In China, Walmart is closing over 30 stores in recent years because of the strong impact from Alibaba and J.D. com. People, there are not willing to spend the time to shopping and are craving for high value and personalized products from worldwide. Reaching a much broad assortment of goods in a few seconds, paying a good price even lower than Wal-mart and having it delivered to your home within one-day, I don’t see any chance the billion Chinese consumers will return to the brick-and-mortar Wal-mart. While the digitization of supply chain for sure improve the efficiency and optimize the cost of Wal-mart, the fundamental concern the loss of business model comparing with e-commerce. I was wondering how much Wal-mart wants to change itself, maintaining its identity and competitive edge and keeping up with the trend. Will digitalizing supply chain suffice or will it digitalize its business model? If it’s the latter, is it still Wal-mart? Is it still a leader in retail industry or a follower that has to strive to find a place in a new era of consumption?
I really like the interesting article!
As someone foreign to the US education system, I don’t quite get why the public schools have to estimate their enrolled students, like the airline, and reserve resourcing according to the forecast. It’s not an issue for US college right? How does public or charter high school system vary with university in terms of enrollment?
The thing I come up with digitization in education is TOEFL. ETS transforms TOEFL to be internet-based, meaning all the reading, listening, speaking and written test are done on a computer with a digitalized supply chain of content distribution. It saves a lot of cost by eliminating the spend on printing and transporting the test papers worldwide, expatriating qualified speaking test officers from US to the rest of the world(IELTS still use this model now), scoring the test manually etc. In this way, it can also conduct data analysis to generate the insight into people taking the test and revamp its content and service accordingly in a convenient way.
This article reminds me a lot of my previous employer-Mars Inc. who is also tacking with the pressing issue of the shortage of quality cocoa. If there will be a day we can never have a cup of coffee, we may not see any chocolate as well.
I definitely agree that the effort of Nestle is not sufficient given the complex reason and stakeholders’ interest. It needs to leverage the collective resource of industry players, government, and NGOs. All the coffee players are in the same boat. If the supply of coffee is not sustainable, everyone will suffer. One thing Mars did well is to share its research result, coming out from a tremendous financial and human resource investment, on Cocoa genes to the world in the hope of stimulating more attention and effort on studying how to maintain and grow the cocoa productivity. It can be a good reference in terms of how to solving the seemingly unsolvable problem by advocating and cooperating with many others, even competitors.
An informative and thought-provoking essay. Indeed, a lot of industries are directly exposed to the huge risk incurred by climate change and many others are influenced indirectly. Mitigating the risk posed to supply chain can be costly and time-consuming.
I don’t think RT has to share its best practice in dealing with the climate change supply chain issue with their competitors. They invested a lot of money and other resources to come up with a solution. If others can have access to it free, RT may lose the incentive to work hard on the solution in order to deal with the climate change issue and gain a competitive edge, just like the essence of a patent. However, climate change is a systematic issue and the mere effort of the certain company won’t suffice to tackle it. I think RT can try to influence the government to come up with some support so that all the players in the industry can benefit.
I don’t think protectionism will achieve its intended goal. It is not aligned with the fundamental interest of a US-based multi-national corporation. An MNC will seek the global source of labor with the lowest cost to build its competitive edge. Meanwhile, the US consumers also benefit from the low price incurred accordingly. However, what politician thinks is to increase the local jobs. These two motives don’t align well. It is not advisable to force companies to create more jobs at the sacrifice of their economic interest or competitive advantage. This probably will result in the company’s operating inefficiently and cut off jobs in the end.
In this globalized world, what the US should think about is how to better educate its people so that they can assume the jobs with high value in the value chain. Low-end jobs are either face the challenge of being transferred to emerging market or being replaced by automation or artificial intelligence.
Thanks for the interesting article. I think this article well reveals a painful fact of doing business in China for foreign companies. The China market is a high risk, high return asset. You can hardly resist a market of 1.3billion people. On the other hand, you never know whether your business will encounter severe challenge overnight because of the regulation issue, a phenomenon rare in other countries.
Personally, I don’t support the ‘methodology’ of the Chinese government to leverage its economic bargain power to efficiently achieve the political purpose. However, I want to argue that I think it’s a mutual responsibility of China and many other countries. Holding a totally different ideology, China has never been truly welcomed by the western world. In addition, the rise of China is also a huge threat to the dominance of western countries. China has been struggling for decades to develop under a pressing international political environment. The communist party has to do all it can to prevent this country from being undermined or even segregated, a lot of times the measure of doing so is to information regulation. For those who were wondering why China is so unique or weird, this is my answer. It’s really a both-sided, political thing.
It seems the interdependence and conflict of China with the western world will continue in a foreseeable future. It is advisable for those who want to do business in China develop a safe strategy and operating model to prevent the sudden shock. Having the political savvy is key. A company should evaluate itself before entering China market. Am I a potentially politically risky industry? You may argue regulating Google’s operation in China is a violation of boundless information access and freedom of speech. I totally agree. However, with a google map, the US government can also keep close track of the key military information-say the deployment of military base-of China, a huge threat to the safety of China. Also, it is critical to build a meaningful relationship with the government and regulatory institution to get first-hand political move news ahead of the curve so that mitigation plan can be taken fast to minimize the loss.
This case is a great example of showing how costly both sides have to pay due to the lack of trust.