Six odd but insightful predictions from Andrew McCafee at MIT via Sloan Biz school.  I've cut/pasted the short excerpt below.

The iPad will definitely gain competition.  As with their MacBook computers, Apple will keep the highest price point and people will pay the premium because of the brand.  Thats leaves lots of room for at least 2 more tablets.  Amazon and Google will fill this void with a Kindle (low price) and Android (the anti-iPad). 

His prediction #2 about cloud based apps for a fortune 500 company is brave.  The problem I've see with this is loss of control and data security.  Will it happen, yes, but in 2012?  It might be too early.  Without a doubt the cost savings would be tremendous and most likely be as stable as an in-house system.  But he is right that email and calendar will likely go first. 

As for the other three . . .I happen to like Citibankonline.  They've done a good job staying current and secure with a good app, web site and text programs.  I can't speak for other banks.  #5 is most ominous but dead on.  As technology improves jobs will move from labor to technical.  Technology will begin to replace more roles just as trains replaced horses and trucks replaced trains and machines replaced people.  I was speaking with a doctor a few months ago who has a son in a very good college.  His son was deciding to become a doctor or go work for Google and learn to be an engineer.  Guess which one he chose.....

The predictions:

1. The iPad will gain some worthy adversaries.
When Amazon's Kindle Fire came out I wrote that the tablet wars were starting in earnest, and when I hear Eric Schmidt promise a "highest quality" Android tablet in 2012 I get excited to see what's coming. Thanks to tablets and smartphones we're moving past the PC's longstanding WIMP interface paradigm (windows, icons, menus, pointers [i.e. cursors]) into one I'm calling VEST — voice, eyes, speech, and touch — that will change what computing devices we use most often, and how we interact with them.

2. A Fortune 500 company will move its productivity and collaboration apps to the cloud.
Berkeley has just explained why it chose Google for its campus-wide email and calendaring apps, so some pretty large organizations are starting to move into the Cloud. I predict at least one big-company CEO will walk away from the on-premises status quo in 2012. If so, it'll be a fascinating experiment to watch.

3. A web-native bank will appear and inspire fanatical devotion among its customers.
OK, this one is more of a blind hope / cry for help than a prediction. But I'm thoroughly tired of the way incumbent financial services firms treat their customers and neglect their web environments. I want this old, sleepy cartel upset by an online newcomer who cares about what customers want and knows how to deliver it to them.

4. There will be at least one instance of a science fiction technology becoming reality.
I don't know what this is going to be — exoskeletons for the disabled? working brain control of real-world objects? — but I'm very sure it's coming. The past couple years have given us cars that drive themselves and computers that win at Jeopardy! Anyone think those are the last of the amazing digital innovations? Me neither.

5. Job prospects and wages will not improve much for the average American worker.
Unfortunately, any honest list of my predictions for 2012 has to include this one. The two forces of trade and technology are combining to create a tough labor market for lots of workers in the U.S., particularly those without specialized skills. I deeply wish things would get better for them, but I don't think they're going to. If you want to learn more about why I think this, check out Race Against the Machine, the ebook I published this past fall with Erik Brynjolsson.

6. The material conditions of life will continue to get better for most people, in most countries.
This prediction might seem incompatible with the previous one, but it's not. Even U.S. workers facing grim job prospects are benefitting from technology's ability to lower prices and improve quality over time. And freedom, trade, and technology have combined over the past generation to improve conditions for literally billions of people around the world. These happy trends will continue. I am sure of it. Sharp-eyed readers will have realized that the wording of this prediction is not mine; it comes from the late economist Julian Simon, and it ends with the words "most of the time, indefinitely." He's right.

You have to feel for the management team at the USPS.  Government oversight.  An outdated business model.  671,687 employees as of last November and the need to cut $20-billion in expenses.Every dollar of cost cutting means layoffs or the closure of a local branch.  Changes that are all very visible.  No other organization is forced through as much pain when changes are presented than the USPS. 

But is slashing services the right way to respond?

Technology, email mostly, has eaten into USPS's volume so revenue is way down and will continue to decrease, but I think its bad business for the USPS to hasten that decrease by further slashing services.  People still need to receive their packages, letters and bills in a timely manner.  Imagine FREE Amazon shipping taking 3 weeks now instead of just 10 days.  Cutting services forces business to find alternatives.  This will put the USPS into a downward spiral that will force them to continue cuts which will then force business to find more alternatives.

At some point, the USPS needs to find new revenue sources.  The fact that they have a monopoly on the "last mile" - the street to the doorway - its hard to imagine that they can't figure this out.  The Direct Marketing industry spends about $150-billion a year on marketing and services.  All of this flows through the USPS in the form of letters and packages.  But the USPS is seen as an "expense" and not as a "service."  The USPS needs to flip that perception and offer services to these marketing companies - everyone from JCrew to Sears to your local Chinese food restaurant are potential clients.  Localized marketing is the last great frontier for advertisers (see: Groupon) yet USPS hasn't brought much to the table in the form of revenue ideas. You can't shrink your way to greatness.

The USPS is still a marvel, at least to me.  You can drop a $.44 envelope into a blue box in NY and having it show up somewhere else about 3 days later with a high degree of accuracy.  In general, its an impressive postal system.  It would be shame to see if slowly privatized piece by piece but that is likely what will happen.

A good short article from HBS on some myths and realities of innovation. 

Innovation is synonymous with change.  In the workplace, change is bad - even though we say its good.  The reality is, no one wants change because change leads to uncertainty which leads to doubt.  Change leads to disruption and managers hate that more than anything.  Change is also complicated to figure out.  Workflows, resourcing levels and the basic way people "go about the day" becomes muddled.  People have a natural tendency to routinize so change is against human nature.

But change is necessary and therefore innovation is necessary.  Any company/industry not innovating is dying.

Balancing the unnaturalness of innovation with the need to constantly do it is a big management challenge.  Companies that have figured it out (Google, Apple, Amazong, IBM) have made innovation a natural part of what they do.  I remember reading an article about innovation at Cisco.  Cisco created 5 "innovation pods" and selected employees to participate.  Being selected for a team was a major honor within the company.  No longer was change relegated to the guy in the corner causing trouble. 

Innovation that works is woven into the culture of a company and rewarded.  Most amazingly, innovation is a discipline and can be measure and managed (myth #1). Innovation also requires a flexibility from employees so they do not get comfortable with rote tasks.

I think in the next ten years the workplace is going to become less geo-centric, meaning, you staff could be anywhere.  Big departments will probably melt away and be left with specific specialist who are very project focused.  Innovation is going to be a big driver of what these project teams will be asked to accomplish.  How do we do it faster?  How do we do it cheaper?  How do we build it better?  New fresh ideas will become more the norm.

Myth	Reality
Innovation is random	Innovation is a discipline — it can be measured and managed. Consider how Procter & Gamble's structured approach to innovation allowed it to triple its innovation success rate and double the size of a typical initiative.
Only creative geniuses can innovate	Innovation is distinct from creativity. While creativity can help, people who aren't intrinsically creative can create high-impact innovation if they follow the right process.
You're either an innovator or you're not	Research recounted in The Innovator's DNA described how innovation is about 30 percent nature and 70 percent nurture.
Innovation happens in the R&D lab	Innovation — something different that has impact — can happen anywhere in an organization. Everyone should be looking for new ways to solve old problems.
We will win with superior technology	Most market disruptions rest on innovative business models — new ways to create, capture, or deliver value
Innovation is all about improved performance	Sometimes innovation is about improving performance along traditional dimensions, but some of the most powerful disruptive innovations sacrifice raw performance in the name of accessibility or affordability.*
Our customers will be a critical source of innovation insight	Your customers might tell you how to make your current offering better, but they won't point the way to disruptive growth; you have to explore new markets in new ways to identify new growth businesses.
Game changing innovation is done only by entrepreneurs	Many of the most exciting disruptions in recent years — such as GE's low cost imaging solution and Cisco's TelePresence solution — have come from big companies
We will win by targeting the biggest markets	Markets that don't exist are difficult to precisely measure or analyze; the most powerful innovations create new markets.
Innovation requires big bets	As our friend Peter Sims writes in Little Bets, if you want to win big, you should start small.

Great tip from HBR today on managing teams:

Engaged employees are essential to a manager's success. Without subordinates who care about, participate in, and take ownership over the work, even the best boss will flounder. Here are three ways to win your employees' engagement:

• Be modest. Share both your mistakes and your successes. Subordinates will see that you're both human and don't have anything to prove.
• Show that you're listening. People tune in to body language. Manage where you look and what you do with your hands so that employees know you're paying attention.
• Don't have all the answers. Managers should catalyze problem solving. Be willing to admit that you don't know what the answer is and invite your team to toss around ideas.

I remember participating in a round-table four years ago with some publishers.  I asked them what they were going to do when writers can market their titles directly to consumers and there would be less of a need for publishers.  As you would expect, they all defended their value-add to the publishing industry.  They select the best titles - they market the books and secure the best printing rates.  They help edit the titles to make them more interesting and commercial - etc, etc, etc....

Amazon is betting they are wrong.

Here is another industry with shifting industry influence.  What made publishers strong a decade ago is no longer needed.  Printing is on its way out.  Marketing can be done easily (or easier) on web sites and tablet devices and reader recommendations are become the de-facto selling agent.  My guess is a good editor is going to have their hands full with all the new titles coming through.  The Internet is the ultimate middleman killer. 

Good quote from an top Amazon executive: “The only really necessary people in the publishing process now are the writer and reader,” he said. “Everyone who stands between those two has both risk and opportunity.”

Amazon has been sleeper of the big tech companies.  Google, Facebook and Apple receive 10x the attention and press, but Amazon continues to impress with smart moves like the low priced kindle fire and their focus on customer satisfaction (i.e. Zappos). 

The new list function on FB is enough to make privacy advocates faint - the rollover description:

Smart lists automatically update themselves with coworkers, classmates, local friends and family members based on your friends' profile info.

You can't delete them.

Per

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A couple of good posts I've read lately regarding FB's continued dominance over Google.  This is especially telling with FB8 conference last week.  They unveiled a slew of new eye-candy that's making my FB page look like a real live reality television show - - but pulled from the Internet. 

The first was Spotify.  Seems you can't sign up for a Spotify account without signing up with FB connect.  Ironically, every 4th FB "news ticker" item I see is a song someone is listening to on Spotify.  Wonder if that was pre-arranged . . . .  This is prompted some to even call the ticker feed a spotify SPAM feed.  My guess is Netflix is next.  The announcement that Netflix will launch a streaming service with FB was completely drowned out last week with the news of the Nextlix split.  The split makes more sense now.  If the partnership works we'll all be sharing movies in 2012.

So FB now has movies, music, updates, places . . and a ticker to that everyone knows what is going on all the time . . .with everyone.

Could there be a breaking point?

Here is a great chart that outlines FB's changes to their DEFAULT privacy policy settings - scary stuff.  Just click the dates on the right. Over the years the settings have gone from restrictive to almost completely open.  Not to mention the number of people who can access it has grown tremendously.

This is all moving towards Mark's vision of the "open social graph" where people are sharing everything seamlessly.   This sounds very altruistic of Mark, but this is driving towards a "who gives a crap" type of level.  The FB wall feed risks become nothing more that an interactive People Magazine or a complete annoyance at worst. 

All of this is based on people allowing FB to freely give out this information - the bottom line is if everyone restricted their privacy setting, FB would be a much more boring place to hang out.  Its the catch-22 of Facebook.  Facebook needs its users to stay open.  Take a hard look at those default privacy settings again, especially 2009 & 2010.

Google doesn't have this problem, which is why in the end it will win out.

I haven't been a Netflix subscriber for some time.  It was years ago when going down the street to the local Blockbusters was getting too cumbersome.  Ahh - the thought of a microwaved popcorn, a pound of Twizzlers and a hopefully undamaged new release.  Renting movies used to be pretty low tech and definitely a pain - you never know what was in or out of stock.

Then Netflix came along.  I joined.  I created my queue and the movies came......one after the other.  And I rated them.  I looked at what my friends were watching and watched those as well.  But then all of a sudden I could rent movies from my cable provider, Verizon.  Now. . .I had red Netflix envelopes but never seemed to have the "right" movie, so on top of $9.95/mo for Netflix I shelled out another $5 for individual rentals from the Verizon FIOS center.  After a few months I quit Netflix but the movie watching has never been the same as FIOS doesn't have near the selection of Netflix, but I never went back because my local Blockbuster closed and FIOS is still easier than creating my movie queue at Netflix.

Streaming movies still hasn't figured its way to the consumer - mainly because people in the industry haven't figured out yet how they are going to get paid.  This is the perfect direct-to-consumer capability that technology and the Internet provide that wrecks most industries (see: music).  So who becomes the new distributor of movies?  Universal Studios?  Cable companies?  Services like Netflix?

As cable boxes start to look more and more like computers, the big winners, I think, will be the cable companies.  They own the pipes and wires and therefore control distribution.  The big question is whether studios will license their content to cable providers.  My guess is they won't and the negotiations will be similar to the ugly situations we've seen with cable companies and networks like Food Network and YES - both had ugly contract negotiations in the NY area that caused both stations to go dark for a period of time.  There is definitely going to be a place for 3rd party streaming services like Netflix.

Netflix split into two companies today - one to service their traditional DVD rental business and another the service the streaming audience.  There have already been a ton of complaints from users who now have to have two accounts.  Long term this should be a good move.  The two business models are completely different.  With 24 million subscribers, Netflix couldn't afford to pay digital license for streaming video when only a small portion of their user base streams - the bulk still receive their videos via DVD. 

The photography industry went through this with the development of digital cameras and the ultimate death of 35mm film.  Both take pictures but that is were the similarity ends.  Netflix did this to better support that part of their business that is going to grow - - and that is going to be their streaming business, not the DVD business. 

If Netflix can find a home in a streaming world they are uniquely positioned to capitalize.

Here is a really interesting graph of social media's impact by the numbers at Mashable.  This can help direct marketers who run their business based on metrics.  Its a good guide because social efforts can be hard to measure and quantify with a specific ROI.  Even with these figures its hard to boil it down to profit.  The CFO doesn't care if there was a 400% increase in likes.  What does it mean in $'s?

All of these efforts have one thing in common - they drive traffic.  They drive traffic through the use of content, most of it user generated.  So the "plain English" formula for social promotions is interesting and compelling content creates traffic that generates sales.

Almost everyone knows what a visitor is worth.  Its a simple calculation of conversion and average order $ size.  If you're site generates 10,000 visits a day and converts 3% with an average $ size of $35 - a visit is worth $1.05.  Having a large social fan base allows a marketer to distribute messages easier and more broadly, therefore creating more visits.

Some of these examples are more focused on awareness and generating "buzz" like Under Armor and Katy Perry, but the charity Free the People is clearly a direct response program.  A simple "like" generates a $1 donation.  They have 649,647 likes and therefore that many dollars in donations.  That doesn't sound like much but those familiar with fundraising will tell you campaign costs to raise donations is the biggest cost at any charity.  This promotion, at least the media distribution, is free.

The situation at News Corp is a good example of leaders creating a culture where breaking the rules (and laws) was OK.

Stories are now pouring out about the culture at News of the World and News Corp.  There were managers walking around meeting rooms with baseball bats.  There existed an obvious history of the company paying to "make problems go away" - for instance, "In the case of News America Marketing, its obscure but profitable in-store and newspaper insert marketing business, the News Corporation has paid out about $655 million to make embarrassing charges of corporate espionage and anti-competitive behavior go away," says NYT.  In once case with a company called Floorgraphics, which won a large settlement with News of America, "Much of the lawsuit was based on the testimony of Robert Emmel, a former News America executive who had become a whistle-blower. After a few days of testimony, the News Corporation had heard enough. It settled with Floorgraphics for $29.5 million and then, days later, bought it, even though it reportedly had sales of less than $1 million."

A culture of whatever goes...goes - was married with a high comfort level of paying off problems.  Why follow rules when you can just pay?

The managers are also horrific liars:

“I hope that you all realize it is inconceivable that I knew, or worse, sanctioned these appalling allegations.”  - R. Brooks earlier last year.  Was arrested this weekend.

“I never condoned the use of phone hacking and nor do I have any recollection of incidences where phone hacking took place.”  - A Coulson.  Emails later proved he OK'ed payments to police for information.  Arrested July 8th.

“The company paid out-of-court settlements approved by me. I now know that I did not have a complete picture when I did so.” - J Murdoch.  OK'ed payments for people who sued over being hacked by the paper.  This now makes  James a criminal.  He's also Rupert's son.  Almost inconceivable he did not understand what he was signing.

Culture like this is sowed by the leaders of the organization. In an environment of pace setting leaders where problems were paid away, people naturally pushed the boundaries of what was acceptable.  Sound familiar?

Any organization is a reflection of its leaders and the culture they create.