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As someone whose first real job was doing grunt work in a plant genetics lab, I too found this very appealing! I want to echo SS and Jacqueline’s points but I do think there are benefits for using this technology in certain labs where this work would get outsourced to technicians (or high school students like me) anyways. Plus, it’s possible that this could encourage more people to consider a career in biotech (industry or academia) who may otherwise have shied away due to the amount of time spent on repetitive tasks. Also, the money saved on labor costs could be used to fund additional research projects, which may actually have a positive net effect. I agree that this technology may have limited use in academia where scientists are expected to challenge and develop new protocols and stay close to the experiment at all times.

This technology might have more application in a commercial setting where there is a need to run the same experiment hundreds of times. For example, I could see Indigo really benefiting from Transcriptic. They could test hundreds (or thousands) more microbes for potential future development than they would be able to test by hand. They could also run the robots overnight, which would allow them to speed up testing. As we saw in the case, speed in discovering new commercializable microbes is essential to Indigo’s business model given that their business model is easy to replicate. This technology could help them move quickly from one product to the next and stay ahead of their competitors.

This is such a cool post Pierre! Very informative piece about an industry that we don’t think about often but impacts our everyday lives. Two questions:

1. Maersk seems to bring a lot of technological innovation to its shipping business. I am curious how they come up with idea after idea after idea on how to apply existing digital technology in innovative and meaningful ways. Do you know if there is some sort of internal process that they follow (almost like an internal innovation funnel) that allows them to regularly comb through new technological advances and consider how Maersk might be able to apply them to their own business?

2. Hanjin, one of Maersk’s rivals, filed for bankruptcy this year. It seems that Hanjin was unable to stomach the sudden drop in shipping prices as excess capacity far outweighed demand industry-wide [1]. Maersk was not immune to this building spree as it “had been at the forefront of the mega-ship frenzy, ordering 20 of some of the biggest vessels on the market in 2011” [2]. Do you think Maersk has been using its value-add services, such as temperature monitoring of individual containers, to subsidize the impact of low shipping costs during this glut in shipping capacity? If so, can they use this as a way to deliberately wage price wars to price out less technologically advanced rivals in the future?

[1] http://www.latimes.com/business/la-fi-hanjin-shipping-industry-crisis-20160913-snap-story.html

[2] Ibid.

Great post on the power of applying even basic technology in new ways or in new environments. One question:

Growing and achieving scale is central to M-Pesa’s model. However, the first concern I had was that their size makes them an attractive target to hackers. I did some research and discovered that two years ago, Kenyan officials discovered and arrested a cybercrime ring operating out of Nairobi “equipment capable of a massive cyber attack, such as infiltrating Safaricom’s M-Pesa (mobile money transfer) system, cash machines and bank accounts” [1]. Although this ring had not attacked M-Pesa, it seems like it is only a matter of time before either hackers attack or the Kenyan government introduces stricter regulation around digital cash transfers.

You asked at the end of your post if M-Pesa could “leverage its first mover advantage and achieve enough technological improvement to become a sustainable leader.” I posit that one key way M-Pesa could do this would be to invest in cybersecurity measures and cooperate with the Kenyan government proactively to ensure it is seen as a regional (and perhaps global) leader in this space. This could enable M-Pesa to expand into other markets that were previously closed to them and avoid the risk of a crippling, potentially fatal cyberattack.

[1] http://pcmlp.socleg.ox.ac.uk/wp-content/uploads/sites/4/2015/06/Gagliardone_Sambuli_CyberSecurity-2.pdf

Great post Shaun! I wonder if Rhumbix could make a case for targeting companies that specialize in overseas construction. In the face of softening demand for these services, Korea’s Minister of Land, Infrastructure, and Transport said “Korea’s construction players should switch to high value-added sectors like project planning and management rather than simply executing the orders they have received” [1]. Rhumbix seems like it could add tremendous value here by allowing Korean construction companies to work smarter, not harder in order to boost profits.

[1] http://www.koreatimes.co.kr/www/news/biz/2016/03/488_199598.html

On November 20, 2016, Jina commented on When Epic Digitization is Not So Epic :

While I agree that Epic needs to increase its interoperability and product, I think Epic should prioritize product improvement to reduce customer flight risk. Epic gained a tremendous advantage by staying ahead of the trend to digitize, which positioned it well for the changes to the medical records industry since 2008. However, without further digital innovation, Epic lost its edge and is now relying on network effect to stay relevant and profitable. As we discussed in class during our Uber case, this makes Epic vulnerable to a potential negative “spiral of death.” It seems Epic’s system is sticky because it’s widely used but not interoperable. If Epic moves towards enabling interoperability first without improving its product, this could start a mass exodus of users from Epic to better EMR systems.

On November 7, 2016, Jina commented on Will it be NextEra’s Era? :

As a follow up to this comment, it seems that NextEra also stumbled politically in their effort to acquire Hawaiian Electric Industries [1]. You are suggesting that NextEra diversify into new markets. What advice would you give them on their approach to ensure they don’t face the same setbacks and potentially expensive breakup fees ($90 million in HEI’s case)? [2]

[1] Utility Dive. 2016. UPDATED: NextEra, Hawaiian Electric terminate merger after PUC rejection. [ONLINE] Available at: http://www.utilitydive.com/news/updated-nextera-hawaiian-electric-terminate-merger-after-puc-rejection/422316/. [Accessed 7 November 2016].

[2] The Wall Street Journal. 2016. NextEra, Hawaiian Electric Terminate Merger Bid. [ONLINE] Available at: http://www.wsj.com/articles/nextera-hawaiian-electric-terminate-merger-bid-1468838067. [Accessed 7 November 2016].

On November 7, 2016, Jina commented on Ohana Means Family: Learning to Share Resources Sustainably :

Totally agree Rotem. The US Navy also agrees with you! The first wave powered electricity to feed into a power grid happened in Hawaii! [1] The Navy is coordinating with the University of Hawaii to pioneer wave technology but as you mentioned, the technology is still in its infancy and it seems like it’s at least 5-10 years from commercial viability. Still, I’m hopeful that this could work out in Hawaii’s favor. Wave technology also has the advantage over solar and wind in that it’s not constrained by when the sun shines or wind blows but is effectively 24/7.

[1] Phys Org. 2016. America’s first wave-produced power goes online in Hawaii. [ONLINE] Available at: http://phys.org/news/2016-09-wave-produced-electricity-online-hawaii.html. [Accessed 7 November 2016].

Tourists have an impact that goes beyond the emissions from the flights they take to get there. Hawaii is dependent on imported oil for the majority of their electricity supply right now, although they are trying to move to 100% renewable energy by 2045 [1]. Hawaii also has a finite freshwater supply [2]. You mentioned 71,000 tourists visit Waikiki alone every day. That’s 7% of Honolulu’s population [3]. With such a large tourist presence, it goes without saying that tourists absolutely place a burden on Hawaii’s energy and water infrastructure. However, as you mentioned in your blog post, Hawaii and its residents depend heavily on tourism to support the local economy. Getting rid of the tourists is not an option. I agree that Hawaii’s government will need to take decisive but thoughtful action on how best to encourage tourism while mitigating the environmental impact locally as well as worldwide.

[1] Hawaiian Electric Industries, Inc.. 2015. Form 10-K for FY 2015. [ONLINE] Available at: https://www.sec.gov/Archives/edgar/data/46207/000035470716000128/a201510k.htm. [Accessed 6 November 2016].

[2] U.S. Geological Survey. 2014. Coastal Groundwater Systems. [ONLINE] Available at: http://wh.er.usgs.gov/slr/coastalgroundwater.html. [Accessed 6 November 2016].

[3] The United States Census Bureau. 2015. Quick Facts: Honolulu County, Hawaii. [ONLINE] Available at: http://www.census.gov/quickfacts/table/PST045215/15003. [Accessed 6 November 2016].

I’m alarmed by your suggestion that Monsanto view climate change as an opportunity to push Roundup products in order to “generate large profits.” A recently released study indicates that the application of glyphosate-based herbicides like Roundup at currently accepted rates, can have toxic effects on soil filamentous fungi [1]. This matters because arbuscular mycorrhizial fungi “establish symbiotic relationships with almost 80% of plants, mainly herbaceous ones, among which are found the cultivated crops that feed the world” [2]. The fungi help improve drought tolerance and pathogen resistance, which improves crop yield without reliance on additional chemical treatments or fertilizer [3]. While Roundup can provide some short term benefits for improving crop yields around the world, it’s not a long term solution. Monsanto needs to do better and come up with some other flagship product if it wants to call itself a true climate change leader.

[1] Nicolas, V., Oestreicher, N., and Vélot, C., (2016) Multiple effects of a commercial Roundup® formulation on the soil
filamentous fungus Aspergillus nidulans at low doses: evidence of an unexpected impact on energetic metabolism,
Environmental Science and Pollution Research, pp 1-12 DOI 10.1007/s11356-016-6596-2

[2] Government of Canada, Agriculture and Agri-Food Canada. 2013. Arbuscular Mycorrhizal Fungi and their Symbiosis with Plants. [ONLINE] Available at: http://www.agr.gc.ca/eng/science-and-innovation/research-centres/ontario/ottawa-research-and-development-centre/the-glomeromycetes-in-vitro-collection/arbuscular-mycorrhizal-fungi-and-their-symbiosis-with-plants. [Accessed 6 November 2016].

[3] Ibid.

On November 6, 2016, Jina commented on Sunny Days Ahead for SolarCity? :

Craig mentioned in his post that Wal-Mart installed a number of solar panels on its rooftops in an effort to move towards sourcing sustainable energy. I did a little additional research and it turns out that Wal-Mart is one of SolarCity’s clients [1]. One of the primary reasons Wal-Mart uses SolarCity seems to be the value proposition of having SolarCity put up its own capital in order to provide Wal-Mart with cheaper electricity. As one of Wal-Mart’s executives put it, “Why put up our own capital?” [2]. The question of tax subsidies aside, do you think there’s an opportunity for SolarCity to structure its deals with its clients in a more economically favorable way? Why should SolarCity carry 100% of the capital burden?

[1] Forbes. 2014. How Walmart Became A Green Energy Giant, Using Other People’s Money. [ONLINE] Available at: http://www.forbes.com/sites/christopherhelman/2015/11/04/walmarts-everyday-renewable-energy/#2eff4e674894. [Accessed 6 November 2016].

[2] Ibid.

On November 6, 2016, Jina commented on From EDLP to EDLT :

Great post – love the mental image of a wind turbine in an Arkansas Wal-Mart parking lot.

I had some questions on the rooftop solar panel initiative. Wal-Mart justifies the solar panels because it’s a great value proposition for the company. SolarCity pays them to use Wal-Mart’s rooftop space and then provides power at costs cheaper than the local utilities. As Ozment, the Wal-Mart electricity executive says in the Forbes article, “The value proposition is really obvious…Why put up our own capital?” [1].

However, what happens if SolarCity goes out of business? You can make the argument that SolarCity can afford to put up the capital that Wal-Mart can’t because it is being propped up by tax subsidies and Elon Musk’s other companies. SolarCity’s most recent bond offering was met with tepid investor response – Elon Musk and his family and friends bought up most of that debt [2]. If SolarCity goes down, should Wal-Mart seek out ways to deploy its own capital to keep those solar panels on its roofs? Do they just drop out of solar energy altogether? If Wal-Mart stops using solar energy and switches back to regular electricity, will that damage their reputation? On the other hand, since millennials seem to care more about affordable products than a company’s values, perhaps it won’t actually make much difference to them [3]. Thoughts?

[1] Forbes. 2014. How Walmart Became A Green Energy Giant, Using Other People’s Money. [ONLINE] Available at: http://www.forbes.com/sites/christopherhelman/2015/11/04/walmarts-everyday-renewable-energy/#2eff4e674894. [Accessed 6 November 2016].

[2] Market Watch. 2016. Elon Musk, SolarCity execs to buy most of SolarCity bond offering. [ONLINE] Available at: http://www.marketwatch.com/story/elon-musk-solarcity-execs-to-buy-most-of-solarcity-bond-offering-2016-08-23. [Accessed 6 November 2016].

[3] Statista. 2014. What matters most to Millennials when choosing where to shop?. [ONLINE] Available at: https://www-statista-com.ezp-prod1.hul.harvard.edu/statistics/317798/us-millennials–most-important-aspects-when-choosing-where-to-shop/. [Accessed 6 November 2016].

On November 6, 2016, Jina commented on Hawaii Leads the March Towards 100% Renewable Energy :

This is an awesome post. Hawaiian officials blocked the NextEra Energy acquisition of HEI in July 2016 on the grounds that “NextEra failed to prove its plans for HECO would be good for the state” [1]. Do you have thoughts on how this will impact HEI’s plans for switching to 100% renewable energy? HEI claims that the breakup fee has gone towards improving the local infrastructure and helping HEI move towards its renewable energy goals [2]. However, do you think it’s possible that access to a bigger balance sheet like NextEra’s would have actually benefited HEI?

On another note, do you view HEI’s partnership with AES as potentially harmful from a PR perspective? AES runs a coal powered plant in West Oahu that provides 11% of Oahu’s commercial energy supply that made the U.S. EPA’s top 10 list of facilities that released the most chemicals in the state [3]. Do you think HEI needs to push AES towards renewable production (e.g. burning biomass instead of coal) or do you think they should simply build out their own renewable capacity and then cut ties with AES?

[1] The Wall Street Journal. 2016. NextEra, Hawaiian Electric Terminate Merger Bid. [ONLINE] Available at: http://www.wsj.com/articles/nextera-hawaiian-electric-terminate-merger-bid-1468838067. [Accessed 6 November 2016].

[2] The Business Journals. 2016. HEI’s profits soar due to failed NextEra-HECO merger bid. [ONLINE] Available at: http://www.bizjournals.com/pacific/news/2016/11/04/heis-profits-soar-due-to-failed-nextera-heco.html. [Accessed 6 November 2016].
Add to My References

[3] The Business Journals. 2015. AES Hawaii coal plant faces dim future with NextEra Energy in charge. [ONLINE] Available at: http://www.bizjournals.com/pacific/blog/2015/03/aes-hawaii-coal-plant-faces-dim-future-with.html. [Accessed 6 November 2016].

If some company succeeds in creating a relatively cheap mechanism for storing electricity, it’s possible that many relatively wealthy households could elect to go off the grid altogether. If this happens, will utility companies be able to maintain their infrastructure with a smaller customer base that tends to delay or default on payments more often? Electricity, like water, is often considered to be a basic human right. What, if any, should the role of government be if major utilities begin to fold or need to increase electricity rates drastically?