Leadoff by Philip Rowley
All About ROI
In this quarter’s cover story, Peggy Daley and Michael Bandemer observe that the effects of California’s new Consumer Privacy Act will reverberate through businesses all over the world—and not just in compliance departments. Data has become such an integral part of every business model—for plenty of companies, data is the business model—that the Golden State’s sweeping new rules could have a direct impact on how a lot of business leaders decide to invest their companies’ capital in the next year.
Nothing unusual about that. External forces play a role in every investing decision an executive makes. And the stories in this issue of ThinkSet provide a wealth of insight on some of the forces we’ll all be reckoning with as we seek the most efficient, effective ways to deploy our organizations’ capital.
For example, I think a lot of us are struggling with the question of how much capital to direct toward data protection. Listening to some experts, you might think no cybersecurity spend is too big. But it’s helpful to remember, as our resident digital historian David Kalat points out, that breaches have been with us about as long as computers themselves—a valuable perspective in today’s frightening landscape.
And any business leader managing a legal department, or a law firm, would be well advised to read the primer on litigation financing by Bob Craig, Daniel Ryan and Larry Tedesco; it’s not new, but litigation finance can help in-house legal departments and law firms pursue claims without risking so much of their own capital. We also hear from Finbarr O’Connor and Gavin Farrell about the bubble they see forming in private equity. If the bubble bursts, we’ll all likely feel it, given the incredible growth in that asset class the last decade or so.
If there’s any investing question that is universal these days, it’s how to use your capital to get a leg up in the competition for talent. To that conversation we bring two invaluable perspectives from clients: Cesar Maldonado, chancellor of Houston Community College, describes how business and academia must create a skilled labor supply chain; and Laura Garza, global head of HR Transformation at Nissan Motor Corporation, calls for HR leaders to embrace a new vision for their function—one that could supercharge a company’s ROI on human capital.
There’s more. In fact, I think every article in this issue has the potential to help a business leader get smarter about the investing decisions she’ll be facing. I hope you’ll agree.