Common Industry Challenges

The WSJ nails the title--Main Street Banking Model Is Being Squeezed—but misses the mark on the cause.   Commenting on the industry's Q1 profit declines, WSJ says: “𝘛𝘩𝘦 𝘳𝘦𝘴𝘶𝘭𝘵𝘴 𝘶𝘯𝘥𝘦𝘳𝘴𝘤𝘰𝘳𝘦 𝘵𝘩𝘦 𝘶𝘯𝘦𝘷𝘦𝘯 𝘵𝘰𝘭𝘭 𝘵𝘩𝘢𝘵 𝘵𝘸𝘰 𝘺𝘦𝘢𝘳𝘴 𝘰𝘧 𝘩𝘪𝘨𝘩𝘦𝘳 𝘪𝘯𝘵𝘦𝘳𝘦𝘴𝘵 𝘳𝘢𝘵𝘦𝘴 𝘩𝘢𝘷𝘦 𝘵𝘢𝘬𝘦𝘯 𝘰𝘯 𝘳𝘦𝘨𝘪𝘰𝘯𝘢𝘭 𝘣𝘢𝘯𝘬𝘴, 𝘸𝘩𝘪𝘤𝘩 𝘵𝘦𝘯𝘥 𝘵𝘰 𝘩𝘢𝘷𝘦 𝘱𝘭𝘢𝘪𝘯-𝘷𝘢𝘯𝘪𝘭𝘭𝘢 𝘣𝘶𝘴𝘪𝘯𝘦𝘴𝘴𝘦𝘴 𝘵𝘢𝘬𝘪𝘯𝘨 𝘪𝘯 𝘥𝘦𝘱𝘰𝘴𝘪𝘵𝘴 𝘢𝘯𝘥 𝘮𝘢𝘬𝘪𝘯𝘨 𝘭𝘰𝘢𝘯𝘴. 𝘛𝘩𝘢𝘵 𝘮𝘰𝘥𝘦𝘭 𝘩𝘢𝘴 𝘣𝘦𝘤𝘰𝘮𝘦 𝘭𝘦𝘴𝘴 𝘱𝘳𝘰𝘧𝘪𝘵𝘢𝘣𝘭𝘦 𝘣𝘦𝘤𝘢𝘶𝘴𝘦 𝘰𝘧 𝘵𝘩𝘦 𝘱𝘳𝘦𝘴𝘴𝘶𝘳𝘦 𝘵𝘰 𝘱𝘢𝘺 𝘶𝘱 𝘰𝘯 𝘥𝘦𝘱𝘰𝘴𝘪𝘵𝘴.”   My take: The “main street” #banking model is being squeezed—but it's been years in the making and is only exacerbated by current economic conditions. The core of the squeeze comes from:   1️⃣ 𝗧𝗵𝗲 𝗿𝗲𝗱𝗲𝗳𝗶𝗻𝗶𝘁𝗶𝗼𝗻 𝗼𝗳 𝗰𝗼𝗺𝗺𝘂𝗻𝗶𝘁𝘆. One of the hardest things for bankers to see and accept is the long-term decline of "geography as community." National providers--banks, fintechs, and even merchants--have chipped into (geographically-based) community institutions' payments, lending, and banking business.   2️⃣ 𝗚𝗲𝗻𝗲𝗿𝗮𝘁𝗶𝗼𝗻𝗮𝗹 𝗰𝗵𝗮𝗻𝗴𝗲𝘀. When Boomers graduated college, their question was "which bank should I open an account with?" When Millennials graduated, they asked "do I need a checking account?" As Gen Z graduates, the question is "what's a checking account?" This is why digital banks and fintechs captured nearly half of all new "checking" accounts opened in 2023. The kids are looking for an easy--and free--way to make payments.   3️⃣ 𝗣𝗿𝗼𝗱𝘂𝗰𝘁/𝘀𝗲𝗿𝘃𝗶𝗰𝗲 𝗽𝗿𝗶𝗰𝗶𝗻𝗴. There's a value disconnect in banking. Too much of banks' non-interest income comes from punitive fees. Like it or not (and I don't), the CFPB has the teeth to address this imbalance. It's "fixes" aren't the right ones, but it is addressing the core of the problem.   4️⃣ 𝗧𝗮𝗹𝗲𝗻𝘁 𝘀𝗵𝗼𝗿𝘁𝗮𝗴𝗲𝘀 𝗮𝗻𝗱 𝗲𝗰𝗼𝗻𝗼𝗺𝗶𝗰𝘀. Banks lost a lot of good people post-pandemic. Replacing them isn't going to get easier because of the: 1) Lack of people with the tech/banking skills that banks need, and 2) Inability to offer an attractive pay package. A banker told me he's found waiters/waitresses make great branch staff because they have good interpersonal skills, know how to ask for the up-sell, and understand time constraints. The problem, however, is that they can earn more money waiting tables at a nice restaurant than they can working for a bank.   5️⃣ 𝗧𝗵𝗲 𝗴𝗼𝘃𝗲𝗿𝗻𝗺𝗲𝗻𝘁. Systematically, the current administration has been shaping the industry to make it more difficult for mid-size institutions to succeed by limiting fees for overdraft, interchange, late payments, and more. A Republican administration in 2025 might alleviate some pressure, but the US banking industry should be prepared for future administrations to continue the banking squeeze. What did I miss?

I am constantly thinking about how to foster innovation in my product organization. Building teams that are experts at execution is the easy part—when there’s a clear problem, product orgs are great at coming up with smart solutions. But it’s impossible to optimize your way into innovation. You can’t only rely on incremental improvement to keep growing. You need to come up with new problem spaces, rather than just finding better solutions to the same old problems. So, how do we come up with those new spaces? Here are a few things I’m trying at Duolingo: 1. Innovation needs a high-energy environment, and a slow process will kill a great idea. So I always ask myself: Can we remove some of the organizational barriers here? Do managers from seven different teams really need to say yes on every project? Seeking consensus across the company—rather than just keeping everyone informed—can be a major deterrent to innovation. 2. Similarly, beware of defaulting to “following up.” If product meetings are on a weekly cadence, every time you do this, you are allocating seven days to a task that might only need two. We try to avoid this and promote a sense of urgency, which is essential for innovative ideas to turn into successes. 3. Figure out the right incentive. Most product orgs reward team members whose ideas have measurable business impact, which works in most contexts. But once you’ve found product-market fit, it is often easiest to generate impact through smaller wins. So, naturally, if your org tends to only reward impact, you have effectively incentivized constant optimization of existing features instead of innovation. In the short term things will look great, but over time your product becomes stale. I try to show my teams that we value and reward bigger ideas. If someone sticks their neck out on a new concept, we should highlight that—even if it didn’t pan out. Big swings should be celebrated, even if we didn’t win, because there are valuable learnings there. 4. Look for innovative thinkers with a history of zero-to-one feature work. There are lots of amazing product managers out there, but not many focus on new problem domains. If a PM has created something new from scratch and done it well, that’s a good sign. An even better sign: if they show excitement about and gravitate toward that kind of work. If that sounds like you—if you’re a product manager who wants to think big picture and try out big ideas in a fast-paced environment with a stellar mission—we want you on our team. We’re hiring a Director of Product Management: https://lnkd.in/dQnWqmDZ #productthoughts #innovation #productmanagement #zerotoone

Trucking has razor thin margins. Many don’t make a nickel on a dollar. Less than a 5% margin is not that good.  Some business minds would stay away from it. Every cost increase matters. And they keep coming.  Insurance, parts, maintenance, fuel, salaries, equipment.  Even money is more expensive than it was before. Increased interest rates make financing tough. When I was a kid, my dad would say,: “this is a pennies business.” I’m starting to get it. Carriers need to control costs.  To control, they must understand.  I’m no expert here, but I see who’s successful. They build networks.  They invest strategically.  They measure everything. They take planning seriously.  They participate in peer groups.  They work directly with shippers. They keep their driver turnover low.  They have a good fuel card program. They are intentional about fuel efficiency.  They are deliberate in their customer service.  They follow and participate in industry research:  American Transportation Research Institute They are in trade organizations that make them better.  Groups like the Truckload Carriers Association (TCA) Many carriers that make money are old companies, multi-generational. They have, in some ways, figured it out.  In other ways, they’re still working on it.  Great fleets are continually improving. They can make money and stay alive. #trucking #profitability #business

In the seniors housing and care industry’s current state, supply is not going to meet demand any time soon. The need for our services is growing quickly, fueled by the demographics of an aging society. The cost of building new communities and providing the services is growing quickly, too, as construction remains expensive and labor scarce. The product is unaffordable for many now, and unlikely to become more affordable as-is. It’s easy to look at the situation and get discouraged when it comes to how we will meet escalating demand. Instead, I like to point out that this moment is made-to-order for innovation. It’s the perfect time to figure out new ways of delivering our services and trying new models. Tim Regan’s recent piece in Senior Housing News (https://lnkd.in/e6yQMfvQ) did a good job of explaining why we’re where we are now. By 2030, the youngest Baby Boomers will be 65 years old. We don’t have enough senior housing now, and to meet the need in five years, a lot of construction needs to start now. “While the cost of capital has improved slightly since last year, many projects still don’t pencil out,” NIC Senior Principal Omar Zahraoui told Regan, “and the floodgates for new development are unlikely to open in the next 12 months.” Regan’s piece touches on tariffs, too, which could increase costs further, as well as the large number of promised deportations, which could make labor harder to find and more expensive. It’s clear that we can’t just sit and wait for conditions to improve. We’ve got to innovate, figuring out new ways of delivering more for less. The needs are too great and the costs are too high to just stick with one fixed model. Instead, we need models that are scalable, in several different categories: 👉Middle-market models that wrap around supportive services 👉“Active adult” models that focus on lifestyle, wellness and health span 👉Community-based models organized around wellness clubs, membership programs and "PACE-like" services 👉Models in which our services are delivered into the home. For the senior housing and care industry to meet the needs of a rapidly growing population of older adults, it has to morph into something beyond just a bricks-and-mortar solution. The companies that figure out more innovative ways of reaching more people with the services they need — and in ways that they can both access them and afford them — are going to be huge winners in the future. To the extent the industry does not seize this opportunity, outside disruptors and innovators surely will. 

"We have the tools, the people, and the frameworks… so why are we still struggling?", said one CIO at a manufacturing company. A CIO recently asked me this while reviewing their security operations. On paper, everything looked great, 24/7 SOC, IAM policies in place, compliance boxes checked. But when we looked deeper, gaps started to emerge: 🔹 Security Ops struggling to meet MTTD/MTTR targets 🔹 IAM leaving orphaned accounts unchecked 🔹 GRC fighting audits instead of preventing issues 🔹 AppSec focusing on code security but missing third-party risks The issue wasn’t effort, it was misalignment between strategy, execution, and measurement. Every security function under a CISO needs clear KPIs, accountability, and alignment with frameworks like NIST CSF, ISO 27001, and PCI DSS to drive real impact. We put together a structured breakdown of what’s expected from each security department, how they should measure success and continuously improve. What did we miss? Any insights? #CISO #CIO #SOC #GRC #SIEM #ZeroTrust #Governance #SecurityStrategy

𝗖𝗠𝗢’𝘀 𝗣𝗲𝗿𝘀𝗽𝗲𝗰𝘁𝗶𝘃𝗲: 𝗖𝗮𝗻 𝗖𝗣𝗚 𝗯𝗿𝗮𝗻𝗱𝘀 𝗽𝗿𝗼𝘁𝗲𝗰𝘁 𝗺𝗮𝗿𝗴𝗶𝗻𝘀 𝗶𝗻 𝘁𝗵𝗲 𝗻𝗲𝘄 𝘁𝗿𝗮𝗱𝗲 𝗿𝗲𝗮𝗹𝗶𝘁𝘆? (Welcome to 2nd Trump Tariffs Era) Tariffs are back, and they are hitting the bottom line harder than ever. With new trade barriers on China, Canada, and Mexico, CPG brands face a triple threat: rising costs, shrinking consumer demand, and disrupted supply chains. But here’s my question: Are we playing defense, or are we strategically pivoting? From what I can see, data tells us a clear story. Historically, high tariffs = lower trade competitiveness. Let's take a look at the U.S. Average Tariff Rates (1821-2016) and trade balance trends: ✅ When tariffs were high (pre-1940s), trade was limited, and the U.S. maintained a surplus. ✅ Post-1945, lower tariffs (via GATT & WTO) fueled economic expansion and trade growth. ❌ After the 1971 Bretton Woods collapse, trade deficits deepened as low tariffs persisted. 🚨 Today, reintroducing high tariffs could lead to cost-driven inflation, supply shocks, and loss of global competitiveness. ++ 𝗪𝗵𝗮𝘁 𝗧𝗵𝗶𝘀 𝗠𝗲𝗮𝗻𝘀 𝗳𝗼𝗿 𝗖𝗣𝗚𝘀 & 𝗗𝗶𝗴𝗶𝘁𝗮𝗹 𝗖𝗼𝗺𝗺𝗲𝗿𝗰𝗲 ++ - Higher Input Costs → Tariffs on raw materials (aluminum, steel, packaging) increase COGS, cutting into margins. - Consumer Price Sensitivity → Higher shelf prices = lower demand. Consumers switch to private labels, local substitutes, or DTC (Direct-to-Consumer) models. - Erosion of Market Access → Retaliatory tariffs make U.S. brands more expensive abroad, favoring European and Asian competitors. - Disrupted Global Supply Chains → Companies must rethink sourcing, warehousing, and last-mile logistics. ++ 𝗖𝗠𝗢 & 𝗖𝗙𝗢’𝘀 𝗣𝗹𝗮𝘆𝗯𝗼𝗼𝗸 𝗳𝗼𝗿 𝗡𝗮𝘃𝗶𝗴𝗮𝘁𝗶𝗻𝗴 𝗧𝗮𝗿𝗶𝗳𝗳𝘀 ++ 1️⃣Pass-Through Pricing? Be Selective. Don’t just raise prices. Instead, optimize pack sizes, value-tiered offerings, and bundling strategies to maintain affordability. 💡Data-driven pricing elasticity is key—test price sensitivity before making abrupt hikes. 2️⃣ De-Risk Your Supply Chain Nearshoring & Friendshoring → Reduce tariff exposure by shifting suppliers to Mexico, Vietnam, and Eastern Europe instead of China. 💡Dual-sourcing strategies ensure supply continuity amid trade wars. 3️⃣ Digital Commerce is the Safety Net DTC & eCommerce are the antidotes to tariff turmoil. 💡Selling via Amazon, Shopify, or localized fulfillment centers avoids tariff-heavy distribution routes. 💡Localized production + micro-fulfillment hubs = reduced cross-border shipping costs. 4️⃣ Work Capital & FX Strategy Matters More Than Ever Hedging currency risks & cash flow forecasting is critical when tariffs disrupt inventory costs. 𝗧𝗼 𝗮𝗰𝗰𝗲𝘀𝘀 𝗮𝗹𝗹 𝗼𝘂𝗿 𝗶𝗻𝘀𝗶𝗴𝗵𝘁𝘀 𝗳𝗼𝗹𝗹𝗼𝘄 ecommert® 𝗮𝗻𝗱 𝗷𝗼𝗶𝗻 𝟭𝟯,𝟱𝟬𝟬+ 𝗖𝗣𝗚, 𝗿𝗲𝘁𝗮𝗶𝗹, 𝗮𝗻𝗱 𝗠𝗮𝗿𝗧𝗲𝗰𝗵 𝗲𝘅𝗲𝗰𝘂𝘁𝗶𝘃𝗲𝘀 𝘄𝗵𝗼 𝘀𝘂𝗯𝘀𝗰𝗿𝗶𝗯𝗲𝗱 𝘁𝗼 𝗲𝗰𝗼𝗺𝗺𝗲𝗿𝘁® : 𝗖𝗣𝗚 𝗗𝗶𝗴𝗶𝘁𝗮𝗹 𝗚𝗿𝗼𝘄𝘁𝗵 𝗻𝗲𝘄𝘀𝗹𝗲𝘁𝘁𝗲𝗿. #tariffs #CPG #FMCG #CMO

It’s been a rough time for the U.S. residential #solar industry with high borrowing costs, high tariffs and lower state incentives. Now, the industry is confronting a dire threat from the GOP House tax and spending bill that will end tax credits for companies that lease panels or customers who buy them. The fate of this $20 billion market now rests in the hands of a few GOP Senators who’ve expressed support for the incentives. I got into the details with my weekend story for Bloomberg Green.

Rising interest rates, supply chain challenges, increased steel costs make offshore wind less competitive than other renewables. Indexing PPAs to inflation is a good idea, but ultimately need to find a way to make OSW competitive with other technologies, or consumers ultimately foot the increased cost. “Of all renewable energy projects, offshore wind farms may be the most vulnerable to rising interest rates as they take longer to build and have higher upfront costs. According to George Bilicic, global head of power, energy and infrastructure at Lazard, building a U.S. offshore wind farm can cost $4,000/kw at the midpoint of estimates, compared with $1,360 for onshore farms and $1,050 for solar facilities. Average costs to build an offshore wind farm have shot up 36% since 2019, compared with 5% for land-based ones, in part because of pricier debt. Offshore wind is a promising clean-power technology because it should be highly productive once the capital is invested. As the ocean is windy, the capacity factor of offshore farms—a measure of how efficiently they generate electricity—is higher than both onshore wind farms and solar power. Installing wind turbines out at sea is also less controversial than on land, so the politics should be easier, in theory.”

Every leader and company wants their teams to be innovative but they limit innovation. Do you notice any of these limiting behaviors? 🚩 Overemphasis on Short-Term Gains -> Focusing on short-term results can undermine long-term innovative projects. Balancing short-term objectives with long-term vision will inspire innovation. 🚩 Impatience with Results: Demanding immediate success can discourage experimentation and risk-taking. Innovation often requires time to develop and mature. 🚩 Micromanagement: Overly controlling every detail can limit creativity and autonomy. Innovation thrives when teams have the freedom to explore new ideas. 🚩Fear of Failure: Creating a culture where failure is punished rather than seen as a learning opportunity can stifle creativity. Embrace failures as stepping stones to success. 🚩Lack of Resources: Not providing sufficient resources, whether it’s time, funding, or tools, can hinder the innovative process. Ensure teams have what they need to experiment and innovate. 🚩 Resistance to Change: Clinging to traditional methods and being resistant to new approaches can stifle innovation. Encourage an open-minded attitude towards change and new ideas. 🚩 Lack of Diversity: Homogeneous teams may lack diverse perspectives, leading to limited ideas. Promote diversity and inclusion to foster a wider range of creative solutions. #productinnovation #productmanagement #productleadership #innovation

Another interesting article that emphasizes the evolving role of security leaders, who are no longer just the gatekeepers of IT but now play a vital role in business continuity and growth. The shift from a reactive to a proactive mindset in risk management is particularly important—anticipating issues before they become crises helps maintain stability and protects the brand. The point on collaboration between departments highlights a subtle yet crucial skill for security leaders: being a translator and mediator. Getting buy-in across departments is often as challenging as the technical side of security, and it requires diplomatic finesse to get everyone on the same page without compromising security priorities. The advice on presentations and data speaks volumes about the value of storytelling in security. By framing security proposals in a way that resonates with management, leaders can bridge the gap between technical necessity and strategic value, ensuring security measures aren’t sidelined but instead, contribute actively to the business's success. Lastly, the emphasis on patience and timing reminds us that security is a marathon, not a sprint. Proposals may not always see immediate approval, but by keeping risks on the agenda and adapting to business priorities, security leaders can steadily push for meaningful, strategic changes. It’s about adjusting the sails, not changing the destination. Key Points Cybersecurity as Business Risk: Modern security leaders must approach cybersecurity as a business risk, not merely a technical one. Collaboration Across Departments: Security leaders face challenges in getting other teams (e.g., HR, legal, operations) to prioritize and address risks, requiring strong interpersonal skills, communication, and support from senior management. Senior Management Involvement: Gaining management and board support is essential for effective risk management. Security leaders should regularly inform them of risks and incidents to secure necessary resources and prioritize action. Aligning with Business Goals: Security must support growth while managing risks aligned with company goals. Leaders need to translate technical security needs into business strategies that resonate with management. Understanding Risk Appetite: Knowing the company's acceptable risk levels helps align security measures with management’s decisions on balancing risks and opportunities. Data-Driven Communication: In presentations, use data, evidence, and case studies from similar industries to build a compelling, relatable case for security proposals. Empathy and Persuasion: Emotional intelligence and persuasive communication can foster trust and influence decision-makers. Strategic Presentations: Keep presentations concise, visually engaging, and focused on strategic calls to action. Patience and Timing: Proposals should align with current business priorities, requiring patience and adaptability to navigate approval processes.