DJ's Profile

Thanks for writing this post! I agree with your perspective and wanted to add some information to the conversation. Your article and a number of additional comments have cited the likelihood that some replacement trade deal would be implemented for natural gas in the absence of natural gas, but I think it may be helpful to highlight some of the industry specific reasons that may shape that perspective. I found an interesting article from the paper from the US International Trade Commission, on some of these dynamics, which include very high transportation costs, non-competitive pricing (e.g. government set or oil-indexed pricing), markets with minimal excess capacity, and generally restrictive contracts (https://www.usitc.gov/publications/332/obstacles_natural_gas_final_pdf_accessible.pdf) . For example, in 2014 74% of natural gas was consumed in the country where it was produced. These barriers highlight the difficulties that US natural gas companies will have in entering global markets in the absence of a regional market. In addition, this underlies the broad global trend in the industry for regional agreements and contracting and the unlikelihood that the US would make it more difficult or expensive to trade natural gas regionally. As others have mentioned, the US stands to be harmed the most by removing a bilateral trade agreement covering natural gas.

Another consideration for Ford in keeping plants in the US is exploring what the Trump administration is willing to offer to keep jobs here. For example, Carrier received significant tax breaks ($7M) just for keeping 1,000 jobs in Indiana (http://fortune.com/2016/12/02/indiana-carrier-jobs-tax-breaks-mexico/). While this administration has demonstrated a public facing goal of keeping jobs in the US, American producers may also be able to negotiate benefits for keeping jobs here. That being said, as you say, there is also the short term versus long term assessment that needs to be conducted. Any arrangement negotiated with one administration is not guaranteed and Ford could end up with a higher cost structure if they submit to the influence of the Trump administration.

Pharmaceutical companies investing in consumer facing digital tools also need to consider the digital tools that other players in the value chain are deploying. Given the value of data in the healthcare space, this dynamic could present a risk for Teva in maximizing the value of these investments in digital tools. For example, CVS Caremark released a diabetes care management tool that incorporates a digitally enabled glucometer (https://cvshealth.com/newsroom/press-releases/cvs-health-introduces-new-transform-diabetes-care-program-improve-health). While this doesn’t directly compete with any of the cosnumer-facing digital tools that Teva has implemented, it shows that other players are positioned to enter this space and other players, like payors, may be better positioned to connect with patients.

I do see specific benefits of digital investments for B2B efforts. For example, Teva could work with PBMs to use data to inform value-based pricing contracts that demonstrate the efficacy of their products.

Interesting overview of the acute need for a wine producer to address the impact of climate change on business. I also read that another significant sustainability issue for wineries is waste water: industry standards show that for every liter of wine produced a winery outputs 10 liters of waste water (http://www.sciencedirect.com/science/article/pii/S0959652609000481). It would be interesting for CyT to conduct a holistic overview of areas to improve sustainability.

You raise a particularly good point on the sustainability aspirations of CyT and whether they should expand their scope to other players in the supply chain rather than focus on their internal initiatives. I think they will absolutely need to pressure other players in the supply chain to better manage resources and sustainability because of the broad risk their scale exposes them to. In addition, in the long run these investments could lead to decreased costs due to energy and raw material consumption as well as improved efficiency and yield. Sustainability efforts could thereby improve profitability in the long run.

Interesting overview of the sustainability impact of Amazon Web Services and some of the broader actions that Amazon has taken to reduce their environmental impact. Reading this overview and seeing Amazon’s description of their sustainability efforts did make we wonder though how much the company over-emphasizes sustainability in AWS. For example, it makes sense that a centralized server is more energy efficient than individual companies operating onsite servers, but I think that the profitability of that business was the main driver. On the topic of profitability, this business has large margins that might make these investments in wind farms and other renewable energy sources more feasible. Given the company’s diversified businesses and assets, it would be helpful to understand the impact of their entire operation. On that note, Amazon received an F from CDP, a non-profit that queries carbon emission statistics from companies and receives information from 70% of S&P 500 companies, for not responding to this organization’s inquiry (https://www.seattletimes.com/business/amazon/amazon-reluctant-to-share-carbon-emissions-data/). While I think it’s important for Amazon to pursue renewable energy sources for their AWS assets, I think Amazon could demonstrate themselves as a leader in sustainability for all of their businesses, not just those with the margin to comfortably cover investments.

Great ideas and perspective on opportunities for Macy’s to stay relevant as e-commerce becomes increasingly prevalent and defines success in retail. I like your ideas to better integrate in-store and digital experiences and rethink the use of the physical space — their only solution can’t be closing stores. Having worked at another large US retailer, though, I have seen the aversion to some of the large investments that are required to achieve these goals. When you have a lot of stores the investments can get big, fast. In addition, it can become hard to make these changes in the short timelines that might be required to retain customers. That being said, it was interesting to also read about how Macy’s began using RFID to track all of their merchandise, an effort that is expected to be completed by the end of 2018 (https://www.forbes.com/sites/barbarathau/2017/05/15/is-the-rfid-retail-revolution-finally-here-a-macys-case-study/#4392c6cd3294). As of May of this year, they had 50% of merchandise tagged. This type of technology allows them to fulfill online orders using their brick and mortar assets. Having better understanding of inventory will also help customers understand when it may be faster to go to the store to pick up an item rather than wait for it to ship. Ultimately, they are seeing operational and financial efficiency through this technology. Another barrier for large legacy players like Macy’s is not just having the creativity to innovate, but also to be able to rapidly test technology and truly believe in the ROI.