The Stephen Covey insights you’ve not heard a million times before

By Neil Patrick

Today I've been revisiting the work of the late great Stephen Covey and his best-selling work “The Seven Habits of Highly Effective People.” The book has topped the best seller lists selling more than 25 million copies worldwide since its first publication in 1989.

Most of us have at least an awareness of this book and its ideas.

But it’s so old! Covey proposed that his teachings were universal and unchanging. But 1989 was a different world and the question I had was, is this still relevant today?

Stephen R Covey
Source:By Abras2010 (FMI Show_Palestrante_Stephen Covey)

It turns out that Covey had already answered this question. Much less well known than the Seven Habits book is its sequel, Covey's 2004 book; "The 8th Habit: From Effectiveness to Greatness".

In this book, Covey recognised that mere effectiveness would not suffice in what he called "The Knowledge Worker Age". He said that, "The challenges and complexity we face today are of a different order of magnitude." The 8th habit essentially urged: "Find your voice and inspire others to find theirs…"

This slideshare from Sompong Yusoontorn summarises the book very well:

In the Seven Habits book, Covey described the opposing ideologies of the scarcity mentality and the abundance mentality. An outlook which views the world as one of scarcity, stimulates primitive urges of possession and control.

The more scarce we view something to be, the stronger the urge to try to control and possess it becomes.

And one thing there is a scarcity of is jobs.

The scarcity mentality is the default setting for how most people view the world. Our whole society is built on it. Competition for scarce resources is the very nature of the capitalist system. Acquisition and ownership are the goal and we are encouraged to view those who own the most to be the most successful. The whole system encourages a win-lose outlook which is the antithesis of a collaborative society.

And the collaborative society is the future. Whilst on the one hand technology may be the biggest destroyer of work yet experienced by mankind, it is paradoxically also the greatest ever enabler of opportunities.

The Abundance Mentality flows out of a deep inner sense of personal worth and security. It is the paradigm that there is plenty out there and enough to spare for everybody. It results in sharing of prestige, of recognition, of profits, of decision making. It opens possibilities, options, alternatives and creativity.

The Abundance Mentality takes personal joy, satisfaction and fulfillment and turns it outward, appreciating the uniqueness, the inner direction, the qualities of others. It recognizes the unlimited possibilities for positive interactive growth and development, creating new Third Alternatives.

Success does not mean victory over other people. It means success in effective interaction that brings mutually beneficial results to everyone involved. ...Public Victory is an outgrowth of the Abundance Mentality paradigm.

Regardless of the growth or demise of capitalism, those who engage in collaborative solutions to problems will have the brightest futures.

Those who retreat into possessiveness, isolationism and protectiveness, will sooner or later become marginalized and irrelevant.

To quote Covey : “The Scarcity Mentality is the zero-sum paradigm of life”.

Is artificial intelligence the greatest threat to human existence?

By Neil Patrick

Here’s a clip from the Rubin Report in which Elon Musk states “AI is like summoning the demon”.

Interesting coming from someone who more than most people is at the forefront of understanding and developing high tech future businesses.

Does he know something we don’t?

The ensuing discussion in the clip seems to miss the point. Rubin’s mates have been watching too many dystopian movies and playing too many computer games in which robots go on killing sprees I suspect.

I wonder if the real reason Elon Musk is so cautionary about AI isn’t because we’re at risk of being slaughtered by evil robots, but because he can see that technological development is now outstripping the abilities of our current political, economic and social systems to keep up.

And that this situation means we have 21st century technology but 20th century political, education, economic, social and legal systems.

The outcome of this two speed society is that jobs will disappear faster than ever…and no jobs equals no money. And in our world, no money is effectively extinction…?

Is this what he’s really hinting at?

Is it ageist that you may be turned down for a mortgage because you are over 40?

By Neil Patrick

Daily Mail 25 Nov 2014: “Over 40? Then you CAN'T have a mortgage: Banks are now rejecting borrowers who would still be paying off loan in retirement”.

This headline caught my eye today. And as is often the case with the Daily Mail, it’s a thinly disguised attempt at sensationalism. Nonetheless, I think it is very significant news, but not because of the implied injustices it alleges.

The essence of the "story" is that new research found that people aged over 40 seeking a standard 25-year mortgage are finding their options restricted because (assuming their mortgage runs its full term - which they rarely do) they will be borrowing beyond the “normal” retirement age of 65.

The new Mortgage Market Review (MMR) rules, which came into force in April, mean that lenders have to spend more time considering whether home buyers can afford the mortgages they are applying for. - not a bad thing at all in my view.

The report released yesterday by the Intermediary Mortgage Lenders Association (IMLA) stated that "interpretations" of the MMR have convinced many banks that lending into retirement now carries extra risk if borrowers go on to find that their retirement income is less than expected.

Mortgage lenders have typically applied an upper age limit of 65 for decades now. So this point isn't really anything new.

I think the real story here isn’t about mortgages and whether or not we get accepted or rejected for one when we apply. The simple facts are that lending is and always has been priced according to lenders’ rules around risk assessment. Basically, the higher the perceived risk, the higher the cost of the loan.

But if one lender rejects your application, there will almost always be others that will accept it, albeit at a higher price and/or on different terms.

Banks and lenders get a hard time from the media. Often, it is justified. Sometimes it’s not. In this case, they are damned if they do and damned if they don’t. If they were not making stricter assessments, they’d be criticised for encouraging over-indebtedness. By applying tougher rules, they are criticised for making mortgages less easily available to some people.

So as far as the new assessment rules are concerned, it’s really not a story.

No, the real story is far behind the headlines.

What is significant I think is what this news reveals about how banks currently view the financial prospects for people aged over 40 in the UK.

Looked at in this way, this news is a bombshell.

Forget the MMR rules, this news tells us that as far as the banks are concerned, the income prospects of people over 40 are very weak. Make no mistake, if a bank is happy that you can afford to repay a mortgage or other loan, they’ll be happy to lend you the money (and of course take the interest too).

So the MMR gripes are a smokescreen. And this isn’t a new form of age discrimination.

But it is a very troubling indication, that those whose business it is to understand the outlook for our incomes have decided that despite rising house prices, the outlook for most peoples' incomes remain very fragile indeed.

Have you got the key skills for the information age?

I’ve  been writing a great deal recently about the destruction of jobs by what is variously called, the third industrial revolution, knowledge economy or new machine age. This situation creates a whole new set of challenges for everyone who wants to earn a living in these tough times.

Most of us know it is happening. What's thin on the ground is information about what we can do about it.

We need new solutions and we need to take personal ownership of our own countermeasures.

This isn’t just my opinion. Multiple and diverse organisations are reporting the same thing:

Manpower states that despite the recession, 31% of employers struggle to find qualified workers because of “a talent mismatch between workers’ qualifications and the specific skill sets and combinations of skills employers want.”

The American Management Corporation says that employers want workers who can think critically, solve problems creatively, innovate, collaborate, and communicate.

The National Association of Manufacturers reports, “Today’s skill shortages are extremely broad and deep, cutting across industry sectors and impacting more than 80% of companies surveyed. This human capital performance gap threatens our nation’s ability to compete . . . [and] is emerging as our nation’s most critical business issue."

The National Academies claim that “The danger exists that Americans may not know enough about science, technology, or mathematics to contribute significantly to, or fully benefit from, the knowledge-based economy that is already taking shape around us.”

The New York Times reports that low-skilled workers are being laid off and "turned away at the factory door and increasingly joining the swelling ranks of the long-term unemployed . . .” This issue results from a disparity between the skills that workers have and those that employers need.

So what can we do about it?

If the last time you sat in a classroom was at university or an employer’s course, the chances are high that your learning skills have significantly reduced. Of course we all acquire job specific skills at work, but what we don’t generally continue to develop in our jobs are the learning skills that are now critical for 21st century career survival.

If we accept that the pace of change in the world is accelerating, then it is logical to conclude that our ability to adapt to change must also be increasingly critical. And the key enabling mechanism for coping with change is learning.

What are the key learning skills for the 21st century workplace?

21st century skills are a set of abilities that everyone needs to develop in order to succeed in the information age. The Partnership for 21st Century Skills has identified three key learning skill areas.

I call them the three Cs of thinking; critical thinking, creative thinking and collaborative thinking:

Critical Thinking

Critical thinking is the ability to think clearly and rationally. It includes the ability to engage in reflective and independent thinking. Someone with critical thinking skills is able to do the following :
  • understand the logical connections between ideas 
  • identify, construct and evaluate arguments 
  • detect inconsistencies and common mistakes in reasoning 
  • solve problems systematically 
  • identify the relevance and importance of ideas 
  • reflect on the justification of one’s own beliefs and values 

After we leave education and start to exist in the world of our jobs, our critical thinking skills may easily become rusty. Other factors start to influence and direct our thought processes. The competitive environments we often experience encourage competitive reactions – the exact opposite of one of the other Cs – collaboration.

So good critical thinking skills not only break the force field of groupthink, they also encourage collaboration.

Creative Thinking

This is the process by which individuals come up with new ideas or new approaches to business. New ideas could result in new products, procedures or policies. They could also result in a new process that cuts costs or improves quality - for example, a bagless vacuum cleaner.

Fresh ideas give businesses a competitive advantage and help make their goods or services stand out in the market place.

We can make use of several different thinking techniques to improve our creativity:
  • Lateral thinking or thinking outside the box. An example of this would be breaking down the steps taken to serve coffee in a cafĂ© and asking 'why' at each step to see if a better process can be created. 
  • Deliberate creativity uses thinking techniques to spark off new ideas. For example, putting on different thinking hats to tackle problems from different angles. 'White-hat' thinking looks at facts and 'black-hat' thinking looks at drawbacks. 
  • Blue-sky thinking involves a group of people looking at an opportunity with fresh eyes. As many ideas as possible are generated in an ideas generation session where no ideas are rejected as silly. 

Collaborative thinking

There are generally accepted to be seven rules for all collaboration:

Look for common ground: find shared values, consider shared personal experiences, pay attention to and give feedback, be yourself and expect the same of others, be willing to accept differences in perception and opinions

Learn about others: consider their perspectives and needs, appeal to the highest motives, let others express themselves freely

Critique results, not people: do not waste time on personal hostility, make other people feel good, avoid criticism and put downs

Give and get respect: show respect for others' opinions, be considerate and friendly, put yourself in the other person's shoes, be responsive to emotions, speak with confidence but remain tactful

Proceed slowly: present one idea at a time, check for understanding and acceptance of each idea before moving on to the next. Speak in an organized and logical sequence.

Be explicit and clear: share your ideas and feelings, pay attention to nonverbal communication, speak clearly and make eye contact, select words that have meaning for your listeners

Remember the five "Cs" of communication: clarity, completeness, conciseness, concreteness, and correctness

It's not a co-incidence that the social web or internet 2.0 also functions with these principles at its core.

New Skills for New Jobs

These skills have always been important for personal development, but they are now absolutely critical in our information-based economy. When most workers held jobs in industry, the key skills were knowing a trade, following directions, getting along with others, working hard, and being professional - efficient, prompt, honest, and fair.

To hold information-age jobs though, people also need to think deeply about issues, solve problems creatively, work in teams, communicate clearly in many media, learn ever-changing technologies, and deal with a flood of information. The rapid changes in our world require us to be flexible, to take the initiative and lead when necessary, and to produce something new and useful.

But these thinking skills aren’t just relevant to our careers and jobs. They play a part in making the world a better and more just place for all of us. I think there’s a good argument that the absence of these thought processes within the management of the banking world was the biggest single factor in the financial collapse of 2008. If we ever needed an example of the terrible consequences of endemic groupthink, we need look no further.

So next time you are considering what skills you could acquire to enhance your career prospects, think outside the box and think about what you can do to improve your thinking skills. Not just for yourself but the world as well.

It's now official - The Global Jobs Crisis is real

By Neil Patrick

When I set up this blog, I was convinced that the subtitle – Global Jobs Crisis was appropriate and justified.

But many of my friends online and offline commented that they thought I was being rather apocalyptic. Even sensationalist. After all it does rather fit with the sort of conspiracy theory stuff which abounds in the online media world.

But I stuck with it nonetheless. Not because I wanted to be alarmist or a doom-monger. On the contrary. I wanted to raise awareness of the problem and try to find solutions that would work for people at a personal level.

It was simply the most appropriate tagline I could come up with which described the unfolding situation as I saw it. And with every week that passes I see more evidence that it remains the right subtitle.

So today I was interested to see that two years after I started this blog, none other than the World Bank has issued a report which describes the global jobs crisis in forensic detail.

I’d forgive anyone for not noticing it. It went more or less unremarked upon by the mainstream media. It’s titled in typical government speak and somewhat benignly: “G20 labour markets: outlook, key challenges and policy responses”.

The World Bank, Washington
By Shiny Things [CC-BY-2.0 (] via Wikimedia

Behind the dull bureaucratic title is the starkest confirmation I've yet seen which describes in depressing detail, the true nature of the problem.

The world is facing a global jobs crisis that is killing the chances of reigniting economic growth. Worse there is no magic bullet to solve the problem.

The Study was released at a Group of 20 (G-20) Labor and Employment Ministerial Meeting in Australia in September 2014. The Bank says an extra 600 million jobs need to be created worldwide by 2030 just to cope with the expanding population.

"There's little doubt there is a global jobs crisis," says the World Bank's senior director for jobs, Nigel Twose.

"As this report makes clear, there is a shortage of jobs — and quality jobs.

"And equally disturbingly, we're also seeing wage and income inequality widening within many G-20 countries, although progress has been made in a few emerging economies, like Brazil and South Africa."

He said that overall emerging market economies had done better than advanced G-20 countries in job creation, driven primarily by countries such as China and Brazil, but the outlook was bleak.

"Current projections are dim. Challenging times loom large," said Twose.

Who says something really matters

Local mainstream media is so heavily influenced by national government spin that we cannot take anything that is said at face value. And I do my best to expose the most blatant deceptions about jobs and employment news that I come across.

Which is why this report has to be taken seriously. The World Bank isn’t beyond the influence of key stakeholders with their own agendas. Many have argued that the World Bank which has had an American as its President ever since its creation in 1946, promotes a US based world view.

And I have concerns that the World Bank still clings to a largely discredited view on monetary systems.

But critically, the World Bank isn’t controlled by politicians. And that’s the most important thing in my view. No-one at the World Bank is trying to win votes from citizens. They gain no benefit by telling people that things are better than they really are.

100 million unemployed

The report, compiled with the OECD and International Labor Organization, said more than 100 million people were unemployed in G-20 economies and 447 million were considered "working poor," living on less than US$2 a day.

It said despite a modest economic recovery in 2013-14, global growth was expected to remain below trend with downside risks in the foreseeable future, while weak labor markets were constraining consumption and investment.

The persistent slow growth will continue to dampen employment prospects, it said, and warned that real wages had stagnated across many advanced G-20 nations and even fallen in some.

"There is no magic bullet to solve this jobs crisis, in emerging markets or advanced economies," said Twose.

"We do know we need to create an extra 600 million jobs worldwide by the year 2030 just to cope with the expanding population.

"That requires not just the leadership of ministries of labor but their active collaboration with all other ministries — a whole of government approach cutting across different ministries, and of course the direct and sustained involvement of the private sector."

The Group of 20 leaders have called for each member country to develop growth strategies and employment action plans. They emphasized the need for coordinated and integrated public policies, along with resilient social protection systems, sustainable public finance and well-regulated financial systems.

"Coordinated policies in these areas are seen as the foundation for sustainable, job-creating economic growth," says the report.

So there we have it. The responsibility for solving the problem has been passed to national governments. And they are urged to adopt a cross-departmental approach to solving the problem.

Given the nature of governmental silos and the painfully slow way in which government policies are formulated and implemented, I’m not holding my breath for any big breakthroughs anytime soon.

And sadly the subtitle of this blog seems to be one thing which isn’t about to become redundant for a long while yet.

Why the US Middle Class is in danger of extinction

By Neil Patrick

Current news reports claim the US job market is slowly improving. Is this a return to better days? Sadly no. It’s a transformation for sure, but not back to anything like we all knew 10 years or so ago.

Make no mistake about it, America's middle-class jobs have been destroyed in the wake of the 2007-8 financial collapse. The growth in new jobs reported gleefully by the government have been almost entirely low-wage jobs. And there is little reason to believe this situation can be quickly or easily reversed.

What has caused this? In the next few posts, I want to look at the factors that are behind this tragic state of affairs, dig into what’s happening and what we can do about it.

I believe there is no single cause or culprit. Instead it’s a complex cocktail of seven factors which have collided to create a perfect storm for skilled American workers. In brief these are:
  • Record levels of government and personal debt 
  • The rise of technology leading to ever falling marginal costs 
  • Capital shifts away from labour and into non-human investments 
  • The globalisation of businesses 
  • Government fiscal policies 
  • Demographics and education 
  • Finite global resources 

But I am getting ahead. In this post, I am going to look at:
  • The nature of the alleged jobs “recovery” 
  • Why GDP growth isn’t making people better off
  • The transference of government debt to households.

The substitution of high paid jobs by low paid jobs is beyond doubt

A recent presentation from the Federal Reserve Bank of San Francisco describes the jobs “recovery” in stark terms. The vast majority of job losses during the recession were in middle-income occupations, and they've largely been replaced by low-wage jobs since 2010:

Mid-wage occupations, made up a staggering 60% of the job losses during the recession. But mid-wage jobs have made up just 22% of the jobs gained during the recovery.

By contrast, low-wage occupations have totally dominated the recovery. They represent 58% of the job gains since 2010. "Many middle-class workers have lost their jobs and, if they have been able to secure new employment at all, find themselves earning far lower wages post-recession," the San Francisco Fed says.

Nearly 40% of the jobs gained since the recovery began - about 1.7 million - have come from three low-wage sectors: food services, retail, and employment services.

And four low-wage occupations are now the top four types of employment in the US: retail sales, cashiers, office clerks, and food preparation and servers:

The problem is compounded by the fact that industries which employ mid-wage earners, such as construction, manufacturing, insurance, real estate and IT, have either stagnated or grown too slowly to recover their pre-recession losses.

Worse again, budget cuts to federal and state government have eliminated a vast swathe of mid- and higher-wage jobs. And a separate chunk of middle-wage jobs including carpenters, plumbers, plasterers and electricians are still waiting for the U.S. housing market to recover.

The growth of wealth inequality is a problem for all, not just the poorest

This is creating a polarised workforce in the United States. Over the past decade, both high- and low-wage jobs have been growing. But jobs in the middle continue to shrink. Mid-wage jobs suffered a major drop after 2001, largely stagnated during the 2000s, and have now declined even further in the most recent downturn.

Economists have been debating the causes of this divergence. Harvard’s Lawrence Katz and Claudia Goldin, argue that new technologies and machines are now displacing mid-wage jobs.

I believe this is a correct analysis as I talked about here. But it’s not the full story. Some others, such as Larry Mishel of the Economic Policy Institute, point to political factors, from the decline of labor unions to trade liberalization to the dwindling minimum wage. This is a factor too, but again it’s only an ingredient in the mix, not the full disastrous recipe.

But neither of these arguments discuss the lead weight which is pulling the whole economy down. And that weight is government debt. That debt puts massive upward pressure on tax, demands endless quantitative easing (devaluation of the dollar to you and me) and limits government spending – the type of spending which would create more jobs in the public sector.

It seems logical to me that there’s no single simple explanation of what’s going on. It’s multi-factorial which makes it complex to understand and remedy both at a national and individual level.

But if the trend continues, it will amplify something which is already a big problem in the United Sates: income inequality. Not to mention the destruction of the hopes and aspirations of a huge swathe of American society. And needless to say, that’s a bad thing…

GDP growth and household incomes have become separated

For the first time in US history, economic growth is no longer driving income improvements at the household level.

Traditionally, improvements in GDP have directly resulted in increased income and prosperity for citizens. In the US, this link has broken. US median household income is now at a lower level than it was in 1999. In fact even though US GDP has been on the rise since 2009, household income has been falling since 2008:

Here we see the evidence of how as technology continues to increase productivity and reduce marginal costs, so we have GDP growth but no wealth creation except for those who are in the boardrooms and/or major equity owners.

To look at it in its simplest terms, businesses can create higher returns with less human labour inputs than ever before. The first industrial revolution substituted human muscle power with mechanical devices. The second industrial revolution transformed transport and communications. And the third industrial revolution is replacing human cognitive tasks with artificial intelligence.

So until recently, technological improvements have only really affected those who sold their manual capacity to earn a living. Today’s technology is reducing the workforce needed for tasks which required the application of professional and mental skills too. But there’s another problem; if we are selling our manual labour, we need to do nothing to create our commodity. Our bodies are there to be applied to work whenever we want. Little or no training is needed.

But jobs requiring the application of skill and knowledge are different. The acquisition of these skills can take years. Sometime decades. And if no-one wants them anymore, we have a stark choice – dump them and start again or try and compete for unskilled work.

So we have an American middle class with skills that fewer and fewer people want or need to pay for. The keys to the acquisition of wealth are no longer the sale of our labour and skill. They are the ownership of income generating assets. And thanks to booming stockmarkets, owning assets has made most of the wealthy even wealthier over the last few years.

This is the reality of the polarisation of America’s workforce. Greater wealth acquisition by those at the top, those who own assets, but falling income levels for everyone else… not just the poorest, but the vast majority of Americans.

Needless to say, this is also a bad thing…

The burden of government debt is being passed to households

Despite multiple deficit-reduction deals during the past three years, the US national debt is projected to swell to 100 percent of the economy by 2038, due primarily to the enormous cost of caring for an aging society.

Whilst WW2 exceeded the current peak of government debt, the end of WW2 and the global restructuring that arose from its ashes is a very different scenario to that we face today. Post 1945 saw the US emerge as the dominant global super power. It’s huge manufacturing capacity, abundant natural resources and global markets created the wealthiest society on the planet:

But post 1980 has seen the failure of that economic model as the production of cheaper goods of equivalent or even higher quality started to materialize in low wage economies.

Making matters worse, tax cuts for the vast majority of Americans were made permanent during last year's fiscal cliff showdown. If the tax cuts had been allowed to expire, projections showed the debt dropping to 52 percent of GDP during the next 25 years.

In effect, huge government debts are being allowed to accumulate unchecked. But sooner or later these debts will be passed to individual citizens rich and poor through the giant levers of fiscal policy.

And you guessed it; this is also a bad thing…

So these three points define the problem: 

  • Millions of jobs for skilled workers in the middle income bracket have simply vanished. 
  • Economic growth has become of value only to the asset owning classes. 
  • Government debt will continue to be passed onto citizens. 

This isn’t a problem which can be solved by the traditional tools of government. If you want to place your faith there, that’s your prerogative and I hope you are right. My take is that we all need to come up with our own personal solution. It might just be the biggest test of our lives…

I’ll be back with more on this soon.