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On November 23, 2017, murray&hume commented on Free Apple Watch! and other ways Aetna is embracing digitization :

While data undoubtedly opens up new avenues for patient management and disease prevention, there should be cause for concern when it comes to appropriate use of patient data. Devices and applications that collect patient data (Fitbit, Apple Watch, etc.) are not only accessible by payors but also third-party groups like advertising companies, some of which are subsidiaries of digital analytics and tracking groups, including device manufacturers like Apple and Google. In today’s digital world, almost no level of data is truly private. When consumers are trying to leverage data to improve outcomes, those who are not healthy risk having their data fall into the hands of large payors who might use that data to set policy premiums. Being the stakeholder who is providing economic distribution of health gadgets as well the stakeholder controlling healthcare expenses, insurance companies have a large responsibility to remain ethical when analyzing patient data. As both payors and providers seek new avenues to learn more about customer behaviour, it possible that there will be large-scale consolidation between health insurance providers and healthcare companies, further blurring the ethical line to gaining patient data. If the stakeholders can keep data safeguarded in the right ways, devices like Apple Watch have the opportunity to course correct America’s dire status with chronic illnesses. The FDA has made significant strides in regulating patient data in mobile health and health IT solutions but much still remains to be established in the field. Who will stand up for policing the ecosystem? Can we develop programs that make it possible for patients to control when data is released? Technology will move very fast, but the challenge still remains to have all the other pieces of the ecosystem keep pace so we don’t miss out on the opportunity to bring quality health back into the hands of the patient.

While the competition for autonomous cars and alternative means for capacity utilization increases, there has been a clear shift in focus away from public transportation to purely movement of goods. If Uber is blocked out of the next frontier of single occupancy/vehicle mobility, what keeps it from innovating in areas where other companies have neglected? Public transportation in the US is a mess and with the data that Uber currently owns, perhaps there are opportunities to provide the transportation ecosystem that the country desperately needs. Understanding local trends in the movement of humans throughout the day and throughout the year, Uber should consider developing solutions that can start moving masses of people, which helps enhance capacity utilization and provide disruptive solutions in an environment that has seen little interest or movement in decades. While nearly all major European countries have robust and affordable rail and bus systems, America places significant reliance on ownership of vehicles. Solutions already exist and what Uber can capitalize on is the execution. As an “asset-less” business, as it claims, Uber would have to prioritize changing its business model and associated cost-structures to accommodate a pivot to a more asset-intensive market of public transportation. However, I find this to a be a great opportunity to consider as an effort to reduce climate change due to vehicle congestion, reduce commute times, and make cities more affordable for citizens to be active contributing members of the larger economy.

Brand equity can only carry a brand so far in the face of increasing challenge associated with the manufacturing and distribution supply chain. While it may seem reasonable to diversify product offerings away from resources and manufacturing that are at the perils of climate change, profitability may not entertain localization of products. As demand for the product continues to grow, consumers will demand increasing quality and innovation to remain loyal. Under these circumstances, PepsiCo must continue providing the existing products or innovate new solutions that are more sustainable to replace. And as a result, I would expect that the consumer demands from the brand will increase.

Looking forward, PepsiCo will have to focus on what they can control. How can they leverage technology to extend product shelf life? How can they grow the market share of customers in markets that are not currently marketed? The greater the distance from resources to end customer, the greater the risk on profitability. I think to combat the economic impact of climate change, PepsiCo will have to engage the entire supply chain with other large companies to reduce the time it takes to solve sourcing challenges. By aggregating capabilities, resources, and consumer demand, companies should be able to balance variabilities across the world. Unfortunately, this may lead to seasonal price variations, which may be more manageable by brands as they leverage their brand power in the market.

I completely agree that being defensive is a troubling path. Undoubtedly, Americans represent a large portion of global flyers and if US3 continues to play hardball and pointing fingers, I can only assume that international airspace may become more difficult for US3 to access. Etihad, for example, provides immigration clearance in Abu Dhabi for all US-bound passengers. This provides a significant operational advantage for American airports and allows security forces to thwart risks outside US borders. Such services are important for the US and can be put at risk if the government and US airlines become overly isolationist. Recently, Emirates decided to reduce their US flights for nearly 50% of their US destinations as a response to declining demand. Rather than take this as an opportunity, the US3 continued their defensive tirade by highlighting Emirate’s lack of profitability and claims of fraudulent government subsidies. Ultimately, these airlines will face biggest losses to their customers. As business becomes more global and younger countries more developed for global tourists, foreign service providers may no longer need to rely on American customers. Inevitably, to compete and provide global services, American airlines will increase prices in response to increase the cost of services, ultimately passing their faults to customers’ ticket prices. And despite Trump’s efforts to throttle middle east air travel, his past ties to the UAE and Qatar and push for American manufacturing of planes will make it difficult for US3 to hold their ground, especially when they fail to seize the opportunity to capitalize on retracting ME3 routes.

While it may be reasonable to consider that Nissan could re-shore manufacturing efforts to the UK, I would be concerned about two things. First, the complete manufacture and assembly of cars may require a labour force that may no longer exist in the UK. Similar to the United States, much of labour heavy jobs in the market are predominantly held by immigrants. And for the UK, this means employees from the EU who will have to now seek job-permits or citizenship to be able to remain a part of the UK working class. Given the current sensitivities of global immigration policies, will there be enough UK citizens to fill those roles in the labour heavy segments? If there are enough employees, this will mean thousands of new factory workers that require on-boarding and training into a highly streamlined system, given that their safety inventory is less than one day. And if Nissan and other UK manufacturers decide to rely on a robotic workforce, that will require a significant shift in the operations and style of manufacturing that perhaps currently exists.

Second, I foresee that for certain components or subassemblies, the development of advanced manufacturing capabilities off-shore may be difficult to replicate in the short period of time without disrupting supply capabilities. As automotive manufacturers advance towards autonomous vehicles and artificial intelligence, Nissan will have to consider whether existing suppliers can be replicated domestically where certain technical capabilities do not exist. If import and regulatory fees become excessive on key component imports, suppliers may be able to squeeze car manufacturers knowing that alternatives don’t exist, placing Nissan under tighter margins.

I think its smart that Nissan works closely with the government to leverage channels wherever possible. Unfortunately, labour and inevitable technology gaps within the UK automotive industry represent just one of many such industries, including consumer goods and healthcare. More worrisome will be if other non-UK owned companies decide entirely to leave the UK as skill-shortages and rising costs make the UK manufacturing unprofitable. If Nissan is unable to find a healthy solution to the on-shoring of its production, what will be the domino effect to other automotive manufacturers like Honda and Toyota, and what will be the larger impact on domestic manufacturing all together?

On November 23, 2017, murray&hume commented on Victoria, Don’t Keep a Sustainable Supply Chain Story a Secret :

You raise an interesting point to consider how much value of a sustainable product purchase is based on the consumer’s desire to make a conscious purchasing decision or for the sake of advertising their “green” purchase. And as you mentioned, intimate wear is difficult to have the public recognition but I do believe that females who are conscious of where their purchases come from will be motivated to make these purchases. Interestingly though, Victoria Secret does not seem to be advertising their move towards sustainable movement, making it indistinguishable to customers. Do you think this is by design in an effort to maintain a sense of continuity? If prices go up without justifying the increase to customers, how will Victoria Secret build their loyalty base?

Perhaps it is too early for them to be overly bullish towards consumers given that this a recent decision by the brand. Interestingly, seems like many brands, including Nike, faced public pressure from Green Peace’s “Detox My Fashion” 2016 campaign for not taking active actions towards sustainable practices. With a new CEO that took helm just last year and given that Victoria Secret has been in a downward slump in the last few years, with recent earnings per share down nearly 30 percent from last year, I question whether Victoria Secret’s response to RAN was just to salvage their plummeting PR and market value. I worry that the breadth of L Brands to be more accountable for their raw materials may be short-lived. Or perhaps some L Brand brands will take greater accountability for their supply chain while others continue their exhausting manufacturing practices. With numerous young companies in the eco-friendly lingerie space (Pansy, Brook There, Sloane & Tate, etc.) and given that most of the eco-conscious consumers are millennials, if Victoria Secret doesn’t focus on communicating their sustainable efforts, they may be too slow to react and begin losing their foundational base of customers.