Tuesday, March 17, 2020

This opinion has good advice for firms who want to have employees work remotely (WSJ, March 2020). Here is a money quote.

"In a world we anticipate, a world where work never really returns to the office, the most important factors for success will be ample trust, mutually agreed-upon norms, good communication and a strong and validating work culture.


"Technical collaboration tools are important too, but not nearly as vital as a good foundation. It might seem daunting to build that foundation on the fly, as we are (sometimes literally) changing the way we work overnight. But a great deal of it is transferable. Every office, physical or otherwise, runs more smoothly when lines of communication are open, when guidelines and rules are clear. Now, we will need to be that much more explicit about articulating those norms."

Monday, March 16, 2020

Use A/B testing to learn about your consumers


A review of two books touts the benefits of A/B testing (WSJ, March 2020). The focus of the books is on the best way to design the consumer's online experience. A/B testing can also be used to test product features and pricing.

Saturday, March 7, 2020

Auto manufactures are integrating vertically to produce electric cars

"In a slick investor presentation Wednesday, Ms. Barra made the case why investing in batteries made financial sense: More control over the supply chain would give GM leverage to push battery costs down to a level that would make electric vehicles both attractive to consumers and profitable.

"As Tesla’s market value has rocketed, the question of whether consumers are ready to buy electric cars has given way to whether manufacturers are ready to make them. More industry leaders are concluding that the only way is to embrace a form of vertical integration that has been out of fashion for decades" (WSJ, March 2020).

Several questions come to mind.

  1. Would investing in tires give GM leverage to push tire costs down? If so, should GM invest in tire production? In rubber plantations? 
  2. GM must think that the answers to Q1 are "No". GM does not produce tires and has not announced plans to do so. What makes batteries a good investment but not tires?  

Friday, March 6, 2020

The Internet is a scary place

"Price customization" is common on the Internet (FindLaw, June 2005).
Here is a short history of pricing and how the internet is opening up new avenues for firms to follow to increase price discrimination and profit (The Atlantic, May 2017).