Book reviews

This article is from Business in Vancouver June 28-July 4, 2011; issue 1131

Priceless: The Myth of Fair Value (And How to Take Advantage of It)

by William Poundstone

Hill & Wang (Farrar, Straus, Giroux), 2011

Poundstone’s book will interest consumers making basic buying decisions, along with managers, price consultants or marketers. Page after page is filled with interesting and often amusing experiments conducted over the years to assess how our perceived values affect price, how price decisions are made by consumers and how choices are made when influenced by a number of accompanying factors (peer pressure, gender).

Today, there is a symbiosis between psychologists and pricing consultants. Psychologists know you can get people to believe almost anything with a sleight of hand. Consider the average jar of peanut butter. How do we choose? Do we know that the producer has cleverly changed the product to appear the same as before, yet there is actually less of the product due to the indentation in the bottom of the jar? Studies show that the average consumer perceives the product to be the same, and a buying decision is made – even though the value is less than before.

Simon-Kucher & Partners (or SKP, a German-based company considered the “rocket scientist” of pricing) routinely employs “psychophysics,” an offshoot of psychology. To SKP, prices are the most pervasive of the hidden persuaders. The same psychological tricks apply whether you’re setting a price for text messages or toilet paper.

There is a chapter dedicated to Internet purchases and what influences them. Consumers are now armed with Internet “research,” so companies and businesses are finding they must adapt and challenge the buyer’s information (Consumer Reports is wrong, the Internet is wrong – gasp! – or the buyer’s math is wrong). Buyers beware, indeed!

The chocolate experiments conducted by Christopher Hsee and Jiao Zhang best illustrate, for me, one of the book’s key principles. Chinese university students had to choose between two options:

• recall and write down a failure in their lives while eating a large Dove chocolate;

• recall and write down a success in their lives while eating a small Dove chocolate.

Sixty-five per cent chose the bigger chocolate. Hsee and Zhang see their experiment as a “microcosm of life,” or a life lesson, if you will.

Money (or price) is the “bittersweet chocolate” of contemporary existence. We spend our lives searching for the lowest price or the highest salary, numbers by which to validate our happiness. You would be well-advised to take this book’s lessons to heart – and it wouldn’t hurt to take it shopping with you either!

Donna Kaye is an assistant trade buyer at UBC Bookstore.

Aerotropolis: The Way We’ll Live Next

By Greg Lindsay and John Kasarda

Viking Canada, 2011

As nations shift from port cultures to airport cultures, Aerotropolis re-imagines the cities of the future. Lindsay, a business journalist, brings his considerable skill to the task of highlighting Kasarda’s urban theories. This book looks at the impact of air transport, whether for goods or people, on urban planning. Using London and Los Angeles as examples, Lindsay and Kasarda show how a crowded airport can lead to a loss when cargo planes seek easy distribution of their wares. They are cheerleaders for Kasarda’s concept of urban design and tend to dismiss any critics – which makes their conclusions flawed, but no less fascinating or important.

Treena Chambers is the marketing technology co-ordinator at UBC Bookstore.

Comebacks at Work: Using Conversation to Master Confrontation

By Kathleen Kelley Reardon and Christopher T. Noblet

Harper, 2010

This book should be used with a degree of caution. Some of the comeback examples relate to situations of extreme confrontation or affront, when a strong response is needed. We’ve all had conversations that went wrong, with people we detest, but I could not see myself saying, “I’m going to count to two and you’d better be out of my face” – in the workplace or elsewhere.

However, there are times when strong words are needed, and this book helps readers build a vocabulary to respond to bullying, lower the emotional level of a conversation, soften a message and avoid being tongue-tied when confrontation occurs.

Reardon, a professor at University of Southern California’s Marshall School of Business, provides readers with a toolbox to help move conversations in positive ways and help practitioners avoid feeling regretful after a confrontation has occurred.

Chapter 5 (“Overcoming comeback brain freeze”) discusses why the brain freezes under attack and why appropriate and witty comebacks are hard for some of us to find. Fear of social rejection or exclusion may cause psychological and physical responses that temporarily shut down the brain.

Or an attack can come out of the blue so surprisingly that it renders the recipient speechless.The heart-pounding, brain-freeze habit can be broken by developing and practising a comeback repertoire.

Chapter 8 (“When conflict is inevitable”) discusses when to walk away – useful at work and outside the workplace. And not only when to walk – how to use body language to convey a response. One business attorney eyeballs opponents, but not by looking into their eyes. He glares at the bridge of their nose, giving the impression of staring and causing them to look down. This often moves the negotiation along faster than a verbal response.

I didn’t locate all the answers I looked for in this book, but I did find some. For the colleague who declaims in a meeting, “Can we form a planning team that’s actually effective in these situations?” it helps to be ready with, “Can you tell me more about what you just said?” rather than replying, “We DO have a good planning team.”

With a more Machiavellian attack such as, “I’m hearing negative comments from colleagues about the lack of communication on your project,” Reardon’s technique of agreeing with the attacker could lead to, “You’re right, we haven’t told the world about X yet, because we are working very hard on Y, and are concentrating on communicating it first.”

Sometimes Winston Churchill’s words are the best advice: “Courage is what it takes to stand up and speak; courage is also what it takes to sit down and listen.”

Jan Wallace is head of the David Lam Management Research Library at UBC’s Sauder School of Business.

Book reviews

This article from Business in Vancouver May 17-23, 2011; issue 1125

Design Is How It Works: How the Smartest Companies Turn Products into Icons

By Jay Greene

Portfolio Penguin, 2010

I’ve been reading about design thinking for two or three years – it’s a current interest of business schools for revisualising teaching methods. This popular book by BusinessWeek reporter Greene profiles companies that have name-brand recognition for the average consumer – Bang & Olufsen, LEGO, REI, Porsche and others. It’s an interesting read with examples that can be applied to many business problems.

Design thinking entails more than designing an attractive shell for a product. It’s more about conceiving something new from the ground up. It requires participants to think broadly about problems, develop a deep understanding of the user experience and recognize the value of contributions from different areas of the enterprise.

A good example is LEGO’s rethink of its core construction-toy business, which nearly foundered when the company gave its designers free rein to innovate components and models for the LEGO City Line. Around 2000, LEGO designers went wild, creating futuristic and stylized toys that children disliked, while sending production costs through the roof. Designers surmised that, like Porsche owners, LEGO consumers would appreciate the stylized fire truck that looked like a moon buggy and had no room for hoses and reels. But they didn’t know seven-year-old boys.

LEGO forced its designers to talk to others throughout the company – marketing managers and manufacturing personnel. Products had to win votes from the group before they could go ahead. To ensure success, LEGO came up with a new formal design process, which the company calls the LEGO Innovation Model. Built into the model sequentially are group brainstorming, consumer research, prototyping, process and financial analysis and marketing strategy, which all help to ensure that innovation goes hand in hand with knowledge of the customer and careful analysis of relevant factors.

One of the problems I have with design thinking is the fluid nature of its definition, and the way in which proponents ascribe design thinking to vastly differing product and process examples. I get confused when Greene decries the use of market research techniques such as focus groups in favour of using designer intuition, then advocates market research in examples used throughout the book.

I’m not alone – on BusinessWeek’s website, readers weigh in with their confusion between design thinking, management thinking, process design, Six Sigma and systems thinking. However, the basic tenets of design thinking can only be beneficial to organizations trying to innovate successfully – to understand customer behaviour, form teams from a variety of disciplines, brainstorm, prototype and design innovation into the beginning, rather than the end, of the process. Seems like common-sense problem-solving to me.

Jan Wallace is head of the David Lam Management Research Library at UBC’s Sauder School of Business.

Billions of Entrepreneurs: How China and India are Reshaping Their Future and Yours

by Tarun Khanna

Harvard Business Review Press, 2011 (reissue)

Previously published in 2008, but re-issued in 2011 with a new preface, Khanna’s thesis remains strong – that China continues to be an entrepreneurial strength, complemented by India’s increasingly confident private sector, and that entrepreneurship in developing countries occurs in far more encompassing ways than in more developed nations. Entrepreneurship has truly gone global, with China and India leading the charge, each in its own way, in a process that the author feels ought to be celebrated. He chronicles “billions” of entrepreneurs in China and India seeking prosperity for themselves and for the benefit of their respective societies, but observes that so much more needs to be done, or done differently, in response to the nuances of the societies in question.

Khanna illuminates the differences between the two countries by posing questions such as, “Why can China build cities overnight (think Bird’s Nest for the Olympics) while Indians have trouble building roads?” and “Why are there so few world-class indigenous private companies from mainland China despite the creation of a juggernaut of an economy?” He observes that the different paths taken by the two countries have a profound implication. Together, they could have a stronger impact on each other and the world if they worked co-operatively instead of as inverted mirror images of each other.

Khanna also outlines the symbiotic business relationship of the two countries, always mindful of their different strengths and complementary abilities. He observes that entrepreneurs worldwide are recognizing that the strength of these two countries is not simply to sell to 1.3 billion Chinese and 1.1 billion Indians, but to 2.4 billion people.

He provides examples of the usual business-school entrepreneurs who started successful and profitable companies, but also includes “political” entrepreneurs who are figuring out ways to make good things happen with difficult constraints (China’s “Big Brother” approach to the Internet comes to mind) and “social” entrepreneurs, who apply creativity to solve problems rampant in both countries. Khanna cautions that the story of China and India requires the jettisoning of old-school thinking and images harboured by Westerners (who also come in for a bit of a scolding and are given a history review). He advises that an “open mind and a willingness to see new, productive imagery is needed” and asks for “respectful listening.”

Donna Kaye is an Assistant Trade Buyer at UBC Bookstore.

Here is LHC rap with more than 6M views on YouTube

A team of scientists is investigating the ‘usefulness of music in science and math education’, and have created a website, with the help of an NSF grant, that includes a database of songs about engineering, math and science. Sing About Science & Math: songs for teaching, learning and fun My favourites: Graphene – the Musical […]

Nechako Lakes district recently requested $1 million in loans to operate B.C.-certified schools in China.

Click here to read the full story, from Janet Steffenhagen’s blog.

 When you check in with your kid, who is now into hour three of his Halo marathon, you repeat that well-worn phrase your mother used on you about killing brain cells and trading in the controller (well, it was a joystick back in your day) for a book. A new article on PBS’s Mediashift web portal presents a different argument: our definition of literacy is outdated. Kids may be learning a “new literacy” through playing video games.

(Cross posted with Chung Collection News):

The Chung Collection Exhibition will be closed to the public on August 22, 26 and 29. We apologize for the inconvenience.

The good news is that the closure is for the completion of a special project- stay tuned in the coming months!

Aug 12

Chung Collection Exhibition closure: August 22, 26 and 29

The Chung Collection Exhibition will be closed to the public on August 22, 26 and 29. We apologize for the inconvenience.

The good news is that the closure is for the completion of a special project- stay tuned in the coming months!

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