Let's Get Down to Business...

What really happened during the past 200 years?

Competing in a global economy starts with understanding its context. And context involves understanding how it got to be this way.

Hans Rosling is a Swedish intellectual who thinks about big questions on a grand scale. He's investigated what's happened over the past 200 years to global wealth and health.

Rather than eye-straining rows and columns of minuscule numbers, he presents his findings with the visual excitement of a rock concert. Watch this video several times and consider all its implications.

First is the idea that the US is "falling behind" the rest of world. Another way to look at this question is to ask, "How long has the US 'led' the world?" And if the US is to be a "leader," does it want to rank highest in per-capita income, life-span or values or something else?

Finally, what about the debate that the "middle class" is in decline. In a global perspective, is the "middle class" in decline? If the middle class has discretionary income to spend on education, for example, does the changing relationships of global wealth and health suggest the middle class will soon be extinct?

How's this Globalization thing working out?

Take a break and enjoy this "clarification" on the state of the world's financial affairs.  Thanks to Greg Mankiw and Tim Phillips.

On the continuation page is another, more serious, explainer of the European Debt Crisis from the New York Times.  As you learn about the problem's symptoms (too much debt, too much spending, too little discipline, etc.), consider also whether the organizational strategy is right.  Were all the "what if?" questions asked?

The "Efficient Grease" Hypothesis

On the continuation page is an article from the April 29, 2010 issue of The Economist.  It asks whether there's a positive return on investing in a bribe.  Do a few dollars or euros discretely slid into the hand of a flinty-eyed bureaucrat get things done?  Or does it just open to the door to more haggling and delay?

Or does it make more sense to invest in a "good reputation?"  Is that a source of "positive" competitive advantage?  In a digitized age where anonymity is protected, how do you get and keep a good reputation?  Enjoy.

How do we do the "Right Thing?"

Maybe it's just my sensitivity to the subject, but some days it seems like no business can operate ethically and every headline exposes some "new" and more unseemly behavior.

Why can't our businesses behave the way they should?

An easy question to ask - and one that certainly should be frequently asked - but thinking about how to answer it leads to more confusion and frustration.

Who decides whether a behavior is good or bad? Who's the "they?" How do you define a "good" behavior versus a "bad" behavior? Are all "good" behaviors always "good" or are they sometimes "not-so-good?"

Our usual response is for Congress to enact a new law, regulation or rule, proclaiming, "This will fix the problem and make businesses behave the way they should."

This usually lasts just long enough for the lawyers (and business managers) to find some loopholes and ambiguities big enough for truckloads of even worse behaviors.

How do we do the "right thing?" Is the right thing following every rule or is it making wise choices? Here's a short lecture by a scholar of psychology and economics (do they go together?) about how choices get made and could get made in our modern society. Enjoy.

Keeping Score

I assume you will also be responsible for tracking the points you earn during the course. 

This Blog doesn't have a mechanism that allows individually secure access.  So I can't post your scores here.

Likewise, we don't use the University's on-line system because it isn't reliable (remember a couple of terms ago when it crashed and mountains of data vanished).

But that doesn't mean you can't, and shouldn't, check in to make sure our score cards match up.  Do that by simply sending an email asking for a status check.  As Reagan said to Grobachev, "Trust, but Verify."

Keep smiling.

Download Problems? Try This...

This Blog and its files and links has grown up with several versions of Microsoft Office, IE and, occasionally, some contributions made with Firefox.

Some files are compressed ('zipped') while others date from the good-old days when a Word file was just that and no more.

So, if things aren't working for you (or you're using an Apple product), try this little workaround.

Instead of opening a file's link, save it instead.  And save it on your desktop so it's easy to find.

Then, using your object program (probably Word or Excel), open the file you've saved on your Desktop.

Doing it this way always works for me whenever I hit a similar problem.  Good luck.

 

Templates for your Marketing Analysis

Figuring out how to organize and present your analysis is often more than half the job.

The Market Feasibility/Viability analysis of your Strategic Concept submission boils down to three questions.

1. How is our product/service different in ways that will matter to our customers?
2. Who are our customers and why do we think they'll want to buy (and keep buying) our product/service?
3. How will we communicate with our customers and distribute information that will help them buy and use our product/service (and want to keep on buying it).

Check out the templates in the link below as one way to organize your answers to these questions.

You don't have to use them but they're great for being certain you're asking the right questions, presenting the information in a useful way and explaining why your product/service delivers the most value for the buck.

Each table's cells should resize as you enter information.  When you finish though, you might need to make some manual adjustments so your finished product looks like a Gold-medal Winner.

Technical Note:  If the templates don't automatically open after downloading, try saving them as a "Save As" file on your Desktop (it should download as a compressed or "Zip" file).   Next, using your Word program, open the "Zip" file. 

Download Templates for Competitive Advantage Analysis

If You Can't Beat Them, Then Beat Them

Wal-Mart grew to be a retailing behemoth as a Price Competitor. "Always Low Prices" was their mantra for 19 years.

Three years ago, they began re-positioning themselves with a new slogan, "Save Money. Live Better." New advertising messages were rolled out portraying a warmer, family-friendly Wal-Mart. No more Smiley-Faces slashing prices in every aisle.

The idea was to appeal to a "middle-class" market segment who wanted more fashionable merchandise and lower prices due to the recession.

Guess what? Wal-Mart got it wrong. The strategy didn't work. It alienated their core customer base who wanted "everyday low prices."

To regroup, Wal-Mart is doing more than just returning to their roots. They're launching a massive, multi-billion dollar strategy that could re-make the face of retailing.

As you'll read in this Wall Street Journal Story [Download Wal-Mart sees Small Stores in Big Cities], there's a new Wal-Mart coming to town. No more big-box stores (typically about 185,000 square feet (over 4 acres) under one roof). Instead, they'll be "Neighborhood Markets" ranging in size from 30,000 to 60,000 square feet or only about a quarter of the size of a "Super Center."

For years, Portland effectively blocked big-box stores, forcing Wal-Mart, Target and others into existing buildings. Wal-Mart plans to work around this roadblock by building more, smaller stores (a typical grocery store is about 45,000 square feet in area) rather than a few, huge stores.

To do this, they'll spend about $7.5 to $8 Billion a year for the next few years. By comparision, the annual General Fund budget for the State of Oregon is about $7 Billion. And, unlke the State, Wal-Mart has that much cash, and more, in their bank account.

Keep an eye on this. It could the biggest brand re-positioning/strategic shift in retailing history.

How Big is "Too Big" in the "Too Big to Fail" Debate?

Most of the Financial Reform debate has focused on what should we do when (not if) a financial banking behemoth fails.

It's argued that something will need to be done because doing nothing risks "systemic failure," which is something so bad that the entire economy might fail unless something is done.

Is that the right question? What about asking instead, "How big is 'too big'?" Why do we need financial institutions so big that they might drag down the entire economy if they fail?

What's the "right size" for banks? Shouldn't they be only big enough to serve their local economy without risking the national economy if they fail? But what's a "local economy?"

Answering those questions isn't easy. It requires first understanding the boundaries of a "local economy." Do we really need "global" financial institutions? Don't banks have to be bigger than the neighborhood coffee shop in order to have the financial clout to make something happen? What is that "right size?"

Here's a video that uses some fancy algorithms to give you a peek at how to answer those questions. Enjoy.

Important Dates and Deadlines

Our course may have a "Wait List." 

One of the most valuable aspects of getting your business education at PSU is small class sizes.  If you were attending Harvard and enrolled in their introductory economics course, the lecture hall would be filled with nearly 900 other students. 

At PSU's Business School, maximum class sizes usually have between 45 and 60 of the best and brightest students in the land.  And I'm stricter-than-most when enforcing that guideline, to the chagrin of the students who don't make the cut. 

We'll reconcile the course's membership during our first meeting and then "true it up" on the following Thursday.  If you're on the Wait List, show up on the first day and see what happens.  If you're not on the Wait List or show up after the course's first session, don't expect to get into the course.

Check the University's website to know the last day you can drop the course without incurring a financial penalty.   Drop the course after that date and you'll get a decreasing amount back.  And the longer you wait, the smaller the refund. The percentage of your hard-earned tuition dollars that will be refunded decreases until a date certain.  After that date, all the money you've paid belongs to the University. 

Good luck.