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When I came to the U.S. in 1980, I was young and naïve. I used to think that corruption and ethical lapses were just a third-world ill. Eventually, I became a tech CEO and learned the harsh realities of American business. Yes, standards are much higher, and breaches are punished, but the temptations are just the same here as they are in any other country. Ethical lapses (which are a form of corruption) are quite common.  You watch stories about these on TV every other day and read about them on TechCrunch.  It was the ethical lapses of our financial institutions that threw our economy into a tailspin, and for which we are paying the price, after all.

It is best to be aware of the temptations and to prevent the lapses from occurring. As Enron, Bernie Madoff, and Lehman Brothers have shown, it’s a slippery slope. Once you start compromising your values for short-term gains, there is no turning back. Business ethics are not something you need to start worrying about when your company reaches a certain size; they need to be sewn into the fabric of your startup from the get-go. The lessons are the same for tech businesses as they are for investment banks and for third-world economies.

Harvard Business School professor Michael Beer researched the difference between companies that perform at high levels for extended periods and those that implode when they reach a certain size. When analyzing the spectacular failures in the recent financial meltdown, he found that:

• Of the original Forbes 100 (named in 1917), 61 had ceased to exist by 1987.  Of the remaining 39, only 18 stayed in the top 100, and their return during the period 1917 to 1987 was 20% less than that of the overall market.

• Of companies in the original Standard & Poor’s 500-stock index of 1957, only 74 remained in 1997; of these, only 12 outperformed the S&P 500 in the period 1957 to 1998.

• The average CEO tenure in the U.S. is 4.2 years, less than half the 10.5-year average in 1990.

Beer posited three core reasons for the failure of so many Wall Street firms in the fall of 2008: the firms lacked a higher purpose (in other words, they were focused on short-term gains, profits, and bonuses); they lacked a clear strategy; and they mismanaged their risk. Companies like Charles Schwab and US Bancorp were able to avoid the fallout by having a laser-like focus on customer service and on honesty and transparency. Neither company touched the subprime mortgage securitization market, because they saw it as risky and simply not the kind of business that served the company’s long-term interests.

Even outside Wall Street, companies like Cisco Systems, Southwest Airlines, and Costco Wholesale, with the strongest sense of higher purpose, achieved the greatest success. Take Costco. Wall Street analysts have long chastised Costco’s management for paying high wages and keeping employees around for a long time, because this results in higher benefits costs. But the company’s CEO, Jim Sinegal, lives by his belief that keeping good employees is strategic for Costco’s long-term success and growth. The company’s per-employee sales are considerably higher than those of key rivals such as Target and Wal-Mart; customer service at the stores is phenomenal and fast; and Costco continues to expand, both in number of warehouses and in products and services for business and consumer customers. The culture of the company flows downward from Sinegal and his focus on employees and, by extension, to customers.

One of the problems that Beer found with the failed banks was that their employees lacked the ability to “speak truth to power”. Employees felt intimidated by superiors; the institutions’ internal voice of conscience and purpose was silenced by a maniacal focus on short-term profits and whatever scheme would bring them in. The silencing of employees who sought to challenge strategy and risk-management practices likely also undermined the banks’ moral authority and emboldened those who already felt inclined to do the wrong thing. With a muted internal voice, these organizations lacked a moral compass. As a result, they drove off a cliff with astonishing speed.

The same things happen in Silicon Valley companies.  I asked management guru — and head of the CEO Institute of Yale School of Management — Jeff Sonnenfeld for his advice on how startups can sow the seeds for building a Cisco or Costco. Here is Jeff’s advice:

1)  Create a culture of openness and welcome dissent – Internal constructive critics are your best friends — too often, founders are blinded by their own enthusiasm for their creative vision and then are surrounded by sycophants, kissing up. Founders who fall out of touch rapidly lose their ethical bearings. At Intel, founder Robert Noyce and Gordon Moore did not look for sycophantic followers in selecting the brilliant, contentious, but relentlessly honest Andy Grove as their colleague and successor. Similarly, Craig Barrett and Paul Otellini have consistently fought for different points of view internally — without undermining the enterprise, and always reinforcing Intel’s self-critical core ethic.

2)  Lead by example.  The authenticity of the leader’s character is essential — if colleagues don’t believe you, they will not take needed risks on your behalf — such as training subordinates to be able to do their own jobs.  Startups are often defined by the hip clichés of VC firms, adoring press, and HR consultants — but the startups don’t really practice what they preach.

3)  Learn from immediate peers or distant models. Too often, founders atrophy because they believe that the unique quality of their business or technological mission means that they too are truly unique in leadership values.  Steve Jobs has patterned himself after Polaroid founder Ed Land — and tried to learn from Land’s strengths and weaknesses.  Henry Ford regretfully once claimed “History is bunk” but in reality revered Thomas Edison.  Michael Dell put legendary tech entrepreneur (Teledyne) and educator Dr. George Kozmetsky on his board right from the start to learn from this brilliant then septuagenarian.

4)  Recognize your own fallibility as a leader, know your limits, and beware of the myth of immortality.  Entrepreneurs often are horrified at the thought of leadership succession. The founders of great firms such as Google, Cisco, Amgen, and Microsoft have known that they would need to prepare for a day when they no longer could be the lone day-to-day internal boss, primary external ambassador, and symbolic cultural icon. The founder of the original (pre-Starbucks) coffee house chain Chock-Full-o-Nuts started his first café on Broadway 43rd Street in 1923 and was a great national success.  Sadly, sixty years later, as a dying man who had been flat on his back for two years at Massachusetts General Hospital in Boston, he still clung to the job of leader of the enterprise, his full-time physician serving as acting president.

5)  Remember that institutional character — like a liquid cupped in your hand — is fragile; easily lost; and hard, if not impossible, to regain. Egomaniacal moves, personal grandiosity, greed, and deception create impressions that are hard to erase.  Whole Foods founder, John Mackey, sabotaged the integrity of his own exalted brand, damaging the company’s internal pride and customer admiration far more badly than any competitor could have, due to his self-inflating and his misleading “anonymous” blogging, hiding his identity through an anagram of his wife’s name, “rehodab.”

I’ll add another very important point: Establish an independent board. Venture firms often demand a majority of board seats as a condition for their investments. Conflicts invariably arise. The board begins to serve the needs of VCs and management, rather than of the company itself, which loses the independent voice to warn it not to do the wrong things. The inconvenient truth is that all board members have a fiduciary duty to act in the interests of the company, and not in their own interests. Board members must not engage in transactions in which they or their partners stand to gain. They are legally required to avoid these conflicts of interest.

Finally, remember that in business, you have to make tough choices at every juncture. Though business decisions usually have clear consequences and outcomes, ethical decisions are always hard. Making the right choice doesn’t always bring success, but ethical lapses almost always lead to failure. No matter what the consequence, doing what’s ethical and right is always the better long-term strategy.

Editor’s note: Guest writer Vivek Wadhwa is an entrepreneur turned academic. He is a Visiting Scholar at UC-Berkeley, Senior Research Associate at Harvard Law School and Director of Research at the Center for Entrepreneurship and Research Commercialization at Duke University. Follow him on Twitter at @vwadhwa.

Earlier this morning, the Windows Phone 7 emulator was “unlocked” (so to speak), granting anyone with a few spare minutes and basic tinkering abilities an opportunity to get a look at a bunch of stuff Microsoft didn’t originally include. Not everyone is prepped and ready to get their hack on, though. Maybe you’re on a Mac

Excerpt from:
Hacked Windows Phone 7 emulator demoed on video

This year’s MIX 2010 was led by Scott Guthrie, who has emerged from Microsoft’s rank and file to own just about everything developer-related. Where last year’s MIX and PDC conferences were spearheaded by Chief Software Architect Ray Ozzie, Guthrie’s keynote appearances focused on the progress Silverlight has made in driving the company’s 3 Screens and the Cloud approach to the disruptions going on in mobile, television, and the Web OS desktop. I spoke with Scott after his opening day keynote in Las Vegas:

Andover, MA-based website conversion company SeeWhy today launched Conversion Manager, an automated web analytics service that allows publishers and e-commerce companies to optimize website conversion rates through real-time ‘remarketing’ campaigns.

The company claims that their solution can recover up to 50 percent of website abandoners (i.e. people who start but never complete a sign-up or payment process) by triggering automated campaigns using email and social media.

The company fences with study results that highlight the importance of real-time follow up with website abandoners, citing research from MIT that says 90 percent of e-commerce leads go cold within the first hour. SeeWhy CEO Scott G. Silk compares such leads with fine wine, stating that unlike the latter e-commerce leads don’t get better with age. Cute.

SeeWhy’s new product builds upon the functionalities of its predecessor, Abandonment Tracker Pro, which we wrote about earlier. With added support for Facebook, Twitter and MySpace, Conversion Manager is able to track individual visitors’ behavior on e-commerce and other websites and trigger automated, real-time messages to shopping cart, online form, and other abandoners by email and social media the moment abandoners leave the site.

Conversion Manager is available now at an annual fee of $15,000.

SeeWhy has so far raised $6.5 million in venture capital: $4.5 million in May 2009 and another $2 million from the same investors in December 2009. SeeWhy’s CrunchBase profile doesn’t list any competitors and a Web search doesn’t immediately turn up potential rivals – if you know alternative services feel free to share their names in comments.

iBUYPOWER announced today its latest, 4 new “Paladin” systems using the i7 980x processors .

See the rest here:
iBUYPOWER announces 4 systems using the i7 980X processors

According to Opera Software, downloads of its latest desktop browser (10.5) have increased in number significantly after Microsoft started offering Windows users in Europe a choice in browser with a so-called ballot screen.

The Norwegian software maker says that on average, more than half of the European downloads of Opera’s latest browser come directly from that Choice Screen.

The increase represents more than a doubling from the normal download numbers. At the beginning of this month, Opera touted that browser downloads actually tripled at first, so maybe that growth rate won’t last forever.

I’m also very curious if Mozilla, Google and Apple are spotting the same trend for their respective browsers.

According to plans Microsoft has agreed to with the European Commission, the rollout of the Choice Screen will continue into May for existing Windows computers and for five more years on new installations.

No wonder Opera Software is trying to push for a global roll-out of the choice screen.

The following numbers are the percentages of country downloads of Opera’s latest desktop browser that originate from the Choice Screen, as part of the total Opera 10.5 numbers:

For the past couple of years now, when talking about the Apple TV product, Apple likes to throw out the word “hobby.” It’s as if they’re ashamed of the device. And considering sales are anemic next to Macs, iPods, and iPhones, it’s no big surprise that they talk this way.

But there’s actually nothing to be ashamed of. The Apple TV is a good product. Apple just needs to put some proper time and energy into it, to expand it to its full potential. And news today about the so-called “Google TV” should do just the trick.

Apple and Google are on the verge of war. The formerly close allies are increasingly competing in key spaces for both, and the living room is likely to be a new battleground because it’s still very much up in air. As the New York Times reported yesterday, Google is working with partners including Intel, Sony, and Logitech to bring a Google TV experience into the living room. This is, of course, where the Apple TV resides. And Apple would be foolish to simply cede any ground it does have to its new favorite rival just because it’s focused on other things (*cough* iPad *cough*).

That’s a Microsoft move.

As Nick Bilton points out, this Google TV would be based around the Android platform. This means that the key idea is likely to have third-party developers work on it to make applications built for a television set. That’s easier said than done, but Android’s open nature should yield some interesting results rather quickly.

Apple, meanwhile, is of course anything but open with regard to their devices. In fact, the Apple TV is entirely closed right now, as only Apple is able to modify its software (without hacking it, of course). I suspect that will change, following this revelation.

The idea of running iPhone-style applications on the Apple TV has long been a sexy one. Hell, people have even ported apps over to a TV screen to show how well it could work. The main problem with developing iPhone apps for the Apple TV seems to be resolution. With the iPhone (and iPod touch), Apple offers only one screen size/resolution, ensuring developers have an easy time making great-looking apps — while at the same time, making sure end users have a great experience.

But the iPad has already changed everything. With their new device, Apple has kept things as simple as possible by making iPhone apps scale up two times to work on the bigger display, but it’s still shows a willingness to move beyond the one screen size. Unfortunately, with the Apple TV, it can be attached to a screen that could be a huge variety of sizes, so it would be hard to control that.

Google doesn’t care about that because Android already runs on dozens of phones with different screen sizes. But Apple clearly cares about how apps look on its devices (so much so that the iPad itself was likely designed at a strange ratio simply to make scaling apps look as good as possible). So does that mean they start offering an actual Apple TV (as in a screen)? Rumors of that have been around for a long time. Or maybe they black-box apps to a certain resolution — similar to what they’re doing on the iPad when an app isn’t scaled up?

Who knows. But what I do know is that upon hearing this Google TV news, the Apple TV became a little less of a “hobby” yesterday.

Aside from calling it a hobby, Steve Jobs has referred to the Apple TV as being a potential “fourth leg” of a chair Apple is building. Leg one is the Mac, leg two is the iPod, leg three is the iPhone, and Jobs had hoped the Apple TV would complete the chair one day. But it seems clear now that he thinks the iPad could be the fourth leg instead.

Screw that. I think it’s time for Apple to build a whole dining room set of furniture. We, as consumers, need a living room arms race between Apple and Google (and Microsoft, TiVo, Roku, Boxee, and the rest) to kick the cable companies’ shitty television user experience to the curb.

If you can’t tell your Belt of Orion from your Little Dipper, Microsoft is here to help. Today it added its WorldWide Telescope application to Bing Maps. The application let’s you look up at the sky from a street view level in a map and see the stars and planets conveniently identified by red lines connecting them together.

Microsoft debuted its WorldWide Telescope application two years ago, and it’s existed as a standalone desktop and Silverlight app. But now that it is part of Bing Maps, it should become more popular. (Inside Bing Maps, you first need to click on “Map Apps” and select WorldWide Telescope to enable it).

The app is not just for identifying constellations and planets. The menu on the left allows you to load up all sorts of data from sky surveys, the Hubble Telescope, and other astronomy data sources. The navigation isn’t as fluid as it could be, but at least it gives you a point of orientation to make sense of the night sky. What Microsoft needs to do is bake this into its Bing iPhone app so that you can see the constellations identified through your camera viewfinder.

There’s no question that Google is setting its sights on taking some of Microsoft’s marketshare in the productivity suite space. Last year, Google announced a new plug-in that syncs Google’s enterprise versions of Apps, including Gmail, contacts, and calendar, with Microsoft’s Outlook. And Google just acquired Docverse, an application lets users collaborate directly on Microsoft Office documents. Today Google is taking another swipe at Microsoft with a new tool that makes it significantly easier to make the switch over to Google Apps from Microsoft Exchange.

Google Apps Migration for Microsoft Exchange is a new server-side tool that migrates a company’s email, calendar and contact data from Microsoft Exchange, an email server software product from Microsoft, to Google Apps. Google promises ease with the tool, allowing IT administrators the ability to select the mail, calendar and contact data to move in phases and migrate hundreds of users at the same time. Plus, employees can use Exchange during the migration without any interruption. The tool works with Exchange 2033 and 2007 for both on-premise and hosted applications and is available to the enterprise and education versions of Google Apps.

This is clearly a play at showing businesses how simple it is to move from from Microsoft products, such as Exchange, that may not be hosted in the cloud to the cloud-based Google Apps product. Google product Manager Matt Glotzbach told me that the search giant wants to make it as simple as possible for potential customers to make the switch to Google Apps, and many potential Google Apps’ clients are using Microsoft Exchange to host and power email, calendar, and contacts. Google also launched Google Apps Migrator for Lotus Notes and a Connector for BlackBerry Enterprise Server.

Google Apps has steadily been growing; already 25 million people are using the Apps product. And that also includes over 2 million businesses ranging from startups, to small businesses, to Fortune 500 companies. And Google is developing a compelling ecosystem around Google Apps, recently launching the Google Apps Marketplace, which is an an app store for enterprise apps in the cloud.

AOL has recruited a few celebrity chefs and foodies; including Curtis Stone, Food & Wine’s Gail Simmons, and Marcus Samuelsson; and the famed Culinary Institute of America to launch food website KitchenDaily. Similar to Epicurious, AllRecipes, or FoodNetwork.com, KitchenDaily features a recipe database of meals that have been tested by top chefs, food magazine and cookbook publishers.

AOL has recruited a number of talent from Conde Nast’s recently shuttered Gourmet Magazine. Former Gourmet Editor Cheryl Brown is the editor-in-chief with a number of former Gourmet writers named as contributors. Epicurious’ Megan Steintrager will be the senior editor of the site.

In addition to recipes, KitchenDaily will feature a meal-planner tool, cooking lessons, cookbook reviews, and and more than 250 instructional videos created by celebrity chefs and industry insiders. AOL already has a food blog called Slashfood though its unclear how the two sites will be integrated.

The recipe site space is crowded, with a number of worthy competitors vying for traffic. And even Microsoft’s Bing launched its own recipe search product. But its seems that KitchenDaily aims to be part magazine, part recipe site, so it may be able to differentiate itself and possibly attract many former Gourmet readers. We know that AOL CEO Tim Armstrong is bullish on niche content so the launch of this site fits into the company’s strategy nicely.