Gather Restaurant - sustainable dining for every budget

More fun places to eat that helps the planet!  Check out Gather in Berkeley,CA.

The founder of Gather came to give a talk at my Graduate School.  Gather is a restaurant with sustainably sourced food.  A lot of restaurants in Berkeley offer sustainably sourced menus, but are usually "mostly" sustainably sourced.  At Gather, all items on the menu are sustainably sourced.

Gather was built on community dollars, not VC funded.  He was able to garner support from small investors starting at $5k to fund his restaurant, much of the proceeds of the restaurant goes back to those small investors.  Talk about keeping money in the community.

In addition, Gather maintains a yummy 50% vegetarian menu, with menu items ranging from a $15 pizza to share to $100 on fish and wine, truly providing a place for people of all budgets, tastes and dietary needs to Gather.

http://www.gatherrestaurant.com/

Only recycling but want to do more? Start an Eco-Team

A lot of Americans have good intentions for the environment, but when asked what they are doing about it, they simply respond with "I Recycle."  Maintaining a sustainable living planet requires a lot more than just recycling, but it is very understandable that knowing where to start may leave people perplexed.  But there are answers out there.  EcoTeams, formed since the 1990s, are neighbours coming together to socialize and learn about sustainable living.  You can also learn how to augment your contribution beyond recycling.  The Green Living Handbook is a good place to start: 

 

Image Courtesy: http://www.empowermentinstitute.net/glh/images/GLH_cover_web320.jpg

Read about the handbook here.
You can also read more about EcoTeams here.

The collboration and transparency generation

"You now have a generation in the workplace who expect transparency in how decisions are made and are used to being collaborative." -Deborah Asbrand

While this may be true, we are at least, if we're optimistic, 10 more years from truly seamless collaboration and transparency.   The bridges for collaboration are being built around us.  Tools like Blogs, Google Docs, Wikis are available.  Open source initiatives are widespread.  But transparency and collaboration is a cultural problem not a tool problem.  It takes 3-4 generations for new paradigms to stick, if it sticks.  The first bulk wave of believers in collaboration and transparency are still in their 20s and 30s.  This group speaks the language and uses the collaboration tools everyday, but the group, except for a select few, is still working their way up the ranks of business, government and society.

While the information age has enabled a brand new breed of young information entrepreneurs, the bulk of society still lives in a tops-down, mainly computer-less world.  And the 20s and 30s will find themselves constantly bumping against a generation gap as they shift the paradigm from tops-down to webbed interactions.

Hiring Leaders in Pairs - part 2

Unfortunately my Google Buzz feed does not update to blog posts directly, so I'm writing another post in response to a great comment I have received on the Hiring Leaders in Pairs post.  Thanks BN for sharing your insights from the HR point of view...

The comment was "speaking as a startup recruiter, it's a conscious expectation that the new VP you hire will have a team they can bring along. it's part of the value they provide when you hire them, and it's definitely discussed during the recruitment process. often you're building out a brand new team from ground up or building upon one or two other people, and VPs should have the connections to identify and fill the gaps in skillset where they exist."  i don't think it would be necessary for the whole team to interview as a lump, it's more of a puzzle where you're fitting together various pieces into a whole. that being said, i like the idea of hiring in pairs. i work much more effectively with my design counterpart than by myself, and if i were a leader it would be a good way to ensure a great team environment along with diversity of thought."

It seems we are doing a version of hiring in pairs or teams in the real world, this often happens in a manager-subordinate situation, and I believe it works for those dynamics.  But for the dynamic of dual-leadership role such as CEO and CFO, President and Academic Dean, there exists a certain power autonomy for the leaders.  I believe in these circumstances there are distinct advantages to explicitly hiring in pairs:  

1. It creates an even power dynamic.
Neither person hired the other and as a result, neither have implicit power over the other.  Being new hires at the same time bonds the pair in the context of the new organization. 
2. It shows the new hires that the organization values the pair as a whole.  
When hiring in pairs, the expectation from the organization that "You are a team" is very obvious.  This in turn dampens the desire to take personal credit for team accomplishments, and sets the understanding of "we want results from both of you, as a team."

This doesn't work for all organizational environments today.  Most organizations track employees on an individual rather than a team basis. But organizations with a strong team cultures and metrics may find this practice useful for establishing team mentality from the top- down.

Hiring leaders in pairs

The status quo is to hire leaders and manager one at a time. Normally leadership positions become available one at a time, making this sequential hire a necessity.  But what if we hired pairs at a time?  CEO and CFO together, President and Academic Dean together?

My organization is currently in the unique position of having both top leadership positions open.  Wouldn't it be great if we can do the hire in pairs with the intent of forming a stunning team?

Team and individual assessments such as 5Dynamics, firo-b, meyers-briggs all conclude that a well balanced team is a powerful team.  The members of a powerful team balance each other in skills, learning styles and personality.  This balance is important for leadership that is resilient to changes and market forces.

While evaluating the performance of individuals alone is the simpler and the politically correct way to do things, it does not reflect the reality of great performances.  Great performances are achieved by great teams, not great individuals.  Just as a great movie is the result of many people behind the scenes, a CEO may start a project but a great team delivers the product.   I do not wish to undermine the ability of the leader to pull the great team together, in fact I believe that is the singular most important contribution of a great leader.

So what does that mean for hiring leaders?
1. Great performance is the result of a great teams, not just a great individual.
2. Great leaders are great because they form great teams.

This means, whenever possible, we should be hiring great teams instead of individuals.  Businesses have discovered this and by hiring consulting firms, they enable the hiring of a great team instead of individuals.

Great leaders are great because they form great teams.  That means when we interview for a CEO, provided other leadership positions are open, we want to test his or her ability to form a great team.  This ability should be demonstrated during the interview process, and the leadership pair, or team, should be hired in one fell swoop.

Is the Fed sustainable?

A visit to the San Francisco Federal Reserve Bank yesterday prompted a lot of questions.  One of which is whether the US Federal bank structure is sustainable, and whether our wealth is protected.  First, a little background on how the Fed works.  It is fascinating how the whole US banking industry works, and the Federal Reserve Bank (FSB) is central to it all because it is the bank for all the other banks.  By manipulating the Fed Rate, Discount Rate and Reserve Limits, the FSB stimulates lending and limits inflation.  Fed rate is the lending rate set by the Federal Open Market Committee (FOMC).  Discount Rate is a special lending rate to member banks of the FSB.  Reserve Limits are federally mandated minimum liquidity that a bank must maintain.  Your local corporate bank, like B of A, or Chase, are required to maintain federally mandated reserve limits.  

For safeguarding, your corporate bank keeps a lot of money at the FSB because they can then count the cash sitting there as part of their reserve.  Ever heard of the Automatic Clearing House (ACH)?  That's actually a service provided by the FSB.  Since all banks have deposits at the FSB, when you deposit a from bank A to bank B, the receiving bank B simply forwards the check to the ACH, which is the FSB, who then moves money from bank A's pile to bank B's pile.    

So is the Fed sustainable?  Is the wealth of the US protected?  The US dollar used to be backed by gold and silver, referred to as the gold standard.  Since gold is now traded separately, backing the dollar with gold will limit growth to our economy and cause unnecessary fluctuations.  The gold standard practice has been long abandoned.  Now the US dollar's value is based on faith of the American people, faith of the world, and the Fed's ability to curb inflation and keep our dollar steady.  So can the Fed keep our dollar steady?

So far, so good.  The primary tools used to stimulate the economy and curb inflation, namely the Fed Rate, Discount Rate and Reserve Limits, have proved useful so far.  The question is whether this can continue indefinitely.  And during this recession, we have discovered the limits of these tools.

To curb fears of bank bankruptcy during the recession, the Reserve Limit  has been increased.  However, to stimulate investment, we had to decrease the Fed Rate, and therein lies the culprit.  You see, there is a lower limit of zero for the Fed Rate.  If we cannot bounce the economy back by lowering the Fed Rate all the way down the zero, which is what we have done so far, then we are out of tools for manipulating the economy from the Fed's perspective.  At that point we have to turn to other stimulants, those which require increasing the deficit.  Luckily, it seems the Fed is raising their rates again in anticipation of the economic upswing.  This story: Feds to lift discount rate as "exit" begins  was covered in today's Financial Times.

So it seems for now the Fed and the Fed policies live on.  But until we figure out other methods for the Fed to stimulate the economy, we are always in danger of hitting this lower bound. 

Supply Side Policies

In Macroeconimics, there are two major schools of thought: demand side (also termed keynesian ), and supply side.   One supply side policy is control of the marginal tax rate.  The marginal tax rate is the rate on the last dollar of income earned.  The topic of marginal tax rates became the central theme of a revolution in economic policy that swept the globe between the 70s and 90s. (Reynolds, 2008) Supply side economists argue that high marginal tax rates discourage labor output and reduce production.  More than fifty nations significantly reduced their highest marginal tax rates on individual income during that period.  In 1979, the US marginal tax rate was 70%.  In 2002, the marginal tax rate fell to 39%.  By doing so, supply side economists argue that output would be increased.  However, graphing the year on year real GDP growth shows that there is no observable significance in GDP rate change.  Indeed, GDP growth has stayed below 5% after the year 1983, whereas in prior years, a rate of higher than 5% was observed every third year.

Granted, the marginal tax rate is not the only lever on the GDP.  However, the prediction of lower marginal tax rate leads to higher output is not realized, instead, the reverse trend is observable.  This leads me to believe that the marginal tax rate may not be a factor that changes production output.   Indeed, “critics of supply-side economics point out that most estimates of the elasticity of labor supply indicate that a 10 percent change in after-tax wages increases the quantity of labor supplied by only 1 or 2 percent.” (Reynolds, 2008)

References:

Reynolds, A. (2008) Marginal Tax Rates. Liberty Fund, Inc.: http://www.econlib.org/library/Enc/MarginalTaxRates.html

Bureau of Economic Analysis
Bureau of Economic Analysis (2010)  National Economic Accounts, GDP: http://bea.gov/national/index.htm#gdp

Money. Happiness, and Early Retirement, is it in your DNA?

Imagine if when you're born, your DNA is taken and a happiness chart is created for you. This chart shows what makes you most happy, and how much material wealth you need to attain that level of happiness. Then you'll know exactly how many years to work before you can retire!

OK, so maybe it's not exactly embedded in your DNA. And nurture probably has a lot do do with what makes you happy. Once I tried sushi, I need sushi once in a while to keep me happy.

But let's say that you can fill out a survey that closely maps your deepest desires, then organizes the information to show you how material wealth corresponds to your happiness. That would be helpful information wouldn't it?

These days, we've been programmed by our media and culture to think that material wealth equals happiness. And so many spend so much time money grabbing, they forget what truly makes them happy. A customized Happiness-to-Wealth Correlation Profile might be the guiding light we all need.

5 reasons why transition to non fossil energy is mighty difficult

Academic and author Vaclav Smil in the OECD Observer summarized the 5 reasons why transition to non fossil energy more difficult than commonly realized. His points are no surprise to anyone in the energy field, but he summarizes them well. The 5 reasons are:

1. The scale of the shift
2. Energy density
3. Power density of energy production
4. Intermittency and thus inability to supply base load energy
5. Geographic distribution

Alternative measures of GDP

Alternative measures to GDP have been under debate since the early 1970s.  The creation of the Measured Economic Welfare (MEW) index attempted to measure welfare.  For the period studied between the 1920s through 60s, every 6 unit increase in GNP corresponded to a 3-4 unit increase in the MEW.  The economists breathed a sigh of relief, believed that the GNP continued to track national welfare, and stopped tracking the MEW.  It is important to note the context of this decision, which at the time is appropriate.  During the 1920s to 60s period, due to general lack of material wealth, welfare of a household is tied to increase in material ownership, which was implied by a rising GNP.  However, by the Law of Diminishing Returns, this trend cannot last.  At some level of material ownership, the benefit of each additional unit is reduced.  This is indeed demonstrated by the 1990s by the Index of Sustainable Economic Welfare (ISEW).  In this analysis, the correlation between GNP and ISEW was positive, until the 1980s, when the correlation turned negative for many developed countries.  It is important to note the time scale and the context for each index.  The state of the nation in time provides the context in which national welfare can be evaluated.  Therefore there is no singular index that can provide the correct answer for all nations for all time.

Time and Place define the context under which the appropriate progress index can be selected.  Culture can be interpreted as “Place.” Bhutan's Gross National Happiness (GNH) measure weighs meditation as an important part of happiness, whereas an American may derive much more happiness when his/her team wins the SuperBowl.  Time, or political and economic progress, is the other element providing context.  For illustration, let’s use Max-Neef’s matrix of human needs as a base for developing an index.  Political and economic progress within a country bounds and prioritizes the human needs that can be satisfied in the matrix.  A third world country where citizens are seeking basic food and shelter would be best served by an index that heavily weighs the Subsistence category within the matrix.  In contrast, a developed country would be best served by an index that more heavily weighs Protection, Idleness, Creation and Freedom.  In addition to the Time context, the Place, or cultural context will provide additional weighing.

So what do the Genuine Progress Indicator (GPI), UN’s Human Development Index (HDI), Bhutan’s Gross National Happiness (GNH) and the Happy Planet Index (HPI) have in common?  They all provide wellness indices in different contexts.  The “west” proliferated GDP as a measure during the race for industrialization experienced between 1920s to 80s.  The timing, or political and economic progress, of GDP measuring countries was similar.  And though the countries were culturally different, the aim for industrialization was common, and thus set the context suitable for GDP measurement.  GDP proliferated as a measure.  Today, the countries seeking wellness measures are in a different time and place.  Given the great discrepancies in political and economic progress between countries and the many different cultures represented, none of the indices can be suitable enough to be used for all countries.  For developing countries, GDP may still be an adequate measure.  But for developed countries where subsistence needs are satisfied, new and perhaps divergent indices are needed.  The argument of what is happy for a Bhutanese may not be fun for an American, infers that it may no longer make sense to force the same index on developed countries in order to enable comparison between countries.  With increased mobility and communication methods, people of similar likes congregate geographically.  Thus we may find ourselves in a world where each country measures its happiness in its own manner and we stop racing against each other for improvement, but only seek to improve against oneself.

References
Daly H. & Farley J. (2004). Ecological Economics: Principles and Applications. Washington, DC: Island Press.

Pearce, D. & Barbier, E. (2000). Blueprint for a sustainable economy. London: Earthscan Publications.