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SmartBrief on Leadership

November 4, 2009

The Big Idea

Could America default on its debts?
It's far from likely that America would stiff her creditors -- but it's no longer altogether unthinkable, writes Robert J. Samuelson. If lenders lose confidence in U.S. bonds, Washington might have to choose between deep spending cuts, major tax increases or defaulting on her outstanding debts -- and simply going broke might be the most attractive of the three options. "The odds may be against ... that fate, but even the remote possibility underlines the precariousness and the novelty of the present situation," Samuelson notes. The Washington Post (11/2)

Strategic Management

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Nestlé hopes healthy snacks will spur growth
Nestlé is pinning its hopes for future growth on transforming itself into a health-and-wellness company, noting that sales of "functional foods" that promise health benefits are much faster than sales of regular foodstuffs in many markets. The company is pouring resources into creating nutritious new snacks and proving the potential health benefits of its existing brands. Analysts say the move is a gamble that could pay long-term dividends, but might also undermine some of Nestlé's established brands. The Economist (10/29)

Synergies helped Credit Suisse survive crisis, says CEO
Credit Suisse prospered during the financial downturn by focusing on synergies between its core businesses, says CEO Brady Dougan. Where some banks spread themselves too thin, Credit Suisse focused on three "culturally similar" businesses: private banking, investment banking and asset management. "If we do these businesses well, we have the potential to see very high growth," Dougan says. Financial Times (tiered subscription model) (11/1)

The Greening of SaaS
Learn how Software as a Service (SaaS) can green up your IT environment by reducing local energy and resource consumption, and lowering hardware acquisition and maintenance costs. Click here for the download now.

On Leadership

Great leaders learn to heed the data
Leaders often have a hard time accepting counterintuitive data, Seth Godin notes. Many leaders prefer to operate from their gut, even when the numbers are clearly not in their favor. Leaders who can accept the wisdom in following the data "are going to continue to have a huge advantage," he writes. Seth Godin's Blog (11/4)

Innovation and Creativity

At Covidien, innovation comes before earnings
Medical products and services firm Covidien earned a reputation as an industry leader in innovation after being spun off from Tyco International following a scandal. The company's success is largely thanks to CEO Richard Meelia's determination to put R&D investment ahead of earnings and to support creative thinking across the company. Between 2008 and 2009 the company has launched 60 new products, and in 2008 the firm racked up $10 billion in sales. Bloomberg Businessweek (11/2)

SmartPulse

Given the weakening of the U.S. dollar lately, are you in favor of action now to strengthen its value relative to other currencies?

Yes. Otherwise, we risk its status longer term as the world's reserve currency.	64.04%
No. Having America's products and services at more competitive prices globally is an immediate necessity.	35.96%

Poll analysis
Backing a strong dollar: Almost two-thirds of 1,043 voters took the longer view on the condition of the dollar, looking to strengthen its relative value and not to continue to risk its status as the world's reserve currency. Only about one-third of participants were sympathetic to its short-term weakness as a means to improving the competitiveness of U.S. products in world markets. This is a surprising and interesting result, given the constant speculation that the Fed and the markets both want a weak dollar. For all parties, watching how evolving monetary and fiscal policy affects the dollar will be an absorbing pastime with continuing controversy. --Eva Schmatz, president, Summus Limited

What do you think the results of yesterday's election mean for the future of White House policy and pending federal legislation?
I see them as more of a "vote of confidence" than a repudiation.
I see them as more of a repudiation than a "vote of confidence."
I don't see them as passing judgment either way.

Daily Diversion

It's opera -- but not as you know it
A new generation of opera directors is using technical wizardry to transform their productions. From Valkyries wielding light sabers to a robotic chorus and musical chandeliers, there's no end to the high-tech hijinks going down at the world's top opera houses. FastCompany.com (10/29)

The Buzz (CORPORATE ANNOUNCEMENTS)

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