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Posts Tagged ‘business

“The only function of economic forecasting is to make astrology look respectable”*…

 

We should remember that we will pass down a whole society to our kids—including the natural environment that underwrites the quality of life of future generations. If the cost of ensuring that large numbers of children do not grow up in poverty and that the planet is not destroyed by global warming is a somewhat higher current or future tax burden, that hardly seems like a bad deal—especially if the burden is apportioned fairly. Now suppose, by contrast, that we hand our kids a country in which large segments of the population are unhealthy and uneducated and the environment has been devastated by global warming, but we have managed to pay off the national debt. That is, after all, the future that many in the mainstream of the economics profession are prescribing for the country. Somehow, I don’t see future generations thanking us…

Economists have botched the promise of widely distributed prosperity: why they have no intention of stopping now– and why that matters so much: “The Wrongest Profession.”

* John Kenneth Galbraith

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As we recalculate, we might recall that it was on this date in 1602 that Vereenigde Oost-Indische Compagnie (VOC, or The Dutch East India Company, as it’s known in the Anglophone world) was born.  Generally considered the world’s first trans-national corporation and the first publicly to issue stocks and bonds (and the first company to be ever actually listed on an official stock exchange), it began with a 21-year monopoly on the Dutch spice trade.  The VOC also prefigured the mega-corporation of today in that it had quasi-governmental powers, including the ability to wage war, imprison and execute convicts, negotiate treaties, strike its own coins, and establish colonies.  Considered by many to be the greatest corporation in history, the VOC eclipsed all of its rivals in international trade for almost 200 years.

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Written by LW

March 20, 2017 at 1:01 am

“Sameness is the mother of disgust”*…

 

Let’s imagine we’re on a beach that’s a mile long, and on that beach there are a couple of ice cream carts…

cart1

Let’s also imagine that the ice cream sold at each cart is identical in quality and cost, so the only reason customers choose one cart over the other is when one cart is closer. Given all of that, the best location of the carts is with each cart halfway between the middle of the beach and one of the ends. In this arrangement each cart gets 50% of the customers, and no one has to walk more than 1/4 mile to get some ice cream.

cart2

But what if one of the ice cream vendors decides to move their cart a bit closer to the middle of the beach…

cart3

They are now the ice cream cart of choice for a bigger segment of the beach, and will get more business. The other ice cream cart has no choice but to retaliate…

cart4

Now once again they each serve the same percentage of the beach-going public. Since any further movement by either cart would mean a loss of business for that cart, they end up permanently side by side, in the middle of the beach, even though this is a less optimal location for their customers.

That is a simple example of something called Hotelling’s law; the tendency of competing products to end up as similar as possible…

“Producers of products and services tend to make their products and services as similar as possible to those of their competitors.”  From The Laws of the Universe, the story of Hotelling’s Law.

* Petrarch

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As we nose around for niches, we might send ambitious birthday greetings to Count Giovanni Pico della Mirandola; he was born on this date in 1463.  An Italian philosopher, he undertook, in 1486, at the age of 23, to defend 900 theses on religion, philosophy, natural philosophy and magic against all comers, in the process of which he wrote his famous Oration on the Dignity of Man, which has been called the “Manifesto of the Renaissance”; a revitalization of Neo-Platonism, it was a seminal text of Renaissance humanism and of what has been called the “Hermetic Reformation.”

Pico’s portrait, from the Uffizi Gallery in Florence

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Written by LW

February 24, 2017 at 1:01 am

“I never worry about diets. The only carrots that interest me are the number you get in a diamond.”*…

 

From James Vaughan, via From Deco to Atom

* Mae West

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As we peel ’em, we might spare a thought for Josiah Wedgwood; he died on this date in 1795.  An English potter and businessman (he founded the Wedgwood company), he is credited, via his technique of “division of labor,” with the industrialization of the manufacture of pottery– and by his example, much of British manufacturing.

Wedgwood was a member of the Lunar Society, the Royal Society, and was an ardent abolitionist.  His daughter, Susannah, was the mother of Charles Darwin.

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Written by LW

January 3, 2017 at 1:01 am

“Consider the furniture!”*…

 

Ikea is a behemoth. The home furnishing company uses 1 percent of the planet’s lumber, it says, and the 530 million cubic feet of wood used to make Ikea furniture each year pulls with its own kind of twisted gravity. For many, a sojourn to the enormous blue-and-yellow store winds up defining the space in which they sit, cook, eat and sleep.

All that wood is turned into furniture that tries to bring a spare, modern aesthetic to the masses. “We’re talking about democratizing design,” Marty Marston, a product public relations manager at Ikea, told me.

The furniture is also sold according to some unique economics. In many cases, Ikea’s famously affordable pieces get dramatically cheaper year after year. In others, prices creep up. In some cases, products disappear entirely. The result is an ever-evolving, survival-of-the-fittest catalog that wields an enormous amount of influence over residential interiors…

Pull up a chair at “The Weird Economics Of Ikea.”

* Arthur Conan Doyle, The Adventure of the Mazarin Stone

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As we avoid the meatballs, we might spare a thought for Sir Thomas Bouch; he died on this date in 1880.  A railway engineer and executive whose career began at age 17, Bouch was knighted for designing the two-mile-long Tay River Bridge— on which an estimated 75 people died when the bridge collapsed.  An enquiry found Bouch to be liable, by virtue of bad design and construction; he died four months after the verdict.

Bouch is thus also indirectly responsible for the best-known poem, “The Tay Bridge Disaster,” by the gentleman widely-regarded to have been the the worst published poet in British history, William Topaz McGonagall.

Sir Thomas Bouch

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Written by LW

October 30, 2016 at 1:01 am

“Say it ain’t so, Joe”*…

 

Technology is killing off independent pizzerias in the United States at the rate of roughly 2,549 locations per year (in 2015 alone). The pizza category is being reshaped by both big new tech deployed by chains and fresh threats from sophisticated emerging brands that are taking slices of the pie from tens of thousands of ill-equipped and low-tech independent pizzerias…

The whole sad story at “How Tech is Killing Off Independent Pizzerias.”

* (probably apochrophal) plea from a young boy to “Shoeless Joe” Jackson, as Jackson left Cook County Courthouse where Jackson was testifying in the Chicago “Black Sox” scandal

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As we ask for extra pepperoni, we might recall that it was on this date in 1841 that Orlando Jones received a U.S. patent for making cornstarch.  Derived by grinding the white heart of a corn kernel, and primarily used as a thickener, cornstarch is also used to keep pizzas from sticking to the ovens, pans, or stones on which they are cooked.

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Written by LW

March 22, 2016 at 1:01 am

“Do not count your chickens before they are hatched”*…

 

We trained chickens to react to an average human female face but not to an average male face (or vice versa). In a subsequent test, the animals showed preferences for faces consistent with human sexual preferences (obtained from university students)…

From the abstract of a scholarly article published in the journal Human Nature.

Read all of the paper: “Chickens prefer beautiful humans“; get more background here.

* Aesop

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As we spend a few more minutes at the mirror, we might recall that it was on this date in 1868 that William Davis, a Detroit fish dealer, received a patent for the first practical refrigerated rail car.  Entrepreneurs looking to expand the market for agricultural goods had been trying since 1842 to ship produce and meat via rail.  But these early “ice box on wheels” designs were impractical (as most worked only in cold weather).  Davis’ innovation was to create a car that used metal racks to suspend meat above and between a frozen mixture of ice and salt. Davis’ design worked well as a preservative strategy; but the carcasses had a way of swinging to one side on their hooks when the car entered a curve at high speed… which led to several derailments and the discontinuation of their use.  It wasn’t until 1878, and a “cooling from the top; meat stacked low” approach developed by Andrew Chase for the meat packers Swift & Co., that refrigerated cars came into continuous use.

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Written by LW

January 16, 2016 at 1:01 am

“In terms of organisational models and human relationship models, humankind has not evolved much over the last millennia”*…

 

The Office of Strategic Services (the CIA’s World War II–era precursor) created this document in 1944, for use by operatives in Europe who were trying to recruit civilians living in occupied countries to commit sabotage. The document is available in full via the CIA’s website.

The Simple Sabotage Field Manual, which contains instructions in physical as well as interpersonal disruption tactics, begins with a preface directed to OSS personnel, describing the problems and possibilities of working with “citizen-saboteurs.” Such people, living under the rule of enemy administrators in countries such as Norway or France, might already be sabotaging materials, machinery, or operations of their own initiative, but these acts “may be completely foreign to [a] habitually conservationist attitude toward materials and tools … Purposeful stupidity is contrary to human nature.” Reading instructions such as the ones in this manual might refine civilian efforts at destruction, and reassure them that they were taking risks that had rewards…

* Miguel Reynolds Brandao, The Sustainable Organisation

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As we consult the chart, we might send commercial birthday greetings to Johan van der Veeken; he was born on this date in 1549.  A shipowner, merchant, and banker, van der Veeken was a founding director of the VOC– Vereenigde Oost-Indische Compagnie, or the Dutch East India Company as we know it– the first multi-national corporation, and the first company to issue stock. 

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