South Korea’s unloved president is ejected from office

President Park impeached

A decision over her permanent removal is in the hands of the constitutional court

The Economist Dec 9th 2016 | SEOUL

FOUR-FIFTHS of South Koreans wanted it—and, to their gratification, the same proportion of MPs did too, as the outcome of a vote on the impeachment of their president, Park Geun-hye, revealed on December 9th. Of the National Assembly’s 300 members, 234 voted in favour of a motion to oust the president, which listed influence-peddling, abuse of power and dereliction of duty, among other constitutional violations. The outcome at least temporarily removes Ms Park from office, over a year before the end of her five-year term, and strips her of her executive powers. The decision on her permanent removal is in the hands of the nine justices on the constitutional court, who now have six months to review the motion’s legality. In the meantime her prime minister, Hwang Kyo-ahn, will act as president.

For weeks Ms Park has been at the centre of an extraordinary influence-peddling scandal involving a corrupt former confidante and friend, Choi Soon-sil. She is in jail on charges of abuse of power and coercion. A criminal investigation—into Ms Choi’s corralling of companies for donations to foundations she ran, and manipulation of state affairs—has produced a colourful cast of characters, from a one-time gigolo (whose testimony to MPs this week appeared to confirm Ms Choi’s influence extended to Ms Park’s handbag choices), to a pop-music video director who profited from his connection to Ms Choi.

The outcome is a victory for South Korea’s three opposition parties and independents, which had hoped that at least 28 dissenters from the ruling Saenuri party might be emboldened to join their combined 172 votes to reach the two-thirds majority required for the motion to pass. Most in Saenuri, which does not yet have a strong presidential candidate, had been alarmed at the idea of an early election for Ms Park’s successor (if the court accepts the motion, one must be held within two months). Choi Jong-kun of Yonsei University, in Seoul, says the wide vote margin revealed many shy Saenuri rebels. They have been won over, he thinks, by massive but peaceful weekly protests and the grilling this week of witnesses and suspects close to Ms Park and Ms Choi, which were broadcast live on national television.

Ms Park is only the second South Korean head of state to be impeached, after Roh Moo-hyun, a former liberal president. For the many South Koreans who recall the brawls in parliament when MPs impeached him in 2004—ballot boxes were hurled and weeping MPs were hauled out of the National Assembly—today’s proceedings were remarkably civil and swift. MPs queued to cast their votes; many photographed their marked ballot papers to share on social media with their constituents. The atmosphere outside the National Assembly, where protesters had gathered, was festive in the run-up to the vote.

Moon Jae-in, the former head of the main opposition Minju party and currently polling as its strongest presidential contender, had previously said that the constitutional court would be defying the people if it denied the parliamentary motion. The justices have little reason to dawdle. In Roh’s case, he was returned to office after 63 days, when the constitutional court ruled that the grounds for his impeachment were too flimsy (infringing minor election laws). That was what 70% of South Koreans wanted in his case. Though the court is allowed six months to deliberate, protesters have promised to keep gathering (a seventh rally in as many weeks is set for tomorrow) and the power vacuum will be damaging.

Mr Hwang, who will address the country later today, is expected to play a limited role, even with his newly acquired presidential powers. Awkwardly Ms Park, who picked him in May last year, had already tried to appoint a new prime minister as a concession to the opposition, but it refused to endorse her nominee. Mr Hwang has done little of note as South Korea’s prime minister—a position that is mainly ceremonial. He is known for having petitioned the constitutional court to disband a minor hard-left party for its pro-North Korean views, when he was justice minister in 2014, a move which smacked, for many, of state heavy-handedness.

While the court deliberates, Ms Park will remain characteristically aloof and alone in the Blue House, the presidential office that was also her childhood home (her father, Park Chung-hee, led the nation from there between 1961 and 1979, after seizing power in a coup). In the most recent of her three televised apologies, she said she had spent “sleepless” nights agonising over the nation’s unhappiness. But Mr Choi says that her addresses mainly suggested her “insensitivity to the reality that she was in”; she was seen, in her reticent apologies, to be making excuses.

Many had wondered as her term wore on what Ms Park’s presidential legacy would be. Abroad, her striking early rapprochement with China has little to show for it. Relations with North Korea got off to a bad start when it set off its third nuclear bomb days before Ms Park took office, and stayed that way (this year alone it has tested two more). At home, the economy is stuttering and youth unemployment has remained stubbornly high. For now it seems the mark she leaves is on the ballot papers.

Poverty without Boarders

One in five children live in poverty. Fifty million households are food-insecure. Social mobility is as low today as it was 40 years ago. While these statistics could describe any number of developing countries, it may come as a surprise that they actually belong to the United States.

Since we started Acumen, the world has shifted from a place divided by rich and poor to one with elements of both the developing and the developed world in every country. America is no exception. While hubs of innovation and commerce explode in parts of India and Kenya, looking more and more like the U.S., we are seeing families struggle to make ends meet in cities and towns across America. Poverty may have different contours depending on where you look, but the overall human reality is the same. The poor, whether living in Kibera or East Baltimore, face a lack of choice, of freedom, of opportunity. That’s why in 2016 we launched Acumen America. We are a single, interconnected world and live in a time where dignity and opportunity can, and should, be extended to everyone, everywhere.

Since the turn of the 20th century, the U.S. has been known as the land of opportunity, a place where prosperity and success can be achieved through hard work and ambition. When waves of immigrants left their homelands, they arrived in search of the American Dream. While the U.S. has become one of the world’s wealthiest countries — founded on the promise of life, liberty and justice for all — the reality is that only a small number actually have the opportunity to realize that dream.

Today, nearly 47 million Americans live in poverty with millions more on the brink. The country’s social safety net is strained and, while assistance programs exist, they are difficult to navigate for those who need them most. The gap between rich and poor is only continuing to widen. This is a problem the government cannot tackle alone.

Photos courtesy of Creative Commons

We are taking what we’ve learned from our 15 years of tackling global problems of poverty and applying these lessons to the U.S. We are seeing a new breed of American entrepreneurs emerge focusing their skills and energies not on profit, but on purpose. They are young, ambitious and driven not by the gleam of Silicon Valley but by the challenge of solving some of the country’s toughest problems. These entrepreneurs don’t believe the solutions solely rest on the government or corporations; instead, they believe the responsibility rests on everyone.

Like our entrepreneurs around the globe, they are committed to the ideas of human equality, freedom and dignity and using the best of what America has to offer — technology, innovation and a sense of possibility — to create and strengthen systems to work for those who need them. And they’re doing so in ways that give people agency and dignity. In this divisive moment in history, these entrepreneurs are not only important drivers of social and economic progress, they also embody the kind of leadership needed in a world that must move beyond the left and right and reshape systems to include all people, not just some.

The problem is they don’t have the support they need to create the change the country needs. Capital — especially early-stage risk capital — is scarce for companies focused on low-income customers. In the U.S., a mere six percent of venture capital is deployed in rounds of one to four million dollars, and 70 percent of all funding is focused on only three states — California, Massachusetts and New York. We need to put our money behind entrepreneurs unafraid to address America’s biggest challenges, support businesses that provide affordable solutions that meet the growing needs of the poor, and create an environment for those businesses to thrive.

Photos courtesy of Creative Commons

At Acumen, we dream of extending the fundamental belief that all men are created equal to every human being on the planet. By putting mission-driven entrepreneurs first and providing them with early-stage capital, we can highlight the possibilities of entrepreneurship in the U.S. and remind the country that solutions to problems that divide us are within our reach. We’ve shown this approach works in some of the most challenging corners of the world, and we believe we can make it happen in America.

길가에 버려지다


대한민국의 정의와 국민의 희망을 죽이는 대통령은 대한민국 국민이 아니며,

대한민국 국민이 아닌 자는 대한민국의 대통령이 될 수 없다.


없는 길을 뚫어라

어둠은 빛을 이길 수 없다.


떠나야 할 시간에

기억한다는 건
과거의 모든 느낌과 일상들을
한 순간에 모두 공존케 하는 것





떠나야 할 시간에

Why do South African protests often turn violent?

The Economist Oct 27th 2016, 23:04 BY E.C.S. | JOHANNESBURG

TO PROTEST the redrawing of municipal boundaries earlier this year, residents in a poor part of Limpopo province set fire to their schools. More than three dozen schools were damaged; many were burned to the ground. “Service delivery” protests over the shoddy provision of electricity and basic sanitation regularly see major highways barricaded with burning tyres. In protests at universities, where students are seeking free tuition, libraries and lecture halls have been torched. Why do South African protests readily descend into violence?

South Africans have plenty to feel angry about. Public services are patchy. Youth unemployment runs at around 50%. The economy is both stagnant and lopsided. A majority of black South Africans are still poor. Many feel frustrated with the lack of fundamental change in their lives, 22 years after the introduction of universal adult suffrage. Researchers at the University of Johannesburg reckon there are on average 11 protests a day, many of them over labour issues. Other research has found an increasing number of “service delivery” protests in recent years. The vast majority of protests are peaceful. Yet they are largely ignored by the government and media, and so citizens up the ante (“burn to be heard”, is one refrain). Moreover, some demonstrations get co-opted by opportunistic looters, while others are fuelled by factional politics. There is also a sense of impunity, caused by the rarity of convictions for burning buildings or stone-throwing.

The violence begets a vicious cycle. Thuggish protests draw heavy-handed responses by police. Tactical units, set up to deal with serious crimes such as car-jackings, have been dispatched to university campuses to quell student protests. Poorly trained private security guards are often deployed as well. Students throw stones at security guards, who hurl them right back. Last week police shot one student leader 13 times with rubber bullets. A broader worry is that legitimate complaints are tarred as thuggish disorder. And arson and looting cause billions of rand in damage—something South Africa can ill afford.

Even by the standards of Africa’s blood-soaked colonial history, South Africa has an especially brutal past. The apartheid regime met dissent with live fire. The African National Congress eventually resorted to violent tactics in its struggle. In the early 1990s South Africa stood on the verge of civil war. Today the country is plagued by a high rate of violent crime. Yet recent local elections saw South Africans express their anger at the ballot box rather than on the streets; the opposition Democratic Alliance gained power in several major cities. Whether this leads to improved public services remains to be seen. But if South Africans feel they are being heard and that democratic institutions are working for them, perhaps the cycle of violence can at last come to an end.

Why Uganda is a model for dealing with refugees

The Economist Oct 25th 2016, 23:00 BY T.G.

THIS week French authorities began clearing the “jungle”, a refugee camp in Calais that has become symbolic of the failures of Europe’s policies towards asylum-seekers and other migrants. In Calais as in much of the West, and indeed in most of the world, refugees have few rights and face hostility from locals. Refugees in Turkey and Lebanon, respectively host to the world’s largest and third-largest such populations, face severe restrictions on employment, education and healthcare. In Kenya and Ethiopia—both of which host hundreds of thousands of refugees—national laws curb free movement, confining most to designated camps. Yet in this bleak global context, Uganda stands out. Why?

Uganda’s refugee policy has been lauded by the World Bank, Oxford Refugee Studies Centre, the UN’s refugee commission and others as one of the most generous anywhere. It is home to more than half a million refugees from neighbouring countries, including the Democratic Republic of Congo, Burundi and South Sudan. Since 2006 they have been granted freedom of movement (subject to limited restrictions), employment rights and equal access to services such as healthcare and education. Refugees can vote and stand for office at the local level. Some property rights are guaranteed: they can own movable property, such as cars and machinery. All refugees are granted a plot of land to cultivate. They are also able to lease other land and start businesses. It is a sharp contrast with neighbouring Kenya, where refugees who have been granted asylum cannot work without paying costly fees for short-term work permits.

The Ugandan approach has numerous benefits. Farming, running businesses and trading with local residents discourages dependency, reducing the need for handouts. Only 1% of refugees in Uganda are entirely dependent on aid. Freedom of movement means refugees are not warehoused for indefinite periods; refugees have a considerable degree of dignity and independence. And host communities benefit too. Trade between the two groups has flourished. Relations between refugees and local residents are generally peaceful. Intermarriages have been reported.

Other countries are beginning to follow the Ugandan example. Ethiopia promises to grant employment rights soon. In Kalobeyei, in north-west Kenya, the local government is considering granting refugees small plots of land and allowing them to sell their produce. But in many countries politics may scupper progress. Uganda has a relatively low unemployment rate for the region: allowing refugees to enter the labour market may be trickier in other countries, especially in those where youth unemployment is high. Lifting restrictions on freedom of movement is also likely to be met with hostility elsewhere. Policies which appear generous to refugees do not win many votes in the West. And Uganda, too, has some way to go: refugees and their children cannot attain full citizenship, meaning a long-term solution for those in its settlements remains out of reach.

Inside the bear


When the Soviet Union collapsed 25 years ago, Russia looked set to become a free-market democracy. Arkady Ostrovsky explains why that did not happen, and how much of it is Mr Putin’s fault
The Economist Oct 22nd 2016 | From the print edition

ON AUGUST 20th Guzel Semenova, a 25-year-old Muscovite, was strolling through the grounds of Muzeon, one of the city’s parks, and stopped by a burnt-out, rusty trolleybus. Inside its shattered interior a small video screen was playing black-and-white footage of events that unfolded in the year she was born. A volunteer explained that the trolleybus had been part of an anti-tank barricade during a coup 25 years ago and symbolised the people’s victory. Ms Semenova looked confused. The 22-year-old volunteer, herself unsure what exactly had happened during those three days in August 1991, said it was when “Russia became free.” Ms Semenova listened politely, then walked on.

A patchy knowledge of those events is nothing unusual in Russia. A survey by the Levada Centre, the country’s leading independent pollster, shows that half the overall population and as many as 90% of young Russians know nothing about the drama that began in the small hours of August 19th 1991.

That morning the world woke up to news of a coup. Mikhail Gorbachev, the last Soviet leader, was detained in Crimea, “unable, for health reasons, to perform his duties”. Power had been seized by a group of hard-line Communists, the chief of the KGB and senior army generals, who declared a state of emergency. Tanks were rumbling through the centre of Moscow. The television, overrun by the KGB’s special forces, was playing Tchaikovsky’s “Swan Lake” on a loop. It was a last, desperate attempt to save the disintegrating empire.

But on the day of the coup not a soul came out to support the Soviet regime. Instead, tens of thousands of Muscovites took to the streets to build barricades and defend their new freedoms. Boris Yeltsin, the first democratically elected president of Russia, then a subordinate part of the Soviet Union, called for resistance. The KGB’s special forces were told to attack the Russian parliament, the epicentre of the opposition, but nobody was prepared to give a written order. Two days later three young men died under a tank. A few hours after that the troops were withdrawn and Gorbachev returned to Moscow. Jubilant crowds marched to the KGB’s headquarters and toppled the statue of its founder, Felix Dzerzhinsky.

Those three days marked the end of the Soviet Union, but they did not become a foundation myth for a new Russia. The country was tired of myths. Modern school textbooks barely mention them. Russian officials used to lay flowers at a small monument to the three young men killed by the tanks, but even this modest gesture stopped in 2004. This year liberals were banned from marching to the place of their victory 25 years ago. The small festival at the Muzeon attracted a few hundred people who watched a stylised performance of “Swan Lake” and a documentary from those days. Shot in St Petersburg, the cradle of the Bolshevik revolution, it showed a vast, peaceful crowd in the main square watching the death throes of the Soviet empire. The camera also captured a young Vladimir Putin by the side of his boss, Anatoly Sobchak, then the mayor of St Petersburg, who had defied the coup. A demonstrator was heard to shout: “When we get rid of the communist plague, we will again become free and we won’t have to fight [a war] again.”

The revolution of 1991 overturned the Soviet Union’s political, economic and social order and put 15 countries on the map where there had previously been only one. But like many revolutions in history, it was followed by a restoration.

The tsar the Kremlin most admires is Alexander III, who on taking office in 1881 reversed the liberalisation overseen by his father, who was assassinated, to impose an official ideology of Orthodoxy, nationalism and autocracy. His portrait and his famous saying, “Russia has only two allies: its army and its navy,” greet visitors to a revamped museum of Russian history at VDNKH, a prime example of Stalinist architecture in Moscow. Stalin himself has had a makeover too. Gigantic portraits of him line the roads in Crimea, proclaiming: “It is our victory!”

The two main pillars of the Soviet state, propaganda and the threat of repression, have been restored. The KGB, which was humiliated and broken up in the aftermath of the coup, has been rebuilt as the main vehicle for political and economic power. The secret police is once again jailing protesters and harassing civil activists. In September the Kremlin designated the Levada Centre a “foreign agent”, which could be the end of it. Television has been made into a venomous propaganda machine that encourages people to fight “national traitors” and “fifth-columnists”. Boris Nemtsov, a liberal politician who once represented Russia’s hopes of becoming a “normal” country, was murdered outside the Kremlin last year.

After nearly a decade of economic growth spurred by the market reforms of the 1990s and by rising oil prices, the Russian economy has descended into Soviet-era stagnation. Competition has been stifled and the state’s share in the economy has doubled. The military-industrial complex—the core of the Soviet economy—is once again seen as the engine of growth. Alternative power centres have been eliminated. Post-Soviet federalism has been emasculated, turning Russia into a unitary state.

Reactionary restoration at home has led to aggression abroad. Russia has invaded Georgia and Ukraine, two of the most democratic former Soviet republics. It has intervened in the conflict in Syria, propping up the regime of President Bashar al-Assad. It has attempted to undermine Euro-Atlantic institutions, backed right-wing parties in Europe and tried to meddle in America’s presidential election. And it is once again using the threat of nuclear arms to blackmail the West.

After the defeat of the 1991 coup, Russia was widely expected to become a Westernised, democratic, free-market country. This special report will explain why that did not happen, and ask whether the West has a Putin problem or a much deeper and more enduring Russia problem.

Mr Putin was originally chosen for the top job by Yeltsin, Russia’s first president, not least for being on the “democratic” side in 1991. When he came to power in 2000, he was expected to consolidate the country. Instead, he has reinstated an archaic model of the state.

It was naive to expect that after 74 years of Soviet rule, and several centuries of paternalism before that, Russia would rapidly emerge as a functioning Western-style democracy. But this report will show that Russia’s relapse into an authoritarian corporate state was not inevitable. It was the result of the choices made by the country’s elite at each new fork in the road. And although those choices cannot be unmade, they do not predetermine the future.

Not the Soviet Union

The collapse of the Soviet Union brought a massive change to Russia. The creation of private ownership launched industries that did not exist before, such as private banks, restaurants and mobile-phone networks. People are free to make money, consume and travel on a scale never seen before in Russia’s history. They consume not just more goods and services but more culture and information. The state no longer dominates people’s lives. Although it controls television, the internet remains largely unconstrained everywhere, and radio and print still have some freedom. Even Alexei Navalny, an opposition politician, admits that “despite the curtailing of political and civil freedoms, the past 25 years have been the freest in Russian history.”

People are becoming increasingly alienated from politics, as demonstrated by the low turnout in the parliamentary elections in September, but they are finding other ways of expressing their views. Although few Russians remember quite how the Soviet regime ended, many enjoy the results. Russia has a vibrant urban middle class which, until recently, was richer than its equivalents in eastern Europe. Russia’s cities, with their cafés, cycle lanes and shopping streets, don’t look very different from their European counterparts.

A new generation of Westernised Russians born since the end of the Soviet Union has come of age. The children of the Soviet intelligentsia—a vast educated professional class that supported Gorbachev—dress, eat and behave differently from their parents’ generation. They have a spring in their step.

Many of these young, educated Russians owe their comfortable lives to a decade of economic growth that began in 1998 and ended with the economic crisis in 2008-09. The impact of that crisis exposed the limits of Mr Putin’s model of governance. And although economic growth recovered fairly quickly, trust in Mr Putin’s model of governance declined sharply, from 35% at the end of 2008 to 20% in early 2012, whereas support for Western-style democracy shot up from 15% to 30%.

Those who felt that Russia needed both economic and political modernisation pinned their hopes on Dmitry Medvedev, who served as president from 2008 to 2012. The Russian elite wanted him to stay for a second term, but in September 2011 he announced that Mr Putin, who was then prime minister, would resume the presidency, while Mr Medvedev would become prime minister. He indicated that this job swap had been planned right from the start of his presidency. Many people felt they had been duped. When three months later the Kremlin blatantly rigged the parliamentary elections, they took to the streets, demanding the same sort of respect from the state as citizens as they were enjoying as private customers at home and abroad. They wanted Russia to become a European-style nation state, an idea formulated by Alexey Navalny, an anti-corruption blogger who had galvanised the protests through social media. His definition of the governing United Russia as a party of “crooks and thieves”, and the mood of protest, spread across the country.

Mr Putin was rattled and angry, but having witnessed the failure of the 1991 coup he knew that tanks were not the answer. Instead he trumped civic nationalism with the centuries-old idea of imperial or state nationalism, offering the idea of Russia as a besieged fortress. In 2014 he annexed Crimea. The tactic worked. The protests stopped and Mr Putin’s personal approval ratings shot up from 60% to 80%. By attacking Ukraine after its own revolution in 2014, Mr Putin persuaded his country and its neighbours that any revolt against the regime would be followed by bloodshed and chaos.

Smoke and mirrors

Mr Putin’s Russia is a slippery construct in which simulation and bluff play a big part

The Soviet Union had many faults, but postmodernism was not one of them. Mr Putin’s Russia is a more slippery construct in which simulation and bluff play a big part. Nothing is what it seems. Elections are held not to change power but to retain it; licensed “opposition” parties are manufactured by the Kremlin; Mr Medvedev’s modernisation was an illusion; doctorates awarded to scores of Russian officials, governors and even to Mr Putin himself were based on plagiarism or cheating, according to Dissernet, a grassroots organisation.

In 2014 Russia put on a remarkable show with the costliest winter Olympics ever staged, in Sochi on the Black Sea. The host country’s athletes got the largest number of gold medals, not least thanks to a massive doping operation in which the Federal Security Service (FSB), the KGB’s successor and Russia’s main security organisation, swapped urine samples through a hole in the wall between an official laboratory and a secret one next door. (That caused many Russian athletes to be banned from this year’s Rio Olympics.) In the same way that Russia has been doping its athletes, its state media have been doping the population with military triumphs and anti-American propaganda, conveying an artificial sense of strength. But unlike those sport victories, Russian violence in Ukraine and Syria is real enough.

Mr Putin’s restoration project is working because the disintegration of the Soviet Union was not complete. The remains of the Soviet and even pre-Soviet system, its institutions, economic structure and social practices, which lay dormant during the first post-Soviet decade, have been revived and strengthened by the current regime.

But just as the Soviet and pre-Soviet legacies cannot be erased, nor can the quarter-century since the USSR ceased to exist. The fundamental conflict between a modern lifestyle and the political restoration under Mr Putin, exposed by the protests of 2011-12, has been suppressed, not resolved. No restoration has ever ended in a return to the past, and none has been permanent.

Russia, perhaps more than other countries, advances through generational shifts. The current reactionary phase may turn out to be no more than a detour on the path towards a modern, federalist nation state. Or it could lead to further decline, interspersed with outbursts of aggression. Which is it to be?

Kodak’s Downfall Wasn’t About Technology

Harvard Business Review by Scott Anthony JULY 15, 2016


A generation ago, a “Kodak moment” meant something that was worth saving and savoring. Today, the term increasingly serves as a corporate bogeyman that warns executives of the need to stand up and respond when disruptive developments encroach on their market. Unfortunately, as time marches on the subtleties of what actually happened to Eastman Kodak are being forgotten, leading executives to draw the wrong conclusions from its struggles.

Given that Kodak’s core business was selling film, it is not hard to see why the last few decades proved challenging. Cameras went digital and then disappeared into cellphones. People went from printing pictures to sharing them online. Sure, people print nostalgic books and holiday cards, but that volume pales in comparison to Kodak’s heyday. The company filed for bankruptcy protection in 2012, exited legacy businesses and sold off its patents before re-emerging as a sharply smaller company in 2013. Once one of the most powerful companies in the world, today the company has a market capitalization of less than $1 billion.

Why did this happen?

An easy explanation is myopia. Kodak was so blinded by its success that it completely missed the rise of digital technologies. But that doesn’t square with reality. After all, the first prototype of a digital camera was created in 1975 by Steve Sasson, an engineer working for … Kodak. The camera was as big as a toaster, took 20 seconds to take an image, had low quality, and required complicated connections to a television to view, but it clearly had massive disruptive potential.
Spotting something and doing something about it are very different things. So, another explanation is that Kodak invented the technology but didn’t invest in it. Sasson himself told The New York Times that management’s response to his digital camera was “that’s cute – but don’t tell anyone about it.” A good line, but not completely accurate. In fact, Kodak invested billions to develop a range of digital cameras.

Doing something and doing the right thing are also different things. The next explanation is that Kodak mismanaged its investment in digital cameras, overshooting the market by trying to match performance of traditional film rather than embrace the simplicity of digital. That criticism perhaps held in early iterations of Kodak’s digital cameras (the $20,000 DCS-100, for example), but Kodak ultimately embraced simplicity, carving out a strong market position with technologies that made it easy to move pictures from cameras to computers.

All of that is moot, the next argument goes, because the real disruption occurred when cameras merged with phones, and people shifted from printing pictures to posting them on social media and mobile phone apps. And Kodak totally missed that.

But it didn’t, entirely.

Before Mark Zuckerberg wrote a line of Facebook’s code, Kodak made a prescient purchase, acquiring a photo sharing site called Ofoto in 2001. It was so close. Imagine if Kodak had truly embraced its historical tagline of “share memories, share life.” Perhaps it could have rebranded Ofoto as Kodak Moments (instead of EasyShare Gallery), making it the pioneer of a new category called life networking where people could share pictures, personal updates, and links to news and information. Maybe in 2010 it would have lured a young engineer from Google named Kevin Systrom to create a mobile version of the site.

In real life, unfortunately, Kodak used Ofoto to try to get more people to print digital images. It sold the site to Shutterfly as part of its bankruptcy plan for less than $25 million in April 2012. That same month Facebook plunked down $1 billion to acquire Instagram, the 13-employee company Systrom had co-founded 18 months earlier.

There were other ways in which Kodak could have emerged from the digital disruption of its core business. Consider Fuji Photo Film. As Rita Gunther McGrath describes in her compelling book The End of Competitive Advantage, in the 1980s Fuji was a distant second in the film business to Kodak. While Kodak stagnated and ultimately stumbled, Fuji aggressively explored new opportunities, creating products adjacent to its film business, such as magnetic tape optics and videotape, and branching into copiers and office automation, notably through a joint venture with Xerox. Today the company has annual revenues above $20 billion, competes in healthcare and electronics operations and derives significant revenues from document solutions.
The right lessons from Kodak are subtle. Companies often see the disruptive forces affecting their industry. They frequently divert sufficient resources to participate in emerging markets. Their failure is usually an inability to truly embrace the new business models the disruptive change opens up. Kodak created a digital camera, invested in the technology, and even understood that photos would be shared online. Where they failed was in realizing that online photo sharing was the new business, not just a way to expand the printing business.

So, if your company is beginning to talk about a digital transformation, make sure you ask three questions:

What business are we in today? Don’t answer the question with technologies, offerings, or categories. Instead, define the problem you are solving for customers, or, in our parlance “the job you are doing for them.” For Kodak, that’s the difference between framing itself as a chemical film company vs. an imaging company vs. a moment-sharing company.
What new opportunities does the disruption open up? Our colleague Clark Gilbert described more than a decade ago a great irony of disruption. Perceived as a threat, disruption is actually a great growth opportunity. Disruption always grows markets, but it also always transforms business models. Gilbert’s research showed how executives who perceive threats are rigid in response; those who see opportunities are expansive.
What capabilities do we need to realize these opportunities? Another great irony is that incumbents are best positioned to seize disruptive opportunities. After all, they have many capabilities that entrants are racing to replicate, such as access to markets, technologies, and healthy balance sheets. Of course, these capabilities impose constraints as well, and are almost always insufficient to compete in new markets in new ways. Approach new growth with appropriate humility.
Kodak remains a sad story of potential lost. The American icon had the talent, the money, and even the foresight to make the transition. Instead it ended up the victim of the aftershocks of a disruptive change. Learn the right lessons, and you can avoid its fate.

Why South Sudan is still at war

The Economist Oct 3rd 2016, 23:50 BY M.F.

LAST month the UN Security Council went on a three-day visit to South Sudan. Five years after a referendum gave birth to the East African country, the delegation was in no mood to celebrate. Fierce fighting between the army commanded by the president, Salva Kiir, and troops loyal to vice-president, Riek Machar, had left at least 300 dead over several days in July; local sources say the toll is vastly underestimated. A UN base was attacked; foreign aid workers were beaten and raped when troops stormed a hotel compound. Mr Machar has since fled the capital, and machineguns have gone silent in Juba. But the calm may not last for long. The Security Council is pushing for the deployment of a 4,000-strong regional protection force—adding to what is already the UN’s third-largest peacekeeping mission, with 12,000 troops. Why does peace remain so elusive for the world’s newest nation?

The conflict has ethnic undertones. Dinka tribesmen make up most of Mr Kiir’s Sudan People’s Liberation Army (SPLA), while Mr Machar’s SPLA-in-Opposition is primarily Nuer. Hate speech, ubiquitous on the radio and social media, is fanning the flames. But it is the country’s cynical elite that has allowed tribal tensions to fester. During the period that preceded the referendum, from 2005 to 2011, SPLA leaders made little effort to promote reconciliation within what was then the Southern Sudan Autonomous Region, where competition for recruits during the 22-year war for independence had left deep scars. Instead the overriding ideology was to secure support for self-determination, with the Sudanese regime in Khartoum blamed for every failing in its dirt-poor new neighbour to the south. That provided a cover for those in power, unchecked by Juba’s fledging institutions, to pilfer public coffers. South Sudan was born with very weak foundations on which to build a nation.

Post-independence leaders soon proved uninterested in achieving this anyway—something the country’s donors long failed to recognise. Created at a time when Iraq and Afghanistan dominated America’s agenda, South Sudan appeared to be the poster-child for Western conflict resolution. Accordingly, the child got spoiled: about $1.4 billion of international aid was allocated to the country for its first year after independence; hundreds of consultants were dispatched to the civil service, schools and hospitals. But it was all carrot and no stick. With no conditions attached, the money rarely found its way to infrastructure projects and public services. The consultants’ advice, especially when it was about boosting governance and reforming the army, was ignored. Chiefly focused on state-building, Western aid also failed to bring together estranged communities. All this left plenty of leeway for factional chiefs to whip up tensions and consolidate power, their rivalries culminating in a full-blown civil war in 2013.

Despite a peace agreement in August 2015, the strife was never really extinguished. A government of national unity took months to form; the demilitarisation of Juba, called for by the accord, did not happen. With his arch-rival in hiding since this summer’s clashes, Mr Kiir is now starting to make the right noises again. But his commitment to peace remains questionable. A leaked UN report alleges that government forces recently procured lorries loaded with fresh weapons, and two fighter-jets. America’s hardening stance is met with growing irritation: Americans were the first targets when soldiers ransacked the hotel compound in July—an attack that underlined the UN’s impotence. The opposition could remobilise too. Taban Deng Gai, the new vice-president, is seen as a ruthless politician. But his ability to rein in troops remains unproven.

Metrics 3.0: A New Vision for Shared Metrics

After accountability and standardization, what should the next phase of measurement focus on?

An evolution in metrics:

Metrics 1.0: Accountability. Individual organizations began to identify outputs and outcomes by which to track their impact. Funders became more data-driven, and began asked investees and grantees for more than anecdotes.

Metrics 2.0: Common standards. Organizations started to realize that to distinguish themselves from purely commercial operations, enhance comparability of results, and increase the flow of capital to the sector, they would need to develop a shared measurement system by which to monitor and report social and environmental performance. In 2013, more than 50 percent of impact investing funds listed in ImpactBase used IRIS, the common language to report social and environmental performance indicators. The conversation about shared metrics has been robust.

But it is at Metrics 2.0 that collaborative efforts seem to plateau. Individual organizations can continue on their own unique paths of performance monitoring and impact evaluation, and the group can keep reporting on common output and outcome metrics year after year, but again we return to the question: Where do we go from here?

We have yet to fully realize the opportunities impact measurement and evaluation can create, and we believe there is another step-change—Metrics 3.0—that we should aim to reach within three years.

A Vision for Metrics 3.0

The next phase of metrics will shift the emphasis from accountability (Metrics 1.0) andstandardization (Metrics 2.0) to value creation (Metrics 3.0).

For metrics and evaluations to create value for us, individually and collectively, we must do two things:

  1. Integrate impact metrics with financial and operational ones. Integrated metrics can help organizations develop better products and services, improve resource allocation, and build more efficient and impactful businesses.
  2. Implement targeted, actionable evaluations that are useful to multiple stakeholders and fit with collective learning agendas. Such evaluations will build on existing knowledge; break down big questions into manageable, answerable pieces; and put the answers back together to inform strategic decision-making for enterprises and the sector at large.

The chart below lays out our vision for how Metrics 3.0 will drive business value and impact at the organizational level, and help us to achieve our shared goals and mission as a sector:

1. Organization-Level Measurement

Most organizations track social and environmental metrics as a separate function; the data is stored separately, analyzed by dedicated staff, and reported on in its own publications. Our vision for Metrics 3.0 shifts isolated impact metrics to integrated financial, operational, and impact metrics.

For instance, Root Capital provides loans to agricultural businesses in Africa and Latin America. Even if perfect information were available about the impact of every loan (such as the number of producers reached, the precise amount of extra income that each earned as a result of the loan, and the effect of that extra income on their lives and their children’s futures) that information would not be a sufficient basis for making underwriting decisions or setting long-term portfolio strategy.

Four windows to opportunity. (Image courtesy of Dalberg, Root Capital, and ANDE)

Root Capital also needs to know the expected revenues, operational costs, and risks of the loan to evaluate impact per dollar, per loan. In 2013, the impact team led an initiative to estimate the impact and profitability per loan, and then developed integrated impact-profitability dashboards for each loan officer. This enabled them to make data-driven decisions about their portfolio management and new client acquisition.

Integrating financial and impact metrics is a challenging task. Existing forms of cost-benefit analysis, developed for policy-makers and service delivery nonprofits, don’t quite fit the new breed of social entrepreneurs, impact investors, and mission-driven businesses. The challenge for metrics professionals is to become sufficiently fluent in operational and financial metrics to both integrate them with impact metrics, and create and advocate for this integrated approach with the leaders of their enterprises.

2. Ecosystem-Level Measurement

We have not realized the potential of aggregated impact data. At a sector level, Metrics 3.0 continues the unfinished work of Metrics 2.0. It encourages demand-led aggregation of impact data, which creates value by demonstrating the scale or reach of a group of organizations, or by enabling capital providers to compare organizations’ impacts and efficiency more effectively. More broadly, we believe that aggregated data will be useful only when it is collected with a clear purpose.

For instance, the South African nonprofit Catalyst for Growth has initiated an analytics platform that will bring transparency to the incubation and acceleration market by providing comparable data on the effects programs have on SGBs. This analytics platform will help SGBs and funders identify the best incubators and accelerators, while giving incubators and accelerators feedback on their performance to stimulate improvement.

Similarly, in Mexico a group of organizations are developing approaches that will increase the flow of resources to women entrepreneurs. Convened by Value for Women, the ANDE Mexico Women’s Working Group has come together to benchmark its practices and performance. Its aggregated performance data will provide evidence to make the case for investing in women, decrease transaction costs, and reduce the perceived risks to serving women entrepreneurs.

In both cases, data aggregation is focused on a particular inefficiency in the market. These efforts not only provide participating organizations with actionable information, but also create sector-level resources for measurement that can be leveraged by others.

3. Organization-Level Evaluation

Evaluations are expensive. Using the highest standards of rigor, it’s possible to spend more evaluating an investment than the actual investment amount. But we believe that organizations can creatively and less expensively conduct evaluations that create more value for additional stakeholders, including the subjects of the evaluation. Hard data about consumers and producers living at the bottom of pyramid is scarce and valuable to others, including upstream companies in the value chain, NGOs serving the same community, and donors and investors. Each data collection exercise represents an opportunity to create value in multiple ways:

  • By testing assumptions about our impact, and hopefully, demonstrating impact to capital providers
  • By refining products and services
  • By channeling feedback from low-income consumers or producers to others engaged in the community (who may in turn be willing to share the cost of the evaluation)

For instance, the nonprofit impact investment fund Acumen, Root Capital, and ANDE, a network of organizations that supports entrepreneurship in developing countries, are experimenting with new ways to decrease the cost and increase the value of data-collection at the consumer- or farmer-level. In particular, our aim is to use mobile data collection platforms and short-form impact survey methodologies such as the Grameen Foundation’s Progress out of Poverty Index. Together we seek to build public knowledge about how we can use technological and methodological innovations in data collection to make large-scale “outcome” data collection more cost-effective, while creating opportunities for enterprises to collect data that is most relevant for their operations.

4. Ecosystem-Level Evaluation

Evaluation, like most forms of knowledge creation, is a public good. Not every organization will conduct evaluations, but every organization could potentially benefit from evaluations done by others. What’s more, organizations working together can build a base of evidence about what works that no single organization could build alone.

We envision that in Metrics 3.0, sector-wide initiatives will catalogue existing information and findings, and identify gaps. In a virtuous circle, this will drive individual organizations to develop evaluations that are “repurposable”—that is, useful to multiple stakeholders.

One example of a sector-wide learning agenda that is already underway is the Smallholder Impact Literature Wiki. The Initiative for Smallholder Finance recently developed the wiki to provide a living resource for its community that helps smallholder farmers capture, organize, and easily access the growing body of literature. The wiki instantly makes clear, for example, that while we have strong evidence to support the theory that providing inputs to smallholders will increase productivity, we don’t have a strong evidence base for the impact of technical assistance of agricultural SGBs. The tool enables new entrants to the field to quickly understand which elements of smallholder finance have been proven to drive impact and in what context, and what gaps remain in our understanding.


The practice of measuring impact has come a long way, but we have yet to realize its potential in creating value for individual enterprises and society at large. We invite our colleagues and peers to join us in envisioning and implementing Metrics 3.0, the next step-change in shared metrics. In doing so, individual organizations can maximize the value of impact metrics by integrating them with financial and operational metrics to inform both day-to-day decision-making and longer-term strategic planning. Multiple enterprises in a sector can collaborate to demonstrate collective scale, channel resources to the most impactful and efficient activities, and start building a base of evidence about what works around a shared learning agenda.

In the next three years, our three organizations are committed to taking action in each of the four windows of opportunity that Metrics 3.0 presents, and we invite you to join us.

To learn more, follow @AspenANDE this week, as ANDE hosts its annual “Metrics Conference” in Washington, D.C. on June 3 and 4.