This article raises some strong points on what is necessary to establish a successful "freemium" model, whereby a small percentage of paid users are enough to earn profits from a product which most customers opt to use for free. Evernote provides the evidence that such a model can work when the necessary elements exist. The key elements needed are:

1 - a massive potential audience
2 - very low operating costs
3 - "gotta-have-it" value to some consumers
4 - high retention rates

The business model of Evernote lends itself well to this approach, and it is phenomenally profitable with only ~6% of its long-term users opting for the paid version. The business was designed to be profitable at just a 1% conversion rate, thus keeping operating costs low. The service it provides becomes even more essential the more you use it, to the point where some customers just can't walk away from it. And, over time certain features have been cleverly designed and offered to only paid customers, thus enticing them to stay and maintaining retention rates.

It appears that at some point this year, if current trends hold, Apple's revenues will surpass Microsoft's. In essence, then, Apple appears to be winning the second war between these two companies.

The post from which this graph appears sounds some dire warnings for Microsoft, specifically stating that it has become too focused on defending its core and lost any momentum on expanding into new markets. As the graph shows, once a company's revenue growth stalls, it is difficult to re-start it. Can Microsoft be one of the rare companies that manages to reinvigorate it's growth? It seems to be behind in any logical market into which it could expand (consumer electronics, smartphones, etc.).

• Create incentives that embrace failure and maximize learning. The example we use for this deals with a drink developed by Diageo: Smirnoff Ice, a mixture of alcohol and pop. It was the eleventh version of a sweet alcoholic drink that they had tried. Many organizations that try to innovate fail a few times and give up; they didn’t.
• Protect clever employees from “organizational rain.” Don’t harass them if they’re two weeks late handling their performance appraisals. Don’t expose them to politics. Talk to them straight, and don’t deceive them.
• Now, here’s something that is in contradiction with much of the old business literature: give them real-world challenges, with constraints. Don’t build ivory towers.
• Create a galaxy of stars, don’t just recruit one star. You create a great team by having a lot of great players who say, “I want to play for the Lakers, because they are really good.”
• Use expertise, rather than hierarchy. Provide boundaries, but don’t create bureaucracy.  Explain and persuade, but don’t tell them what to do. If you have a great [engineer or architect] and your task is to come up with the new swimming pool for the Beijing Olympics, that’s enough of a challenge. Don’t worry; they’ll apply their creativity and come up with something brilliant — like the Beijing “Water Cube.”

There is little doubt that "clever" employees, much like smart students, do require special consideration when designing roles and responsibilities, so that they do not become bored and frustrated (personal note - I can attest to this - as a "smart" student in elementary school, I found far too many ways to get in trouble when I was bored by the slow pace of classwork). These tips provide good suggestions on how to do this without giving the appearance that such employees are put on a pedestal or gaining special treatment. The goal is to set an environment where their energies are channeled to meet company objectives in a way that works for their style (which, on deeper thought, is not much different than your goal in defining roles for any employee).

This article in strategy+business covers an important, yet still highly underappreciated, trend whose ramifications will shape the world for the next half-century, and that is the shift in demographics, driving an aging population in the developed world and continued rapid population growth in the developing world. Far more than global warming, this trend has the potential to destabilize existing economies and upset the "world order," with all the potential chaos and, far too likely, violence that such change portends.

You can't fight demographics, and the figures that will shape the next 50 years have already been established. Japan, Europe, and (to a lesser extent - only because of higher immigration) the US will see an aging population, creating huge burdens on government coffers and the younger workers who will be expected to provide the tax revenue. This has been discussed for years but, since the consequences are still many years out and the elderly form such a powerful consumption and voting block, it is difficult to formulate a strategy to respond.

The interviewees discuss a range of ideas but only a few touch on the need to provide incentives to change behaviors. It is only through firm incentives that people, businesses, and government will change their everyday choices. Some practical (if admittedly difficult) ideas offered include:

• Delaying benefits from social insurance to encourage people to work later in life
• Encouraging retirees to move to lower cost-of-living regions to stretch the impact of their retirement benefits (though encouraging them to leave the country sounds a bit harsh)
• Using tax incentives to encourage larger families (to increase the future working population)
• Loosening up immigration policies
• Improving (perhaps subsidizing) child care coverage to encourage women to remain in the workforce
• Providing credits to encourage the hiring of older workers (where the alternative may be offshoring, where there are insufficient younger workers fill the necessary jobs)

And if you think that sounds challenging for the developed world, consider the challenges of developing economies, whose resources are, in many cases, insufficient to support their existing population. Some of the statistics shared are frightening:

• The population of Yemen will more than double from 17M to 39M people by 2020.
• Pakistan will add one-half the current population of Germany, or 38M people, over the next decade.

In such countries that already fight to maintain stability (and, in Yemen's case, lose), the potential for unrest is enormous. It is only by eventually moving beyond China and India and finding opportunities in Africa and the Middle East (which will represent over 20% of global population by 2050) that we can hope to provide an environment in which such countries can grow without violent disruption. This is not an altruistic wish, and it is my hope that the necessity of finding new markets will drive businesses and governments to focus their future efforts on Africa.

This post summarizes the results of a study by the Hay Group to discover the top 20 companies at developing leadership skills and practices. The qualities they use to determine the results include:

Active management of succession plans
Career growth opportunities clear to employees
Use of corporate social responsibility program in recruiting
High proportion of women in senior leadership
Easy for employees to work from home
Strong internal talent pipeline

With such familiar names as GE (my first employer), P&G, Accenture, and 3M on the list, seems likely that it's a relatively stable group. Obviously, its tough to rapidly improve your performance in these categories, but these are worthy goals for any company that wants to sustain strong long-term performance.

Some of these are repeats, but there are a few new gems in here, moving well beyond the traditional anatomical references.

It is a sad state of our litigious society that product warning labels have gotten so tedious and lengthy. In fact, I wonder if they aren't ignored more frequently, and therefore create more problems, then if they really stuck to focusing on the real risks. And it points out one of the major costs of doing business for many companies (and doctors) - the cost of dealing with litigation.

Love these lists of bad names and logos, and this one is more comprehensive than most. Outstanding research, Will. Warning, a few of these may be mildly offensive if you are easily offended.

One company on their, Fuchs Lubricants, is a major player (sorry, couldn't resist) in the metalworking coolant market, so this isn't just a list of Mom & Pop shops.

I'll take one of these Star Trek type control pods please. To go. More practically, the Personal Energy Generator, Powermat Wireless Battery Charger, and Keyboard/Scanner look interesting. You can keep the waterless washing machine and Transformers Edition Camaro for now.