TIME leadership

3 Books Every Leader Should Read to Be Successful

Frank Gehry has selected personal favorites for his 'Curated Bookshelf' at Louis Vuitton's London flagship. The shelf is located in the first-floor librarie.
Jessica Klingelfuss

Teachings from the best in the business world

As an employee, you function mostly as a solitary unit. You do your part, produce your “output,” and the work is done. But as a manager (or more precisely, a leader—managers manage tasks, leaders lead people), everything changes. Your success is no longer about your own output, it’s about other people’s — the most important work you do is often what enables other people to do their jobs. But finding your way can be difficult. So in honor of National Book Month, here are three books that every leader should read to succeed.

High Output Management by Andy Grove

Key points: Grove’s book, reflecting on his time as Intel CEO in the 1970s, remains relevant today because of the basic principles it outlines: As a leader, you are an enabler of others. Your team’s performance, not your own output, is what you are judged on. Grove also shares five key things that should inform and govern your time: decision making, information gathering, information sharing, nudging and role modeling. If you are spending significant time doing things outside of those five key areas, it might be worth rethinking your schedule.

Best quote: “The art of management lies in the capacity to select from the many activities of seemingly comparable significance the one or two or three that provide leverage well beyond the others and concentrate on them.”

Who Says Elephants Can’t Dance? Inside IBM’s Historic Turnaround by Lou Gerstner

Key points: Compared to High Output Management, which can read a little like a textbook, Who Says Elephants Can’t Dance? is practically a thriller. Gerstner’s well-known memoir about the turnaround of IBM is a vibrant book on leadership during a challenging time. It’s about transformation. Gerstner touches on the importance of speed and a clearly communicated set of principles—especially across a company as large as IBM was at the time. Gerstner also talks about the issues big companies run into with mid-level talent: “People do what you inspect, not what you expect.”

Best quote: “I came to see, in my time at IBM, that culture isn’t just one aspect of the game, it is the game. In the end, an organization is nothing more than the collective capacity of its people to create value.”

The Amazon Way: 14 Leadership Principles Behind the World’s Most Disruptive Company by John Rossman

Key points: This is by far the easiest read of the three in this post, but it’s also the most effective at providing prescriptive and actionable leadership advice. Rossman, a former Amazon executive, decodes a lot of the behind the scenes at Amazon and points to what is most important at a company that complex: decision making and ownership. The owner of a project or product doesn’t have to be the most senior person at the organization. In fact, it can be a very junior person. But this person is the sole person responsible for the project’s outcome.

Best quote: “Amazon.com employees quickly learn that the phrase ‘That’s not my job’ is an express ticket to an exit interview.”

Have your own favorite leadership books? I’d love to hear them—tweet at me @cschweitz.

Read next: 4 Biggest Myths About Being a Great Leader

Listen to the most important stories of the day.

TIME Innovation

Watch How Dust Makes an Amazing Journey From Africa to South America

This NASA footage shows show dust from the Sahara winds up in the Amazon rainforest

The Amazon rainforest might be a little less green if not for a massive plume of Saharan dust that drifts across the Atlantic Ocean each year, according to a new, multi-year study by NASA scientists.

NASA used light pulses from its CALIPSO satellite to measure the transatlantic dust cloud in three dimensions. They found that wind carries roughly 182 million tons of Saharan dust out to sea each year. The cloud sheds roughly 50 million en route to South America, but the remainder fans out over the Amazonian basin and the Caribbean Sea, dusting the soil with 22,000 tons of phosphorus, a nutrient commonly found in commercial grade fertilizer.

Amazingly, the special delivery of plant food almost perfectly matches the amount of phosphorous the Amazonian jungle loses through heavy rains and run-off water.

“This is a small world,” said study author Hongbin Yu, “and we’re all connected together.”

 

MONEY TV

Nickelodeon Thinks You’ll Pay $6 a Month for a Netflix for Preschoolers

Blue's Clues
Nick Jr. Blue's Clues

If you think your toddler needs more screen time—and if you somehow don't already have more than enough child-friendly streaming options—Nickelodeon has the product for you.

This week, Nickelodeon announced that it is launching a new app for the iPhone, iPad, and iPod touch, available at Apple’s App Store starting March 5. The app will be a subscription video service called Noggin—the same name of the cable TV channel that was a predecessor of Nick Jr.—and it will offer as much ad-free viewing of “Blue’s Clues,” “Little Bear,” and other preschooler fare as your little one’s eyeballs can handle, at a price of $5.99 per month.

As Variety noted, “Nickelodeon continues to grapple with ratings declines at its traditional TV network, owing to viewers seeking video content on new kinds of screens.” In a recent week, Nickelodeon’s ratings among kids were down 35% compared to the same period a year ago. So you can’t blame the Viacom-owned network for trying to do something to boost its audience and revenues.

But who is going to pay $5.99 a month this service? Starting at just $2 more monthly, you can be a subscriber to Netflix, which has plenty of content for children of all ages—it’s even been adding reboots of kids’ shows like “Care Bears,” “Magic School Bus,” and “Inspector Gadget”—as well as movies and shows for adults. The vast majority of consumers who are intrigued with streaming already subscribe to one or more service, such as Netflix, Amazon Instant Video (free for Prime members), or Hulu Plus, all of which have sections full of kids’ content. There’s also plenty of free kid-friendly streaming video out there (PBS Kids, for example). Finally, if you have a pay TV subscription that includes Nickelodeon, as most packages do, you can download the Nick Jr. app for free and watch unlimited, ad-free full episodes of “Dora the Explorer,” “Bubble Guppies,” and such.

It’s unclear, then, why all that many families would need to pay another $6 a month for yet more preschooler streaming content.

If there’s a parallel in the industry, it’s CBS All-Access, the subscription streaming option that also charges $5.99 per month—and that many observers assume will fail. At least the CBS product is targeting adults, most obviously folks who are big fans of the network’s shows, such as “The Good Wife” and various versions of “CSI” and “NCIS,” as well as older programs like “Brady Bunch” and “Star Trek.”

CBS All-Access has some hope of attracting grownup subscribers who are picky about what they watch and who like CBS’s programming. But how many preschoolers do you know are picky about what they watch? Most of the kids we know are more than happy to be allowed to watch something—anything—on the iPad while their parents enjoy their meal at the restaurant.

TIME Spending & Saving

Budget-Minded Travelers Have to Look Harder for Deals

airplane-landing-runway
Getty Images

Consolidation means would-be deal hunters must turn to new sites for savings

One of the ways the TV show The Americans makes it clear that it’s a period piece is by showing its Soviet spies working at a travel agency. Yes, those were indeed different times when a family could support a decent lifestyle by booking trips for tourists. When the web emerged in the 90s, travel agencies were one of the first to fall by the wayside.

A generation of web startups emerged helping travelers to quickly find the cheapest fares on their own PCs: Expedia, Travelocity, Orbitz. Priceline offered its distinctive “name your own price” model before giving in and adopting the basic discount business model of the others. Meanwhile, independent travel agents in North America and Europe closed up shop.

After a while, consolidation became inevitable and it grew harder to differentiate between the myriad travel sites. A generation of younger startups like Kayak and Trivago emerged to improve on things, by offering meta-search engines that searched the travel search engines for deals that were getting harder to find. Airlines and hotels wised up to the game, inserting add-on fees onto their posted fares or offering deals available exclusively through their own sites.

In time, consolidation gobbled up the young startups: Priceline bought Kayak and Expedia acquired Trivago. Many of the older sites are still around , for anyone loyal to them–Travelocity, Hotels.com, Cheaptickets.com–only they’re owned by either Expedia and Priceline.

And earlier this month, when Expedia said it would pay $1.3 billion for Orbitz, it left basically two major online-travel sites. There are a few mid-sized travel companies remaining but some, like TripAdvisor, have seen their stocks rise on speculation that its shares could soon be in play.

For consumers, the trend probably isn’t a positive one. It may well make finding the best travel deals that much harder, now that there’s less incentive for Expedia and Priceline to compete with others for the best deals. The Justice Department may review the proposed Expedia-Orbitz deal for antitrust concerns. If regulators act to derail the transaction, Expedia will owe Orbitz $115 million, so Expedia has a strong incentive to see the acquisition go through.

In the meantime, competition from other web giants hasn’t really emerged. There have been reports that Amazon would enter the online-travel space in January, but they haven’t panned out yet, and Amazon’s plans may be as modest as some package deals as part of Amazon local. Google’s purchase of ITA hasn’t made it a huge presence in online travel, but it allowed it to create a spiffier interface for the same flight data that can be found on Kayak, Orbitz and others.

If there’s any hope for bargain-hunting travelers, it may come from the ever flowing emergence of new travel startups. The clearest example is Airbnb, the accommodation-rental marketplace that more than any other startup of the past decade has shown there’s still growth for new entrants. Airbnb was recently valued around $13 billion, or slightly less than the combined market value of Expedia and Orbitz and about a fifth of Priceline’s.

For airfares–or for hotels and vacation rentals that can’t be found in the lodging-sharing economy pioneered by Airbnb–there are mostly smaller players. HomeAway, which offers through VRBO.com and other sites vacation rentals that avoid Airbnb, has a $2.9 billion market cap. CheapOair and Skyscanner represent a new, more-meta kind of airfare engine that scours fares available to online travel agents.

In the end, consolidation may simply push budget-minded travelers away from the biggest companies and toward new startups that are figuring out new angles for finding travel values. Vayable, for example, connects travelers with locals who can act as tour guides, while Gogobot uses a social model to help tourists plan trips based on their interests.

And then there’s Flightfox. The San Francisco-based startup, sensing the difficulty of finding the best travel deals online in an era of consolidation, uses crowdsourcing to tap the expertise of others who know the tricks of finding deals. In a way, Flightfox has brought the online-travel industry back full circle to the traditional travel agent. After two decades of online travel sites, having a human book your itinerary may be the once again the best option.

MONEY online shopping

Target Undercuts Amazon and Walmart With Easier Free Shipping

Target sign
Mike Blake—Reuters

Target just cut its minimum purchase requirement to receive free shipping in half, from $50 to $25. That's $10 less than what you have to spend at Amazon or Best Buy for free shipping.

Target has a long history of being in the crosshairs of Amazon, what with the world’s largest e-retailer routinely undercutting Target’s prices, combined with a wide range of strategies to woo moms in particular away from “Tarjhay” with speedy one-click shopping. Perhaps Amazon’s most deadly weapon—causing trouble not only to Target, but nearly all brick-and-mortar retailers—is Amazon Prime, the subscription program that provides free two-day shipping, among other perks, in exchange for a $99 annual fee. Above all, what Prime membership does is dramatically increase one’s spending at Amazon.com because nearly all purchases made on the site will ship for free. And the purchases made at Amazon.com are purchases that are no longer taking place at Target, or via another retailer.

On Monday, Target went on the offensive by tweaking its own free shipping policy, with the hopes of stealing some business back from Amazon, among others. The new shipping policy, Target boldly claims, “Will Change Your Life,” presumably in ways not unlike how Amazon Prime is known to dramatically change one’s spending habits and errand schedule.

The new policy grants free standard shipping (3 to 5 business days) on all Target.com orders of $25 or more. Previously, the purchase threshold for free standard shipping was $50. The minimum purchase requirement for free shipping at Walmart.com, for instance, is set at $50, while Amazon and Best Buy offer free shipping on most orders if the total is $35 or more.

Clearly, the move gives Target a little leg up on the competition, and it could very well start a free shipping pricing war among retailers—a war that would obviously benefit shoppers. But how big of a deal is Target’s policy change really? And is there a prayer it could actually change your life?

The truth is that Target’s new policy won’t affect its best customers at all. That’s because the most loyal Target shoppers are highly likely to be in possession of the Target REDcard, a debit or credit card that providers the user with 5% off on all Target purchases, as well as free, no-minimum-purchase standard shipping on all online orders. What’s more, Amazon Prime subscribers who are happy with the service aren’t likely to be wooed away by Target.com—which has fewer items for sale than Amazon (who doesn’t?), and whose free shipping is slower than that of Prime.

The consumers being targeted by Target’s policy change, then, are those who aren’t regular Target shoppers and don’t subscribe to Prime, or those who do subscribe to Prime but have been thinking that maybe the annual membership fee isn’t worth it. Also, for Target’s offer to seem truly compelling, you must be someone who would regularly want to make online purchases of $25 but not over $35. Once you’ve hit the latter price point, after all, you can get free shipping from Amazon or Best Buy alongside Target, so Target’s free shipping is a wash.

All that said, there are probably some consumers who will view Target’s new policy as an appealing alternative to Prime and Amazon.com in general. Just as Target’s decision to offer a free non-minimum-purchase shipping promotion during the recent winter holidays gave its web business a boost, the retailer will certainly juice e-retail sales by cutting its free shipping purchase threshold in half. Some tiny portion of shoppers will probably “change their lives” by placing a few more small-money orders at Target.com now that shipping is free.

It seems unlikely, however, that the policy change will move the needle much in Target’s ongoing battle against Amazon, nor will it cure Target’s larger problems, including its failed expansion in Canada and the fading of its reputation among shoppers and the industry as retail’s cheap-chic darling.

MONEY Bankruptcy

Bankrupt RadioShack Wants to Reward Execs With Bonus Pay

RadioShack with clearance sign in window
Joe Raedle—Getty Images

Why should CEOs make more when their companies fail?

For most Americans, the “failure” concept is scary precisely because it means taking a financial hit. For a few others, though, there tends to be a little more victory — or at least a lot less agony — in defeat. Even in the midst of what most of us would call epic failure, the top tiers of corporate managements often get paid handsomely despite failure.

Take RadioShack’s RADIOSHACK CORP. RSHCQ 3.33% bankruptcy for example. Despite being broke, the retailer is now angling to pay out several million to a handful of employees.

Just a little set aside

RadioShack, which finally filed for Chapter 11 bankruptcy protection recently, has asked the bankruptcy court to allow it to allot $3 million for retention bonuses to give eight executives and 30 other employees financial incentive to stay on board.

It’s still unclear who exactly would qualify for the bonuses, which would range from $88,000-$650,000 for eight executives, with the additional $1 million set aside for 30 others who also landed in the “critical employee” bucket.

Meanwhile, though, many of the 27,500 RadioShack employees out there are likely worried about their jobs or have already been laid off. When it comes to regular old severance, RadioShack had already changed its policy in December so that former employees would no longer receive lump sums, but instead get payments in weekly or bi-weekly dribs and drabs until the full amount is reached.

Given the bankruptcy, that also means they’re just part of the huge crowd of entities to which RadioShack owes money — money they may or may not receive.

Looking up the (pay) record

RadioShack had already been using its scarce financial reserves to try to convince upper tier execs to stay long before this most recent setback.

Last year, the company agreed to pay Chief Executive Officer Joe Magnacca a $500,000 bonus to hang in there through next year; its rationale was “due consideration of the skills and talent deemed critical to the company’s business turnaround efforts currently under way, the difficult business environment, and the competition for skilled, talented employees.” Other executives were eligible for bonuses of $187,500 and $275,000 at the time.

Clearly, the incentives didn’t do much to help the struggling chain, which hasn’t reported a profit since the year ended December 2011. Things were bad enough without its own strategic missteps; the electronics landscape is super competitive, and it had to contend with a multitude of big-box stores like Best Buy BEST BUY BBY 2.07% , not to mention online powerhouse Amazon.com AMAZON.COM INC. AMZN -0.07% .

However, it’s pretty easy to say management’s strategy was lacking, too. Take last year’s bizarre decision to spend big bucks on a Super Bowl commercial. The retailer went on to report continued poor financial results and 1,100 store closures shortly thereafter.

It hasn’t been lost on RadioShack’s shareholders that some people have been making gains despite the retailer’s struggle to survive — and it wasn’t them.

Last August, the majority of RadioShack shareholders used their say-on-pay votes to express displeasure with overall CEO pay policies for the second year in a row. Only 43% voted in favor of the pay plan. In 2013, CEO Magnacca had received a base salary of $893,000, and a $1.3 million bonus, $1 million of which was a sign-on bonus.

The bankruptcy benefits club

Word of RadioShack’s request gave me a case of déjà vu. In 2011, Borders sought to pay out $8.3 million in bonuses as it plodded through bankruptcy and shut down stores in its efforts to put its financial house back in order. (As we all know, though, Borders ultimately couldn’t be saved.)

Digging deeper in my archive for related topics, I remembered that in 2012, The Wall Street Journal published an article called The CEO Bankruptcy Bonus, which revealed some disturbing data along these lines.

It teamed up with consulting firm Valeo Partners and studied CEO pay at 21 of the largest 100 companies that had gone through bankruptcy. Those CEOs together raked in $350 million when one takes into account base salary, bonuses, stock, and severance, and some enjoyed larger windfalls during bankruptcy protection than they had beforehand.

The median pay for the studied set of folks was $8.7 million, only a tad lower than the $9.1 million median pay for regular S&P 500 companies at the time. RadioShack’s case is grating, but it’s not without precedent.

Death of the meritocracy

The court will decide whether RadioShack can go forward with the bonuses at a hearing scheduled for March 4.

Regardless of RadioShack’s specific outcome, this situation highlights some questions about our own society’s view on merit, money, and the marketplace.

Why do so many default to a hard-edged “tough luck” attitude toward most Americans when things like mass layoffs go down, yet shrug or sometimes even defend CEOs and other high-ranking executives who make out like bandits even though their performance has been poor or even downright damaging?

Things like bonuses for bankruptcy and a more common insult to common sense, golden parachutes, represent perverse incentives.

It’s time to rethink who we see fit to reward, and why. The last thing a healthy marketplace needs is incentive to fail.

Check back at Fool.com for more of Alyce Lomax’s columns on environmental, social, and governance issues. Alyce Lomax has no position in any stocks mentioned. The Motley Fool recommends Amazon.com. The Motley Fool owns shares of Amazon.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has adisclosure policy.

Related Links

TIME stock market

Here’s the Biggest Change in Technology in Recent Memory

Yelp Yelp. If you’re on vacation or new in town (or even not-so-new in town) and you want to learn about what’s around you — shops, restaurants, dry cleaners, gas stations, bars, you name it — Yelp has you covered, complete with user reviews so you can separate the good from the bad.

It's not some new, slick gadget or big idea

With the bulk of the earnings season behind us, the stock market appears to be in a much better mood than it was a month ago. The S&P 500 is up 3.8% over the past month, while the tech-heavy Nasdaq 100 is up an even healthier 5.9%. Tech, it seems, is a popular sector refuge in the sea of uncertainty facing 2015.

But a closer look at the tech earnings from the past month shows a more complex story as not all tech names are being favored equally. In fact, some of the companies that dished out disappointing forecasts were hammered hard. If there is one key trend that emerged from the recent parade of fourth-quarter earnings, it’s that 2015 is turning into a stockpicker’s market for tech shares.

This is in contrast to the past couple of years, when waves of enthusiasm or caution swept across the tech sector at large. Last year, for example, an early rally for tech led to concerns that another bubble would emerge–concerns that were quickly dispelled by a brutal selloff come April. By June, stocks were recovering, and the Nasdaq 100 ended last year up 18.5% and the S&P 500 up 11.8%.

One trend from 2014 that’s continuing into this year is the outperformance of larger-cap tech stocks. Smaller tech shares tend to do well in the several months following their IPOs, then have a harder time pleasing investors. A good example is GoPro, which went public at $24 a share in June, surged as high as $98 in October and and fell back to $43 last week in the wake of its earnings report.

GoPro’s post-earnings performance illustrates the selective mood of investors. The company blew past analyst expectations with revenue growth of 75% and higher profit margins. But the stock plummeted 15% the following day as analysts raced to lower price targets. Why? GoPro’s outlook was seen as too weak to support its lofty valuation and its chief operating officer was leaving.

That pattern played out in other smaller tech companies. Yelp slid 20% after its own earnings report that beat forecasts but that showed worrisome signs of slower growth and slimmer profits this year. Pandora fell 17% to a 19-month low after disappointing revenue from the holiday quarter. Zynga finished last week down 18% after warning this quarter will be much slower than expected.

What all of these companies also have in common are uncomfortably high valuations. Even after the post-earning selloff, GoPro is trading at 37 times its estimated 2015 earnings. Pandora is trading at 75 times its estimated earnings, while Yelp is trading at an ethereal 371 times. The S&P 500 has an average PE of just below 20.

So which companies did the best this earnings season? As a rule, it was big cap names serving the consumer market: Apple, Twitter, Amazon and Netflix. What these four companies have in common beyond strong earnings last quarter is that all were seen as struggling by investors during some or all of 2014.

Compare them to big-cap tech names that posted decent financials in the fourth quarter but that weren’t seen as struggling before, but instead were seen as thriving tech giants. Google, for example, is up 6% over the past month, while Facebook is up 1%. Both are enjoying steady growth that was so consistent with their past performance it has a ho-hum quality to it.

By contrast, Apple, which had been portrayed by critics as a gadget giant past its prime, has seen its stock rally 21% in the past month to a $740 million market cap, the first US company to be worth more than $700 billion. Amazon, which investors feared would suffer prolonged losses because of its expansion plans, is up 29%. So is Twitter, another object of investor worry in 2014. Netflix, a perennial target of bears, is up 40%.

So what have we learned about the technology sector so far this year? On the whole, investors are favoring tech stocks in a world of uncertainty – where negative interest rates have become bizarrely commonplace, and where the next market crisis could come from a crisis involving the Euro’s value, or China’s economy, or oil’s volatility, or Russia’s military aggression.

But at the same time, investors have grown more selective about the tech names they invest in. They might snap up hot tech IPOs, but they’ll drop them quickly if those companies can’t deliver over time. They prefer big tech, especially companies that cater to consumers. And if those tech giants can engineer a turnaround, they’re golden.

TIME Television

Amazon Orders Full Seasons for 5 New Shows

One of them is Amazon's most-watched pilot ever

Amazon’s new slate of original programming includes its most-watched pilot ever, its first documentary series and two children’s shows.

The company announced Wednesday that it had given the green light to five new series, including The Man in the High Castle (an adaptation of Philip K. Dick’s novel), The New Yorker Presents (a television approach to the magazine’s content), the dark comedy Mad Dogs and the kids’ programs Just Add Magic and The Stinky & Dirty Show.

The shows’ pilots had been available for Amazon customers to watch and to give feedback on, a process that helps Amazon Studios decide which projects to pick up for full seasons. The full seasons of its original programming are then available only to Amazon Prime members.

Amazon’s 2014 show Transparent, which returns for a second season later this year, was its breakout success, winning multiple Golden Globe Awards and being named TIME’s best TV show of the year.

TIME Drones

Know Right Now: How the FAA Plans to Regulate Drones

Drone operators would need to be at least 17 years of age

The FAA has proposed new regulations for small, unmanned aircraft. Watch the Know Right Now video above to find out more.

TIME Drones

Amazon Says FAA Proposals Won’t Ground Drone Delivery Plans

Amazone Drone Delivery
AP This undated image provided by Amazon.com shows the so-called Prime Air unmanned aircraft project that Amazon is working on in its research and development labs.

"We are committed to realizing our vision."

Amazon said Monday it remains committed to developing unmanned aerial devices to deliver products to customers, even as proposed federal regulations seemed to rule out the possibility of a drone delivery service.

The proposed rules governing small drones, released by the Federal Aviation Administration (FAA) Sunday, would require that operators pilot the vehicles with “unaided vision” and would prohibit them from flying over people. Both seem to conflict with Prime Air, Amazon’s vision of flying automated drones to the homes of customers.

But Amazon said it would continue to work on drone deliveries while the FAA proposals were under consideration. “The FAA needs to begin and expeditiously complete the formal process to address the needs of our business, and ultimately our customers,” said Amazon executive for public policy Paul Misener. “We are committed to realizing our vision.”

A press release from the FAA announcing the regulations stressed that the agency “tried to be flexible in writing these rules.” The agency said it still seeking comment on the proposals, which are expected to take up to two years to become law, particularly the potential requirement that operators be able to see the craft they are operating.

“We want to maintain today’s outstanding level of aviation safety without placing an undue regulatory burden on an emerging industry,” said FAA Administrator Michael Huerta.

Amazon suggested that it would fight a regulation that effectively banned the service.”[We] are committed to realizing our vision for Prime Air and are prepared to deploy where we have the regulatory support we need,” said Misener.

 

Your browser, Internet Explorer 8 or below, is out of date. It has known security flaws and may not display all features of this and other websites.

Learn how to update your browser