Mina Willett's Blog

Andrew McAfee’s blog post about how to make better decisions using big data, stimulated by information technology, helped me tie together our IT class discussion and our decision making class. While we talked more about tools to evaluate the general market in our decision making class, I thought the tool McAfee introduces could link a company’s information technology and how they utilize that information to make decisions.

McAfee created a chart to show the perfect balance between the amount of data generated for the company and the amount of importance the company places on that information in their decision-making. He emphasized that there needs to be more data-supported opinions than ‘Highest-Paid Person’s Opinions’. What drew me to comment on this is that as technology becomes more and more advanced, it will become increasingly prominent in the running of a business. McAfee argues that HiPPO’s intuition in decision-making pales in comparison to the decisions that data predicts. This is fascinating, as human intuition is less valued in his eyes then technology. I disagree, and believe that it is necessary for people to analyze and develop to data for well-informed decisions.

A Windfarm in Pincher Creek, Alberta, has been aquired by Ikea Canada, which will help Ikea achieve it’s goal of being globally energy independent by 2020. Making this purchase is addressing both social sustainability and the companies value proposition.

Firstly, by investing in the wind farm (along with solar panels on the roof of their Toronto location), Ikea is giving wind energy back to Alberta’s energy grid. This, in turn, will help grow the renewable energy business in Canada. Ikea’s investment will not only help Ikea become a more sustainable company, but they will also be contributing to the greater Canadian community.

Second, boosting the companies credibility in terms of sustainability adds to Ikea’s value propostion. Kerri Molinaro, Ikea Canada’s President says, “We are able to support the transition to a low-carbon future, reduce our energy and operating costs and pass those benefits on to our customers by continuing to offer high quality home furnishings at low prices.” The furniture and goods that Ikea sells are now connected to creating a more sustainable future for the company and their products, which increases the value and appeal of Ikea products.

Source: http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/ikea-eyes-low-carbon-future-with-alberta-wind-energy-project/article15436596/

After reading Constance Ang’s blog post about Abercrombie and Fitch firing an employee becasuse she refused to take off her headscarf, as well as CEO Mike Jeffries comments about soley marketing to customers that fit to A&F’s look, I was struck by the statement these events made not only about A&F management and marketing, but about their company culture in general.

During our class devoted to People, Culture and Teams, it was mentioned that company culture begins with the founder, the individuals who create and run the company. What does it say about A&F when the CEO makes a statement essentially stating that the company did not want “unattractive individuals” to wear their products? I believe that this sets a precedent for discriminating not only to customers, but also employees, as the case Candace mentioned about the young woman who was fired over religous head dress. When I compare A&F to, for example, Zappos, the difference is clear. I would rather purchase from/work for a company whose CEO values their customers and employees no matter their religion or physical apperance. While I agree that A&F’s actions were unethical, I also think that it exposes the companies culture as very negative.

The Article How to Build a World-Class Recording Studio on the Cheap that was assigned for class preperation this week showed me that large corporations are not the only ones who create shared value for their customers, but smaller businesses often rely on shared value for their survival.

Tom Dobrzanski started his recording studio, Monarch Studios, in his Basement and catering to up-and-coming bands that would soon be looking for more professional recording studios. Dobranski saw that as the bands that he recorded for were gaining followers and expanding their operations, he should expand as well. By expanding his operation, not only did Dobranski create a better quality service (Reconceiving products) for his customers and improve the experiance for the bands he was resording for, but Dobranski also enabled a large amount of local cluster development. He did this by reaching out to music students in the community to help him build his studio, and giving back to them by offering experiance and sharing his own advice and experiences in the music industry. Dobranski also created more value for the bands that he records for because the client and business owner can continue to build a strong relationship.

I recently read a blog post from my class-mate Aimie Lee’s Blog about the role of social media in the growth of many businesses around the world. I thought that this was a very interesting post that also connected to my life, and how businesses play a part in the social media outlets that I currently use.

For example, I recetly started to follow the Lululemon Lab (@lululemonlab) on Instagram. The Lululemon Lab is located in downtown Vancouver, and is commited to designing innovative new clothing products while “supporting and designing for (their) local community”. The Lab doesnt simply post photos of the products that they create for their retail space, but also of their staff, the multiple events that they hold every month in the community, and promotions for other local businesses. So while I agree with Aimie, that Instagram and other social media outlets are helping businesses grow, I believe that social media is also helping companies, like Lululemon and the Lululemon Lab, reach out to their local and global communities. This connection that companies create with customers and communities alike create more social value for their customers and communities alike.

In the previous blog post, we looked at how Tamara Mellon is setting her brand apart from the rest of the luxury fashion industry. Like her brand, “Tamara Mellon”, the Luxury brand Kate Spade has created an extension brand, called Kate Spade Saturday. This brand is founded on the same principles of the original Kate Spade, “As part of the kate spade new york family, we share a love of bright colors, graphic shapes, and bold prints, and believe that getting dressed should be a lot of fun”. However, there are multiple aspects of the new brand that set it apart from its parent company.

First, like Tamara Mellon’s new brand, Kate Spade Saturday releases new items on a more frequent basis then the typical luxury brand. New patterns and styles are emailed out every Saturday to subscribing customers. This unique positioning of the brand sets it apart from all others in the industry, keeping the product new and fresh.  Secondly, the price point is lower while still being associated with an expensive luxury brand. This draws in customers who want the brand value and quality of Kate Spade, but at a cheaper price and in different styles.

Source: https://www.saturday.com/About-Us/saturday-aboutus,en_US,pg.html

“ In the fashion business, speed is life” – Howard Davidowitz

While the typical cycle of a luxury brand, like Jimmy Choo, has four collections a year, some breakout fashion labels are releasing new items monthly. This is a unique form of product positioning in the fashion industry, as the grand majority conform to the same seasonal release of collections. A few standout luxury brands are successfully using this position to market their fashion labels.

For example, this fall Tamara Mellon, the co-founder of Jimmy Choo, a luxury shoe company, is setting out into the fashion industry with her new label, called Tamara Mellon. The clothing and shoe line will release new luxury items every month, instead of quarterly. This is a unique attribute for a luxury brand to possess, and certainly sets Tamara Mellon apart. This product positioning is very promising for the future of the company, especially since the founder of the company is well known in the fashion industry. As Tamara Mellon is associated with quality and luxury from her history in fashion, so will her new brand.

Source: http://www.businessweek.com/articles/2013-10-04/jimmy-choo-co-founder-tamara-mellon-puts-on-her-revenge-boots#r=hpt-ls

During our last class, my group made a perceptual map on cars, with price and luxury brand image on the x-axis and y-axis, respectively. We observed that there were very few brands of cars with high luxury brand image and low price, and with expensive cars with low luxury brand image. However, Mercedes-Benz CLA compact model, which sells for under $30,000 USD, is breaching the unpopulated area of the perceptual map that hosts car brands with high luxury brand image and low price. Though the price is not low when compared to Toyota or Ford, it is “uber-cheap” when compared to other high-end luxury vehicles.

When purchasing a car like a Mercedes, the customer is investing in the brand imaging that comes along with the insignia on each car. By offering a product that more customers can afford (like young up and coming professionals who want the brand but cant afford a $50,000 USD sedan) they are building an early relationship with customers who will hopefully, in the future, return to the brand and buy high-end vehicles. By offering a less expensive but still luxurious product, Mercedes Benz is investing in the future of their company.

Source: http://www.businessweek.com/articles/2013-10-02/mercedes-cla-sedan-with-budget-price-outsells-high-end-models-in-u-dot-s-dot-debut#r=hpt-ls

This week, Scribd, an online document sharing website, will introduce a new feature to its users: subscription e-books. Customers will pay a monthly fee to access a large collection of books made possible by Scribds first partner, HarperCollins. The website can be accessed from most mobile outlets. This is similar to Amazon’s online service, where you can purchase books and access them on a kindle or through a mobile app. Yet, the company is said to be moving into “unchartered waters”…  so what makes Scribd different?

The main point of difference is that the customers are paying a single monthly fee for an unlimited number of books. With other online providers such as Amazon, the customers are paying per book. If you are what Scribd CEO Trip Adler calls a “power reader”, Scribd is clearly the preferable service. However, if you are a student who can barely find time to read a book of choice, or a busy mom plagued with the same problem, why pay a flat fee for a service you may not use? It is clear that Scribd has a very unique service, however, its target market is a narrow because of that.

Source: http://www.theglobeandmail.com/report-on-business/small-business/sb-managing/leadership/document-sharing-site-extends-netflix-model-to-books/article14640114/