Most people first heard the term “asymmetric warfare” after 9/11, when the world saw that in the modern age a few people with a little money could credibly threaten giant entities with tons of money, and the conflict between them would be waged on principles that no one had fully figured out. The trend has expanded into a far more general, tech-based phenomenon – call it the rise of the nobodies – and this week we see it playing out in varied settings worldwide.
The most dramatic example is of course Europe’s own 9/11, the ISIS-related terrorist attacks in Paris and, now for the third day, the transformation of Brussels into a ghost town as authorities shut down subways, close schools, and tell residents to stay indoors because of a potential “imminent” attack. French President Francois Hollande will meet with U.S. President Barack Obama on Tuesday and with Russian President Vladimir Putin on Friday to plan a response. Great powers are struggling to counter a tiny organization that could not succeed without, among other necessities, mobile phones and the Internet.
In a starkly different realm, Reed Hastings’s Netflix is confounding the great powers of mass communication. There was a time when three TV networks (ABC, CBS, NBC) together attracted 90% of all U.S. TV viewing. Now a new survey shows that more than half of all Americans use Netflix to watch TV shows and movies online. And unlike the big TV networks, Netflix is expanding quickly and aggressively around the world. The broadcast networks are under attack on many fronts, but the sudden, highly successful rise of Netflix is most striking. This is a company that just rented DVDs by mail until 2007.
Eighteen months ago, how many people had ever heard of Ben Carson? Today he’s the No. 1 or No. 2 candidate favored by Republican voters. His rapid rise would have been impossible before the rise of Net-based media and communication. Though enormously accomplished as a surgeon, he was unknown beyond the medical world until he spoke at a Washington prayer breakfast with President Obama in attendance in 2013. His blunt criticism of the Affordable Care Act made him a Republican hero, and the Internet enabled video of his speech to go viral. The net has also enabled his campaign to raise impressive sums in mostly small donations, Obama-style. The great powers of the party, embodied in Jeb Bush, are far behind and struggling.
Campbell Soup reports earnings on Tuesday, representing another set of great powers losing ground to nobodies playing by different rules. Big Food, which ruled America’s tables and supermarkets for decades, is being defeated by hundreds of smaller companies purveying fresher, healthier, more natural, or just more cleverly marketed products. Campbell CEO Denise Morrison has been most outspoken among Big Food CEOs acknowledging the problem, but whether she can implement a winning strategy is another matter.
Every day, great powers of every kind are waging asymmetric warfare. Figuring out how to win is proving remarkably difficult.
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What We're Reading Today
Brussels remains in lockdown
Belgian Prime Minister Charles Michel fears a credible threat of an attack, closing down schools and subway systems for the third day on Monday. Police have arrested 16 people believed to be tied to the Paris attacks but continue to search for suspected gunman Salah Abdeslam. British Prime Minister David Cameron met with French President Francois Hollande, agreeing to increase data sharing about terror suspects.
Walmart trolls Cyber Monday
The retailer has decided to launch sales online next Sunday, ahead of the usual Cyber Monday. CEO Doug McMillon is following a retail trend of trying to launch holiday sales earlier than competitors. Walmart.com chief Fernando Madeira said the decision came after discovering that shopping-related online searches jumped on the Sunday after Thanksgiving.
Argentina votes in new president
Buenos Aires mayor Mauricio Macri defeated Daniel Scioli, the handpicked choice of president Cristina Fernandez de Kirchner, who is stepping down because of term limits. In one of his first moves, Macri says he will remove capital controls, including a dual exchange rate system. The reforms will be painful, likely shrinking the economy by 3% over the next two years.
SEC judges’ fairness comes into question
The Securities and Exchange Commission uses an in-house court for a number of insider-trading cases, which increased in the wake of the Dodd-Frank law. The SEC wins 86% of cases before its own judges, far exceeding its 70% win rate in federal court. One of the judges, Brenda Murray, stated in court that the SEC commissioners frown on in-house judges deciding against them.
Building a Better Leader
Avoid self-promotion to reach the top
Deloitte CEO Cathy Engelbert says management will recognize talent and leadership. Instead, focus on building your capabilities and confidence.
To keep your teams inspired…
…strive for continual improvement. It will encourage them to do their best work and not ignore the small stuff.
We’re not busier than we used to be
But seeming to be has become a sign of status.
Mergers & Breakups
Pfizer, Allergan agree to $160-billion deal
If approved, it would be the largest merger this year. Allergan, maker of Botox, will buy Pfizer so the new company will be domiciled in Ireland and escape some U.S. taxes. Pfizer CEO Ian Read will run the new company while Allergan CEO Brent Saunders will join the board and become president and COO.
Petco nears sale
The pet-supply retailer, owned by private equity firm TPG and Leonard Green & Partners L.P., is in talks to sell Petco for $4.5 billion to another private equity firm, CVC, and Canada Pension Plan Investment Board. Petco CEO James Meyers also explored an initial public offering but with the slowdown in the IPO market has opted for the private deal.
Time for P&G to split?
Some analysts argue that CEO David Taylor and Chairman A.G. Lafley should consider splitting Procter & Gamble into three companies: beauty products, health care and grooming products, and home and family care products. Doing so would strongly increase returns to shareholders, the analysts calculate. P&G has struggled to grow revenues and has announced plans to divest over 100 brands.
Up or Out
Fortune Reads and Videos
Fiat Chrysler will pay tuition for dealer employees’ families
All 118,000 dealership employees and families can take free classes at Strayer University.
Mattel, Hasbro slammed in labor report…
…over conditions at their Chinese factories. Major concerns include long hours, few breaks, poor working conditions, unsafe facilities, and forfeiture of earned wages by employees who quit.
JFK conspiracy files, Zapruder film up for sale
Bidding starts at $168,000.
Obama on ISIS
The president called them “a bunch of killers with good social media.” He continues to push for a global coalition to fight the insurgents.
“My experience was probably similar to what a lot of Type A individuals go through when they become managers, and you shift from doing to delegating and enabling the doing. You figure out that dictating the answer or micromanaging not only is not welcome, it’s just not helpful. You can’t scale yourself and grow your organization, and you might as well have no employees if that’s the approach you’re going to take. It took a couple of fits and starts to really understand that.” – Cindy Holland, Netflix’s VP of original content, discussing how she learned to delegate.
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|Produced by Ryan Derousseau|