I suspect the question that Patagonia grapples with relates to which way a public ‘announcement’ of their sustainability efforts will swing the pendulum. While consensus tends to be that consumers around the world put a big price on sustainable manufacturing practices, research doesn’t always support the same. To quote Yvon Chouinard (Patagonia founder) in an interview some years back, “ Sustainability is not enough at all. Saving the planet is number 19 on people’s priorities. You’d think it would be number one. But no, number one is personal security. The world is scared to death of everything, right now.”
Given that Patagonia is manufacturing a product associated with comfort in harsh climates, the focus on sustainability could well drop even further. In such a case, the onus is on the manufacturer to drive change in manufacturing practices, and in consumer behaviour. Interestingly, this was echoed by Chouinard in the same interview when he said, “So it’s not going to come from the consumer. It has to come from businesses who understand that the consumer is going to be demanding these kinds of products in the future. You have to start reacting right now, before the customer tells you so.”
As a result, the onus is on Patagonia to drive customer education and sustainable production initiatives until the next generation of environmentally conscious consumers aren’t paying for their Patagonia themselves. The lack of faith that lobbying initiatives will, in fact, change competitor behaviour probably holds the firm back. After all, Patagonia refusing to undertake the same additional practices it propagates because its competitors refuse, while fair, will not play out well from a public perception standpoint.
This makes for a great read, Kunal, and you touch upon some very important points.
Traditionally, the Railways has been hampered by two major constraints:
(A) The Railways has often served as the epitome of socialist India, with the smallest price hike leading to political gridlock. As a result, any expenditure on the Railways was essentially an expense, since the money could never be recovered by raising consumer fares.
(B) While the size of the Railways workforce is often referred to, what is less spoken about is its organizational structure. Reporting to the Parliament of India is the Railway Board, headed by the Railway Minister but also comprising 14 other officials with responsibilities ranging from infrastructure & engineering to staff & rolling stock. There is no geographic division of responsibilities and often an overlap in functions when it comes to taking transformational decisions. As a result, the Board is known for being, historically, one of the most ‘bureaucratic’ set-ups in India.
Driving change in the Indian Railways, hence, is never about financial or technological transformation but is instead routed in driving political and structural change.
To answer your question, the best way to roll out change will be to have any initiative championed via a hub and spoke model. At the Centre will be an assigned member of the Board who is responsible for budgetary support and decisions that require political support. The spoke, meanwhile, will be represented by the head of the Railways in the region SUPPORTED BY the state government. State governments have a huge incentive to support Railways modernization since an upgrade in Railways services is a) a major plus point when it comes to fighting elections (Railways are, after all, the means of transportation for the typical voter) and b) a key attraction for manufacturing businesses looking for attractive destinations. With the growth of competitive federalism in India, states now compete not with other countries, but with each other to attract investments.
As you mentioned, the Indian Railways have over a period of time become archaic. As a result, benefits from modernization will be tremendous and instantly recognizable and realizable to external stakeholders. Meanwhile, for vendors and contractors who enable the execution of modernization initiatives, the size of the Railways pie is so huge that there is large financial incentive to support any actions in this direction.
This is a great piece, and I find my thoughts strongly aligned with JJFG.
When a sense of isolationism takes over, the role of corporations often gets cloudy. Apple’s contribution to the US economy is, at the end of the day, in the form of the taxes it pays (or doesn’t !).
A number of national governments around the world have tried wooing Apple to manufacture in their respective countries, and each time Apple has taken a measured view of whether the opportunity is financially attractive or not. Invariably, the proposal has been rejected. Similarly, politics should not cloud Apple’s judgement when it comes to the US.
Political leaders and movements are short-lived compared to the lives of large corporations and conceding to illogical demands should not even be on the table. Instead Apple must use its size and influence to a) contribute to American society through skilling, training and leading the development of revolutionary technology b) to lobby in Washington to ensure that no politically motivated move threatens the firm’s success – be it in the short term or longer.
This makes for a very interesting read. Traditionally, corporations that have built strong relationships with governments are the ones that engage closely with them behind closed doors, but don’t advertise this relationship in public.
With that as the background, embracing Trump’s “Made In America” campaign will be detrimental to Walmart in two ways. Firstly, it aligns them very clearly with a single political ideology, and even more in this case, with a single politician. Given that corporations are going concerns that live far longer than any single politician, such a move will not do Walmart’s long-term political engagements any good.
Secondly, and perhaps even more importantly, making in America would break the spine of Walmart’s competitive advantage. Walmart draws its success from its ability to provide the most competitive prices, which are made possible by low input costs and strategic sourcing. Manufacturing in America will raise COGS significantly and no longer enable the firm to offer the prices consumers are used to. Violent fluctuations in price are a poison pill that no one can swallow – neither a discount store like Walmart nor a producer of premium goods like Apple, which is why the world’s most valuable company has vehemently pushed back on any suggestion that it will move production to the US.
Instead, Walmart should leverage its influence to lobby Washington’s policies, while using its contribution to taxes, employment and economic activity as a Trump card against any sort of political backlash.
This makes for a great read! I personally believe that WB and other studios must continue investing in the movie theatre-going experience.
For the longest time, movie theatres enjoyed an entertainment monopoly, with no real direct substitute. Then Netflix and other digital platforms arrived and shook the entire landscape. The arrival of a competitor made us realise how little the cinema has done to stay with the times. The theatre experience is often noisy, expensive and forced – no one likes watching trailers or the inability to control intermissions. However, the business continued to stay relevant because even today, the big screen experience, with high-quality audio and video, is difficult to replicate.
In recent years, an effort has been made to turn the experience more pleasurable. IMAX, reclining seats, on-demand food and alcohol are all relatively recent additions to the dark hall. But this is just a start.
Going forward, Hollywood studios must collaborate with multiplex chains to overhaul the experience. This means leveraging technology to create high-quality productions, often in expensive formats. The quality of the viewing experience must be visibly superior to the one experienced while on the couch at home. Movie theatre chains, on their part, must invest in infrastructure that makes the movie hall an added attraction, instead of an annoyance that theatre-goers must put up with. This could include more spacious seating, engaging the touch and sensory experience or transforming the viewing area itself into a second source of entertainment like, for instance, a hot tub. This has been successfully tried before – spectators in hot tubs are a common sight at sports matches.
In today’s day and age, we certainly don’t NEED movie theatres. But it is up to production studios like WB, in partnership with multiplex chains, to make us WANT them!