2008年2月29日 星期五

The Price of Going Green

The Price of Going Green

Payback From Earth-Friendly Products
Takes Years; Can a House Be Too Eco?
February 29, 2008; Page W8

Most homeowners like the idea of going green -- until they get the bill.

With home sales slumping and consumers rethinking their remodeling budgets, building contractors and suppliers are dangling green upgrades. They hope that energy-efficient systems and products made from sustainably harvested materials will hook consumers concerned about global warming, pollution and natural resources.

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Yet with a few exceptions, green materials and construction cost extra, making them a hard sell. Enermodal Engineering, a Canada-based consulting firm, estimates the premium at 5% to 10%, depending on how extensively a builder uses recycled materials and water- and energy-efficient products. When Specpan, an Indianapolis research firm, surveyed builders recently for Building Products magazine, the greatest number estimated a 10% to 19% cost increase when going green.

There are signs, though, that the industry's sales pitch is resonating. In the American Institute of Architects' fourth-quarter survey of 500 architects, 61% said their clients are interested in "renewable" flooring materials like cork and bamboo, up from 53% a year earlier; 47% said clients wanted high-end appliances, down from 65%.

Being earth-conscious isn't always easy. Anna and David Porter decided three years ago to trade in their 4,000-square-foot Seattle home for a smaller, greener abode. They paid about $300,000 for an old house on a beachfront lot in Stanwood, Wash., and budgeted $450,000 to renovate it into a green showplace, with kitchen countertops made of recycled glass and concrete, a geothermal heat pump, a tankless hot-water heater, a solar electric system and cabinetry and flooring made from sustainably harvested wood.

Contractor estimates ranged from $700,000 to $800,000 and still didn't include everything the couple wanted. In the end, they tore down the house, salvaged or gave away most of it and spent $1.2 million, not including the original purchase, to build a custom-designed, 2,700-square-foot replacement. It was "the right thing to do," says Ms. Porter, a nonprofit project manager. Even though many of the upgrades will help keep energy costs down, she adds, "I don't expect we'll get back all the money that we paid in our lifetimes."

In fact, earning back the green premium can take years, not counting rebates and incentives that may be available from government agencies. Enermodal calculates a payback period of more than 10 years for the most extreme green measures, including super-efficient furnaces and water-thrifty faucets. Systems integrator Solar Depot estimates a solar hot-water system will pay for itself in eight to 10 years, depending on the climate, site and home size; a solar radiant floor-heating system will take five to six years. But considering the average U.S. homeowner lives in a house only seven years before moving, many will need more than the hope of lower utility bills to inspire a green remodeling. (And some green products, such as bamboo floors, don't save any money.)


Yet there are some items with relatively short paybacks. EnergyStar.gov, an Environmental Protection Agency Web site, estimates a 3.5-year payback period for the $200 premium on an Energy Star-rated electric clothes washer costing $500 and a 3.1-year payback for the $30 premium on an Energy Star side-by-side refrigerator costing $1,100. Compact fluorescent light bulbs -- which go for about five times the price of incandescent bulbs -- pay back their extra cost in about four months.

Mark Silberman, a retired wine-store owner, plans to tear down a four-bedroom split level in Norwalk, Conn., he bought seven years ago for $500,000 and spend about that amount again to rebuild. He has just begun making his way through the dizzying array of green options -- earthen roofs, gray-water irrigation systems, geothermal heating, recycled shingles. Since all these things could add 20% to his final cost, he figures he'll probably just pick those that make the house less drafty and expensive to heat. "If something helps save the earth's resources, that's an extra bonus," he says.

Cost has been a stumbling block to the green building movement ever since interest in solar homes, sod-topped buildings and dome houses took root in the 1960s. Ratings standards such as Energy Star and the U.S. Green Building Council's LEED (Leadership in Energy and Environmental Design) point system help people evaluate costs and benefits.


John Kurowski, a Denver builder who began building "green" homes in 1974, says there is more to consider than just the bottom line. For example, one of the most cost-effective remodeling steps is to caulk and insulate thoroughly. Yet making a building too tight can hurt indoor air quality. "You have to look at the entire system," he says. And some green products can have other downsides. Deck-material makers Trex and TimberTech were early producers of composites blending plastic with reclaimed lumberyard sawdust to create a semisynthetic "lumber" that wouldn't splinter or rot. But with time, the embedded wood tended to stain, scratch and attract mold.

The companies say they have largely conquered the mold with chemical additives. But they also have launched "virgin" polyvinyl chloride decking that they say is more scratch- and stain-resistant. Tom Lent, policy director of an environmental group, the Healthy Building Network, calls pure PVC decks a "disaster environmentally." Anthony Cavanna, chief financial officer of Trex, says 99% of its products are still made using recycled plastic grocery bags. Carey Walley, a TimberTech spokeswoman, says a pure PVC deck, with a 25-year warranty, is "more sustainable" than pressure-treated wood, which may need replacing after 10 years.

The greenest home, though, may be the one you live in now, given the cost in dollars and pollution of ripping out old materials and producing and shipping new ones, the National Trust for Historic Preservation noted in a recent issue of the magazine Preservation. New York architect Andrew Kotchen reminds clients they can save energy and fossil fuels simply by building smaller mansions. "Bigger isn't better," he says.

Write to June Fletcher at june.fletcher@wsj.com

2008年2月28日 星期四

Sony Sharp 解說合資液晶10代線的來龍去脈


DATE 2008/02/29 印刷用網頁































新力中缽:根據每項業務的具體形態來確定生產方式。數位影像業務是典型的垂直綜合型。水準分工的典型是PC。包括這兩種方式在內,新力共有 5種生產戰略。此次的合資並不是說新力要從垂直綜合向水準分工過渡。電視機領域,面板從外部採購,但形成產品特色的部件還是和以前一樣由自己生產。將通過 圖像處理技術、自主開發的影像技術、商品策劃能力、與網路的連接等提高附加值。







夏普片山:現在光是建設第10代工廠就已經忙的不可開交了,還沒有考慮下一步計劃。(記者:大西 順雄)

【続報】シャープとソニーのテレビ向け液晶パネル生産 販売の合弁会社設立覚書締結,記者会見での一問一答

2008年2月27日 星期三

Booming Sales Don't Keep German Companies From Cutting Jobs

Siemens Plans to Cut Up to 7,000 Jobs

Work | 27.02.2008

Booming Sales Don't Keep German Companies From Cutting Jobs

German workers have been buried in bad news as companies announce major job cuts. On Wednesday, Feb. 27, BMW and Henkel joined Siemens in slashing thousands of jobs.

Luxury German carmaker BMW said it was cutting 8,100 jobs as part of a restructuring effort aimed at boosting the group's profits. The company booked record sales of 56 billion euros ($83 billion) in 2007, an increase of 14.3 percent over the year before.

The Munich-based company said 5,000 of the planned job cuts would affect temporary employees and a total of 600 would be slashed in the carmaker's international operations. A total of 2,500 cuts in full-time positions would affect workers in Germany.

Voluntary departures and non-replacement of workers who retire would make up for most of the lost positions, BMW board member Ernst Baumann said in a statement.

Workers fit the body of a BMW 1 in the BMW plant in LeipzigBildunterschrift: Großansicht des Bildes mit der Bildunterschrift: BMW isn't doing as well as some other luxury carmakers

BMW, which is the world's leading luxury carmaker, foreshadowed moves to cut its workforce as part of an announcement it made at the end of December. At the time, however, the company did not provide any details.

BMW share price falls

The move to reduce its workforce, which totals over 100,000, came ahead of the release next month of its latest earnings results and follows the publication of figures showing booming sales of BMW cars.

But analysts have been complaining that BMW's pre-tax return on sales has been lagging behind other premium car groups, including Mercedes. BMW shares were down by about 2 percent at 36.65 euros ($55.12) after the company set out the details of the job cuts.

The German trade union IG Metall was critical of the company's plans.

"Mr. Baumann obviously believes that he can be a troublemaker and boost the share price by keeping workers permanently insecure," Werner Neugebauer, head of the union's Bavarian chapter, said a statement.

Neugebauer added that he doubted the company would be able to find enough employees willing to retire early. IG Metall said it had an agreement with the union that would prevent full-time employees from being forced out of their jobs.

Raw material costs lead to Henkel cuts

A shopping cart filled with a box of Persil detergentBildunterschrift: Großansicht des Bildes mit der Bildunterschrift: Henkel makes Persil detergent and other household goods

Better-then-expected profits were also not enough to save 3,000 jobs at German chemical group Henkel. It announced plans to cut 3,000 jobs and sell its position in a US affiliate to deal with rising raw material costs and stiff competition.

The job cuts will cost about 500 million euros in the short-term, the company said, but lead to annual post-2011 savings of 150 million euros. In a statement, Henkel said it was still working out the details of the cuts and would discuss the measure with labor unions.

Henkel currently employs about 52,000 people, 80 percent of whom are located outside Germany.

"With this step, we are responding early and responsibly to the ever faster changes in our markets," Henkel chief Ulrich Lehner told AFP. "This way, we prepare for oncoming developments and ensure the future viability of our company from a position of strength."

Also on Wednesday, Henkel said its net profits increased by 8 percent in 2007 to 941 million euros. Sales also passed the 13 billion euro mark, a rise of 2.6 percent.

Cuts not contradictory to profits

Announcing job cuts at the same time as increased sales is not contradictory, according to Roland Doehn of the RWI economic research institute in Essen.

"The companies are forced to do it in order to stay ahead of the competition," he told the AP news agency. "To say: 'We have good profits and are satisfied, we're not going to do what the competition does' is very problematic."

DW staff (sms)

Siemens Plans to Cut Up to 7,000 Jobs

德国经济 | 2008.02.26


今天,全球电气电子巨头——德国西门子在其总部慕尼黑正式宣布,决定出售它旗下的“西门子企业通汛部门”(SEN)(以下简称“西门子通讯”)。此举也意 味着,这个大型康采恩将在世界范围内裁员3800人。而仅在德国,就牵涉到近2000个工作岗位。除此之外,还有3000名员工将会通过出售或并入伙伴企 业的方式离开西门子,其中有1200名都是德国员工。

此次出售“西门子通讯”的裁员决定,在 德国主要涉及慕尼黑总部的约1700名员工。而位于德国东部“音乐城”莱比锡的“西门子通讯”工厂也会随之被解散,它自身拥有的约530名员工将被出售或 者“与第三方协商解决办法”。在希腊塞萨洛尼基(Thessaloniki)和巴西库里蒂巴(Curitiba)的“西门子通讯”制造厂也会遭受同样命 运。


在此次出售前,西门子就下了决心,一定要将裁员 改组的措施明朗化,并要掌控在自己手中,以免上次向明基出售手机部门终遭破产的悲剧再次上演。西门子财政负责人乔•凯瑟(Joe Kaeser)表示,“有关这次对西门子通讯(SEN)的提前改组及其与之相关的企业整顿流程,我们都将会在西门子自己能控制的情况下开始进行;并且我们 保证,为随之而来的人员安置所采取的举措将会尽可能的在社会可承受范围内推行。”




尽管如此,西门子的此项裁员计划却为德国金属工 业工会(IG Metall)所诟病,被指责为缺乏责任心。巴伐利州的工会主席维尔讷•诺伊格鲍尔(Werner Neugebauer)批评说,“至今都还缺乏一个行之有效的总体计划纲领,但雇员们却都做好谈判的准备。我们希望,西门子能够吸取上次它向明基出售手机 部门时的惨痛教训”。


Siemens Plans to Cut Up to 7,000 Jobs

Published: February 26, 2008

Siemens plans on Tuesday to announce that it intends to eliminate up to 7,000 jobs, or 40 percent of the workers in its troubled business telecommunications unit in Germany and Brazil, as it seeks a buyer for the business, a person with direct knowledge of the situation said.

Executives were to disclose the plans for the unit, Siemens Enterprise Communications, which makes corporate phone networks, at a meeting with representatives of the workers’ council in Munich.

According to the person, who spoke on condition of anonymity, executives will announce plans to cut up to 4,000 jobs in the unit, which employs 17,500, and advise the worker representatives that a further 3,000 jobs could be transferred into ventures with new business partners.

The layoffs could occur in Leipzig, Germany, and in Brazil, where Siemens has factories that produce phones and corporate communications networks, the person said. About half of the 4,000 layoffs will be in Germany, this person added.

Peter Löscher, the chief executive of Siemens, has said he wants to sell or find an investment partner for the entire business by June. Plans for the job cuts were first reported Monday in The Financial Times Deutschland.

The corporate telecommunications business was first prepared for a potential sale in 2005, as part of a reorganization. Last year, Siemens put the largest part of that business, a unit that sold network equipment to phone operators, into Nokia Siemens Networks, a joint venture with Nokia of Finland, the market leader in cellphone manufacturing.

But it has so far been unable to find a buyer for the rest of the business, formerly called Siemens Enterprise Networks, which makes products like the Siemens Gigaset for business.

2008年2月26日 星期二

Google Outlines The Secret To Its Success

因嗎 天曉得
Google Outlines The Secret To Its Success

Google knocks the BBC off top spot to take first place in Superbrands survey

GOOGLE, the American internet search giant, has been voted the UK's number one brand in the latest annual Superbrands survey.
The company knocked the BBC off top position and into fourth slot, while Microsoft took second position and oil giant BP snatched third place in the annual snapshot.

Stephen Cheliotis, chairman of the Superbrands council which oversees the survey, said the list was intended to reflect brands which have "established the finest reputations."

The full article contains 87 words and appears in Edinburgh Evening News newspaper.
Last Updated: 25 February 2008 12:26 PM

2008年2月25日 星期一

“BRAVIA F1系列”特長は高画質と操作性、デザイン

新力推出液晶電視“BRAVIA F1系列”

  新力推出了液晶電視“BRAVIA F1系列”。根據影像內容可調整畫質的動態效果和明亮度,根據圖像可選擇最合適的影像顯示。例如在圖像發暗時,可抑制過度的輪廓顯示,除去圖像干擾,形成平滑的影像。


  價格採用開放式,零售價方面,16吋機型為9萬日元左右,52吋機型為46萬日元左右。3月20日起陸續上市。(2月22日 《日本經濟新聞》晨報)



 ソニーは22日、「〈ブラビア〉ハイビジョンミュージアム’08」を東京都内で開いた。同社の液晶テレビ「ブラビア」シリーズの春の新製品4シリーズ、11機種が披露された。(アサヒ・コム編集部) 〈写真特集〉はこちら











 新ブラビアのラインアップは、大型のF1シリーズ(画面サイズ32、40、46型)とV1シリーズ(40、46、52型)、2台目向けの中型テレビの J1シリーズ(20、26、32型)、若者と女性をターゲットにしたM1シリーズ(16、20型)。3月20日から順次発売される。オープン価格。



 リモコンは無線通信のため、テレビに向けなくても操作でき、家具などの障害物越しでも利用できる。また、「ブラビアリンク」に対応したブ ルーレイディスクプレーヤーやホームシアターシステムなどをHDMIケーブルで接続すれば、テレビのリモコンでこれらの機器も操作できる。






NEC 將把所有資源集中于新一代網路


DATE 2008/02/25 印刷用網頁

  NEC代表董事社長矢野薰在2008年2月20日舉行的經營說明會上公佈了將致力於新一代網路(NGN)技術、把海外銷售比率提高至30%以上的經營 方針(圖1)。矢野表示,“預計07財年NGN的2000億日元銷售目標能夠實現”,“08財年的目標為倍增至4000億日元”(矢野)。

  矢野強調,NEC所定義的NGN包含被稱為3.9代(3G手機擴展版)的通信方式“LTE(long term evolution)”,以及可實現固定電話通信和行動通訊體聯動的服務“FMC(fixed mobile convergence)”等。並表示與NTT集團推出的NGN相比範圍更廣。

  關於今後的課題——把海外銷售額從現在的約20%進一步提高的問題,“首先要在3年以內超過30%。預計通過本公司的努力以及與其他公司的合 作,能夠達到這個水準”(矢野)。提出的目標為40%。不過關於此目標水準,矢野明確表示“很明顯,在3年之內達不到”。(記者:清水 直茂)


2008年2月24日 星期日

Maybe Microsoft Should Stalk Different Prey 雅虎會變成微軟的AOL

Digital Domain

Maybe Microsoft Should Stalk Different Prey

stalk (FOLLOW)

Published: February 24, 2008

OVER the years, Microsoft has pummeled countless rivals, including the superheavyweight I.B.M. But it has never faced a smaller foe as formidable as Google. The tale of the tape gives Microsoft a $100 billion advantage in market capitalization, but it counts for little: Google appears to be its superior in strength, speed, smarts.

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David Paul Morris/Getty Images

Lawrence J. Ellison is chief executive of Oracle, which has made acquisitions that dovetail with its core business. Last month, it reached a deal to buy BEA Systems for $8.5 billion.

Having exhausted its best ideas on how to deal with Google, Microsoft is now working its way down the list to dubious ones — like pursuing a hostile bid for Yahoo. Michael A. Cusumano, who has written several books about the software industry and about Microsoft, is not impressed with Microsoft’s rationale for its Yahoo offer. He said the bid seemed to be a pursuit of “an old-style Internet asset, in decline, and at a premium.”

Determined to match Google in search and online advertising, Microsoft has managed to overlook a plain-vanilla strategy, the oldest one in the book: build on its own strengths. What it does best is to sell software to corporations, for all sorts of applications, visible and not so visible, at a handsome profit.

If Microsoft thinks this is the right time to try a major acquisition on a scale it has never tried before, it should not pursue Yahoo. Rather, it should acquire another major player in business software, merging Microsoft’s strength with that of another. This is more likely to produce a happier outcome than yoking two ailing businesses, Yahoo’s and its own online offerings, and hoping for a miracle.

For an illustration of how Microsoft could select targets more judiciously, Mr. Cusumano, who is a professor at the Sloan School of Management at the Massachusetts Institute of Technology, pointed to the Oracle Corporation’s strategic acquisitions and its prudent use of capital to “roll up firms with similar products and customers to its own.” With impressive regularity — 13 strategic acquisitions in 2005, another 13 in 2006 and 11 in 2007 — Oracle has picked up key products and customers while avoiding an “oops” slip, venturing too far away from its core business, or paying too much. At no point along the way has it acted in a fit of desperation.

Last month, Oracle pulled in another major prize, BEA Systems, a leading software company, for about $8.5 billion. You’ve probably never heard of BEA: it’s doubly obscure, producing the behind-the-scenes infrastructure that large companies use to build behind-the-scenes software systems for their entire business, or “enterprise software.” Both Oracle and BEA are based in Silicon Valley, but their side of the street is not lit by klieg lights and does not get the same attention as the Googles and Yahoos.

And, to be honest, it’s not much fun hanging out on the enterprise side of the software business. BEA says its software helps organizations “ensure that business processes are optimally defined, managed, executed and monitored.” Unless you’re playing Business Jargon Bingo, it’s hard to sit still and remain attentive. You have to admire Oracle’s ability to remain focused on the business that serves business and to not be distracted by the buzz of the Web crowd gathered across the street.

Microsoft does business software well. Approximately half its revenue comes from business customers for its e-mail infrastructure, database systems, developer tools, Office productivity applications and other mainstays. It has also assembled, through acquisitions, a fledgling line of enterprise software that it calls Microsoft Dynamics. Microsoft would like Dynamics to be viewed as competing head to head with the No. 2 name in enterprise software, Oracle, or the No. 1, SAP of Germany. For the moment, however, Microsoft Dynamics’ parity with those big names is nothing more than wishful aspiration.

Professor Cusumano has a suggestion: Rather than acquire Yahoo, Microsoft should pursue SAP.

It’s not an outlandish idea. The two companies held merger talks in late 2003, and perhaps since then, too. Microsoft is in an enviable position: it is a nearly universal presence in corporate data centers, and large enterprise customers are arguably the best customers a software company can have. Clients pay very dear prices for the complex, semicustomized software that runs their business. And once they’ve got their systems running — a process that can take years to complete — they aren’t inclined to change vendors lightly.

A few dozen well-paying Fortune 500 customers may actually be more valuable than tens of millions of Web e-mail “customers” who pay nothing for the service and whose attention is not highly valued by online advertisers.

Today, SAP’s market capitalization is about $59 billion, and a sizable premium to get a deal done would send its price well north of that. Microsoft cannot put both SAP and Yahoo in its shopping cart, deals that together might run well over $120 billion. Microsoft must pick one or the other.

Suppose that Lawrence J. Ellison, the chief executive of Oracle, were the head of Microsoft and was doing the shopping. Which deal would he choose? Past experience suggests that it would not be Yahoo. That acquisition would bring little but duplication headaches — and no large enterprise customers.

It’s amusing to note that the most Larry-like choice, Microsoft’s acquiring of SAP and leaving it alone as an autonomous division to avoid a cross-cultural integration fiasco, is the course that would be most discomfiting to Oracle. Frank Scavo, president of Computer Economics, an information technology research firm, in Irvine, Calif., said that “a Microsoft-SAP combination would be Oracle’s worst nightmare.”

Google would not be happy with a conjoined Microsoft and SAP, either. It has made a pro forma expression of its own opposition to a Microsoft-Yahoo merger, but we can speculate that it may be cheering that deal on. Working in Google’s favor are the hostile nature of Microsoft’s bid, the colossal potential for integration problems, and organizational paralysis in, and exodus of talent from, Yahoo.

But were Microsoft to turn and head in SAP’s direction, Google would have reason for concern. Whatever strengthens Microsoft is bound to influence, later if not sooner, its continuing competition with Google. For its own part, Google is keen to expand its foothold inside large companies. Last year, it acquired Postini, whose software filters corporate e-mail. Google has not done so well with corporate customers on its own, however. Google Apps has conspicuously failed to win adoption quickly.

If Microsoft is to rededicate its attention to its most valuable assets, business customers, a prerequisite is dropping its ill-advised bid for Yahoo. And to find the best acquisition strategy, ask, “What would Larry do?”

If Microsoft tries to fight Google with wobbly legs, scared witless, it will lose.

Randall Stross is an author based in Silicon Valley and a professor of business at San Jose State University. E-mail: stross@nytimes.com.


微軟是看中雅虎的網上應用科技嗎?不見得。雅虎近年沒有推出過什麼令人注目的科技創新,就算是原先不少人寄以很高期望的search engine Panama也令人大失所望。




雅虎是網絡經營的先驅者,不幸它的經營概念滯留在開墾時的視野框框中。那是個只顧搶eyeballs、盡量scale up,那是個無所不為、而又一切皆可為的奔放不羈時代。當時的網絡經營者都相信,網絡可以高速地四通八達,網絡的經營模式不僅要是個conglomerate,更要是個多層次的conglomerates。這基本上還是雅虎的經營模式。



雅虎的經營概念和模式已經顯得既過時又殘舊。在網絡世界,若然沒有不斷以自我摧毀的創造(creative self-destruction)來維持新的經營概念和模式,那麼十多年下來,驀然回首已是老態龍鍾的「百年」身了,雅虎不幸便是這樣的一間網絡公司了。


例如,現時紅透半天的Facebook本來已是它的囊中物,甚至跟Facebook的CEO Mark Zuckerberg協定以十億美元作為收購價了,但臨門一腳,舉棋不定,三心兩意,害怕買貴了貨,結果錯失良機。到回頭要人家減價為八億五千萬元,這反而給Zuckerberg一個脫身的機會。後來Zuckerberg以二億四千萬美元的天價賣了一?六%股權給微軟 —— 相當於整間公司市值一百五十億美元。


、裹足不前,以致吃到了口中的deal也給Google搶走。還有,雅虎也認真考慮過收購Jotspot —— Facebook和Myspace等social network科技的原創者。同樣也因為意向不堅定,而給當時還羽毛未豐的Google收購了。


有一個時候,雅虎的graphical display廣告帶來不錯的利潤,可是這門生意已在走下坡,與此同時Google則創新了不少賣廣告的方法。時至今日,如果雅虎想增強它的廣告收入,最簡單和有效的方法是讓Google幫它推銷它的search engine的廣告。Google推銷廣告的能力比雅虎實在強大得太多了。雅虎有能力迎頭趕上嗎?想也不用想了。






寶成 力拚醫療觀光






蔡其瑞表示,寶成集團是透過轉投資寶鈺生技公司發展假牙新技術,目前已自行開發亞洲第一套TDS(Total Dental Solution)電腦3D齒雕與植牙系統,可生產高附加價值數位假牙及植牙產品,搶攻全球上百億美元假牙商機。




【2008/02/25 經濟日報】

A Capitalist Jolt for Charity

英文人行道 et cetera, et cetera.

A Capitalist Jolt for Charity

Sandy Huffaker for The New York Times

EPals has for-profit and nonprofit arms. Candace Pauchnick, standing, uses its tools in her class.

Published: February 24, 2008

IN the summer of 2005, Miles Gilburne and Nina Zolt had long talks over dinner in their Washington home about what to do next. For more than six years, Mr. Gilburne, a former AOL executive, and his wife, Ms. Zolt, a former lawyer, had supported a philanthropy that used books and online tools to enhance skills of inner-city students.

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Doug Kanter/Bloomberg News

Bill Gates of Microsoft and Muhammad Yunus, who won a Nobel for his microfinance venture, have been pioneers in harnessing business means for socially conscious ends. The Gates Foundation treats its grants like venture capital investments.

The XO machine from One Laptop Per Child, left, and the Intel Classmate PC feature ePals services, which connect students and classrooms worldwide.

Doug Mills/The New York Times

Edmund Fish, C.E.O. of ePals, says “a learning social network is not an oxymoron.”

Doug Mills/The New York Times

Miles Gilburne and Nina Zolt are the force behind the firm.

The program, which Ms. Zolt directed, had been moderately successful. Students liked writing online about books and sharing their ideas with Internet pen pals, including adult mentors. Many teachers embraced the project, called In2Books, and participating students outscored their peers in standardized tests.

Still, the costly venture grew only gradually, classroom by classroom. The couple had put $10 million into the charity, a “meaningful portion” of the family wealth, Mr. Gilburne says. “It was enough money that I did lie awake at night thinking about the size of the checks,” he recalls.

As philanthropy, the couple’s efforts, however worthwhile, weren’t sustainable. But their vision of using the Internet for communication and collaboration to improve education has taken on a new life — as a business.

Today, the once-struggling venture has morphed into a primarily for-profit enterprise. And the striking transformation of In2Books is emblematic of a larger trend: charities are changing their spots and making use of some of capitalism’s virtues.

The process is being pushed forward by a new breed of social entrepreneurs who are administering increasing doses of bottom-line thinking to traditional philanthropy in order to make charity more effective.

To make a fresh start, Mr. Gilburne attracted like-minded angel investors, and at the end of 2006 the group bought a for-profit company, ePals Inc., to expand on the original mission and support the foundation. The ePals company has grown and now offers classroom e-mail, blogs, online literacy tools and Web-based collaborative projects on subjects like global warming and habitats.

EPals says 125,000 classrooms around the world are using at least some of its free tools, reaching 13 million students, and its ambition is to become a global “learning social network.”

National Geographic is to announce this week that it is investing in ePals, based in Herndon, Va., and will supply educational content for the ePals learning projects. Worldwide distribution should get a lift from Intel, which will soon ship its Classmate laptops, designed for students in developing nations, with the ePals icon on the screens. And ePals is also offered for use on the low-cost computers from One Laptop Per Child, a nonprofit group trying to bring the content and experience of the Internet to children in developing countries worldwide.

Various versions of efforts like this are appearing across the philanthropic landscape as business-minded donors, epitomized by Bill and Melinda Gates and their foundation, have treated their charitable contributions more like venture capital investments. They seek programs that can be catalysts for broad changes in fields like health, education and the environment, they measure performance and results, and they encourage nonprofits to become more self-sustaining.

Yet to have the greatest possible impact, a further step down the capitalist road is sometimes needed, analysts and others in the field say. Muhammad Yunus, the microfinance pioneer and Nobel laureate, calls this next step the “social business.” The goal, according to Mr. Yunus, is to create ventures that more than pay for themselves — in other words, turn a profit.

Social business entrepreneurs, he writes, can help “make the market work for social goals as efficiently as it does for personal goals.”

PHILANTHROPIES are discovering that for-profit status and financing can be a useful tool. For example, many microfinance lenders, modeled after Mr. Yunus’s project, the Grameen Bank in Bangladesh, aim to make the crossover to profit-making institutions.

Mozilla, the nonprofit foundation that developed the open-source Web browser Firefox, decided that it needed a for-profit unit to accelerate its business activities and gain market share against Microsoft’s Internet Explorer. The business unit is freer to spend on marketing, charge for software service and technical support, and pay to compete for engineering talent in Silicon Valley.

Likewise, Google.org, the search giant’s corporate foundation, chose for-profit status to be able to easily make investments in for-profit companies including alternative energy start-ups like eSolar and Makani Power.

“Capitalism is a very mutable, flexible beast, and what we’re seeing is social entrepreneurs addressing some of these social challenges in profoundly different ways than traditional nonprofit organizations,” said John Elkington, co-author with Pamela Hartigan of “The Power of Unreasonable People: How Social Entrepreneurs Create Markets that Change the World,” a new book that was handed out last month to attendees at the World Economic Forum in Davos, Switzerland.

Even among its hybrid peers, ePals has evolved into an unusual combination of a business and a social venture. When Mr. Gilburne and Ms. Zolt established the for-profit arm in 2006, they attracted like-minded investors, acquired ePals Inc. and began hiring talented staff. They gave the original education foundation a 15 percent stake in the ePals company, and its endowment will grow if the business prospers. The nonprofit division is focusing on educational research and bringing technology into classrooms.

But the company is where the action is. “This needs to be a large business to have a really significant social impact,” Mr. Gilburne said. “We couldn’t do what we’re doing as a nonprofit.”

Very few nonprofits get big. Only 144 of the more than 200,000 nonprofits established since 1970 had grown to $50 million or more in revenue by 2003, according to a study published last year by the Bridgespan Group, a nonprofit consulting firm that advises philanthropies.

With the rising influence of social entrepreneurs in philanthropy, many nonprofits have sought to generate revenue to become more self-sustaining. But it is still rare for a nonprofit to cross the chasm to become mainly a profit-seeking business, as in the ePals experience.

“It’s tricky, but it makes sense when the business is highly aligned with the mission of the social entrepreneurs,” said Jeffrey L. Bradach, a managing partner of Bridgespan.

As a for-profit business, ePals can more easily attract financing for growth. But outside investors raise the risk that the original social ideals will be lost in a single-minded pursuit of profit. Mr. Gilburne has tried to avoid that pitfall by gathering a stable of angel investors among his longtime business friends, who bring not only money but also a shared belief in the promise of the Internet to improve education.

The group includes Stephen M. Case, the former chief executive of AOL; Mitchell Kapor, the founder of the early spreadsheet maker Lotus Development and an open-source software supporter; and Yossi Vardi, an Israeli Internet entrepreneur.

“None of our investors are interested just in making another financial score,” Mr. Gilburne said.

AFTER pooling their money, the angel investors bought the ePals company in December 2006 for an undisclosed price. Mr. Gilburne had watched ePals for years, starting when he was at AOL in the 1990s, and he saw it as the foundation on which to build an educational social network.

EPals started as a Web-based electronic pen-pal service in 1996, offering point-and-click tools that teachers could use to control how students use e-mail. A teacher in California, for example, set the controls so her class could communicate online only with a class in China that was engaged in a joint cultural exchange project.

Since the angel investors came aboard in 2006, the ePals work force has more than doubled, to 43, and the company continues to hire. It has improved the e-mail and blogging software and added links to outside resources, like National Geographic’s digital library, to its Web-based software for online projects.

“We were a small company with little capital,” said Tim DiScipio, a founder of the original ePals, who is the chief marketing officer of the revamped company under its new ownership. “But now we have the resources to really pursue the vision of social learning over the Internet.”

Until last fall, ePals charged $3 to $5 a year for each student e-mail account, but the service is now free. The effect of free distribution was immediate and dramatic. The number of registered users has nearly doubled, to 13 million, since September.

The growth and ambition of ePals have impressed National Geographic enough to make an investment and forge a partnership.

“We’re looking at them as a global network to distribute National Geographic content,” explained Edward M. Prince, the chief operating officer of the venture arm of the nonprofit scientific and educational organization.

The ePals team is betting that it can build a worldwide social network in education — a serious, controlled version of Facebook, for students in kindergarten through 12th grade. “When markets go digital, they go collaborative and sharing,” said Edmund Fish, the chief executive of ePals and a former executive of AOL, where he oversaw online education offerings. “That can happen in education, too. A learning social network is not an oxymoron.”

Even the basic social networking of ePals e-mail exchanges, teachers say, helps improve writing skills and stirs curiosity about other cultures. Mirjana Milovic, a teacher in Kragujevac, Serbia, says ePals has helped the 120 students in her school with their English-language skills. Their correspondents in Alabama and Kansas have also learned that jeans and Nike shoes are popular in Kragujevac but that the McDonald’s in town closed for lack of business.

“We usually prefer our domestic food,” wrote Marija, an 18-year-old.

Candace Pauchnick, who teaches English and sociology at Patrick Henry High School in San Diego, has been using ePals for what she calls “virtual field trips.” In their online exchanges with students in Italy, China and the Czech Republic, her students have learned about family life and political systems in foreign lands and improved their writing skills.

“If they were just writing for me, they wouldn’t be as careful,” Ms. Pauchnick said. “But they’re writing for a student in another country. It’s not drudgery for them. They buy in and they enjoy it.”

Ms. Zolt, the chief program architect of ePals, endorsed the for-profit route but insisted that the digital network also provide a free searchable database for educational research.

“The promise here is to be able to study, with vast amounts of real-time data, how children learn,” she said.

Scholars are enthusiastic. “Its potential is very exciting,” said Linda B. Gambrell, a professor of education at Clemson University, who is one of the academic advisers of ePals. “This should help us quicken the pace of translating innovative research into best practices in the classroom.”

Like many start-up companies, the revamped ePals is still working on its business model. Mr. Gilburne, the chairman, says it will pursue corporate sponsors for certain project areas. These could be part of a company’s community and social responsibility activities, providing approved adult experts to help students online. For example, General Electric might sponsor ePals’ global warming section by providing environmental experts as online mentors, Mr. Gilburne said, or perhaps Intel or I.B.M. would help in engineering projects.

There are commerce opportunities, Mr. Gilburne added, for education publishers who might want to market books or curriculum materials for home-school students over ePals.

Eventually, Mr. Gilburne said, advertising will be part of the mix. “But we’ll go gingerly to figure out what is appropriate and doesn’t impose on the classroom,” he said.

The failure rate for entrepreneurs — whether social or purely capitalist — is high. Still, ePals’ backers are betting that it is worth the risk. “These kinds of opportunities to do well and do good at the same time don’t grow on trees,” said Mr. Kapor, the ePals investor and a philanthropist. “But I do think that ePals could be one of them.”

2008年2月22日 星期五

Toyota Reaches for Agility

At Toyota, a Global Giant Reaches for Agility

Published: February 22, 2008

TOYOTA CITY, Japan — At Toyota’s training center inside its Motomachi assembly complex here, workers use golf balls to limber up their fingers before they learn new tasks on the factory floor.

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Ayumi Nakanishi for The New York Times

A manager, top, using golf balls to limber up his fingers at a plant in Toyota City, Japan.


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Ayumi Nakanishi for The New York Times

A Thai worker learning to apply paint evenly.

Holding two balls in each hand, they try to make them revolve in opposite directions, which requires a surprising amount of concentration.

The exercises are just a small part of Toyota’s plan to search continually for ways to streamline methods to build its cars, breaking down the steps used in thousands of tasks on the assembly line in order to teach them to new employees and managers.

Toyota sees the training centers — one here, and another in Georgetown, Ky., as well as more planned for elsewhere in the world — as an important tool as it gears up for its next major phase of growth.

With plants in 27 countries, more new factories under construction and workers speaking languages that include Russian and Turkish, Toyota’s top executives are trying a difficult balancing act — replicating the company’s success and operating principles in other countries while ceding more control to these new outposts at the same time.

Such thinking represents not just a challenge of reconciling conflicting goals — to control and let go simultaneously — but also a fundamental shift for Toyota, where senior management jobs are held entirely by Japanese executives, and whose major operations, from engineering to design to strategic planning, remain based in this city about 200 miles west of Tokyo.

“It’s extremely important to have the same common Toyota Way infiltrated to employees in all corners of the world,” said Katsuaki Watanabe, the company’s president. “But on the other hand, in each corner of the world, in each region, there are inherent characteristics that need to be respected.”

For example, Mr. Watanabe has asked foreign managers to assess which tasks they can handle on their own, which they can handle with help from Japan, and which areas Japanese officials still need to supervise.

Toyota needs to act quickly. Next year, it expects to sell more than 10.4 million cars worldwide, double what it sold in 2000. At the same time, Toyota is under pressure to put an end to the recalls of the last three years that have damaged its reputation for bulletproof quality.

“As a global company, there are many, many things I believe Toyota has to do,” said Fujio Cho, its chairman. “We cannot go back to what we were in the past.”

Mr. Watanabe said that Toyota had learned, especially through experience in the United States, that it could not simply impose Japanese practices on workers in other countries. It also has learned it cannot spend decades gradually handing off responsibilities. “What took us 20 years is now concentrated down to five years,” Mr. Watanabe said.

John Paul MacDuffie, a professor at the Wharton School of the University of Pennsylvania, said of Toyota’s new strategy: “This is about a greater maturity about globalizing and transferring knowledge.”

Toyota’s expectation that its sales will surpass 10 million next year would put it well ahead of General Motors, which is roughly tied with Toyota for the top spot in the global auto industry. (G.M. has not given its own global sales target, but its sales around the world this decade have grown an average of about 1.5 percent a year, while Toyota’s have averaged about 7 percent.)

Toyota’s sprawling organization includes American operations that have become a smaller version of the parent company, with a 51-year-old sales organization based in California. That entity oversees 1,300 dealerships, which are supplied with vehicles built in Japan and by plants in Kentucky, Indiana, Texas and, soon, Mississippi. Toyota also has a design center in California and another under construction in Michigan.

European locations are quickly gaining the same kinds of operations, run from a headquarters outside Belgium, and supplied by a plant in France that turns out the small Yaris cars 24 hours a day.

In China, however, Toyota’s production has long trailed other global auto companies because it hedged its bets with a modest venture that builds only a few thousand vehicles a year. It regrouped in 2003 in a deal with a major Chinese player, First Automotive Works, and Toyota is making plans, according to media reports, to build its first assembly plant there.

To be sure, Toyota is not alone in taking a global approach to its business. Ford Motor, which is reorganizing after billions of dollars in losses the last few years, is realigning its product development so that it uses the same underpinnings, or platforms, for most of its vehicles around the world.

Asked in December what company he viewed as a model, Ford’s chief executive, Alan R. Mulally, immediately cited Toyota. Meanwhile, G.M. has been on its own drive to share platforms among its operations in North America, Europe, Latin America and Asia, said a spokesman, Dee Allen.

“For all intents and purposes, our globalization is set,” Mr. Allen said. Using the same platforms “really is a natural progression as the world has become smaller, and products are being sold in a lot more places than they used to be,” he added.

But Toyota has a leg up on its American rivals, because it has spent decades leveraging its basic lineup in world markets.

Toyota sees teaching its production system in the new training center here as crucial to maintaining quality, and reducing the recalls that have plagued the company in recent years.

Such training is essential in places like China, where Toyota found that some of its newest employees had never driven the cars they were hired to build.

At Motomachi, more than 3,000 tasks on the assembly line have been translated into video manuals that are displayed on laptop computers above 30 simulated workstations, situated where their functions would be carried out inside the factory.

The videos show everything from the correct way to hold a screw to the best way to hold an air gun so that a worker’s hand will not tire in a few hours.

This month, workers from Toyota’s plant in Thailand took part in training required for jobs in their plant’s paint shop. Listening as an interpreter translated from Japanese into Thai, the workers were shown how to bend their knees and spray a water gun across a clear panel of Plexiglas.

Their first goal was to learn to aim the spray between two lines of tape across the Plexiglas, representing the side of a car. A second exercise was intended to teach them not to use the spray too liberally by capturing the water sprayed against the glass in three containers, which bore lines marking 200 grams. If the water rose above the line, the worker was spraying too much.

The walls of the production center bear flags from various countries and states where Toyota has factories, including the Czech Republic, West Virginia and Brazil. Before they leave, workers sign their home flag, like the one from China that is nearly covered with signatures.

But new ideas do not apply only to the trainees. At Toyota’s Tsutsumi plant, which builds the hybrid-electric Prius, Toyota has overhauled the way it delivers parts to the assembly line. The top floor of the plant, built in 1970, has been emptied and turned into a sprawling parts warehouse.

Workers on the plant floor used to choose the parts they needed to install on each vehicle from bins next to the assembly line. Now, a crew of workers upstairs loads the required parts into containers. The bins are placed inside the empty car bodies. Workers need only reach for the appropriate parts. After use, the bins are collected and sent upstairs to be refilled. The process will be part of the operation at Toyota’s new plant in Mississippi. It has cut Tsutsumi’s labor costs by 20 percent, said Osamu Ushio, general manager for the final assembly division, for two reasons.

First, cutting out the need to pick out parts shortened the training time for temporary workers, who make up one-third of the work force at Tsutsumi.

Second, older Japanese workers who are guaranteed lifetime employment by Toyota but can no longer handle the physical tasks of building cars can shift to loading containers.

That allows Toyota to deploy younger workers, often the temporary ones, who can work faster than their elders at lower wages. They earn about two-thirds of what permanent workers do, or as little as $10.50 an hour, with few benefits. Said Mr. Ushio: “We have to adapt to the changing environment.”

2008年2月20日 星期三

Making Economics Relevant Again

Economic Scene

Making Economics Relevant Again

Published: February 20, 2008

It was only a decade ago that economics seemed to be an old and tired discipline. The field no longer had intellectual giants like John Maynard Keynes or Milton Friedman who were shaping public policy by the sheer force of their ideas. Instead, it was devolving into a technical discipline that was even less comprehensible than it was relevant.

Some Wall Street firms had become hesitant to hire Ph.D. economists, and the number of undergraduates majoring in the subject was plummeting. “A good deal of modern economic theory,” John Cassidy wrote in an article titled “The Decline of Economics” that appeared in The New Yorker in 1996, “simply doesn’t matter much.”

Over the last decade, however, economics has begun to get its groove back. Armed with newly powerful tools for analyzing data, economists have dug into real-world matters and tried to understand human behavior. Economists have again become storytellers, and, again, they matter.

They have explained why Americans don’t save enough money — and come up with clever ideas to increase savings. They have discovered that modest increases in the minimum wage don’t actually destroy many jobs — and thus made possible the recent state-by-state push to raise minimum wages. Since the mid-1990s, the number of undergraduates majoring in economics has risen sharply.

But there are more than a few economists who believe that the renaissance has come with a big downside. They argue that the new research often consists of cute findings — which inevitably get covered in the press — about trivial subjects, like game shows, violent movies or sports gambling. Economics may be popular again, but there still is no one like a modern-day Milton Friedman or John Maynard Keynes.

So when I recently set out to conduct my second annual survey of economists, I decided to try to uncover the next best thing. In its first incarnation, the survey simply asked for the names of the next generation of stars specializing in the economics of everyday life. This year, though, I went the other way — toward the big picture — and asked which economists were managing to do influential work on the crucial questions facing modern society.

Who, in other words, was using economics to make the world a better place?

I received dozens of diverse responses, but there was still a runaway winner. The small group of economists who work at the Jameel Poverty Action Lab at M.I.T., led by Esther Duflo and Abhijit Banerjee, were mentioned far more often than anyone else.

Ms. Duflo, Mr. Banerjee and their colleagues have a simple, if radical, goal. They want to overhaul development aid so that more of it is spent on programs that actually make a difference. And they are trying to do so in a way that skirts the long-running ideological debate between aid groups and their critics.

“Surely the most important societal question economics can help answer is why so many people are crushingly poor and what can be done about it,” David Romer, a professor at the University of California, Berkeley, said. The macro issues (like how to build a democracy) remain maddeningly complex, Mr. Romer noted. But thanks in part to the poverty lab, we now know much more about how to improve daily life in the world’s poorest countries.

The basic idea behind the lab is to rely on randomized trials — similar to the ones used in medical research — to study antipoverty programs. This helps avoid the classic problem with the evaluation of aid programs: it’s often impossible to separate cause and effect. If aid workers start supplying textbooks to schools in one town and the students there start doing better, it could be because of the textbooks. Or it could be that the town also happened to hire a new school administrator.

In a randomized trial, researchers would choose a set of schools and then separate into them two groups. The groups would be similar in every respect except for the fact that one would receive new textbooks and one wouldn’t. With a test like this, as Vinod Thomas, the head of independent evaluation at the World Bank, says, “You can be much more accurate and much more clear about the effect of a program.”

The approach can sound cruel, because researchers knowingly deny help to some of the people they’re studying. But what, really, is the alternative? It’s not as if someone has offered to buy new textbooks for every child in the world. With a randomized study, you at least learn whether your aid money is well spent.

Ms. Duflo, who’s 35, and Mr. Banerjee, 46, came to economics from opposite ends of the intellectual spectrum. She was studying history at the École Normale Supérieure, one of the most prestigious colleges in France, when she decided that the more scientific approach of economics offered a better way to address global poverty. He dropped out of the similarly prestigious Indian Statistical Institute after two and a half months of studying math; he found the subject too abstract.

By 2003, they were both working on development at M.I.T. At the time, randomized trials were becoming more popular in the United States, but they were still fairly rare in the developing world. So along with Sendhil Mullainathan, a colleague, Ms. Duflo and Mr. Banerjee founded the lab. (It’s named for the father of an M.I.T. alumnus, who owned the exclusive right to sell Toyotas in Saudi Arabia.) Day to day, the lab is now run by Rachel Glennerster, who came from the International Monetary Fund, and it has become a magnet for some of the world’s best development economists, including Marianne Bertrand, Michael Kremer and Edward Miguel.

Mr. Kremer and two other economists, in fact, did the textbook experiment — and found that textbooks didn’t improve test scores or graduation rates in rural western Kenya. (The students were probably too diverse, in terms of preparation and even language, to be helped by a single curriculum.) On the other hand, another randomized trial in the same part of Kenya found that treating children for intestinal worms did lift school performance. That study has led to an expansion of deworming programs and, as Alan Krueger of Princeton says, is “probably improving millions of lives.”

Mr. Banerjee estimates, very conservatively, that $11 billion a year — out of roughly $100 billion in annual development aid worldwide — could be spent on programs that have been proved to work. Unfortunately, nowhere near $11 billion is being spent on such programs. “Right now, we don’t have a lot of things that have been taken up by the policy world,” he said. “But the policy lag is usually substantial. Now that we have a lot more results, I expect that in the next 10 years we will have a lot more impact.”

Mr. Banerjee and Ms. Duflo may not be a modern-day Keynes or Friedman. But they have still managed to do something rather profound. They have brought together the best of the new economics and the best of the old.

As has been the trend over the last decade, they have plunged into the world around them, refusing to accept the idea that economics is merely an extension of math. Yet no one can accuse them of working on some little problem that doesn’t matter.

E-mail: leonhardt@nytimes.com

2008年2月19日 星期二

Spinning a Global Plan


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謬爾•帕米薩諾(Samuel J. Palmisano)擔任國際商業機器公司(IBM)老板快有6個年頭了。雖然他對公司將業務重心調整到軟件和服務上的做法感到滿意﹐但並不是總能得到股市的響應。


帕 米薩諾在擔任IBM日本區主管時曾走遍整個亞洲。上週他在IBM總部就該公司在發展中國家和地區的發展戰略接受了《華爾街日報》(Wall Street Journal)記者的採訪。他透露﹐IBM正在對公司結構進行改造﹐以便於更大程度地滿足發展中國家的需要。目前發展中國家市場對該公司銷售額的貢獻率 為21%。IBM將在美洲(以巴西為基地)、中東、非洲、東歐和亞洲成立新的團隊。以下是此次採訪的摘要﹕




























帕米薩諾﹕公 司高層會到學校或者重要的政府崗位挖掘最傑出的人才。在俄羅斯﹐主管業務的就是位很出色的人。他便走遍了各所優秀的學校做這樣的工作。在公司進入印度市場 的早期﹐聘用的都是生活在新加坡或者美國的印度人。而在中國則採用自願者的方式﹐例如IBM在中國的實驗室就聘請那些家在中國大陸並會說中文的人。








帕米薩諾﹕我 們在埃及的業務增長神速。IBM在埃及有一個巨大的軟件實驗室。它為IBM開發軟件組件和中間件。它同時也為我們在全球各地的客戶工作﹐你知道﹐對埃及來 說這就意味著出口。我們在埃及的業務正在以兩位數增長﹐不是嗎﹖埃及是中東地區人口最多的國家﹐該國政府正在致力於實現埃及經濟的現代化。

William M. Bulkeley

Spinning a Global Plan

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Nearing his sixth anniversary as the boss of International Business Machines Corp., Samuel J. Palmisano is happy about the way he has repositioned the company -- even if the stock market hasn't always shared his enthusiasm.

Mr. Palmisano has shed IBM's personal-computer business, spent more than $10 billion on software acquisitions and focused on global markets and what he calls 'infrastructure' -- the software, services and computers that power big business and government.

The chief executive, who traveled broadly in Asia when he headed IBM Japan, talked with The Wall Street Journal about IBM's growth strategy in developing economies last week at IBM headquarters here. He disclosed that IBM is reorganizing to tailor its structure more to the needs of these developing countries, which account for 21% of its overall sales. It will create new developing-markets groups for the Americas, based in Brazil; for the Middle East, Africa and Eastern Europe; and for Asia. Excerpts follow:

WSJ: Why do you need to create the new divisions?

Mr. Palmisano: They're going to be completely separated [from the existing groups] so that they don't get traded off against a problem in Germany, or Japan, or the United States. We've said we're going to invest $1.6 billion over three years. And then you create leaders who've lived in these markets.

WSJ: How important are developing economies to IBM's future?

Mr. Palmisano: We target 50 countries that are small today that will be big in the future. That is probably why, in this economic environment, we might have a different view of what's going on than others. There's another big world out there, and it's expanding due to other factors -- not just the U.S. import market.

WSJ: What made you start focusing more on these markets?

Mr. Palmisano: After the dot-com implosion, the big trend we saw was that global economies were going to integrate. Asia and developing economies are the fastest-growing part of the world. And the IT industry is growing dramatically faster than their GDP.

WSJ: Did you start initially by emphasizing personal computing?

Mr. Palmisano: Four or five years ago, we shifted our model out of the PC-related things, because it's pretty obvious that the PC is the past. PC's over . . . [Now] it all goes to the cellphone. The cellphone becomes actually the PC for entertainment, for microloans, for all those other things.

WSJ: How do you tell when a country is developed enough for business?

Mr. Palmisano: You always get the highlight numbers from the GDP. But underneath that, people are getting credit cards, buying cellphones, buying cars. You keep looking for the evolution of a consumer class.

WSJ: IBM doesn't sell to consumers. Why do you look at that consumer activity?

Mr. Palmisano: We do infrastructure. We do back offices. We do banking systems. We do telco billing. We do call centers. It's growth where there's good profit opportunity -- not low-margin kinds of areas.

WSJ: Are governments and utilities your initial customers?

Mr. Palmisano: [Countries] all have the same pattern: They build out a banking system and a telecommunications infrastructure. A communications infrastructure is the interstate highway, the shipping lane of the future.

WSJ: What happens next?

Mr. Palmisano: Because they don't have a big tax base, they can't go out and tax. So they have to begin to privatize. The banks and the telcos begin to become private. The governments get their piece, and they reinvest it in major infrastructure projects.

WSJ: How do you get started in these countries?

Mr. Palmisano: You need to enter early to establish relationships. You need to be there when they're looking for partners because once they become very, very successful, everybody wants to be there.

WSJ: What else do you do to build a relationship?

Mr. Palmisano: We need highly skilled people. So we say we need to help in the school systems. We'll go in and create a services-as-a-science curriculum in Vietnam, or in Bulgaria, or in Indonesia. We'll go do that because we need that skill base, and they want to enhance the skills of their population.

WSJ: Are there other elements of relationship building?

Mr. Palmisano: If you're going to be a global entity, you don't want to be viewed as a foreign multinational.

WSJ: If you build infrastructure for the state telephone company and later work for a competing wireless company, would that be a problem?

Mr. Palmisano: No. They're fine with all that. Take India. I mean, we have outsourced every Indian telecommunications company. And I can't think of a Chinese bank that we haven't done the back office for.

WSJ: Are these systems rudimentary?

Mr. Palmisano: In Shanghai or in Beijing, they are the most advanced, the most modern infrastructure data centers that you'll ever see in the world. The transaction volumes are going to be significantly bigger than the world's biggest financial-services companies by an order of magnitude -- a billion people opening accounts, using ATMs.

WSJ: How do you find local talent?

Mr. Palmisano: IBM's senior management will hire some of the top people out of the schools and the key government positions. We have a great guy who's running our Russian operations. He went to all the better schools and things like that. The early days of India, they were Indians who had lived in Singapore or the United States. In China, we asked for volunteers, like in our laboratories, who had family in mainland China and spoke Mandarin.

WSJ: Do you use American or European IBM workers anywhere?

Mr. Palmisano: We will within finance because you want to make sure you have your control systems in place. You do not want to have local control systems.

WSJ: There's a lot of worry that globalization means fewer jobs and lower pay for U.S. workers. Is that a legitimate worry?

Mr. Palmisano: It's actually a big opportunity. Why not take advantage of it? The leading nation in the global economy is the United States of America. Great schools. Great capital formation. A system that works.

WSJ: Some would say that if you're helping Vietnam or South Africa build their education systems, it takes away job opportunities from Americans.

Mr. Palmisano: There is a real issue here where I think we need to do something more [in the U.S.]. IBM announced programs where we'll match money put in a learning account, and you can apply those tuitions to get future skills that you think are necessary for you.

WSJ: Can you give an example of a smaller country where your work has expanded rapidly?

Mr. Palmisano: Egypt's growing like crazy. We have a huge software laboratory in Egypt. It's doing development for IBM: software components and middleware. At the same time, it's doing commercial work, which they would view as an export business, you know, for clients around the world. The commercial business is growing double digits, right? Egypt is one of the largest populations in the Middle East and has a government that's trying to modernize its economy.

William M. Bulkeley