Thanks for a great post!
One of the tensions I see digitization for McDonald’s is the increasing want to customize orders. For instance, McD’s new in-store “Create Your Taste” screens let’s us make a totally customized burger (http://www4.mcdonalds.ca/createyourtaste/). For a company famous for standardization, I think McDonald’s needs to be very careful in what digitization it adopts to truly understand the impact it has on the operating model (e.g., digital pre-ordering fits with that, but not sure if Create Your Own taste is more of an image driver or actually benefits their operating model).
Thanks for a great post!
What really stuck with me is the way that this technology can connect to other parts of our lives, seeing that food is so integral to everything else we do. One could imagine this device to be hooked up to not only fitness trackers like FitBit, but also to your doctor who can track how your body reacts to different foods or to insurance companies that adjust premiums based on how healthy your meals are.
With regards to their operating model: I’m curious to see how this will play out in terms of the actual food. Will Foodini “own” all the food production, or will it be smarter for them to be the “platform” and then let the WholeFoods/McDonald’s/Chipotle be the ones developing the food and owning the recipes?
Very fascinating article … and as a Dane, I appreciate that you chose to write about Maersk!
Another thing that Maersk is looking into is 3D printing (http://www.maersk.com/en/the-maersk-group/about-us/publications/maersk-post/2014-3/spare-parts-just-press-print). As the ships are (hopefully) most often at sea, there are few opportunities to easily get new spare parts – 3D printing could be a solution.
As you write, route optimization is crucial to ensure high capacity utilization and make the trips across the Atlantic worthwhile. This is an optimization problem that could be solved together with other shipping lines to share capacity. I know of one new project aiming to do this “xChange” (https://xchange.bcg.com/public/index.html). I’m curious to see if this is a solution that will be adopted.
I definitely agree to your view that the restaurants don’t really have a choice in embracing the digital waive. I’d be interested in hearing your thoughts on how digital will impact the “in-store” experience (e.g., food ordering). I’d think this might differ by type of restaurant – for instance, we see how McDonald’s have the “Create Your Own Taste” digital boards, and Panera Bread have ordering kiosks. Would this necessarily translate to a more upscale dining experience? Is there something in the dynamic here that makes digital not as successful in the in-store dining experience for non-fast food restaurants?
Hi JASP – thank you for your comment, and great questions.
Re the impact: Estonian officials say that the move towards a paperless society is saving Estonia 2% of GDP (https://e-estonia.com/facts/). Given that this is recurring savings, the digitization seems like rather lucrative move.
According to the World Bank, “over 14,000 new companies registered in Estonia in 2011, 40% more than during the same period in 2008. High-tech industries now account for about 15% of GDP” (http://www.economist.com/blogs/economist-explains/2013/07/economist-explains-21).
The digitization has also been a big benefit to the police: “Since the introduction of e-Police, Estonian police have: handled 70% more offense reports per day, decreased road fatalities by over 400%, performed look-ups on 10x more vehicles per month” (https://e-estonia.com/component/e-police/).
I have, however, not been able to find much information on what Estonia did to transition it’s work force. I look forward to dig a bit more into this – indeed an interesting question.
Very interesting article!
I wonder how the fitness industry can think about integrating fitness with other aspects of our lives to boost their customer base. For instance, we could imagine gyms teaming up with insurance companies to lower health premiums based on X number of gym sessions per month. Also, I wonder if the fitness world could be a main driver in the digital health world through fitness AND health tracking (e.g., device connects to your doctor whose system monitors your general health and captures any leading indicators of illness).
Thank you for your elaborate comment! I indeed do find it interesting that while Greenland’s nature clearly does not benefit from global warming, there might be an economical gain to its people – I can only imagine the internal conflict that creates.
Interesting perspective you bring up re the shrimp farms. Royal Greenland prides itself on wildly caught shrimp, which could be a competitive advantage for them going into a more “premium” shrimp market. As you correctly point out, though, the movements in fish stock still requires a dramatic change in wild capture techniques … so, maybe they should just go all in and become farmers instead?
Thanks for an insightful and well-written post, Nathan!
I am particularly interested in your thoughts about the container waste. Even though aluminum cans have become a lot lighter (12 g in 2010 vs 19 in 1980), we consume so much more that the can volume drives an increase in aluminum material use from 820M kg in 1980 to 1,100M in 2010 (https://www.gatesnotes.com/Books/Making-the-Modern-World).
In the US, 67% of aluminum cans are recycled, which is at “historically high levels” . Contrast that to Denmark at 90% . What Denmark did was a mix of three things: (1) a “container deposits” of 1 DKK (equivalent to 20 dollar cents), which is 4x the rate in the typical state-rate in the US (Massachusetts at 5 dollar cents), and (2) an easy deposit system implemented inside almost every supermarket  and (3) bright lime green “container deposit trash cans” that allow people to put their cans to use for the less priviliged who can collect the cans and return them to the supermarket for the fee (http://www.mx.dk/diashow/10018/10018-nxKHn_DMNPJM9YkDieCiyQ.jpg).
While MillerCoors might not be able to drive this change alone, they are in a prime position to champion a change in the US bottle and can return system.
Thank you for an insightful – and to some extent controversial – post. I like the comments to your posts, in essence asking Walmart to do more and questioning the intentions behind the change. While I agree that yes, Walmart could do more, and yes, Walmart might be doing this for cool business, I think we should acknowledge that the business has indeed taken steps towards more sustainability.
Craig, one thing that keeps getting back to me is whether it would be a good idea to invent a “sustainability label”? Certainly, a retailer the size of Walmart could drive this initiative if interested. On the “pro”-side, the sustainability of different products is incredibly hard for the consumer to research and hence take into consideration when choosing between the 8 different brands on the pasta aisle. On the “con” side, Walmart might not be too interested in the product mix effects and how do you come up with a label that is truly reflective of reality?
Regardless of the challenges of such a label, I think the conversation is interesting: How do we ensure that the consumers become more informed so that we can create a true pull, and not just rely on the companies themselves to take sustainability initiatives.
Barbara, thank you for a great read on Starbucks’ leadership in sustainability.
To the question you pose: “What does being a trendsetter mean”? – I think that it means to be someone who takes on the leadership to change and then supports others in making that change as well. Starbucks is indeed leading by example – however, I wonder could (should) do more to let this practice be implemented for other coffee producers/food retailers. For instance, is the Starbucks C.A.F.E. certification locking in its suppliers to the Starbucks way of doing things and should Starbucks instead have done more to develop a commonly shared certification together with its competitors? I’m not sure where I fall on that question. It is clear that Starbucks has been immensely successful and is driving real change, but I wonder if that change could be even bigger if they support other businesses in making the transition as well.
Thank you for an incredibly thought provoking and well-written post.
I wonder whether this issue can be solved entirely by the private sector or if the state needs to step in with either regulation or programs (at the extreme, one could even imagine state-owned bee farms). For instance, if suspect that the investment vs benefits ratio for a given bee farmer to innovation in bee genetics are limited. A bee farmer might simply pick up another profession, and the consumer might not notice a direct change other than honey becoming more expensive. However, as you point out, it could be necessary to the survival of the species. As climate change becomes more and more pronounced, it would be interesting to see how the market solves for these issues that together need to be solved, but are hard for the market to coordinate around.
Thank you for writing an interesting, clear blog post Elyse!
GM is setting ambitious targets and is currently on track to deliver – that’s indeed quite impressive. I second the comment about considering the environmental impact on other parts of the chain than sourcing. Another topic I find interesting for GM is how the company will react to the growing concerns about GMOs in our food.
While GMOs are a heated topic, an abundance of research finds that GMOs significantly increase farm yields, while decreasing pesticide use and soil erosion – a net positive for the environment (e.g., see this large study from the National Academy of Sciences http://www.nap.edu/download.php?record_id=12804#). Hence, the “non-GMO” trend could be deteriorating to our environment. However, General Mills just recently in March 2016 stated labelling its products with a GMO label. I’m curious to see whether GM will stand firm to its GMO use and take an active role in educating the public about the environmental benefits of GMO or if GM will bow to the demands of its customers.