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Men replacing women CEOs marks step back on diversity

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The direction a company takes on diversity comes from its board room, where white men have dominated since the last century. When choosing a new CEO, board members tend to rely more often on people they know than on executives selected by recruiters who screen candidates from a wider field, said Trina Gordon, CEO of executive-search firm Boyden. About 80 percent of S&P 500 directors are men.

“Boards are still not very diverse, and if you don’t have diversity at the governance level, there’s not a lot of changes that are going to happen,” Gordon said.

Women, who make up about half of the U.S. work force, aren’t forecast to gain parity in the board room until 2032, according to a June estimate from executive recruiter Heidrick & Struggles.

Debra Crew’s promotion to succeed Susan Cameron as CEO at Reynolds American Inc. earlier this year was the first female-to-female handover in the S&P 500 in five years, according to data from recruiter Spencer Stuart. The distinction was short-lived because even before she took the job, British American Tobacco Plc said it would buy Reynolds. Now Crew reports to BAT CEO Nicandro Durante.

Prior to that transition, the last time a female CEO was replaced by another woman was in 2012, when Sheri McCoy succeeded Andrea Jung at Avon Products Inc. McCoy announced her resignation Thursday from Avon, which is no longer in the S&P 500. A successor hasn’t been named.

The third example in recent years was Xerox Corp. CEO Ursula Burns, who replaced Anne Mulcahy in 2009. Burns retired this year and was replaced by Jeff Jacobson, her former chief operating officer.

When female CEOs step down, it’s typically a man waiting in the wings. Among the 27 S&P 500 companies run by women, most chief operating officers or presidents are men. At PepsiCo Inc., Indra Nooyi appointed Ramon Laguarta as president last month, setting him up as one of her possible successors.

A big issue is that companies often prefer to make a safe choice for leadership, selecting an executive with a track record for running a company or a large unit, and those executives are still overwhelmingly male, said Gordon.

“The statistics are daunting,” she said. “There is a perpetuation of the status quo.”

Female chief executives are judged differently than men, another hurdle women face on the path to the C-suite, said Barbara Annis, founding partner of Gender Intelligence, a company that focuses on improving workplace gender relations.Research shows that women are judged on performance, while men are given opportunities based on their potential, she said. And when a woman is at the helm and a company performs poorly, frequently her gender is viewed as the reason.

“We attribute results to one’s gender when it comes to a woman, and we don’t do that with men,” Annis said. “So often when that happens, we end up picking a man as the successor.”

The different expectations also extend to how activists approach female CEOs, according to a 2016 report from a researcher at Arizona State University. For every 10 shareholder proposals at a company led by a man, there were 15 for a company with a female CEO. Those women had a 27 percent chance of being targeted by activists, while the risk to men was almost zero, according to the study, which examined shareholder proposals at Fortune 100 companies from 2003 to 2013.

Even as the number of women running the biggest companies falls to 25 from 27 this year — thanks to the departure of Crew and Rosenfeld — it remains a relatively new phenomenon to have so many at one time, Stellings from Catalyst said. Between 1972 and 2000, there were never more than four female CEOs serving at one time, she said.

“You could easily fit all of them, in the history of our time, into one room,” Stellings said.

When Mondelez International said last week that chief executive Irene Rosenfeld was retiring, it was no surprise that the food company also announced she would be succeeded by a man.

Since 2009, 19 female CEOs of Standard & Poor’s 500 companies have stepped down. In only three of those cases was she replaced by another woman, according to data compiled by Bloomberg. Rosenfeld, 64, will retire in November and be succeeded by Dirk Van de Put, who currently leads McCain Foods.

“It underscores just how truly exceptional it is for a woman CEO to be succeeded by another woman,” said Brande Stellings, senior vice president of advisory services at Catalyst, which tracks diversity in companies. “Since we had the first woman CEO in the Fortune 500 in 1972, there’s only been 62 women CEOs in total, which is pretty staggering.”

Investors are putting pressure on company boards to improve lacklustre diversity records, particularly this year, when State Street Corp. and BlackRock Inc. voted against hundreds of directors at companies seen as lagging on gender parity and other measures. McKinsey & Co. and other consultants are providing a growing body of research that indicates that companies that shift away from a monolithic white male leadership outperform those that haven’t changed their complexion. Still, most measures of diversity have been largely unchanged for a decade.

source: http://www.afr.com/leadership/men-replacing-women-ceos-marks-step-back-on-diversity-20170806-gxqcvc

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Samsung CEO embarrassed by the Galaxy Fold fiasco, he “pushed it through before it was ready”

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The Samsung Galaxy Fold is perpetually coming soon. The Korean company issues a new press release or has an exec do an interview every few weeks reiterating in vague language that the launch is still on, and it will happen sooner rather than later. But time keeps passing and the Fold is still nowhere to be seen in stores.

Samsung co-CEO DJ Koh has now told The Independent that he admits he “missed something on the foldable phone”, but the company is in the process of recovery. At the moment more than 2,000 prototypes are being extensively tested so that no new issues will arise.

DJ Koh, Samsung Electronics co-CEO

DJ Koh, Samsung Electronics co-CEO

Koh earnestly confesses that “it was embarrassing. I pushed it through before it was ready”. He didn’t go into more detail – like whether Huawei announcing the Mate X had anything to do with the rushing of the Fold to the market, but we can of course infer that. Then again, seeing what happened to the Fold, Huawei has also decided to push back the release of the Mate X by around three months, which should be coming in September.

Koh is adamant that the Galaxy Fold hasn’t been canceled and will indeed launch… at some point. He didn’t reveal a specific release date, only saying it will be out “in due course.” “Give us a bit more time,” he continued. “The last couple of weeks I think we defined all of the issues and all of the problems we couldn’t find [before sending to reviewers].”

Source: https://www.gsmarena.com/samsung_ceo_embarrassed_by_the_galaxy_fold_fiasco_admits_he_pushed_it_through_before_it_was_ready-news-37880.php

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Russian Gamer Brothers Are the Newest Hidden Billionaires

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Russian-born Igor and Dmitry Bukhman are seeking growth to challenge Tencent and Activision.

Almost two decades ago, in a remote Russian city best known for its butter and linen, two brothers shared a bedroom and a Pentium 100-powered computer they used to code their first game.

Wall Street wants a piece of what they’ve built since.

Playrix has met with some of the biggest banks “and visited their skyscrapers,” said Dmitry Bukhman, 34, citing meetings with dealmakers at Goldman Sachs Group Inc. and Bank of America Corp. For now, though, “we are focused on growing the business.”

He and Igor Bukhman, 37, are the brains behind Playrix Holding Ltd., the creator of popular games similar to Candy Crush, including Fishdom and Gardenscapes, with more than 30 million daily users from China to the U.S. and annual sales of $1.2 billion, according to Newzoo. That makes the company one of the top 10 iOS and Google Play app developers by revenue, data from researcher AppAnnie show, putting Playrix in the same league as Tencent Holdings Ltd., NetEase Inc. and Activision Blizzard Inc.

Playrix Mobile Gaming Founders Dmitri And Igor Bukhman
Igor, left, and Dmitri Bukhman in Tel Aviv.Photographer: Corinna Kern/Bloomberg

Today, each brother is worth about $1.4 billion, according to the Bloomberg Billionaires Index. They haven’t previously appeared in a global wealth ranking.

Their road to riches started in 2001 in the city of Vologda, almost 300 miles (483 kilometers) north of Moscow, where Igor learned from a university professor that he could sell software online. He decided to try with Dmitry, who was still in high school at the time.

“We had no experience, no business understanding whatsoever—everything we could imagine was writing games,” Igor said.

The U.S. is Playrix’s biggest market, followed by China and Japan, the brothers said in a recent interview in Tel Aviv, where they spend some of their time. The two remotely manage about 1,100 employees, including personnel at its Ireland headquarters and developers in Russia, Ukraine and Belarus.

“For $3 billion we won’t sell”

The brothers’ first product was a game akin to Xonix in which players must use a cursor to open pieces of a hidden picture before being struck by flying balls. They wrote it during a summer break and generated $60 in the first month and later $100 a month, about half of the average salary in Vologda.

“We thought, ‘If one game makes $100, we can write several dozen of them and make a lot of money,”’ Igor said.

Their second game, featuring an animated character designed by an outsourced artist, brought in $200 a month. Their copycat of Tetris brought in $700 a month, but the brothers shut that down after learning that the game was protected by a license. In 2004, when the business reached $10,000 of monthly revenue, they registered a legal entity, rented space for an office in the basement of a book warehouse and hired other staff to accelerate production.

In the early years, they sold casual games through sites such as majorgeeks.com or download.com, before moving to bigger platforms like Yahoo! and AOL. Then, within the past decade, games started moving first to Facebook and then smartphones. Many of them were available for free, with users paying only for certain in-game features.

Playrix makes most of its money from in-app purchases and the brothers mostly shun advertising, which detracts from the user experience. Ads generate less than 3 percent of revenue, Dmitry said.

relates to Russian Gamer Brothers Are the Newest Hidden Billionaires
GardenscapesSource: Playrix

“It was a major challenge for us to switch to developing free-to-play games—that’s totally different DNA,” Dmitry said. “Free-to-play games aren’t games that you develop, release and move on to making another one. They are services that need to be supported constantly as users are waiting for regular updates.”

Playrix succeeded in this transition, achieving worldwide recognition over the past three years with Gardenscapes and its sequel, Homescapes, a new variety of match-3 puzzle in which a player completes rows of at least three elements to pass levels and progress through an animated storyline—in this case, helping a butler named Austin renovate a house with a garden.

“Austin engages in dialog with you, you help him to select ways to decorate the mansion, you dive into the history of this character and become related with him,” Dmitry said. “This genre variety we introduced—match-3 with meta game—became very successful, and other companies started copying us.”

“Playrix is certainly responsible for the first major innovation in the match-3 genre since King Digital Entertainment Plc seemingly had the market locked down with Candy Crush,” said Newzoo analyst Tom Wijman. “Playrix managed to add a layer of complexity and ‘meta game’ to the match-3 genre without driving away casual mobile players.”

The company employs several full-time script writers who work on Austin’s dialog, and it’s always improving the games, Dmitry said.

“It’s like apps, like Spotify—people can use them for years,” he said. “More and more people are getting accustomed that it’s perfectly normal. Why not pay $5 to get pleasure from playing a game on a smartphone rather than watching videos or listening to music?”

relates to Russian Gamer Brothers Are the Newest Hidden Billionaires
HomescapesSource: Playrix

While Playrix hasn’t introduced a new title since 2017, the company recently acquired several gaming studios to expand into new genres, Igor said, declining to disclose which studios until it releases games developed by them later this year.

Successful titles attract whales. Activision Blizzard acquired King Digital in 2015 for $5.9 billion, and a year later Tencent led investors in an  $8.6 billion deal to acquire a majority stake in “Clash of Clans” maker Supercell Oy.

Could Playrix be next? In February, the Information reported that it could be sold for $3 billion, citing Chinese firms iDreamSky Technology Holdings and FunPlus Game Co. as potential suitors.

The brothers dismissed the report.

“For $3 billion we won’t sell,” Dmitry said with a smile, while acknowledging that Playrix had been discussing strategic options as recently as last year, noting its meetings with Wall Street banks.

Their goal, for now, is to become a “top-tier gaming company,” that rivals Activision Blizzard and Electronic Arts in the West, and NetEase Inc. and Tencent in China, Igor said.

“We want to grow as big as they are, using developer talent from our region—the former USSR and Eastern Europe,” he said.

There’s no magic number that would compel the Bukhmans to sell the company, because they say money is secondary to doing what they love.

“Some may think that when you have a lot of money, everything becomes different and more interesting, you start doing different things,” Dmitry said. “But no. We just keep working.”

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Boeing working on software update to boost safety, says CEO

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Boeing’s Chief Executive Officer (CEO) Dennis Muilenburg said  the aircraft manufacturer is taking actions to ensure the safety of its 737 Max jets in the wake of two crashes that killed 346 people.

In an open letter addressed to airlines, passengers and the aviation community, Muilenburg said Boeing will soon release a software update and offer related pilot training for the 737 Max to “address concerns” that arose in the aftermath of October’s Lion Air flight that plunged into the Java Sea, killing 189.The planes’ new flight-control software is suspected of playing a role in the crashes.

Muilenburg said Boeing representatives are supporting investigation into the cause of last week’s crash of an Ethiopian Airlines Max 8 that killed 157.The United States and many other countries have grounded the Max 8s and larger Max 9s as Boeing faces the challenge of proving the jets are safe to fly amid suspicions that faulty sensors and software contributed to the two crashes in less than five months.

The letter reads: “We know lives depend on the work we do, and our teams embrace that responsibility with a deep sense of commitment every day.

“Our purpose at Boeing is to bring family, friends and loved ones together with our commercial airplanes—safely.

“The tragic losses of Ethiopian Airlines Flight 302 and Lion Air Flight 610 affect us all, uniting people and nations in shared grief for all those in mourning.

“Our hearts are heavy, and we continue to extend our deepest sympathies to the loved ones of the passengers and crew on board.

“On safety measures, he said: “Safety is at the core of who we are at Boeing and ensuring safe and reliable travel on our airplanes is an enduring value and our absolute commitment to everyone.

“This overarching focus on safety spans and binds together our entire global aerospace industry and communities.

“We’re united with our airline customers, international regulators and government authorities in our efforts to support the most recent investigation, understand the facts of what happened and help prevent future tragedies.

“Based on facts from the Lion Air Flight 610 accident and emerging data as it becomes available from the Ethiopian Airlines Flight 302 accident, we’re taking actions to fully ensure the safety of the 737 MAX. We also understand and regret the challenges for our customers and the flying public caused by the fleet’s grounding.

“Work is progressing thoroughly and rapidly to learn more about the Ethiopian Airlines accident and understand the information from the airplane’s cockpit voice and flight data recorders.

“Our team is on-site with investigators to support the investigation and provide technical expertise. The Ethiopia Accident Investigation Bureau will determine when and how it’s appropriate to release additional details.

“Boeing has been in the business of aviation safety for more than 100 years and we’ll continue providing the best products, training and support to our global airline customers and pilots.

“This is an ongoing and relentless commitment to make safe airplanes even safer. Soon we’ll release a software update and related pilot training for the 737 MAX that will address concerns discovered in the aftermath of the Lion Air Flight 610 accident.

“We’ve been working in full cooperation with the U.S. Federal Aviation Administration, the Department of Transportation and the National Transportation Safety Board on all issues relating to both the Lion Air and the Ethiopian Airlines accidents since the Lion Air accident occurred in October last year.

“Our entire team is devoted to the quality and safety of the aircraft we design, produce and support. I’ve dedicated my entire career to Boeing, working shoulder to shoulder with our amazing people and customers for more than three decades, and I personally share their deep sense of commitment.

“Recently, I spent time with our team members at our 737 production facility in Renton, Wash., and once again saw first-hand the pride our people feel in their work and the pain we’re all experiencing in light of these tragedies.

“The importance of our work demands the utmost integrity and excellence—that’s what I see in our team, and we’ll never rest in pursuit of it.

“Our mission is to connect people and nations, protect freedom, explore our world and the vastness of space, and inspire the next generation of aerospace dreamers and doers—and we’ll fulfill that mission only by upholding and living our values. That’s what safety means to us.

“Together, we’ll keep working to earn and keep the trust people have placed in Boeing.”

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