Many thanks for your comment to my essay!
Its a great point you raise that Pandora’s competitors, in addition to their differentiated services, also do provide a form of internet radio similar to Pandora’s offering.
I also appreciate your identification of the underlying value of providing music to listeners: the human touch. This is an important operational factor for all curation-based services to deliver in order to capture value, and I believe it is very hard to create, especially when considering a technology-based approach rather than having humans complete the job.
Aravind Eye Care has a special place in my heart, not only for their impressive mission and impressive track record, but also because it was the first HBS case I ever read back in undergrad. Great choice.
You do an excellent job laying out the parts of the operating model that have allowed Aravind to process many more surgeries at a lower cost than equivalent care providers in more developed countries. However, a key bottleneck in my mind, and this also came up in Narayana Hrudayalaya, is the poor’s access to Aravind’s facilities. You cover the tele-medicine and outreach programs well. But in my mind, in order for Aravind to truly accomplish his mission to eradicate blindness, I wish he kept some more of the value that he generates for his paying customers and invested more aggressively in getting out into rural areas with his surgeries. Now that he has a strong surgery operation that is sustainable, he must continue to strengthen accessibility in my mind.
The most compelling case as to the alignment of the business model and the operating model here to me is alignment between the “bargain hunting” experience with the procurement strategy – both share this concept of “Good Stuff Cheap” that you lay out quite clearly. To me this seems to be one of the key drivers of the impressive top-line and bottom-line growth that you referenced for FY15.
I am curious to learn more about how the Company continues to have strength in procurement in different economic cycles. One example that comes to mind that arguably faltered due to a collapsing procurement strategy is Gilt Group. Gilt benefited from high-end retailers’ struggle to clear shelves following the financial crisis, and had a great deal of high quality inventory. However, as the economy improved and the amount of overstock good declined, Gilt’s value proposition also deteriorated and growth slowed. I realize Ollie’s is targeting a different part of the value chain, but I imagine they might face similar procurement issues when the economy takes off.
Very interesting business that does indeed seem to have good connections to our Donner case, in which we saw a conflict between small, prototyping orders and the larger bulk orders. Failure to balance them out resulted in orders of lower quality and later delivery. How does Phillips-Medisize seem to overcome this? I believe your paragraph about the dedication to pre-production facilities that are strategically placed in important locations relevant to the company’s full production operations does a good job explaining how PM overcomes this production / operations challenge.
However, a key challenge that will always remain, especially in the medical industry, is the inherent conflict between mass manufacturing and quality. How can we ensure rapid delivery that is the highest grade product? This is where I believe your paragraph on human capital puts PM over the top: a highly qualified and technical labor force will ideally reduce the tension between speed of production and quality of finished product.
One item I am left curious about though after reading your essay (realizing you had a word limit) is: how is PM well positioned to help clients develop new and innovative products? How are the pre-production and full production facilities designed as to ensure PM can continue to develop and build the next generation of products?