Following up from my previous post, it is important to address some of the key factors which make Esports what it is to us today – a thriving, competitive industry that everyone wants to be a part of. For starters, anyone can play AND watch the game (the AND is crucial because it allows viewers to relate professional performance to their own endeavors in-game). This is also important due to the fact that Esport games often receive ‘patches’, which are updates which occur every couple of weeks and months, changing the overall style and game-play aspects for each individual game which doesn’t allow a game to stagnate. This is very different from traditional sports – whilst sports like soccer are only known to be played in certain places (eg. a field) and with the same set of rules and guidelines, the fact that a game such as League of Legends is changing all the time forces players to adapt to the changes made every ‘patch’, which gets both the professional and casual scene thinking of new ways to play a game.

Two more important aspects are that the games are usually free (to play), and that their development as well as the professional gaming scene are largely controlled by the game developers. For example, Riot Games (the creator of League of Legends) is responsible for providing the game to the public for free as well as managing professional competitions and tournaments (such as the OnGamenet Champions in Korea and the League Championship Series in North America/Europe). This could be seen as ‘going direct’ – Riot Games does not provide the game through third party organizations and is thus fully responsible for the success of it. Riot generates money not only through the professional scene, but also due to the fact that any player can use real money to buy enhanced ‘features’ in the game, which do not change the overall game-play aspect, but allows players to CUSTOMIZE their game-play style. Much like customizing a pair of shoes, this allows players to stay loyal to the game – as they know that Riot will often produce a high quality feature which addresses their needs and wants.

With a final outlook on the idea of streaming (mentioned last post about Amazon acquiring Twitch for $1.1 billion), one would definitely consider the question of whether a platform would be worth so much money. The fact is, being streaming platforms, websites such as Twitch and Azubu consistently show advertisements on streams. If a popular player gathers many viewers, and many viewers view an advertisement, this is exactly how these players earn revenue. According to a recent study, one of the most popular players in China (former World Elite player ‘Caomei’) earns up to $800,000 a year JUST by streaming.

Additional Sources (to last post’s blog)
Ongamers

Esports is a term which sounds foreign to most adults – frankly, most would have no clue what it is, and what its significance is in recreation. Esports stands for Electronic sports, a term coined to address teamwork-based video games as an official ‘sport’. Super Data Research’s Blog provides some information about this specific industry, and why it is set to overtake the world in terms of potential business. In August of 2014, online store Amazon announced its decision to purchase Twitch, an online streaming platform for $1.1 billion US dollars, one of the biggest financial deals in Esports history. To give another example of the scale of Esports, 40,000 people watched the 2014 League of Legends World Championship Final live in the Seoul World Cup Stadium in Korea just last month, with millions more viewers watching via streaming platforms.

40,000 people in the Seoul World Cup Stadium

What sets Esports different from other types of traditional sports is the extraordinary level of interaction that players can have with their idols. If one is good enough at a game, he/she is usually able to play online with some of the best players in the world, a feature that few sports offer (imagine playing golf with Tiger Woods, or tennis with Roger Federer, or basketball with Lebron James on a DAILY basis). This type of business (not necessarily through selling a product but rather by providing the service of playing or watching a video game) is an incredibly new and innovative way in which people can get involved with a growing industry. Like advertisements for products, online ‘teasers’ or ‘cinematics’ are used to delight fans about an upcoming event/competition or the release of a new character (a type of marketing), whilst for many of these games the days of inventory is incredibly short (it only takes 2-3 hours to download a game and watching a competition is just like watching a sport online). In my next post I will continue to address some of the factors which makes Esports the worldwide phenomenon it is known as today.

Sources
Google Images

The Arc and Social Enterprise are 2 different entities – yet they serve a similar purpose which will be discussed later in the post. The Arc Initiative is a program developed by the Sauder School of Business which empowers students with the skills on how to run businesses in order to be passed on to people of their native countries, such as Arielle Uwonkunda. The Social Entrepreneur is an individual who creates opportunity for those who believe that they have no hope, such as Jim Fruchterman using technology to address various social problems. Whilst the United Nations is an incredible organization devoted to helping many people around the world, it is clear why the Arc or Social Enterprise will still be needed even if the UN was fully funded.

Firstly, Social Entrepreneurs are specialists depending where they come from – even with research the United Nations may not be aware of the specific cultural or local settings, which need to be taken into account when solving a problem (such as preserving traditional/sustainable farming methods or solving problems between tribes and working in the best interests of both parties). This is the same members of the Arc Initiative and their familiarity with their own countries’ issues.

With the familiarity of local methods and practice, using these solutions to solve problems may be the most beneficial as they can be replicated by locals as it would be unhealthy to completely rely on the UN for funding in the long term. The bond between individuals and the local people will be key to the relationships between potential UN agents and the locals, as the Arc student or the Social Entrepreneur would be able to act as a ‘bridge’ between the two groups. In the case of the Arc Initiative, the world of business is ALWAYS changing so it would be more beneficial to have an educated individual up to date with the latest technology and knowledge helping out at underdeveloped areas, as these individuals would already have been trained specifically on tackling certain problems, which the UN agents would probably have (in terms of experience), but not extreme specialty in addressing local problems.

Lanny’s Blog mentioned that one of Asia’s largest retail stores: Muji, is coming to Toronto. Muji is an incredibly successful name in many Asian countries such as Singapore and Hong Kong, and many people might assume that Muji will also be successful in Toronto due to the large Asian population. Before jumping to such a rash conclusion, it may be wise to examine some of the factors that might affect Muji’s sales.

While operations is such a key factor in the delivery of a product, and Muji (who keeps its manufacturers private) for Canada will probably take more Days of Inventory than the Asian stores which are more likely to be closer to the manufacturers. That being said, Muji are an established company and minimizing costs should not be a problem given they almost do not advertise (2% outside Japan) and that they do not utilize packaging. Rather it might be more useful to examine the impact that Muji might have on similar stores in Canada, namely Target, Staples, Shoppers, Ikea and clothing companies as mentioned in the article.

Muji sells a wide range of products, including bedroom equipment/accessories, clothes, food, household products and accessories etc. However, due to the lack of extreme focus that Muji places on any of these products in particular, it is less likely to be a threat to major, established stores in Canada such as Ikea, Staples, which are trusted brands for the specific genre/type of products that they sell (Ikea for furniture, Staples for stationary). The stores most likely to be affected are Shoppers and Target, which are similar stores to Muji in terms of products sold as well as product variety. One of Muji’s greatest value propositions is its ability to produce a wide range of HIGH quality products which are durable and minimize wastage (or resources or space). This might be a point of difference which the likes of Shoppers and Target cannot compete with, as Shoppers in particular is more of a distributor of products from other companies (with Muji being its own brand), while Target offers even more products than Muji which may not suit specific customers’ needs.

Yesterday, a few Sauder Alumni came to section 101 to talk to us about their experiences as entrepreneurs in the business world. The alumni were Paul Gill (founder of the Naked Coconut), Jennifer Martin (founder of SIP Soda) and Paul Davidescu (founder of Tangoo), and they each had plenty to respond to and talk about when faced with questions from the class. Linking it back to the lecture on Entrepreneurship that we had a couple of weeks ago, I think it is worthwhile to identify some of the key skills that 3 of these alumni have in their possession and how they’ve used the skills to turn their businesses into successful ones.

Paul Gill definitely has the important trait of creativity (Entrepreneur). The incredible idea to launch a coconut-based soy sauce product was an excellent choice when addressing the consumer market – there were few of this type of product and they were being poorly distributed according to Gill. The release of such a product in Canada and Vancouver in particular (with a large Asian population) was also a smart move in terms of expanding a business. Overall, it is safe to say that Gill definitely excelled in identifying his target market and what they wanted.

Jennifer clearly showed her will to succeed through persuasion, with her herself stating that she sought the advice of multiple chefs and figures in the food industry in order to get a better grasp on her product. This is crucial, as whilst launching any new product into the market, one should first look to experts in that particular field in order to get some constructive and legitimate feedback, as well as looking into other factors such as market trends, points of difference (and parity) as well as customer tastes and preferences (currently many consumers are in favour of a healthier, ‘freer’ lifestyle).

Paul Davidescu certainly combined the idea he had with the growing trend of technology, opting to create an interactive website as well as an application for the Apple app store, allowing for consumers to easily connect to Tangoo. This is an important thing to note from Davidescu – he not only used technology to market his product, but he based functionality on a user-friendly program which was easy to use (through the demo). This also ties into a separate topic which has always been of interest to me – the relevance of programming and computing in any type of business today.

However, an important thing to note is that all 3 Sauder Alumni started these businesses themselves – an interesting method to evaluate their success would be taking a look a the ‘what ifs’ if they had collaborated with a partner or a few more people whilst creating their business. I personally believe that it is more beneficial as two or more people can bring more ideas to the table, and can use each others’ experience to create a successful enterprise.

From a couple of sources on the 7th of October (2014), a project called ‘Collectively’ was released – a website which ‘celebrates’ and ‘connects’ cutting edge ideas that are ‘shaping the future of sustainability’. This is meant to be a collaboration between major companies such as Coca-Cola, Google and Marks & Spencer – and signals the increased focus on the concept of sustainability in the business world. Apparently, one of the key factors that sets Collectively apart from other different types of collaborations is the fact that multinational companies are behind this project. The home page details the media’s obsession with fear, and that the world is doomed due to humans and their actions. Allegedly, with the companies having ‘put aside their differences’ this promises to be an interesting and informative project, featuring high quality content.

An interesting point to note about this type of news is that while it has something to do with the sustainability aspect of a cooperation, it is difficult to pinpoint any 1 of the 3 ‘stages’ of sustainability that a company is engaged in. This is mainly due to the fact that it is not a production related project, but if one were to really attempt to categorize it, then it would definitely be in the ‘Innovation stage’, simply because this website looks to address some of the ‘big problems’ in society such as society and people’s perspective on our world and our actions, and aims to provide that ‘high quality content’ which was explained in the first paragraph.

This project can technically be very efficient. This is because most companies that have collaborated on this are well known, and it can only serve to boost each company’s image in terms of creating a more sustainability-conscious business. In a way, one could view the 29 companies as having made a ‘good investment’ in terms of brand name and brand image, which can ultimately help them in the long run. At the same time, publicity can be gained via the website, allowing companies to ally themselves with new partners. For the ‘not-so-well-known’ companies out of these 29 such as ‘The Dow Chemical Company’ (which I had never heard of prior to reading this), it can only increase recognition of the organization. This is achieved even without the companies having to advertise about their products, which they clearly specified as ‘having nothing to do with our brands’. In a way, the companies managed to assist themselves without ‘explicitly’ trying to do so. Overall, it seems that as people have started to take sustainability and ethical and social responsibility of companies into account, companies who choose to enter this field like the 29 here could hope for positive results due to this type of collaboration.

Source: Marketing Magazine UK

Summary:
As Enbridge wants to run its $7.9 billion pipelines, they should always beg to consider the rights of the First Nations people. In this case, the proposed pipeline locations are where the waters of Nak’al Koh are situated, which are home to many types of wildlife. The Yinka Dene Alliance is head of the opposition of the project.

What are the concerns?
Essentially, because there is such diverse wildlife, including the endangered Nechako white sturgeon, an oil spill could definitely wreak havoc on the environment, potentially destroying the whole ecosystem. Moreover, because of the Supreme’s Court recent decision granting Tshiqhot’in to 1,750sq km in central BC, there is now increased tension and focus on the rights of aboriginal people. Some people wonder that because of the creation of new jobs due to development of the land, why the First Nations tribes do not agree with this project. The answer, in my opinion, is relatively simple. While development is definitely something that people look forward to as a progression of society, certain types of development hinder and wipe out the natural culture and habitat of areas.
For people like Lillian Sam, the land is precious, and the maintaining of cultural practice can only come via the same lands.

What now?
As legal battles continue on and disputes continue to arise time and time again, one should examine the possible consequences and benefits of such a project (that Enbridge is planning). On one hand, while it will enable provision of oil to many areas of Canada, there are the concerns which were addressed above. One should also take note of the fact that pipelines could destroy the natural scenery and formation of the land, and the disruption of a such a balanced and preserved environment could be costly for the ecology of Canada as a whole. In my opinion, it is important to keep in mind our roots and where we Canadians come from, and that ultimately, we should make a decision about our lands, not business people.

Source: Vancouver Sun

One of the posts on Nodoka’s Blog denoted the problem that supermarket giant Aldi faced – that its frozen beef products contained 30% horse meat. Apparently, the major causes for the failure (according to Nodoka) were the a) failure to track the different suppliers of the beef, and b) nobody knew who to blame once it was found that 30% of the meat was horse meat (the authorities, the different suppliers, Aldi, etc).

This, actually raises the question of the operations of the company – if the company is not sure on the quality of the goods that it is receiving from its suppliers, it probably is a better idea to either change a supplier or establish some ground rules which they should follow. The point is, because the operations segment is so important, the COO should continuously regulate the policies that govern the operations of Aldi in order to ensure no such other scandals ever repeat themselves. Currently, they seem to be doing a good job as no other scandals have been linked to the supermarket chain.

I definitely agree with Nodoka’s point that Aldi should work in the customers; best interest in stocking up on high quality food which doesn’t have to be incredibly expensive. With Aldi having won so many awards over the last few years (), customer loyalty is surely going to prove to be an important part of its business. If another scandal such as the horsemeat arises, it could cost Aldi a lot of revenue, given the different types of supermarkets available all around the world. More importantly, Aldi’s Value proposition of having low prices and high quality food could be put into jeopardy (if it hasn’t already) as a result of such situations, thereby destroying its brand name and potentially ruining the company.

In the future, if other issues like this arise, I would recommend that Aldi attempt to deal with the problem internally and maintain its quality control (which could signal a change in operations for the company) which would ensure the safety and genuine quality of the food it sells to its customers.

23rd September 2014

An incredibly interesting section of business and its fundamental concepts is the idea of operations management, which Mahesh kindly talked to us about today. Learning about the process of Input > Operations Management > Output has allowed me to realize the importance of this process. One of the most important concepts is the Days of Inventory, which can be defined as the no. of days that it takes for the product to be created. Because today’s world is all about substitutes and consumer behavior, getting a product out to the consumers as quickly as possible has become a top priority for many companies.

For example, on the 23rd of September (the date of the lecture), the news reported that SMA Solar Technology AG had taken over the OPERATIONS MANAGEMENT of Canada’s largest photovoltaic plant in Ontario. The president of Kingston Solar addressed the fact that the company was looking to select an O & M provider, and believed that SMA had technological and management expertise in this area.

Possible consequences in the future would be lower energy costs due to higher efficiency, as well as more efficient services during power outages (if there are any).

Source:
PV Magazine

The building of a business model can seem like a tall order. However, based on the reading material given before today’s class, I’ve managed to take some simple notes on how to break down the process of creating a model. Essentially, it is split into 9 building blocks, and all contribute to the different areas that a business needs to address in order to run smoothly.

Zooming into the headphone/earphone market, a company called Master and Dynamic is beginning to make strides. As the ‘anti-Beats’, they serve to use combine a relatively older yet classic design with clear sound which can be considered their Value Proposition. Entering the market versus Beats is a challenge, as recently Apple purchased the audio company for 3 Billion, which will significantly increases Beats’ R&D, funding as well as advertising capabilities. With their flagship pair of headphones called the ‘Modern Thinking Cap’, this is certainly a model for those who want to stand out among the conventional Beats. As it isn’t very prominent in Asia at the moment, a wise choice would be for Master and Dynamic to expand product channels to Asia and increase marketing, if it truly wants to challenge the empire that is Beats Audio, which is already well established across the globe. They could also look to other major companies for collaboration if they want to expand, such as Samsung or Sony (which are all companies which are incredibly strong in the Asian Market), as Beats now do (following Apple’s acquisition).

Sources:
Forbes
Bloomberg