Category: Research

MIT entrepreneurs: The world's 10th-largest economy

Posted by MIT Sloan Executive Education - 4 months and 23 days ago

Living MIT graduates who have started and built for-profit companies do not qualify as a nation. However, if they did, they'd be the world's 10th largest economy, with gross revenue falling between the GDP of Russia ($2.097 trillion) and India ($1.877 trillion), according to a report released earlier this week.

"The report confirms what has long been clear: Our community's passion for doing, making, designing and building is alive and growing," President L. Rafael Reif wrote in an email to the MIT community. "As we do our part by continuing to foster our students' natural creativity and energy, it is inspiring to see the potential our alumni hold to extend MIT's power to do good for the world."

As of 2014, the report estimates, MIT alumni have launched 30,200 active companies, employing roughly 4.6 million people, and generating roughly $1.9 trillion in annual revenues.  An update to a previous reported authored in 2009, the new report outlines key entrepreneurial trends, such as the declining age of entrepreneurs, and alumni contributions to company growth and innovation, such as patents filed. Other key results for entrepreneurial impact and trends:

  • 25% of alumni have founded companies, with more than 40% of these labeled as serial entrepreneurs
  • 11% of alumni who have graduated in the 2010s have already founded companies, compared with 8% who founded companies within five years of graduating in the 1990s, and 4% in the 1960s
  • 80% of alumni-founded companies have survived five or more years, while 70% have survived 10 years. (Across the U.S., roughly 50% of all new companies last five years, while only 35% last 10 years.)
  • MIT entrepreneurs favor the East and West coasts: More than 30% of all the surveyed companies are located in Massachusetts, with 8% in Cambridge; 20% are located in California. Approximately 23% operate in other countries.

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Simple Rules: A new book by strategy expert Donald Sull

Posted by MIT Sloan Executive Education - 8 months and 14 days ago

Simple Rules small

The world is highly complex, and we struggle to manage the complexity of it every day. Most os us accept this complexity as unavoidable, attempting to manage the complex systems we face with complicated solutions. But meeting complexity with complexity can create more confusion than it resolves. So how can people better manage the complexity inherent in the modern world?

Donald Sull, Senior Lecturer at MIT Sloan, swears by simple rules, whether in his personal life or in helping companies he consults with make better decisions. His latest book, Simple Rules: How to Thrive in a Complex World, co-authored with Stanford University's Kathleen Eisenhardt, aims to help more people put these simple rules in practice.

A decade ago, in the course of studying why certain high-tech companies thrived during the internet boom, the authors discovered something surprising: To shape their high-level strategies, companies like Intel and Cisco relied not on complicated frameworks but on simple--and quite specific--rules of thumb. The simple rules these companies had mapped out in order to manage complex processes helped them make on-the-spot decisions, adapt to rapidly changing circumstances, and bridge the gap between strategy and execution. All this even though they were in extraordinarily complex, challenging, and fast-moving industries.

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Beware the negative review

Posted by MIT Sloan Executive Education - 1 year and 22 days ago

Business owners and foodies alike are relatively well versed in the dynamics around Yelp and other crowd-sourced review sites. Recently, trust is a primary area of concern. Just this week, Jonah Bromwich stately plainly in his New York Times article, "Two Apps to Guide you to Good Food," that "I don’t trust Yelp reviewers." And it appears he may have good reason.

negative review

recent study by MIT Sloan Professor Duncan Simester and Eric T. Anderson of Kellogg School of Management of Northwestern University, found that approximately 5% of product reviews on a large retailer's website were submitted by customers who had no record of purchasing the product. These insincere reviews were also significantly more negative than others. As a result of findings such as these, many businesses are now including language in their contracts to ban customers from (or even fine them for) writing negative reviews--a reaction that has created it's own ripple of controversy. Anti-disparagement clauses, however, are probably unenforceable and are now illegal in California and may soon become illegal in every state.

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Can data analysis help change behaviors?

Posted by MIT Sloan Executive Education - 1 year and 1 month and 5 days ago

Can scientists prove whether individual behaviors, such as eating or exercise habits, are contagious? Research from Alex 'Sandy' Pentland, Professor of Media Arts and Sciences and the Director of the Human Dynamics Lab at MIT, shows that may be possible.

"If individual behavior is contagious, then we can change this behavior either by changing the behavior of several influential elements in the social network, or by changing the social network itself," concludes Pentland.

Pentland and his research team studied 70 college students living in a residence dormitory at a North American university, with the student subjects spread evenly across the freshmen, sophomore, junior, and senior grade levels. Participants were given a Windows mobile phone, through which scientists collected data from self-reported surveys designed by experts in political sciences and medicine. Cell phone sensors recorded proximity and location every six minutes and documented communication.


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The odd man out may make for a better team

Posted by MIT Sloan Executive Education - 1 year and 7 months and 27 days ago

Understanding dispersed team dynamics is a timely consideration, as non-traditional teams are becoming more and more commonplace. Corporations are cutting down on real estate costs, offering employees more flexible work models, and investing in expertise located anywhere and everywhere around the world, resulting in geographically dispersed collaborations. While collocated teams (every team member working on the same site) may have the advantage over dispersed teams in many respects, studies show that more thoughtful configuration of dispersed teams may actually give them the upper hand.

“Within dispersed teams, there is first and foremost a mutual knowledge problem,” says JoAnne Yates, Sloan Distinguished Professor of Management, who teaches in the new, upcoming Executive Education program, Communication and Persuasion in the Digital Age. “When you’re collocated in the same building, you are aware of what your team members know and do not know. And you understand context. When working across distances, this is not necessarily true, and there are all kinds of failures that can come from that. You may not, for example, understand delays in communication. When you don’t get a response right away and you’re expecting one, you make all kinds of assumptions, and most are disparaging about the other party. Then perhaps you find out there was a holiday—like Patriot’s Day, which occurs only in Massachusetts. It’s important to have ways of understanding the specific context your colleagues are working in and of establishing trust and common ground.”

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It’s time to rethink wages

Posted by MIT Sloan Executive Education - 1 year and 10 months and 2 days ago

For the last year or so, there’s been a significant amount of news coverage around the wages paid to low-income earners, such as those working at fast food outlets and in retail stores. There have been public protests, calls for boycotts, and legislation to raise the minimum wage in some states.

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Corporate boards miss out when they don’t include women

Posted by MIT Sloan Executive Education - 1 year and 10 months and 7 days ago

Shirley Leung, Business Columnist for The Boston Globe has written extensively—and frequently—about the dearth of women on corporate boards. In her piece, “Across Health Care Board Rooms, That’s Madam Chairman to You,” she discusses the growing role of women on health care boards (nearly a third of Massachusetts-based hospitals have a woman running the board for the first time) and she compares the trend to the fact that only three percent of Fortune 500 companies have female board chairs.

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