According to The Globe and Mail, Alibaba’s retail record has been broken today-$9.3 billion in USD on China’s Single’s Day. Born on this day, I have little idea how this semi-jocular festival has evolved into a national shopping jubilee over the last decade, but I truly feel that convenient transport, large consumer base and increasing wealth have made the giant in e-commerce. A question, however, has hovered in my head for a long time: Can this model be replicated in Canada?

When I first shopped online in Canada, I was astonished by high shipping charge and delivery procrastination. I conceived that Canada’s e-commerce had much room for improvement. As I learned progressively in COMM 101, however, my view has changed.

Firstly, I believe that Canada’s small population and high labor cost prevent rapid development in online retail. Consider cost of transport. In China, shipping cost can be very low, because labor cost is low and many deliveries can be made at once-Density of population is high especially in major cities. I recall high-rise apartment buildings in Shenzhen-In Vancouver we have nothing in comparison, not because Canada cannot build them, but because Canada does not need them.

Secondly, wide availability of cars and absence of congestion make shopping a less grueling activity for Canadians. In China, less developed cities see fewer people with cars, while large cities are constantly plagued with traffic jams.

Thirdly, after seeing Canadians’ focus on practical utility, I do not believe that Canadians have high demand for what Chinese typically buy, such as non-luxury clothes with varied design and accessories. I have been to some malls and was astonished by them selling mostly the same brands. This does not happen in China.

I believe, however, that Canada’s online retailing business still has much to explore on accessibility of varied goods that physical shops already offer. In the area of e-commerce, Canada needs to learn from Asian countries.

Reference: Alibaba: A retail colossus flexes its muscles

<http://www.theglobeandmail.com/report-on-business/alibaba-singles-day-sales-break-past-8-billion/article21538437/>

Image Source: http://wei-ukconsulting.co.uk/wp-content/uploads/2014/11/Singles-Day-Chart.jpg

-If  the United Nations was fully funded, why would we need the Arc or social enterprise?

During my course preparation for lesson 20, this question reverberated times and again in my mind. In fact, social enterprise is not a novel concept to me. When I was in high school, I attended one Model United Nations event involving delegations from multiple countries, and our issue was micro-finance in Africa. I also have a friend, a true social entrepreneur, whose business provides impoverished children in Vietnam with affordable stationary.

Firstly, I believe that every top-down decision is only effective when people truly comply with it, with good administration or even force. The UN, however, has no military or political authority to enforce any decision. For instance, it could only condemn Rwanda in 1994 for genocide, and urge its members to send peace keeping troops. If we do not take the initiative to create social enterprises or at least encourage them, we will only see politicians preaching for change without seeing any real change coming.

Secondly, we must bear in mind that the UN is not a business group, but a political one. It is true that the UN could help humanitarian organizations clear political barriers, for instance, help doctors acquire unhindered access to fighting areas. The UN, however, is never as able as shrewd businessmen in detecting opportunities that allow social enterprises to survive and develop.

A third and more subtle point is that social enterprises generally teach people how to fish, while the UN gives fish directly. If a famine arises, it is likely for the UN to be immediately involved. In less turbulent times, however, only social enterprises have the day-to-day attention required to help poor people regain self-sufficiency.

Reference: The Arc Initiative

<http://www.sauder.ubc.ca/Global_Reach/ARC_Initiative>

Image Source: http://www.socialenterprise.net/assets/images/image001.jpg

I was reading Bogdan Proskurnia’s Human Intuition vs Big Computer Data when the optimism reminds me of a book called Antifragile. Written by Nassim Nicholas Taleb, a former trader, the book fully explores the danger of modernism, and constantly reminds us that man-made complex systems are extremely vulnerable to rare but disastrous events.

According to Nassim, natural systems have been effectively tested through time, and what remains in our sights are not easily broken down by changes. For instance, even a nuclear war cannot destroy the planet wholly. Man-made systems, such as financial systems, however, have developed too rapidly during the past century. While their complexity enables errors to occur at more joints than ever, the impact of a big error could cause unprecedented damage as well. For instance, the Cuban Missile Crisis nearly caused a nuclear war, and now when a financial crisis occurs, multiple markets go down together due to globalization. He warns us that rapid development and over-reliance on new technology could become very dangerous.

This is not saying that big data, among other impactful technologies, is totally unreliable. What we need is empirical skepticism. Social sciences, unlike natural ones, produce results that more or less deviate from the Truth. For instance, economists, with various complex models,have rarely predicted financial collapse. Financial models, such as DCF and comparable multiples, employ many assumptions regarding depreciation, firm similarity, or similarity between past and present. On the one hand, the assumptions may not be entirely accurate. On the other hand, statistics cannot reflect everything in this world (it instead builds a model reflecting a real situation).

Computer performance today is astonishing, but computer intelligence still cannot match us in decision making. While holding the belief that science is our future, we must also remain eternally aware of its flaws, and withhold in us healthy skepticism at all times.

Reference: Antifragile: Things That Gain from Disorder, Nassim Nicholas Taleb, Random House, 2012

Image source: http://www.pwc.com/en_US/us/technology-forecast/2013/issue2/features/assets/th-feature01-figure02.jpg

While reading external blogs, the article “The Agony of Realizing, It’s All Social” raised in me particular interest. It says that many good employees, when leaving their original working teams, under-perform instead. He believes that “management is a social act”, and creating good communication and connection among employees can genuinely boost efficiency.

I totally agree with the blogger’s view when I recall our lecture for “People, culture and teams”. Zappos’ image as a closely bonded company still hovers in my mind. By giving employees genuine care through insurance coverage, free food, games and celebrations, it is obvious that Zappos has a healthy working environment devoid of what we contemptuously call “office politics”. I believe that when every employee pays full attention to the company’s well-being(which links to that of his own), he is able to cooperate well with his co-workers and work efficiently. Unlike stream line production, service companies, as we see today, cannot boost efficiency much through employing new technologies, and this is where management becomes crucial.

In other firms such as Google, we can also observe intention of creating healthy working atmosphere. Google has gyms and free food for employees, and a employee could really take some time off to have afternoon tea with his co-workers. This is not waste of working time, however, for informal contact is usually more effective than formal business meetings, and co-workers who know each other better are more likely to offer their true opinions.

Therefore, I believe that good management is crucial to good coordination within an enterprise, and good coordination is in turn essential to efficiency.

Image Source: http://www.personalitytutor.com/files/2012/03/Socializing-With-People.jpg

Bill Gates initially managed his business part-time as a university student. Steve Jobs started Apple with Steve Wozniak in a garage. After many success stories, venture capitals now have unprecedented generosity for poor start-up entrepreneurs, which at first glance seems a good thing. The article about “too rich to succeed”, however, suggests otherwise.

I cannot help but agree with what the article presents. Entrepreneurship, in its original form, involves much risk to an entrepreneur. Firstly, the entrepreneur must be willing to give up stability, for he usually quits college or forsakes a stable job to pay full attention to his business. Secondly, even with that, generally more entrepreneurs fail than succeed. Immediate availability of capital, however, lowers the risk for entrepreneurship, and encourages more people less qualified as entrepreneurs to start businesses. After all, even failed entrepreneurs today could get appreciation from big firms, and only capital providers need to bear the loss. Given the situation, today’s entrepreneurs will be more aggressive in taking risks than those who totally rely on themselves, or sometimes squander money unnecessarily on “management” and “structure”-whose benefits are only obvious in large firms-simply because they know not how to use the money.

In addition, even when a firm with ample capital at the beginning succeeds, it faces many internal problems. Firstly, investors need monthly or quarterly reports, which adds administrative burden to an entrepreneur. Secondly, investors could effectively influence business decision, sometimes against an entrepreneur’s right intuition. These will have negative impacts on expansion of start-up businesses.

I am not preaching that zero capital should be provided to entrepreneurs, but our investors need to spend their money more rationally. In the past, only start-up businesses that have survived and are prepared to expand begin receiving financial support in large quantities, so I believe that the bulk of money should continue being spent that way.

Reference: The “Too Rich to Succeed” Challenge Facing Start-ups

<http://knowledge.wharton.upenn.edu/article/what-happens-when-start-ups-raise-too-much-capital/>

Image Source: http://tribkswb.files.wordpress.com/2013/07/money.jpg

Canadian advertisers, in the US, UK and Australia’s footsteps, are now able to advertise on Instagram. I believe this is a more sound strategy than advertising on other social media platforms, such as Facebook and Twitter.

Facebook has in fact both transformed and alienated our social activities. Nowadays, fewer users remain daily active, and when they do they simply post pictures or add people, in order to “enhance social circle” or catch up with friends far away. In this regard, people are unlikely to heed advertisement that comes with friends’ posts (which some rarely browse anyway). Twitter is more anonymous, however, and an account’s followers are more likely to read what is posted, but embedded links appear more frequently than pictures on Twitter, and when pictures appear they can only be posted one at a time.

Instagram, however, has a clear focus not on online socializing or information spread: People who use it simply post and browse pictures. Therefore, advertisements for food, clothes or other fashion items find their potential clients more directly-Many people post pictures of food or clothes on Instagram, and are really interested in them. Pictures rather than words also could become immediate shopping trigger, especially for less known brands, which are unlikely to impress customers with written description. When customers become attracted to an item, they could click on attached link to explore further, but by then they have already developed fondness for a product, rather than dislike for an annoying ad banner.

Reference: Canadian Advertisers to use Instagram as a brand-building vehicle

<http://www.theglobeandmail.com/report-on-business/industry-news/marketing/brand-building-one-instagram-post-at-a-time/article21514759/>

Image Source: https://pbs.twimg.com/profile_images/1550954462/instagramIcon_400x400.png

The recent establishment of Dasiqox Tribal Park has announced Tsilhqot’in people’s resolve against New Prosperity copper-gold project. In this contest we could observe two different views of sustainability: While we usually see sustainability as harvesting resources without causing irreversible damage to the environment, First Nations only justify non-industrial scale exploitation, which is deemed respectable to gods and nature. Taseko Mines clearly failed to identify all its key partners in this case, and its efforts in acquiring key resources have thus been stalled.

This is not the only case where First Nations people try to hold back what we call progress. BC Hydro’s recent Site C hydroelectric megaproject is battling against chiefs in a similar fashion. Under PEST analysis, political dissent seems the only constraint that hinders Canada’s industrial development, considering the country’s high GDP, social harmony and technological vantage.

First Nations people clearly have a point beside their traditional beliefs. Nature is both resilient and fragile, and one can hardly predict the negative implications of massive projects. China’s Three Gorges Dam project, for instance, brings economic progress as well as environmental loss. First Nations are a natural checking force for such potential damage.

Firms, however, also needs to persuade First Nations to accept gradual, constructive and sustainable progress, sometimes with visible benefits. I cannot help but wonder whether industrialization is possible in Canada at all, but if it is, the key lies in whether firms and First Nations could achieve mutual understanding.

References:

“Tsilhqot’in set to declare site of New Prosperity mine a tribal park”<http://www.vancouversun.com/news/metro/Unilateral+park+declared+Tsilhqot+includes+Prosperity+mine/10192766/story.html>

“First Nation chiefs to stage Site C showdown” <http://www.vancouversun.com/news/First+Nation+chiefs+stage+Site+showdown/10215965/story.html>

Image source:

http://www.gov.mb.ca/conservation/firstnations/images/fishingcamp.jpg

Recently, I have perused Aurora Qiu’s blog post analyzing Coca-Cola’s recipe for success. As Professor Mahesh Nagarajan mentioned in class, “well-organized supply chain management and operation” are integral elements in Coca-Cola’s triumph over most beverage companies. An expert in management studies, Mr.Nagarajan certainly has a point, but I do believe that more factors contribute towards such success.

An article I stumbled upon explicates Coca-Cola’s sale strategies, which I believe complement the post’s sole focus on internal efficiency boost. Coca-Cola’s product and customer differentiation particularly catch my eyes. I realized that Coca-Cola does not only produce coke: An array of time-tested products from Sprite to Vitamin drink allows Coca-Cola access to customers with diverse tastes and needs, enabling it to expand market share to include people with different lifestyles. For instance, I myself dislike carbonated drinks, but I drink Glacéau Vitaminwater and Minute Maid, which are also brands under Coca-Cola. In addition, observant eyes will be astonished by Coca-Cola’s omni-presence: I have seen its brands even in shabby selling booths of rural Cambodia and canteens in crooked lanes of small Chinese cities. This would be impossible if Coca-Cola could not achieve “superior delivery”. I can never deny that supply-chain management and efficient operation contribute to Coca-Cola’s success, but no matter how many goods are produced at how fast a rate, a company has to sell them as quickly as possible to make the most of profits.

Reference:

“Behind the Success: A Modern Operation System for a Classic Beverage” <https://blogs.ubc.ca/yutianqiu/2014/10/04/behind-the-success-a-modern-operation-system-for-a-classic-beverage/>

“Who dares wins-success through intelligent risk” <http://businesscasestudies.co.uk/coca-cola-great-britain/who-dares-wins-success-through-intelligent-risk/key-aspects-of-coca-colas-business.html#axzz3FJqhNNcB>

Image source:

http://payload.cargocollective.com/1/5/168466/2317061/main_photo_portfolio.jpg

In the backdrop of general protest and unprecedented crackdown, Hong Kong’s tourism industry is taking the toll, with 7% decline comparing to the same “Golden Week” from the previous year. What underlines such brief turbulence is, I believe, an accumulation of complicated social, economic and political issues.

Comparing Singapore and Hong Kong’s economic growth since Hong Kong’s reunion with China, we will begin to understand why people in Hong Kong bear grudges. When economy progress is relatively slow and political progress stagnant, it is easy to blame the government for inaction. Even as mainland Chinese, I find it impossible to deny that the government has not done enough to prevent Hong Kong from a relative decline, but I also believe that Hong Kong’s stagnancy has some internal reasons.

If we run a brief PESTLE analysis for any industry in Hong Kong before protests, we will discover that Hong Kong’s political and social climates, at least comparing to Singapore, are less friendly. I recall my own visit to Hong Kong earlier this year-I was annoyed by the need of an Entry-Exit Permit and customs officials’ bureaucracy (Back then I could enter Singapore with my study permit more easily, but I was stopped at the airport, as my permit was not “individual visit permit” but “group visit permit”). I believe that businessmen in China also have the same problem-if they spend too much time dealing with bureaucracy and miss fleeting business opportunities or major negotiations.

Hong Kong’s linguistic environment also appalled me. I have heard from friends that one needs to learn Cantonese to study in Hong Kong’s universities, but I was never told that many ordinary people have near-to-zero English proficiency. In Singapore, school education has already switched from traditional Chinese to simplified characters and Mandarin, while conversational English proficiency is taken for granted. Time has changed. When people in Guangdong Province know both Mandarin and Cantonese, Hong Kong is falling fast behind.

17 years after the reunion, Hong Kong is at crossroads once again. It is easy to identify factors that hinder economic growth, but it is not easy to make political changes, or transform a society’s habits overnight.

Reference:

“Hong Kong Protests Start to Hit Tourist Arrivals”<http://online.wsj.com/articles/hong-kong-protests-start-to-hit-tourist-arrivals-1412310385>

Image source:

https://www.economy.com/dismal/graphs/blog/ach_112111_3a.GIF

One of the most striking business news stories in 2013 exposed secret connection between JPMorgan and multiple top Chinese officials, who allegedly helped JPMorgan gain influence and secure contracts in China. While United States’ Foreign Corrupt Practices Act condemns open bribery, JPMorgan’s practice of hiring officials’ offspring and paying for their consultancy are not legally such.

A basic concept in business ethics is avoidance of dishonest behavior, but the question comes when we try to define it: Should we employ common sense, or examine with existing laws? The United States believes in rule of law-it chose the latter. It is, however, unreasonable that JPMorgan could have invested so much resources for no promise of payback. Perhaps no covet contract exists on paper, but verbal promise is equally powerful from influential figures.

I recall Milton Friedman’s arguments: A firm should prioritize its immediate stakeholders and operate within laws’ boundaries. The only losers in JPMorgan’s game may be other firms that have weaker connection with officials. After all, private relationship weighs much in China’s business arena, and JPMorgan simply tried to follow suit. What do JPMorgan and the US stand to lose when they court Chinese officials? If they lose nothing, why should they punish themselves at all, when no law is obviously violated?

Logically speaking, I believe that where there is no law, a firm should operate for maximized interest.

Article:  JPMorgan’s Fruitful Ties to A Member of China’s Elite

Image source: Image1