It’s nice to know that Batman also goes to HBS, too.
I would be interested to learn more about the business model on the supply side: what kind of employees do they hire, how much do they make on how much work, and how much could they make otherwise. This sets the baseline for the value added by the app, as a platform that connects cheap labor with high-price buyers of spare time. The business model is dependent on socioeconomic factors like income disparity, population density, and geography.
The operating model, as I can see, is still in the experimental stage. The complexity appears to be growing geometrically as the business scales. (As the numbers of labor suppliers and buyers grow linearly, their interactions will grow geometrically.) Fortunately, modern computing is capable of handling massive data processing, but to use it to build up quality and consistency will require numerous iterations of improvement.
Comparing the US market to China, where I come from, I see China has higher income disparity, great population density (in cities), but lack of trust among people will be a key hurdle, which can potentially be overcome by employing labor full-time. In US, I feel the cities will be more suited for this model for now.
Firstly, I feel the author mistook the meaning of the term “business model”, hence omitted this part. Secondly, I learned about the operating model of the firm but would like to see benchmarks to make sense of how severe the issues were. Lastly, I believe revitalizing opportunities can only exist on the real “business model” side.
A business model is defined as how the firm creates and captures value. In GM’s case, it is about making cars that suits different markets, and sell them, hence generating value for the customers and capture profits. What the author classified under “business model” is still operating activities. What I believe is GM’s failure in business model is being a laggard in market trends towards more fuel-efficient cars and other product innovations. This leads to the company generating less value over time, hence capturing less through selling the cars.
On the operating side, one would take for granted that a massive, manufacturing company will have complex processes. I wonder how it compares with large companies in somewhat similar, or different industries. How is it worse than, say, GE, Toyota, or Samsung? If they are all the same, the operating model, even with the known inefficiencies, is not the reason for GM’s failure.
Lastly, efforts in streamlining the operating model does not give me any confidence in the firm’s future. A large organization should do this as a constant effort, a baseline for survival. Meanwhile, the actual value creation (business model) needs to be re-invented. They need to find another competitive strategy for GM’s products, for it to revitalize itself.
I believe Lenovo enters Brazil not only to gain manufacturing benefits, but also sales and marketing foothold, which is the basis for future value creation. In order to tap into the Brazilian electronics market, it may prove ineffective to design and build everything in China. This entry will allow the company to design and build PCs, as well as other growing electronic products categories (smart phones, tablets etc.) for Brazil and other South American markets.
Indeed the supply chain needs to be improved to remove waste. This is likely to be a long and expensive transformation.