Zach Gordon's Profile

Alex – thanks for your article, it’s great (and very interesting) to see how BP has turned the recent drop in oil prices into an opportunity to invest in improving its operating model with new technology. To the extent that the investments have a positive financial return (i.e. that the cost-savings outweigh the upfront capital expenditures), I wonder why BP wouldn’t have made these improvements earlier. I imagine the company’s decision will have at least something to do with technological constraints that have either been eliminated or made less costly. To that end, how much of BP’s technological improvements have been engineered in house versus by third-party equipment and services providers? If BP is able to develop some of its own cost-saving technologies and processes, it’s reasonable to think that those advances could be an important source of competitive advantage for the company going forward.

Meant to post mine as a comment, not a reply!

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Excellent article on an interesting competitor to Airbnb. I understand Uniplaces’ strategy to differentiate itself by targeting students looking for mid-term rentals, but I wonder if the company’s operating model diverges enough from Airbnb’s to ensure a long-term competitive advantage. For instance, if Airbnb launched a service tomorrow that focused on connecting longer-term renters with longer-term property owners, would Uniplace be able to convince consumers to stay on its platform? Perhaps one way to increase stickiness would be to partner with universities such that Uniplaces could entrench itself in the student market. Given the fact that the company is working with limited resources, do you think it would be better for Uniplaces to focus on bolstering its presence in this targeted market, or aim to broaden its base as quickly as possible in order to gain scale?

Excellent article on an interesting competitor to Airbnb. I understand Uniplaces’ strategy to differentiate itself by targeting students looking for mid-term rentals, but I wonder if the company’s operating model diverges enough from Airbnb’s to ensure a long-term competitive advantage. For instance, if Airbnb launched a service tomorrow that focused on connecting longer-term renters with longer-term property owners, would Uniplace be able to convince consumers to stay on its platform? Perhaps one way to increase stickiness would be to partner with universities such that Uniplaces could entrench itself in the student market. Given the fact that the company is working with limited resources, do you think it would be better for Uniplaces to focus on bolstering its presence in this targeted market, or aim to broaden its base as quickly as possible in order to gain scale?

Haley, thanks for the excellent article on Enlightened. The business model makes a lot of sense and the innovative operating model (specifically the SaaS structure) is a creative way to make the large up-front investment work for businesses from a financial perspective.

To me, the service Enlightened provides is great for companies in the private sector, but could also be an excellent option for governmental agencies as they update their lighting and HVAC equipment. I looked on the company’s website, and wasn’t able to find any mention of a focus on public-sector clients. I wonder if the company is targeting government agencies as well, and if so, whether it would need to consider any tweaks to its current operating model to make its platform as attractive as possible.

Sam, excellent article on a platform I’d never heard of before! The opportunities for companies to apply ID.me’s technology are clear in so many different contexts, particularly in today’s expanding sharing economy. From both a business and consumer’s standpoint, it would be so convenient to have all ID verification taken care of through one portal, rather than have to deal with verification on each individual website. I recently had to upload photos of my passport and my driver’s license in order to make a reservation on Airbnb, and having to jump through the same set of hoops for other websites would not only be a pain, but would also a bit unnerving given the sensitivity of sending those documents over the internet.

It’s clear that ID.me has focused its early efforts on military and/or government-related discounts. I imagine that if the company wishes to provide broad-based verification services for a wide array of consumers and businesses, achieving scale across its network will be crucial. To that end, how has the company organized its efforts (strategic and marketing) to grow its user base? Will the company aim for rapid expansion or focus on building up its current platform at a more measured pace?

Carlos, thanks very much for the great look into the banking sector in Brazil! One thing I was wondering as I read it is the source of Itaú’s outperformance from a customer service perspective. I’ve heard from friends that have accounts at Itaú that the bank’s personalized service is one of the main ways that it stays ahead of the competition in terms of client satisfaction. Given the bank’s focus on shifting much of its platform to digital, how is it planning to maintain the right measure of personal interaction with its clients? Is it possible to tell whether client satisfaction has gone up or down in recent years? Given Itaú’s leadership in transferring its platform to digital, it will be interesting to see if the bank is able to gain market share in the coming years on top of the investments it has made since 2012.

Your analysis does a great job demonstrating how an old technology can be harnessed to meet a very modern challenge. The numbers as it relates to the environmental benefits of train travel (10x more efficient than car travel and 20x more efficient than traveling on a plane) speak for themselves. Based on your framework, it’s clear that trains in France already have a meaningful environmental impact given how prevalent train travel in France must be; after all, a train company can only generate €30bn in annual sales if it’s moving quite a few passengers!

To me, there appears to be a potentially substantial incremental impact of convincing more people to take the SNCF train line more often. For every new passenger that opts to take the train rather than drive his/her car or hop on a plane, the marginal environmental impact should be almost entirely positive. Especially for less popular travel times (i.e. when the train system is less crowded), it’s likely that incremental passengers would be boarding trains that would have been running anyway, just half empty. In those cases, the SNCF wouldn’t have to add additional trains, even if the number of additional passengers were reasonably large.

In this context, I wonder if there are ways to incentivize or otherwise convince more Frenchmen to take the train? To the extent that service delays or other inconveniences are dissuading people from taking the train, addressing those issues head on would give an indirect, but perhaps substantial boost to the net environmental savings the SNCF produces versus other methods of transport.

You do a really great job of laying out the challenges Doosan faces as it relates to environmental concerns in the power generation industry, particularly in the coal-burning segment. Given Doosan’s high exposure to coal-burning plants and leadership in thermal technology, it’s clear that the quickest gains in environmental efficiency will come from enhancing the company’s core offerings in this legacy space.

On a longer-term time horizon, you mention the need for Doosan to extend its business into alternative sources of energy generation. Given that Doosan has already made considerable advancements into nuclear power technology (http://www.doosan.com/en/media/press-view/doosan-heavy-industries-construction-signs-a-deal-to-supply-main-equipment-to-shinkori-nuclear-power-plant-units-5-and-6-20140902175915132060), do you have a view as to whether nuclear is an attractive option for Doosan to expand its business in South Korea? From a technological perspective, I imagine that there might be valuable sources of overlap between thermal and nuclear power. That said, whereas nuclear was once considered a compelling alternate source for energy, many now question how viable nuclear is from a long-term environmental perspective (especially following the Fukushima disaster in 2011). Is going nuclear a good bet for Doosan to make?

You’ve done a great job laying out some of the biggest challenges faced by Antofagasta and other mining companies in Chile as it relates to sustainability. No doubt there are a wide variety of environmental challenges that any company operating in the space globally will encounter, but I wonder if there are particularities that either benefit or hurt Chile’s progress towards a more sustainable model. In particular, you mention that Chile is home to Codelco, the largest mining company in the world that is also run by the government. I understand that in recent years, the Chilean government has gotten more stringent on holding copper mining companies to environmental standards (http://www.earthisland.org/journal/index.php/elist/eListRead/chile_finally_gets_tough_on_mining_industry/), but I imagine there must be at least some conflict of interest in the fact that the government is in charge of both the largest company in the sector and the sector’s regulation. Has this potential conflict of interest impacted progress in the industry at large and if so, is it up to Codelco’s competitors to lead the charge in driving the adoption of higher environmental standards?

Carlos, you provide a great overview of Suzano’s efforts to make its business more sustainable in Brazil, particularly as it relates to FSC certifications for its forests and the company’s use of green bonds. Given the heavy use of industrial equipment in cutting trees down and processing wood into finished products, I wonder to what extent Suzano has pursued improvements to its manufacturing process? Particularly in light of Brazil’s extremely high import tariffs, capital improvements to factories and machine purchases can be extraordinarily costly. I wonder if there is a way for Suzano and other leading companies to work with the Brazilian government to structure exemptions (full or partial) to import tariffs if the equipment imported will have a significant and measurable impact on the company’s environmental impact?

You’ve done a great job laying out the implications of a tightening water supply – it’s no doubt a humongous challenge for Pepsi and other companies that produce water-intensive products. The company is clearly making progress at upgrading its supply chain and manufacturing processes in a way that substantially diminishes the company’s environmental impact, all without consumers noticing any change in what they’re consuming!

While reading your piece, I was reflecting on other initiatives Pepsi has launched in its effort to be a more sustainable company. In particular, I remembered an initiative the company launched in 2009 to make the packaging for its popular Sun Chips brand more eco-friendly. The packaging was 100% compostable, which when compared with standard packaging for chips represented a meaningful improvement. However, the updated bag was met with very mixed feelings by consumers. Some applauded the company for its leadership in pushing packaging into greener territory, while others complained louldly that the compostable material was too noisy. 18 months after the launch of the new bag, Pepsi capitulated to disgruntled consumers and reverted to its prior packaging (http://usatoday30.usatoday.com/money/industries/food/2010-10-05-sunchips05_ST_N.htm).

In this context, I wonder what Pepsi has done since its experiment with Sun Chips to introduce green packaging? At a more conceptual level, I wonder how consumer-facing companies weigh the trade off between product improvements from an environmental perspective and alterations to the underlying experience consumers have with the product?

There are so many opportunities for a vertically-integrated company like Ambev to reduce its environmental impact. As you’ve laid out very nicely in your post, the company has adopted a very proactive approach to dealing with many of these opportunities as it relates to its supply chain and distribution network. On top of those opportunities, an additional challenge that Ambev and many other CPG companies are grappling with is the need to reduce the impact from packaging materials. Ambev has made some progress in developing more environmentally-friendly packaging materials and practices, such as the development of a plastic bottle made of 100% recycled materials (https://www.google.com/search?q=ambev+environmentally+friendly+packaging&ie=utf-8&oe=utf-8#q=ambev+recycling) and a more close monitoring of raw materials the company recycles in each of its many markets (http://www.ab-inbev.com/content/dam/universaltemplate/abinbev/pdf/sr/download-center/AmBev_GCReport_1.pdf). That said, it is unclear how much of a priority packaging is in the context of the company’s overall sustainability program. I wonder to what extent the company could further its environmental efforts by setting its sights on what is undoubtedly a huge producer of waste?