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Christopher Kissel
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Thanks for the article, Kieron. Evidently, Siemens is grappling with an exercise in estimate trade risk, a task that is traditionally very difficult to get right. Lacking certainty on what policy will come of Brexit, whether it is “hard” or “soft”, places the company in a tough situation. If I were in their shoes, I would first be considering which customers are most valuable to them. Though they delivered more wind turbines to the UK than anyone else, by volume, we should investigate how profitable a UK customer is versus an EU customer. For this, we should assume that the company could set up independent supply chains in each segment.
The next strategy that I would employ would be to stress test the firm by assuming the worst case scenario: high import/export tariffs and a higher cost of labor due to shortages. Here, I would look at a firm like Fuyao glass who took measure to own as much of their supply chain as possible. How would they approach steel smelting for raw materials? Lastly, what R&D improvements can be made to cheapen labor and raw material requirements?
Thanks for the article, Dan. I think that you have made a compelling argument for ExxonMobil to change some of its emission-related operations. You have stated that many of the company’s operations are in areas with violent and risky weather patterns which could destroy many of the company’s facilities. In my experience, the company has been able to build and maintain PP&E in the coldest, warmest, or harshest climates on earth. As an example, hurricane Harvey caused a massive surge in gasoline price in the lower 48 as up to 1/5 of the supply was disrupted by the storm. However, the interruptions were because refineries had to evacuate their people. As flooding subsided and people returned, there was little damage significant enough to write off assets of to have to re-build.
I also think that while it is easy to make ExxonMobil the face of climate change, action needs to be taken much more broadly. Though it stands to suffer (as you alluded to), many stakeholders and countries are in much graver danger. The company may decide to move facilities around more strategically but in many cases (Sakhlin, Equatorial Guinea, Northern Canada), they have been successful in some of the harshest climates.
Lastly, I would be curious to understand the opportunities that ExxonMobil could be afforded as climate change accelerates. One which comes to mind is arctic drilling. As ice melts, it will become easier to explore and drill. Would this make them more reluctant to venture into more volatile climates?
Thanks for writing this piece, Michelle. It is an exciting time to see the entry of renewables in markets such as India and China. As Nate alluded to, it would be interesting to analyze the effects of government policy, particularly in the instance of a subsidy scheme. For instance, the government of Spain heavily subsidized the renewables sector to meet some of its clean energy goals in 2009. The underlying economics of the scheme were not economic to begin with. As the government aided the companies to develop the clean technology infrastructure via loans and tax breaks, much of the higher operating expenses were passed on to businesses and consumers. This resulted in making energy-intensive industries much less competitive.
I also wonder how public opinion could affect project sanctioning. Public opinion of nuclear energy undergoes a massive step change any time an accident happens. Are there PR risks with wind farms that operators need to consider?
Great read, Kiara. You have made a compelling case for reducing the time to market at Uniqlo in order to directly compete with numbers 1 & 2 in the world, H&M and Zara. As you mentioned, Uniqlo has thus far differentiated itself on high-quality basics, whereas H&M and Zara are disposable fashion. Uniqlo’s push to serve additional market segments reminded me of the GAP case in marketing whereby a push to serve a broader range of customers actually squeezed the brand from top and bottom. I agree with your recommended strategy so long as Uniqlo can clearly define how it will be able to continue to differentiate itself by faster, more desirable basics, while avoiding becoming like the firms that it is competing directly against.
As for using AI in inventory and consumer tastes, does this apply to fashion directly at shows and unveiling or does some lead time exist in trialing different lines and styles and then interpreting sales data? Are there additional opportunities for Uniqlo to maintain its differentiation while speeding up its delivery process?
Very interesting read, Trevor. The Ford Motor Company appears to have come out swinging in an attempt to respond rapidly to imminent changes in the transportation sector. You mentioned that the company has gone out and acquired Argo Ai, Princeton Lightware, Velodyne, and SAIPS. The company is also investing significantly in supply chain systems to reduce inventory holding costs. My one concern here is their broadness of strategy. If the company can implement light sensing technology, 3-D printing, and supply chain optimizing, they will win, like you mentioned, by owning more of the value chain. These may be challenging technologies to integrate simultaneously and though the company views their acquisition as strategic, I wonder if all were required at once?
Some of the experiments being run ([10] “Ford At CES Announces Smart Mobility Plan And 25 Global Experiments Designed To Change The Way The World Moves,” Ford Motor Company press release, January 6, 2017, https://media.ford.com/content/fordmedia/fna/us/en/news/2015/01/06/ford-at-ces-announces-smart-mobility-plan.html, accessed November 2017.) are exciting. Some of the parking and ride-sharing technologies that you referenced are fascinating!