RVD's Profile

Agree with the above about great post, and I will start by saying that as a HUGE fan – I agree with Gabrielle that even as Cirque du Soleil has diversified its offerings, it is still synonymous with its traditional acrobatic shows. So I like the push for both supply and demand side solutions because a plan that solely focuses on diversification inherently involves a shift from their core – something I would be devastated to see. With this in mind, I think their move to open shows in locations that are either closer to their sources of talent or that are more pro-immigration is the best move for them to make in terms of growth. As a small company (outside of the talent), I am not sure they have the resources to really take on a direct legal or lobbying battle – nor am I convinced it would be the best use of their limited resources.

If they have to substitute out performers or offer a “lower quality” show than they should instead push consumers and investors to push for change on their behalf through a low-cost viral marketing campaign rather than lobbying directly.

From my perspective, I actually very much agree with Graham on the “romance” of wine – at least optically. What I mean by this is, I agree that people would balk at the idea of grapes grown in greenhouses if they were exposed to those greenhouses upon visiting the vineyards and going wine tasting. The reality though is most hectares of grapes are constantly outside of the sights of visiting consumers and they would never even know what practices are being conducted on their wines unless the producer is advertising “all natural” or “organic”, etc. For this reason I am actually not opposed to the idea of taking more drastic steps when necessary – though I would argue we are not quite there yet and so I wouldn’t invest immediately in these types of initiatives.

Moving on to Paul’s comment, while I agree exploring new land opportunities for growth makes sense – it is actually REALLY hard and the particular soil and land atttributes (e.g., tilt for irrigation, etc.) are far more critical for wine production than temperature and so the company would be better to invest in tempering the temperature on their existing plots of land that moving to new plots of lands.

I agree with Ashiana that the time and cost to transport the product “round trip” for packaging does at first seem to be incredibly inefficient and costly to the company so I wonder why they do this to begin with? I tried to search online to find out more as to the rationale but came up empty handed. Let’s thus assume that there are cost-savings or reasons for them having chosen this option and I have to side with EN above – again, this assume they are rationale and maximizing their profits. So removing the option that they have just been operating poorly for years, I too think that the investment to move facilities now is premature and they should really start pushing hard for legislation and trade agreements.

This push for trade agreements is of course very complicated – more so for Ireland and the UK than the UK and the general EU. I say this for a number of reasons:

1. They are connected by land (obviously)
2. Much of Northern Ireland (UK)’s goods are shipped out of the port of Ireland — huge disadvantaged impact on this part of the UK
3. In absence of EU requirements, the UK and Ireland would very easily come to agreement (I would argue) that the border remain open and free for trade; however, the EU requires Ireland as a member to enforce a border and customs so the two are not allowed to have their own bi-lateral arrangements in my understanding

Given this, I think Ireland and Diageo (UK) really need to start pressuring the EU to think through some of this as well while working bi-laterally under the assumption EU gives them permission for some sort of special status.

The insurance business here is something I find really interesting because of the risk and pricing debates that I could see stemming from this. For example, a basic pricing model may simply say that those policy holders that “choose” to live in areas such as Texas and Florida that are most exposed to these types of catastrophic events should bear the burden of that risk through increased premiums; while those who “choose” to live in areas less risky should continue to pay their current or even lower premiums. For me what makes this proposal challenging is the fact of which that the actions taken by the policy holders in “less risky” climates can have huge impacts on the other policy holders who are living in the “risky” climates.

Playing this out, if one policy holder in Florida is taking every action possible to reduce their impact on global climate change while another policy holder in Chicago is significantly contributing to global climate change – how can an insurance company price their product appropriately so as to drive behavioral changes in the Chicago policy holder given that the risk exposure of the insurance company is by many accounts a combination of both of these individuals?

Like Brandon above, I too think about this as larger than a pure product innovation lab experiment but I think the fact of which that we are able to have that debate is an issue in and of itself. Adidas needs to be much more clear in what it is ultimately hoping to get from their Speedfactories. I say this because investor relations will depend on it, but also because I think the development and approach to scaling is different for them depending on whether this is really about innovating on a product or innovation in manufacturing.

For the former, innovating on the product, they should have and would need to first prove that demand for this product would warrant the R&D investment and capital costs to develop. Many competitors have already gone to market, Nike being the obvious one, with customizable shoes and to my knowledge the penetration hasn’t been large enough yet to warrant a huge investment in “hyper-customization”. Alternatively, if this were the latter, innovating in manufacturing, that I agree that the ROI is harder to define but I would argue that even under the most extreme of assumptions one would conclude that the potential for this far exceeds that of the simple product innovation. The ability to radically redefine and localize their entire production has far greater potential impacts for the company and the entire supply chain. I would assert based on their goal that they are certainly targeting this latter innovation in making such a large investment.

I definitely agree that Tesla’s move towards manufacturing automation is certainly aligned with their overall goals of speed and quality but I also believe that Tesla and its founder Musk have largely underestimated how difficult of a task this truly will be for the organization. This I think is evident in their acquisition strategy and hiccups they have faced in meeting customer demand. I would argue however that they have taken the right approach for them of quickly getting the product to market and then tinkering with the production cycle and automation to drive down future costs. This has enabled them to increase their cash inflows, deliver on their customer promise to early adopters, and invest this money back into their automation efforts.

As you note though, more importantly I think is what you question around, “with such a transparent strategy of moving towards automation, how will Tesla manage their current labor workforce and will this transition cause internal uncertainty and new challenges?” I think recent news certainly would point to the issues you are alluding to here. Business Insider reported last May about Tesla saying, “There’s been chatter about a union-organizing effort at the company’s Fremont, Calif. factory.” As you noted above about them having been failing to meet customer demand for existing orders because of the manual work required “by hand,” Tesla could be in for even more trouble if they aren’t able to temper the arising issues with their workforce.