Former Windows Chief Steven Sinofsky holds a Surface tablet with skateboard wheels attached to show the strength of the device during the launch event for Microsoft Windows 8 in New York, Oct.25th, 2012

Two weeks ago, Steven Sinofsky, the chief of Windows, helped Windows introduce its latest system Windows 8 and its Surface tabletS. But he unexpectedly announced his departure on November 13th. “Microsoft shares fell by 3% to $27 in early trading on Tuesday as the news reverberated around the web, leaving “Microsofties” themselves stunned as they tried to digest what the change will mean for the company. Sinofsky was “a tremendous talent,” one said on Tuesday.”

Mr Steven Sinofsky has always been viewed as a visionary in Microsoft. He is the leading force in the development of Windows 8 and his success in the Windows division has led many to believe that he would take the place of Microsoft’s CEO.”By leaving, Mr. Sinofsky has drawn negative speculation – not only of tension within Microsoft’s upper ranks, but also of the positioning of Windows’s future within the brand.”

This is supposed to be the big time for Microsoft since its newest product Window 8 and Surface tablets have just faced the public yet this news is failing people’s expectations about Microsoft. What surprises me is that many people are still buying Microsoft’s stocks despite the shares are now dropping. And why is that? (the video below:” bad news for Microsoft is also good news for investors” provides an explanation for this phenomenon)

This reminds me of the COMM 101 finance class that we had recently. In the COMM 101 class, we discussed the Google stock-price case. The early release of Google’s earning caused its share price to drop tremendously. This is because the price of the stock is not heavily determined by investor’s expectations about the future earnings. More importantly, the price of the stock is determined by the company’s cash flow. And news on Cash Flow will turn cash flow into prices; Google missed its estimate on its earnings! (Earnings and cash flows are related) So if the earnings is less than expectation then the cash flow of the company is very likely to fall in the future. As a result, people do not want Google Stock anymore. Investors buy stocks for the future possible value and they bet on the future growth in stock price. That’s why Google’s price went down after the early release of the financial report; it was not up to the expectations of the investors.

In this case, Microsoft is a huge company and it is gaining profit at a fast speed from its newest Windows 8 and Surface Tablets. At the same time, it has a temporary low stock price due to departure of Sinofsky. What time is better to purchase its shares than now? It is estimated by many analysts that Microsoft’s stock price will go up soon in the recent few weeks and now would be the perfect time for investors to purchase the share in this large company.

 Microsoft’s performance in recent years

News Source: Microsoft stock sheds 4% after Windows boss departs(the Globe and Mail)

News Sources:Windows chief Steven Sinofsky pushed out of Microsoft

VIDEO:Bad news for Microsoft is good news investors

VIDEO:Microsoft CEO sees new era with Windows 8

The Google Toronto office is the headquarters of advertising sales for all of Canada, among a host of other things. The tech juggernaut also has offices in Ottawa, Montreal and Kitchener-Waterloo. At Google Inc’s Toronto new office, many designs and settings of this new office wow people. Not only does Google has set up a small kitchen with many snacks and drinks for employees on each floor but Google also has all kinds of entertainment settings like indoor-gyms,a music room,a  luxury lounge, game rooms as well as outdoor mini-golf field as shown by the pictures below.

 Google’s Toronto Office’s mini-golf fieldThe game rooms inside the officeThe amazing indoor-gyms

Google has always been dedicated to the design of each of its offices in order to motivate its employees to interact and communicate with each other. Employees tend to talk more often when they are relaxing in the luxury lounge and having snacks in the kitchen. Also, Google’s employees even get free massages, isn’t that great! This shows how much importance Google places on its working environment and atmosphere.

While many people say that would love to work at a place like Google some say they would not because the office settings make them stay in the office longer and ignore their families. “While Google employees do pull long hours, at least it’s in an enjoyable work space. But there is an argument to be made that no amount of toys will allow you to  buy innovation.”

In the COMM 101 class, we have discussed the case of the Zappos, one of the most successful shoe sellers. We learned about the significance of people, culture and teams. In Zappos, the company focuses highly on building a enjoyable working environment for employees so as to motivate them and make sure they have the top-notch customer service, which will help them build more and more repetitive customers.

This applies to Google as well. Google is making effort to provide its employees incentive for them to work harder and love the place they work. Also, Google wants a harmonious working environment in which employees are like a big family. In the business world nowadays, we need to find creative ways to motivate our employees instead of just expecting them to be loyal and hardworking.

Google employees Jeff Bailey, left and Marc-Andre Decoste jam in the recording room at the new expanded Google offices in Montreal, March 19, 2012

Google employee Eric Dingle hangs out on the rock climbing wall at the Google offices in Montreal, Monday, March 19, 2012

Original News Source: Colour-coded lunches? Google pioneers a whole new office(the Globe and Mail)

Video:Autodesk’s Carl Bass on how companies can promote innovation

VIDEO: Inside Google Canada’s new Toronto headquarters

After reading Nikita Arora’s blog posts on “How Lululemon tripled its profits by improving its supply chain”, I found it very interesting and convincing but I have some disagreements toward the view that Lululemon has an efficient supply chain though it has made huge success in recent years.

Lululemon, the famous Canadian Athletic brand, ranks among the most productive chains in US, only running behind Apple and Tiffany, co.

“According to the ranking by U.S. research Retail Sails, Lululemon rakes in $1,936 (U.S.) per square foot, behind Tiffany’s $3,017 and the chart-topping $6,050 generated by Apple. Lululemon, which holds the No. 1 spot among apparel chains, and operates more than 100 shops in the U.S., has moved up one ranking from the last measure, swapping spots with Coach Inc. Rounding out the top five is Michael Kors Holdings.” 

Lululemon has been growing and expanding at a fast speed in recent years. What is different from Lululemon and Apple, Tiffany is that Lululemon also ranks 8th in the fastest growing annual change in store sales, which indicates its promising future. The sales of Lululemon has increased by 33% since last year.

With the growing sales and demand comes with increasing problems. Even though Lululemon’s retail sales are increasing annually, it still has one of the biggest problems unsolved. Lululemon’s supply chain management proves to be very inefficient and unresponsive , as we have discussed earlier in the COMM 101 class. The products of Lululemon get off shelves faster than new products arrive, resulting in a shortage of goods and loss of potential customers. Part of the reasons are Lululemon’s manufacturing partners’ locations. Lululemon’s manufacturing partners are based in Canada, the United States, China, Taiwan, South Korea, Peru, Israel, Bangladesh, Cambodia and Vietnam. However, most of its products are manufactured in countries far away from North America, resulting in a long time product-delivery and a inefficient supply chain. While some people may consider this as a good trend because Lululemon can increase the demand for its product when the supply is not enough, therefore making its products hot and desirable among customers, they clearly understate the significance of supply chain and logistics.

Lululemon has a high inventory turnover, which is a good thing meaning its products go out fast. However, Lululemon needs to enhance its control over its inventory and try its best to make the accurate forecast of its products’ needs in order to promote its retail sales. It is true that Lululemon will make money as long as it sells all of its products and it may get into trouble when some of its products are stuck in factory when it is producing too much. Yet the company needs to take opportunity costs into account and starts to consider improvements on its supply chain management so as to grow bigger and keep its revenue increasing. Supply chain management does make a difference in today’s retail world!

The optimistic behavior of Lululemon in the recent years:

Official Lululemon Website (Learn more about Lululemon!)

Original News Source:Lululemon among most productive chains in U.S. (the globe and mail)