Look ahead and reason back

Tractor manufacturers are trying to lock farmers into getting repairs from their dealers. (WSJ, March 2021) One question is, "Were the manufacturers hoping to use Barbie doll pricing?"

This article finds that right to repair legislation can result in a lose-lose-lose outcome.

1. Consumers may lose because manufacturers increase the price of the tractor when the link between tractor sales and revenues from repairs decreases. 
2. Producers may lose because the increase in the price of tractors fails to offset the lose of revenue from repairs. 
3. The environment may also lose.

Barbie doll pricing for printers

Planet Money (Feb. 2021) describes how companies charge low prices for printers to sell high-price ink and make substituting third-party ink difficult.

Is this an example of 1st degree price discrimination?

"When a woman gets a caesarean section at the gleaming new Van Ness location of Sutter Health’s California Pacific Medical Center, the price might be $6,241. Or $29,257. Or $38,264. It could even go as high as $60,584.

"The rate the hospital charges depends on the insurance plan covering the birth. At the bottom end of the scale is a local health plan that serves largely Medicaid recipients. At the top are prices for women whose plans don’t have the San Francisco hospital in their insurers’ network" (WSJ, Feb. 2021).

Should NASDEQ require diversity on boards of directors?

Arthur Levitt, former chairman of the SEC, says the SEC should investigate to determine what benefit, if any exists (WSJ, Jan. 2020). Here is a money quote.

"The most powerful argument for board diversity is that diversity is a social good. The most powerful argument against a board diversity requirement is that if it were manifestly good for companies, there would be no need for it in the first place. Successful companies can’t keep secrets quiet for long; if one could reliably increase its market capitalization by, say, 5% through the appointment of a diverse board, every company on Nasdaq would already meet that standard.

"The problem of board diversity is compounded by the nomination process. Searches for directors are formally structured, but in the end they depend on informal social networks where friends recommend each other. In my experience, many such searches are closer to a social-club recruitment process than a serious contemplation of someone’s task-specific skills. And as has been shown by the National Football League’s Rooney Rule, which since 2003 has required that teams interview at least one ethnic-minority candidate for all head-coaching positions, formal requirements for effort don’t necessarily lead to results.

"Since neither Nasdaq nor the SEC can reliably say that more diverse boards produce better results than homogeneous ones, the SEC should lead."

Trends in which activities beauty firms perform internally

"Historically, big beauty companies have been in charge of their own manufacturing, formulations and distribution, while relying on advertising agencies to market their products and retailers to sell them. But a generation of beauty startups, including Kylie Cosmetics, is upending that formula, selling directly to consumers and relying on social media for marketing, while farming out production and distribution to third parties."

Kylie Cosmetics generates  "$200 million in annual revenue with fewer than a dozen employees and virtually no ad spending."

WSJ, Jan. 2021.

HBR on Strategy

 Casadesus-Masanell, Ramon. 2014. Introduction to Strategy. HBR

Casadesus-Masanell, Ramon. 2014. Industry Analysis. HBR

ebiz

Marchand, Donald A., and Joe Peppard. 2013. Why IT Fumbles Analytics. HBR
Focus on information rather than technology.

Carr, Nicholas G. 2003. IT Doesn't Matter. HBR
IT is a commodity -> spend less, follow rather than lead, and focus on risks rather than opportunities.

Davenport, Thomas H. 2006. Competing on Analystics. HBR
Become an analytics competitor to differentiate yourself.

McAfee, Andrew, and Erik Brynjolfsson. 2008. Investing in the IT that Makes a Competitive Difference. HBR
IT -> more concentration and more turbulent. To thrive firms need to deploy, innovate, and propagate.