(book review) Starbucked

Starbucked: A Double Tall Tale of Caffeine, Commerce and Culture by Taylor Clark
(Little, Brown and Company, NY-USA, 2007)

For all you coffee lovers out there and the rest of you, Taylor Clark has written this fun piece of Starbuck's birth, its growth and its journey that will educate and humour you at the same time.

The first part of the book talks about how Starbucks changed economics of the coffee industry. It talks about the history of coffee and the culture surrounding it. The second part contains discussion around the controversies surrounding Starbucks. The criticism points how Starbucks has homogenized the planet, destroyed cultural diversity within its stores, killed the local coffee houses and how they have underpaid the farmers. This author has managed to maintain a good balance of the positive and negative aspects of the company. Overall, its a great research and analysis on the impact that Starbucks has on all our lives.

With my background, I enjoyed reading how they developed their brand, the history of the Mermaid logo and how it evolved. I liked to learn about their approach to retail design and the impact it has on the customers. Clark's research and his journalistic style of writing appealed to me. I encountered this same (journalistic) style of writing with Sarah Lacy's book (review below) and seem to enjoy it.

Even though I found it hard to separate Howard Schultz from Starbucks throughout the book, I still have an appetite for more. The next book I want to read now is Onward: How Starbucks Fought for its Life without losing its Soul by Howard Schultz.

Crowd-funding is here to stay!

Seth Godin made big waves earlier this year when he announced the crowd-funding campaign for his new book. He reached his $40,000 target in barely a few hours and passed way ahead of the set goal. Even though crowd-funding as a concept is not really new, the last few years have shown a spurt in the adoption of this concept.

Last month, I was in the beginning stages of writing a strategic plan for Kiva.org and was interviewing Matt Flannery for deeper insights on the business model. Kiva is the world's first and the largest person-to-person micro-lending website and has helped over 800,000 people through small loans from lenders. Since Kiva, a number of other philanthropic organizations have taken up crowd-funding as a way to collect larger amounts of money to help their causes.

Crowd-funding solves the problem of access to money by tapping into individuals for small amounts of investment rather than venture capitalists or banks for a huge amount. The ability for everyone to invest in projects anywhere in the world via the internet, with as big or as small an amount will open up opportunities that we never imagined. We are already seeing some great start-ups in this field such as Kickstarter.com, Crowdrise.com and Quirky.com to name just a few.
   
Crowd-funding is still in its toddler years. The concept has had a great burst of adoption in the last few years. But, with the number of people, businesses and organizations running to get a piece of the cake, its not long before we'll see the space with just too many choices. On the other hand, as more organizations keep on pouring in, some of the current problems will get more attention; which means we will have more sustainability, accountability and traceability in the future.

(book review) Brilliant, Crazy, Cocky: How the top 1% of Entrepreneurs profit from Global Chaos

Brilliant, Crazy, Cocky: How the top 1% of Entrepreneurs profit from Global Chaos by Sarah Lacy

John Wiley & Sons, New Jersey-USA, 2011

I started reading this book when I did not know who Sarah Lacy was or what the book might contain. The only thing that really made me pick the book was second half of the title - 'How the top 1% of Entrepreneurs profit from Global Chaos' . I was not convinced that anyone could actually accomplish such a humongous goal in just a couple of hundred pages. But, Sarah Lacy has done an amazing job.

She traveled to places like Brazil, India, China, Israel, Indonesia and Rwanda to explore how entrepreneurs, despite of challenging situations have made a whole lot of difference in their worlds. She has written about real stories she experienced, real people she met and entrepreneurs she interviewed. Lacy further goes to explore how some of these people created solutions to better their (unique) difficult situations. And some of them are set to change the world. The following excerpt from the book is mentions some of the entrepreneurs she talks about in detail:

“So, too, is the high-growth entrepreneurship wave sweeping the developing world about more than just cash and stock options. Marco Gomes wants anyone in Brazil to make money using the Internet. Xu Xiong wants a way for anyone in China to get a driver's liscence without paying bribes. Ravi Ghate and Rajiv Mehrotra want to connect India's villages to lifesaving information. Martha Tilaar wants every Muslim woman to feel beautiful. And Jean Dieu Kagabo wants his once-decimated nation to stand on it own two feet, consuming its own products and creating its own jobs.”

While she talks about the how entrepreneurs in the developing world are solving real problems, she talks about why Silicon Valley may lose the edge in the future:

“...in Silicon Valley, VCs hem and haw over investing in a company like Facebook at too high of a valuation, because they can't immediately determine how they'll double their money. This is the curse of short-term thinking. It's not risk-based investing if you can see an exit before you do the deal. Or as legendary venture capitalist Vinod Khosla sums up his industry's sad evolution: “There's too much capital and not enough venture.”

I enjoyed the ethnographic research throughout this book. It is not an easy task to just travel to 11 different countries and understand minute details of people's cultures, beliefs, actions, their situations and put in detailed descriptions of how and why the people act the way the act.

I read this book almost a year after it was published. Even if I am late, I wanted to write this review for all the others who might have missed it.

(book review) War In The BoardRoom

War in the Boardroom: Why Left-Brain Management and Right-Brain Marketing Don't See Eye-to-Eye -- and What to Do About It  by Al Ries and Laura Ries

(HarperCollins, NY-USA, 2009)

"You win by creating better brands" is the message I took away from this book. Al Ries talks about the differences between left-brained management and right-brained marketing and how rift between the two causes problems. Thats 'war in the boardroom'. The war is caused due to difference in the approaches of left and right brained thinkers - Management is logical whereas marketing is creative. Management or the numerical mind goes with a expansion approach to build a business, to create a product. But creative people look for a focused message - You need to contract in order to build a brand, you need to develop a perception. This difference in thinking causes a rift between the two. The book explains why money alone is not enough to build a brand. The authors finally provides a few hints on how to find a middle ground between the right brained managers and the left brained artists. It demonstrates how both kinds of people are important for a business to succeed.

The book gives some recent and interesting examples - I enjoyed reading through them and realting to each story. It talks about why brands like Harley Davidson, Starbucks, Heinz dominate the market while others fail. Strong brands do not focus on everyhing they can do, they focus on their strengths and dominate it. I liked the FedEx story about how the brand lost millions of dollars in its initial years until they found an area to focus on. Once they focused on their core strength (overnight deliveries), they just took off. The fun part is that they never closed any of their other services - but they became the best overnight delivery business and created a strong perception. That is what great brands do.

Overall, the book is a easy read. I would recommend the book to both sides - left brainers and the right brainers :)

(book review) Free: The Future of a Radical Price

Free: The future of a radical price by Chris Anderson

(Hyperion, NY-USA, 2009)

Chris Anderson talks about how marketing has evolved in the 21st century and how companies like Google, Facebook and the likes succeed by giving out their products for free. Anderson talks about how companies create great customer relationships by giving out free products. These relationships then help them in earning money at a later point. 

As we switch to the digital era, we are chaging the actual economics of charging for products. As we know, the cost of production for digital products is close to zero. Thus by the laws of economics, the price of the products should fall to zero as well. That is how 'bits' based company give out their products for free. In the bits world, every year producing products gets cheaper because most of the human jobs get replaced by algorithms. It reduces a major part of the production price.

The question this book attempts to answer is how companies make money from the power of "Free"? An interesting question with a number of interesting stories. Overall, a good read. I would recommend it to any one planning to start or wanting to suceed in a 'bits' business and business students.

My team's stints @ the International Business Simulation Competition and our presentation at Netflix HQ

Last month was filled with hard-work and passion. I was involved in two events that made Lucas GSB proud. 

The first event was the 48th International Collegiate Business Strategy Competition - We got a second place in overall performance. I was the CEO of our company - Chronolife. We were a team of 6 people. This was a 4 month long event culminating with a 3 day intensive phase at UC Long Beach. There were schools from US and Canada and we made it to the top, beating some of the premier business schools.

The second event was a competition to come up with strategic solutions for Netflix's current situation. Netflix invited winning teams from Lucas GSB to present at their Los Gatos HQ. I was a part of one of the winning teams - We presented our ideas to some of the Netflix executives. It was a high point for all of us.

I wanted to share these articles from our Associate Dean's blog. It has some pictures from these events. Have a look:

http://lucasgsb.blogspot.com/2012/04/mba-teams-shine-at-netflix.html

http://lucasgsb.blogspot.com/2012/04/lucas-cleans-up-again-at-business.html

(book review) Wikinomics

Wikinomics: How Mass Collaboration Changes Everything by Don Tapscott and Anthony Williams
Portfolio - USA, 2006
 
The book is written by Don Tapscott (named as one of the most influential management thinkers by Thinkers50) and Anthony Williams. Wikinomics directs one towards thinking the enormous oppotunities Web 2.0 has to offer. It focuses on empowered consumers of today (prosumers) who produce and consume services and prodcuts of a company. The main themes/ ideas discussed are innovation throguh open source, sharing, peering and ideagoras. The book continually reminded me of how Linux OS came into being. (They have a discussion about it in the book as well).

I enjoyed reading how various companies succeeded using crowd-sourcing as a strategy and the possibilities opensourcing has to develop cutting edge services. Tapscott and Williams take examples from successful companies like Google, Apple, P&G and more. I personally like how they quote Eric Schmidt in their book -

Google CEO Eric Schmidt told us he hadn't had a product idea in years. “Virtually all of the product ideas in Google,” he says, “come from the 20% of the time employees work on their own projects.”pp260

Its not only external innovation they talk about, but it is also how companies work their way up through internal openness. One point that stood out was collaboration between competitors - an area less talked about.

The book would have been even better if it had a step by step approach on how those companies implemented crowdsourcing. It is educating to read how corporations have used the power of Wikis, Social Networking sites, You-tube or Flickr to mass collaborate and innovate. The book also lacked stories on how companies can/ have gone wrong using these techniques - Wish there was more disciusion on 'pitfalls' of crowd-sourcing.

They also have a website: http://www.wikinomics.com/blog/
I can't wait to read the new book Macrowikinomics by the same authors.

(Ruta Writes...)...Artisan Leadership: Why it is relevant today.

Excellence & creating value are always at the core of a successful business. A leader with an artisan attitude has a holistic view of his work – he not only works on the  practicalities of his job but also on the softer side of his output. He pays complete attention to detail and pushes himself and his work towards excellence.

An artisan knows how to Balance Practical and Aesthetic Quality Standards. He has a passion for his work and passion, cannot be taught. Its either there or its not. You just can not have passion and still be disciplined and dedicated towards your work. That is the reason why the 20% off time in Google works to the company's and to the employees advantage. Google encourages its employees to use 20% of their weekly time (i.e. one day per week) to work on a project they feel passionate about. Not surprisingly, most of the innovations and most of the successful projects come from this 20%. This is because, the employees use this time to do something they feel passionate about.

'Balancing practical and aesthetic quality standards' is not a unidimensional skill.  To be a successful leader in a multidimensional skill, one needs to develop himself as a 'T-shaped individual' as popularized by McKinsey & Co. The vertical axis is the area of expertise for the individual. This is the area he needs to have deep knowledge to make any valuable (traditional/ practical) contributions to the organization. The horizontal axis is where the person develops his soft skills – for example, his aesthetic sense. The business skills I get from my MBA program is going to be the vertical axis of my T. Developing other skills is going to be the real challenge.

Another thing to look at would be how the industry is changing today. Many of the older business models from yesteryears are being rendered meaningless. Today's companies are built around the notion of 'innovation'. All the mundane tasks are usually outsourced to save money. Hence, companies require people from varied backgrounds – Engineers with marketing expertise or architects with finance education. Such individuals are at the edge of innovation. This is a T-shaped individual who can balance practical and aesthetic standards. Today's successful companies do not just make MP3 players, they make iPods. They make things that
not only serve the purpose but things that also add a emotional value. Today, a well established company like Nestle` is using an in-house design methodology to tap into consumer emotions through packaging. The methodology is based on a Japanese technique called Kansei. The technique, mainly popular in the automobile industry focuses on the consumer emotions and feelings as a primary source of design inspiration and translates them into products.  Why does a company do that when it already is selling it products really well? Because, the industry is changing. The consumers are changing. Its not just about the products anymore. Its about the added soft value. This can only be understood and achieved by such employees who can balance practical and aesthetic quality standards.

No education or studies of any sort ever goes waste. They might not come in handy right away, but they will help some day.