because of the eradication of smallpox, the near elimination of polio, and the significant recent progress on HIV/AIDS, humanity in general is living longer and healthier lives. Average life expectancy at birth in India around 1950 was 38 years; today it is 65. In China, it was 41; today it is 77. Over the same period, average life expectancy in the United States has risen from 65 to approximately 80. Numbers can be misleading, but these tell a compelling story.

Building on this amazing success story, major institutions — the United Nations, the U.S. Government, and the Bill and Melinda Gates Foundation, for example — have invested billions of dollars in recent years, targeting specific diseases, promoting the use of vaccines, and building public health infrastructure in developing nations. All these admirable efforts promise to continue the favorable trend in healthcare that has unfolded over the last half-century.

However, there is a hidden dimension in this picture. As Eric Bing and Marc Epstein explain in Pharmacy on a Bicycle, billions of poor people living in rural areas all too frequently fail to gain the benefit of these advances in healthcare. It’s fashionable to look on the world today from the perspective of the cities, but in spite of the massive migration of the last several decades, nearly half (49%) of the world’s population still resides in rural areas. Great numbers of these people live far from transportation hubs, often hours or even days of walking from the nearest road. It’s to these billions of people, nearly all of them desperately poor by American or European standards, that Bing and Epstein turn their attention in their illuminating little book.

Pharmacy on a Bicycle rests on a single, fundamental premise: “Most poor outcomes [in healthcare] are caused not by lack of effective medicines or medical know-how. The ability to prevent and treat many of these diseases inexpensively has been available for a very long time. But getting the right remedies to the right people in the locations where they are needed, in a way they will use them, and at a cost they can afford is continually a challenge. This is not a scientific problem. It’s a business challenge.”

Bing and Epstein argue that humankind has never before been in such a good position to meet this challenge. The costs of many widely-used drugs have fallen dramatically, and scientists have greatly simplified the treatment of many diseases by combining multiple drugs into single capsules or tablets. Extremely cheap diagnostic techniques that provide nearly instant assessments are now available. Through telemedicine, a single well-trained physician can now offer her or his expertise to much larger numbers of patients. The widespread use of clinical checklists and the application of franchising to the healthcare industry have both improved access and lowered costs. And new business models, successfully piloted in many countries, using bicycles, motorcycles, and trained village-level representatives, make it possible for healthcare agencies and for-profit companies to overcome the “last mile problem” that has traditionally limited most of the benefits of the market economy to population centers. “We are now at a tipping point to make lasting global health impacts,” the authors write.

One of the most promising recent developments is the now near-universal access to cell phones; by next year, the number of mobile phones is expected to be greater than the world’s population. “Mobile phones are now being used for patient education and awareness, treatment compliance, health care worker training, data collection, disease and epidemic outbreak tracking, and diagnostic and treatment support.”

Pharmacy on a Bicycle is intended to spark much wider adaptation of these advances by making them more widely known. The book presents a seven-point implementation model called IMPACTS, which encompasses innovation and entrepreneurship, maximizing efficiency and effectiveness, coordinating with partners, accountability, creating demand, task shifting (e.g., empowering nurses to take on some doctors’ responsibilities), and scaling. The book includes an abundance of excellent examples that bring these deadly-sounding prescriptions to life.

Eric Bing is an M.D. who also possesses a Ph.D. in epidemiology and an MBA. He’s the director of global health at the George W. Bush Institute at Southern Methodist University. His co-author, Marc Epstein, is an eminent and much-published professor of management at Rice University in Houston whose previous teaching posts were at the Harvard and Stanford business schools and INSEAD (European Institute of Business Administration).

 

Good news for book publishers—and readers of books!

By Tom Hallock

My friend Johanna Vondeling, editor of many of my books over the years, recently posted this article on Facebook. I thought it worthy of wider attention here. The author, Tom Hallock, is Associate Publisher at Beacon Press and a friend of Berrett-Koehler Publishers, where Johanna is Vice President. She reports that Hallock recently read Steve Piersanti’s “10 Awful Truths About Book Publishing” (posted here). He thinks Steve makes good points AND he wanted to point out some good news for publishers amidst all the recent change in the industry. “His ideas are spot-on and inspiring,” Johanna wrote. 

1. Publishing is generally maintaining revenue during its digital transition, something most other industries have been unable to do.

2. There is a new efficiency in the industry causing returns to be dramatically reduced. Digital content, short run and print-on-demand manufacturing, the rise of direct and online sales and an improved supply chain have all reduced the impact of an industry practice that has been a drain on profit. This reduction of waste has also lowered our environmental impact.

3. Our content can be monetized in more ways than ever: eBooks, other digital content, digital download audio, etc.

4. Media continues to be most responsive to big new ideas that are first introduced in book format.

5. The need for investment in physical inventory has also been reduced by all the factors mentioned in #2 above and because we are less reliant on physical display in bookstores.

6. Publishers do not require the physical display of books in order for readers to find them. The 24/7 availability of all books everywhere through our own web sites and those of online booksellers means that readers have instant access to our titles when events, or media attention, or broader shifts in the culture create interest in them.

7. The international market has opened up and is providing access to readers throughout the world whether or not they have access to a physical bookstore that carries English language books. Readers discover books through multiple sources, most of which don’t recognize borders.

8. There is almost a daily growth in tools to build community and reach readers. In particular our ability to aid readers in discovery through BISACs (a Book Industry Study Group subject heading classification), metadata, keywords—as well as social media—has to some extent freed us from the activities of intermediaries and empowered us to grow our businesses.

If you own stock, invest in companies, or are starting a new business, read this book!

A review of The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public, by Lynn Stout

@@@@@ (5 out of 5)

If you so much as skim the business pages in a newspaper, there’s little doubt you’ve heard it said or seen it written that corporate officers and directors are required by law to maximize shareholder value and that they’re subject to lawsuits if their decisions favor any other stakeholder such as employees, customers, or suppliers over profit. The well-entrenched view that shareholders are paramount is widely regarded as the cornerstone of contemporary business law — and it’s flatly untrue.

In The Shareholder Value Myth, business law professor Lynn Stout proves this point, citing chapter and verse in court decisions going back more than a century. “So long as a board can claim its members honestly believe that what they’re doing is best for ‘the corporation in the long run,’ courts will not interfere with a disinterested board’s decisions — even decisions that reduce share price today.” Having laid the legal groundwork, Stout then proceeds to explain how this mistaken view of shareholder primacy is bad for business.

“Put bluntly,” she writes, “conventional shareholder value thinking is a mistake for most firms — and a big mistake at that. Shareholder value thinking causes corporate managers to focus myopically on short-term earnings reports at the expense of  long-term performance; discourages investment and innovation; harms employees, customers, and communities; and causes companies to indulge in reckless, sociopathic, and socially irresponsible behaviors.” Among the examples Stout cites is the Gulf oil spill, caused by excessive cost-cutting on the part of BP. “In trying to save $1 million a day by skimping on safety procedures at the Macondo well, BP cost its shareholders alone a hundred thousand times more, nearly $100 billion.” Q.E.D.

Stout deftly demonstrates that this irrational focus on shareholder value has been harmful in other ways as well. For example, “[b]etween 1997 and 2008, the number of companies listed on U.S. exchanges declined from 8,823 to only 5,401.” Of several factors that help explain this trend, shareholder primacy clearly stands out. Smart people know that there’s more to success in business than a rising stock price.

The origin of this misguided notion lies in the thinking of the so-called Chicago School of free-market economists best known through the work of the late Nobel Prize-winner Milton Friedman. Friedman had written a book in the 1960s that highlighted the idea, but it was his essay in 1970 in the New York Times Magazine that gained wide attention. There, he “argued that because shareholders ‘own’ the corporation, the only ‘social responsibility of business is to increase its profits.'” Stout argues that “shareholders do not, and cannot, own corporations . . . Corporations are independent legal entities that own themselves, just as human beings own themselves.” Shareholders merely own shares of stock that constitute a contract with the corporation to receive certain financial benefits.

They’re not in charge of the show, either. Some lawyers and economists writing after Friedman contended that  shareholders appoint the directors as their agents. This too, Stout contends, is mistaken. She devotes two chapters to prove that this description of shareholders as principals “mischaracterizes the actual legal and economic relationships among shareholders, directors, and executives in public companies . . . Moreover,” Stout writes, this assumes “that shareholders’ interests [are] purely financial,” when in fact shareholders may have any one of a great many different reasons for buying and holding shares in a company.

A fair portion of The Shareholder Value Myth is focused on analyzing the impact of several popular measures promoted by shareholder advocates, the SEC, and Congress over the past two decades: “de-staggering” boards, so that all directors may be removed at once; giving shareholders the right to circulate proxies to all other shareholders on issues of interest; and equity-based compensation. Ask yourself: How often have shareholders removed the entire membership of a corporate board with a single vote? And how often have shareholders of a public company — other than corporate raiders or hedge funds — successfully obtained proxies to overturn a corporate board policy? You can guess the answer to those questions. But the very worst impact of these efforts to strengthen the shareholders’ hand has come from the popularity of equity-based compensation. “In 1991, just before Congress amended the tax code to encourage stock performance-based pay, the average CEO of a large public company received compensation approximately 140 times that of the average employee. By 2003, the ratio was approximately 500 times.” That policy isn’t the only factor to account for this dramatic rise in the ratio, but it’s certainly a major one. And it only seems to work on the upside. How many times have you read about board decisions to lower a CEO’s pay in proportion to the decline in its stock price the past year? You probably know the answer to that one, too. 

The Shareholder Value Myth is an important contribution to a growing body of thought that seeks to re-conceive the role of the corporation in a more expansive manner commensurate with its growing importance in contemporary society.

Top 10 trends shaping the future of publishing

By Johanna Vondeling   

1. Everyone’s a publisher

Now that digital content is popular and relatively easy and inexpensive to produce, millions of individuals and thousands of non-book-publishing media companies have leapt into the business of creating and distributing digital content (often coupled with print-on-demand options).[i] [ii] The near-elimination of barriers to entry into the publishing marketplace has produced an ever-increasing flood of information and entertainment options for consumers.[iii]

Moreover, publishers’ primary competition today isn’t other books, but rather other forms of media, such as social media platforms, games, and streaming media. As the presence and relevance of physical retail for books continues to decline, so too will the necessity for other entities — including authors and other content producers — to work with established legacy publishers to bring books to market.[iv]

2. Content comes first

All content producers now need to approach format as a secondary consideration. The innovators are designing work-flows that prioritize the development and (pre-publication) tagging of content irrespective of format, knowing that the eventual outputs could be infinite: Print book? E-book? Online course? Webinar? App? Blog? Tweet? Tagging must be “semantic” (tagged for meaning, not just coincidence of terms), to facilitate discoverability. Content producers must make it as easy as possible for content to be re-purposed by its curators and leveraged and shared by its marketers and distribution partners.

3. Content marketing is king

Content is still king. And content marketing (defined as “marketing without marketing, or building soft power and social gravity for a brand through shared values and interests”) is edging out traditional push-marketing practices. By disseminating great quality and immersive content through social platforms, content producers can market themselves without interrupting consumers with more explicit advertising.[v]

Content marketing facilitates reader engagement. Engagement, in turn, produces strong brand ties, leading to increased purchasing, product loyalty, and customer advocacy. But there is no standard definition or metric for engagement, nor do most organizations fully understand the migration from engagement to revenue. The challenges are 1) understanding what’s happening within the dynamic ecosystem of content and social media and 2) being able to make tactical changes to increase conversion and revenue.

4. Big data rules

The amount of data in our world has been exploding. Analyzing large data sets—so-called big data—has become a key basis of competition, driving growth and innovation. The increasing volume and detail of information captured by enterprises, and the rise of multimedia and social media, have all been fueling exponential growth in data.[vi] As a result, businesses now have broad and deep visibility into their stakeholders’ behaviors and values. But which information matters most? Big data offers promise in making sense of this complexity.

The few businesses that have successful migrated from print-first to digital-first models have invested significantly in building in-house data and analytics teams.[vii] While the growing importance of data analysts should not be under-estimated, the need for creative thinking in the changing world of marketing has never been greater. Note the rise in recruitment of ‘data scientists,’ who are savvy in computer science but – crucially – also able to apply creative thinking to data-driven challenges.

5. Mobile matters

The number of mobile-connected devices will exceed the world’s population in 2013.[viii] In 2012, mobile subscriptions in China surpassed 1 billion and mobile Web users overtook PC access to the web.[ix] Millions of people in developing countries may never own a book or a computer, but they do own a mobile phone.

To move forward in “mobile optimization” means content must be conceived of and designed explicitly for mobile devices. Every experience offered through digital channels – every web page, shopping cart and piece of rich content – must work well on any device in any location. Customers generally understand that concessions need to be made for the smaller screen, touchscreen input, and slower speed, but they won’t accept unnecessary hassle or delay. Apps are a part of today’s approach to mobile, but they are not a cure-all to this challenge, as use of the mobile web increases daily.[x]

6. The Internet is the classroom

The education industry is experiencing dramatic disruption. Profits and enrollment at for-profit colleges and universities in the United States are growing at a staggering rate.[xi] We’re witnessing the proliferation of “massive open online courses (“MOOCs”).[xii] Education start-ups are creating and offering online study groups, flashcards, lecture notes, and a wealth of other tools for free. Investment in education technology companies increased from less than $100 million in 2007 to nearly $400 million last year.[xiii] And while digital textbooks have been slow to gain adoption, many education providers are turning away from print textbooks in favor of digital devices in classrooms and lecture halls. In response, some publishers are diving head-first into the growing business of online education.[xiv]

The disruptive power of information technology may be our best hope for containing the soaring costs that are driving a growing number of students into ruinous debt or out of higher education altogether. It is also a potential boon to those displaced workers under pressure to become “life-long learners.” But this disruptive power also poses a potential existential threat to many physical universities and traditional textbook publishers.[xv]

7. Get used to strange bedfellows

Legacy industries, like book publishing, are realizing that they can’t go it alone if they hope to survive and thrive. Many are forming unlikely alliances or funding start-ups to help them adapt amid the present flux and strategize for the future. In 2012, Pearson bought Author Solutions, one of the leading providers of self-publishing services. In 2013, Pearson and Kaplan have both launched incubator programs to help vet and mentor education-tech start-ups. Macmillan has been aggressively investing a fund of over $100 million in ed-tech start-ups.[xvi] Other publishers are leveraging ties with other branded media platforms and content providers. Hyperion is selling its backlist and will focus exclusively on content tied to its sister companies Disney and ABC.[xvii] Wiley is distributing material from (former competitor) OpenStax College, an open-source platform that makes introductory college textbooks available as free downloads.[xviii]

8. Set up high-value networks

Platforms like Craigslist and eBay engage in “commons-creation” by establishing virtual spaces in which strangers can pool their ideas, sell products or services, and make social connections. The platforms that can provide real value gain users (and often revenue) quickly. We’re also witnessing a dramatic rise in the use digital personal assistants networks like Task Rabbit.

And Amazon successfully launched Audiobook Creation Exchange, a platform that connects freelance narrators of audio books with the owners of content who are looking to publish audio books. As workers experience less job security and turn increasingly to independent and task-based employment options, such platforms provide value by leveraging the sponsor’s “right of way” to create credible networks that connect people seeking products and services with those eager to provide them.

9. Crowdfunding has come of age

Digital crowdsourcing platforms like Indiegogo, Kickstarter, Unbound, and Pubslush are proliferating, gaining both users and donors at a remarkable pace. Now, content curators can use these platforms to locate content that readers are attracted to and willing to pay for – before it is produced and distributed. Combined with the boom in self-publishing, this trend means more opportunities for cultural producers to identify content with proven market demand, and more ways to identify the hardcore fan base for a particular set of content, before making the decision to invest.[xix]

10. The means of production is going hyper-local

Paradoxically, globalization is both making it easier to purchase a product on the other side of the planet and moving the production of goods closer to the site of purchase. The emergence of “additive manufacturing” and 3-D printing holds the promise that individual creators and users can “make” anything in their own homes. Book and magazine publishers are printing closer to their customers through globally dispersed printing operations and print-on-demand programs. Espresso machines facilitate the printing of out-of-stock and self-published books in physical bookstores.[xx]

All these developments offer the opportunity to bring production closer to the customer, facilitating just-in-time sales and providing more sustainable alternatives to current distribution practices.

Johanna Vondeling is Vice President for Business Development at Berrett-Koehler Publishers. 

Notes

i.         “Shatzkin: Soon, Most People Working in Publishing Won’t Be Working at Publishing Companies.” Digital Book World. March 19, 2013.

ii.         “Ecco, MLB Team Up for E-book Series.” Publishers Weekly. March 20, 2013.

iii.         “The Ten Awful Truths About Book Publishing.” Steve Piersanti. March 6, 2012.

iv.         “Book Publishers Scramble to Rewrite Their Future.” Wired. March 19, 2013.

v.         Adobe/Econsultancy Quarterly 2013 Digital Intelligence Briefing. January, 2013.

vi.         “Big data: The next frontier for innovation, competition, and productivity.” McKinsey Global Institute. March, 2011.

vii.         “The FT has ‘crossed over’ to become a digital business—but can anyone else replicate that feat?” paidContent. March 18, 2013.

viii.         Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, 2012-2017. February 6, 2013.

ix.         “2013: The year nothing but mobile matters for any business selling in China.” MobiThinking. December 20, 2012.

x.         Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, 2012-2017. February 6, 2013.

xi.         “The Rise of For-Profit Universities and Colleges.” University World News. July 15, 2012.

xii.         “Massive open online courses: Time and a little money are a worthy investment.” Financial Times. March 11, 2013.

xiii.         “The Siege of Academe.” Washington Monthly. September/October 2012.

 xiv.         “Wiley Launches Digital Classroom, Video and Ebook E-Learning Site.” Digital Book World. March 19, 2013.

xv.         “The Siege of Academe.” Washington Monthly. September/October 2012.

xvi.         Publishers Lunch. March 7, 2013.

xvii.        Publishers Lunch. March 7. 2013

xviii.        “Wiley, OpenStax Team on College Biology Textbook.” InformationWeek.com. March 11, 2013.

xix.         “Veronica Mars Lives again: Lessons from a record-breaking Kickstarter campaign.” paidContent. March 17, 2013.

xx.         “Just Press Print.” The Economist. February 12, 2010.

Understand how Netflix, Wall Street, and economists use (and misuse) statistics

 

A review of Naked Statistics: Stripping the Dread from the Data, by Charles Whelan

@@@@ (4 out of 5)

In the unfolding Age of Big Data, no one who hopes to understand the way the world works can afford to be ignorant of statistical methods. Not a day goes by that statistical analysis isn’t behind some front-page story — in politics, sports, business, or even entertainment. The statistical concepts of probability, sampling,  and statistical validity, once considered obscure and of interest only to geeks wearing pocket protectors, are now indispensable tools for the active citizen to grasp. Writing in a breezy and intimate style, with humor and lots asides to the reader, Charles Whelan attempts to unpack these concepts and explain them in English with a minimal use of advanced math, and he succeeds . . . up to a point.

Naked Statistics was published just four months after Nate Silver’s best-selling book, The Signal and the Noise, which covers much the same ground in a very different way. (I reviewed that book here.) Whelan focuses on the nitty-gritty of statistical methodology, delving into such topics as how samples are chosen, what’s meant by terms such as correlation, standard deviation, and regression analysis, and how to determine whether the results of a test are statistically valid. However, he doesn’t lose sight of practical questions, unpacking such seemingly puzzling statements as “the average income in America is not equal to the income of the average American” and spotlighting the difference between precision and accuracy. Silver instead explains how statistical methods are applied in a wide range of activities, from baseball and basketball to Wall Street. Whelan includes lots of formulas laden with Greek letters, though, conveniently, they’re confined for the most part to Appendixes that follow many of the book’s chapters and can be skipped by a non-technical reader. (I ignored them.) Silver’s book is refreshingly devoid of Greek letters.

As Whelan makes clear, perhaps unintentionally, statistics is a forbiddingly technical field. Truth to tell, if you really want to understand statistical methodology and how it can be applied, you need a fair grounding in mathematics and a tolerance for terminology that doesn’t appear in everyday English. In fact, you probably need to take the same sort of graduate school courses Whelan took years ago. This is heady stuff!

All in all, for a run-of-the-mill mathematical illiterate such as me, Nate Silver did a much better job getting across the significance of statistics and how its methods are applied to strip away the complexities of today’s often baffling, data-driven world.

Heads up: My new book will be in stores Sept. 9

My co-author, Paul Polak, and I are now putting the final touches on the manuscript, and it’s got months of design and production ahead. But the new book will be published this year by Berrett-Koehler, the San Francisco firm that brought out an earlier book of mine, Values-Driven Business: How to Change the World, Make Money, and Have Fun (co-authored with Ben Cohen of Ben & Jerry’s fame). The official publication date for the new book is Sept. 9.

Its title is The Business Solution to Poverty: Designing Products and Services for Three Billion New Customers.

It’s premature to tell you much about the book, but I thought you might like to know a little about my co-author, Dr. Paul Polak.

Paul Polak is widely regarded as the father of market-centered approaches to development. He started harnessing the energy of the marketplace 30 years ago when IDE, the organization he founded, sold one-and-a-half million treadle pumps to small farmers in Bangladesh, increasing their net income by more than $150 million a year. Over the past 30 years, he has had long conversations with more than 3,000 small farmers who live on less than $1 a day and walked with them through their fields. IDE has now enabled 20 million of the world’s poorest people to move out of poverty by selling them radically affordable irrigation tools made available through thousands of small village manufacturers, dealers, and well drillers, and opening smallholder access to markets where they could sell their crops at a profit.

Paul’s earlier book, Out of Poverty: What Works When Traditional Approaches Fail, has been widely used as a basic text on practical solutions to rural poverty. He is the founder and CEO of Windhorse International and co-founder and board chairman of Spring Health India, for-profit companies with the mission of bringing safe drinking water to 100 million poor rural customers in the world. Paul is the prime mover for creating and implementing the four social impact multinationals in this book, each designed to transform the lives of 100 million $2/day customers and generate annual sales of $10 billion.

Prior to founding Windhorse, in 2008 Paul established D-Rev, a nonprofit that seeks “to create a design revolution by enlisting the best designers in the world to develop products and ideas that will benefit the 90 percent of the people on earth who are poor, in order to help them earn their way out of poverty. Paul’s vision inspired Smithsonian’s Cooper Hewitt travelling exhibit, “Design for the Other 90 percent.” He was named by The Atlantic as one of the world’s 27 “Brave Thinkers” along with Steve Jobs and Barack Obama. He has also received the Ernst and Young Entrepreneur of the Year award and the Scientific American “Top 50” award for agricultural policy.

Paul graduated from medical school in 1958, worked for 23 years as a psychiatrist, creating innovative models of community treatment, and at various points in his career also worked as a farmer and a hands-on investor in oil and gas, real estate, and equipment leasing. He and his wife Agnes have been happily married for 53 years, and have three grown daughters. At the age of 79, he still puts in an 80-hour work week and loves what he does.

A brilliant Indian novel about the 19th Century opium trade

A review of River of Smoke, by Amitav Ghosh

@@@@ (4 out of 5)

Balzac (and lots of people after him) thought that “Behind every great fortune there is a crime.” Nowhere is that aphorism more baldly illustrated than in the 19th-Century opium trade that enriched England, Scotland, and the United States and created a score of hereditary fortunes that have left their mark on the world for nearly two centuries since. After all, when Europeans introduced China to the practice of mixing opium with tobacco in the mid-18th Century, the one-sided trade in Chinese porcelain, tea, silk, and other goods was rapidly draining Europe of silver and reinforcing China’s position as the world’s richest country. The opium trade reversed that trend. Early in the 19th Century, with the Industrial Revolution gathering force in Europe, China’s nearly two-century-long decline  was underway. Meanwhile, massive profits from opium enriched the endowments of Harvard and Yale, helped build Princeton and Columbia Universities; launched the fortunes of the Astors, the Delanos (FDR’s grandparents); and bankrolled the Bell Telephone Company, antecedent of AT&T.

River of Smoke is the second book in Amitav Ghosh’s planned Ibis trilogy set among the momentous events of the massive 19th-Century opium trade between India and China. The first book in the trilogy, Sea of Poppies, set the scene with an in-depth look at the harvesting and manufacture of opium in India. River of Smoke details the life at sea and in the foreign enclave in Canton of the immensely rich men who dominated the trade, principally Britons.

Ghosh’s sprawling novel spans the years 1838 and 1839, detailing the events in South China that led to the First Opium War. The central plot-line follows the journey of a poor Indian Parsi (Zoroastrian) named Bahram who had risen to lead the trade division of a celebrated Mumbai shipbuilding company owned by his wealthy in-laws. Though not yet rich himself, Bahram has become the dean of the Indian opium traders, realizing profits for the family as great as those of many of the British and Americans but, in the racist fashion of the times, he is looked down upon as “inferior.” However, he comes to play a principal role in the traders’ increasingly tense and threatening dealings with the newly energized Chinese government, which has resolved to end the opium trade. (Bahram is the author’s invention, but the English and American traders depicted in the novel come straight from the pages of history.)

Any lover of language will find the writing of Amitav Ghosh irresistible. I certainly did. Both the dialogue and the narrative text in Sea of Poppies were enchanting. Ghosh had immersed himself in contemporaneous dictionaries and wordlists of 1830s India and Britain to reproduce the language and the vocabulary of not one but several English dialects. In fact, a great many of the novel’s characters are historical figures who left behind memoirs, letters, parliamentary testimony, and other records, and as Ghosh notes in his acknowledgments, “Much that is said in this book is taken from [the characters’] own words.” Even more colorful is the hybrid language that emerged from the marriage of English and Hindi and surfaces in dialogue throughout the book. But in River of Smoke, it’s the pidgin of 19th-Century Canton that stands out, and wonderful it is to behold!