06Jun

Predicting 2020 “will be a year of moderate global growth and contained inflation, with risks skewed to the downside,” J.P. Morgan Asset Management last week released its second annual Global Alternatives Outlook.

The report offers a look across key alternative asset classes over the next year to 18-months, with a focus on hedge funds, private credit, real estate and private equity.

The broad outlook, according to J.P. Morgan, is more optimistic, if cautiously so, than economists and analysts have been in the last year or two. Says the report, “The trajectory of growth in 2020 will likely be uninspiring, with the rest of the world looking a bit better but the U.S. economy growing at a trend-like pace. The risk of recession should remain contained, but other risks may continue to build. The pace of profit growth looks set to decelerate further on the back of falling margins, which could potentially lead businesses to pull back on hiring.”

“In sum, 2020 looks to be a year of moderate growth, contained inflation and accommodative policy. While the potential for a further deterioration in corporate profitability presents a risk to this view, a recession over the next 12 months is not our base case.”

For hedge funds, the report sees opportunities from the ongoing digital transformation of industry, “fueling capex and rising demand for software and services.” Fund managers should “increase the integration of Environmental, Social and Governance (ESG) criteria and sustainability across their businesses and investment activities.” And, “Value is seen as one of our best bets.”

For private credit, “we are witnessing demand for exposure to U.S. housing and consumer credit. One popular strategy has been mortgage origination to the self-employed and those who are strong financially but are disqualified by their FICO score.” Other opportunities exist in distressed lending and non-performing bank loans and in commercial mortgage lending.

For private equity, the report sees opportunities in small private companies, those with revenues between $10 million and $100 million. In addition, “E-commerce, cybersecurity, and software-as-a-service (SaaS) are a few areas where we continue to see tremendous promise.”

For real estate the strongest US potential J.P. Morgan sees is in single-family rentals, biotech, self-storage and data centers.

Photo by Luke Chesser on Unsplash

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Productivity Is a System Problem

Productivity is about systems, not people, says the Harvard Business Review.

Sure, there are hacks and techniques each of us can use to filter out the noise, but in the end, writes Daniel Markovitz, “The most effective antidote to low productivity and inefficiency must be implemented at the system level, not the individual level.”

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“94% of most problems and possibilities for improvement belong to the system, not the individual,” he says, citing the case made by W. Edwards Deming in his book Out of the Crisis. “I would argue that most productivity improvements belong there as well.”

This is a particularly telling point for human resources professionals who are often tasked with providing training on time management. Markovitz says there’s nothing wrong with teaching techniques like Pomodoro, Inbox Zero or one of the many others. What’s necessary is to also address system inefficiencies.

That’s where he focuses his article, offering what he calls “four countermeasures.”

Tier your huddles

Whether you call them stand-ups, check-ins or huddles, Markovitz shows us how to use these meetings to avoid the inefficiency of “scattershot emails about a variety of problems.” Instead of kicking problems up the hierarchy, address problems at the lowest possible level. Problems that can’t be resolved at the staff huddle are the ones, and the only ones, to escalate to the next level huddle.

Make work visible

Because so much of office work is done by individuals working alone, it becomes invisible. Implementing a physical or virtual task board where every task is represented along with who is handling it not only makes a more equitable distribution of work, it also eliminates status check emails and the need to cover that topic in meetings.

Markovitz suggests making downtime equally as visible. Instituting “predictable time off” allows workers to know when someone is unavailable and react accordingly.

Define the “bat signal”

Pointing out that Batman knew flashing the symbol of a bat in the sky meant a crisis, Markovitz suggests companies adopt something similar to indicate when an issue is a real emergency.

“With no agreement on what communication channel to use, workers are forced to check all digital messaging platforms to ensure that nothing slips through the cracks. That’s toxic to productivity. Companies can make work easier for people if they specified channels for urgent and non-urgent issues.”

Align responsibility with authority

“If an employee is responsible for an outcome, they should have the authority to make the necessary decisions without being forced into an endless string of emails, meetings, or presentations,” writes Markovitz.

“The pursuit of individual productivity is healthy and worthwhile,” he agrees, though the value is limited because of all the pulls and tugs by others.

“To make a real impact on performance, you have to work at the system level.”

Photo by Carl Heyerdahl | Image by Gerd Altmann

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Why Is the Cybersecurity Gap Growing?

In 2016 Cisco estimated there were a million unfilled cybersecurity jobs worldwide. Last November, (ISC)2, the International Information System Security Certification Consortium, said the world was short 4 million cybersecurity professionals.

Why has the gap widened?

Dice.com, the tech careers site, says the reasons are numerous. Two, though, stand out, Dice says in a recent post:

  1. “Many cybersecurity workers feel constrained by a lack of career development and training offered to them.”
  2. “Enterprises that need highly-skilled and motivated employees to ensure the business is secure are not taking the right steps to nurture the talent needed to make that happen.”

To explain that, Dice cited a survey by Enterprise Strategy Group (ESG) and the Information Systems Security Association (ISSA), which revealed that 68% of the cybersecurity professionals feel they have no well-defined career path. Most moved into security because of a personal interest after first working in different IT areas.

Steve Durbin, managing director of the Information Security Forum, told Dice there’s a disconnect between human resources and security teams. HR doesn’t understand what skills are important, nor does it recognize the mental and physical toll cybersecurity takes.

“This hinders the organization’s ability to identify relevant talent and provide adequate support for the professional development of the security workforce,” Durbin said.

It’s easy to get “pigeonholed,” Morgan Mango, a cybersecurity researcher, says. As an example, she says someone working in PKI early in their career might get tagged as a specialist, limiting their options.

“I would always suggest people to find a job in cybersecurity that’s very flexible and very broad in terms of job description and tasks,” Mango told Dice.

Organizations have a responsibility to encourage development of their security professionals.

“To build a sustainable security workforce,” Durbin said, “Organizations should adapt to market demands by seeking candidates with diverse competencies and skill sets coupled with providing competitive benefits and structured career development. For some these changes are already underway but for the majority, the approach is still new and untried.”

Photo by Adi Goldstein on Unsplash

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