Jose ReportsJose Reports

OPECOPEC

Net NeutralityNet Neutrality

What would What would Dr. S think?Dr. S think?

DPQDPQ10/26/1010/26/10

LeadershipLeadership

LeadershipLeadership

Because knowledge is the scarcest Because knowledge is the scarcest of resources, leadership is the most of resources, leadership is the most important factor in business successimportant factor in business success

LeadershipLeadership

Because knowledge is the scarcest Because knowledge is the scarcest of resources, leadership is the most of resources, leadership is the most important factor in business successimportant factor in business success

Different leadership skills are Different leadership skills are needed at different phases of a needed at different phases of a business… i.e., during radical business… i.e., during radical market transformation, rapid market transformation, rapid growth, acquisitionsgrowth, acquisitions

LeadershipLeadership

Because knowledge is the scarcest of Because knowledge is the scarcest of resources, leadership is the most resources, leadership is the most important factor in business successimportant factor in business success

Different leadership skills are needed at Different leadership skills are needed at different phases of a business… i.e., different phases of a business… i.e., during radical market transformation, during radical market transformation, rapid growth, acquisitionsrapid growth, acquisitions

Remember: leaders receive information Remember: leaders receive information from the marketplace, rather than give from the marketplace, rather than give orders to the market as in socialismorders to the market as in socialism

Leadership Leadership

Many hugely successful business Many hugely successful business people never attended college or people never attended college or received a degree like these received a degree like these billionaires: Bill Gates (MSFT), Steve billionaires: Bill Gates (MSFT), Steve Jobs (Apple), Sir Richard Branson Jobs (Apple), Sir Richard Branson (Virgin enterprises), Ralph Lauren (Virgin enterprises), Ralph Lauren (fashion), Dave Thomas (Wendy’s), (fashion), Dave Thomas (Wendy’s), Henry Ford (Ford), Henry Ford (Ford),

FranchisesFranchises

FranchisesFranchises

A business method that involves a A business method that involves a company (franchisor) licensing company (franchisor) licensing trademarks and business systems to trademarks and business systems to individuals or companies unrelated individuals or companies unrelated to the franchisorto the franchisor

FranchisesFranchises

A business method that involves a A business method that involves a company (franchisor) licensing company (franchisor) licensing trademarks and business systems to trademarks and business systems to individuals or companies unrelated individuals or companies unrelated to the franchisorto the franchisor

Subway, McDonald’s, 7-11, Subway, McDonald’s, 7-11, Hampton Inns, Supercuts, H&R Hampton Inns, Supercuts, H&R Block, Dunkin’ Donuts, Jani King, Block, Dunkin’ Donuts, Jani King, ServePro, AMPMServePro, AMPM

FranchisesFranchises

In franchise operations knowledge is In franchise operations knowledge is shared in both directionsshared in both directions

FranchisesFranchises

In franchise operations knowledge is In franchise operations knowledge is shared in both directionsshared in both directions

Local people know their markets; Local people know their markets; franchisers know how to advertise, franchisers know how to advertise, economies of scale in purchasing, economies of scale in purchasing, how to run the operationhow to run the operation

FranchisesFranchises

In franchise operations knowledge is In franchise operations knowledge is shared in both directionsshared in both directions

Local people know their markets; Local people know their markets; franchisers know how to advertise, franchisers know how to advertise, economies of scale in purchasing, how to economies of scale in purchasing, how to run the operationrun the operation

One third of all revenues from retail One third of all revenues from retail sales of goods and services is from sales of goods and services is from franchised businesses; in hotels, it’s franchised businesses; in hotels, it’s 75%75%

Winners and LosersWinners and Losers

Remember: profits are contingent on Remember: profits are contingent on efficiency in producing what efficiency in producing what consumers want, at a price they are consumers want, at a price they are willing to paywilling to pay

Winners and LosersWinners and Losers

Remember: profits are contingent on Remember: profits are contingent on efficiency in producing what efficiency in producing what consumers want, at a price they are consumers want, at a price they are willing to paywilling to pay

This prospect of profits (and fear of This prospect of profits (and fear of losses) is crucial to the functioning losses) is crucial to the functioning of the market as a wholeof the market as a whole

Winners and LosersWinners and Losers

Remember: profits are contingent on Remember: profits are contingent on efficiency in producing what efficiency in producing what consumers want, at a price they are consumers want, at a price they are willing to paywilling to pay

This prospect of profits (and fear of This prospect of profits (and fear of losses) is crucial to the functioning losses) is crucial to the functioning of the market as a wholeof the market as a whole

Only about 10% of the total economy Only about 10% of the total economy is profit, but it motivates efficiency is profit, but it motivates efficiency in producing the other 90%in producing the other 90%

Winners and LosersWinners and Losers

Monopoly is the enemy of efficiencyMonopoly is the enemy of efficiency

Winners and LosersWinners and Losers

Monopoly is the enemy of efficiencyMonopoly is the enemy of efficiency Dr. S sez: “What is called capitalism Dr. S sez: “What is called capitalism

might more accurately be called might more accurately be called consumerism. It is the consumers consumerism. It is the consumers who call the tune and those who call the tune and those capitalists who want to remain capitalists who want to remain capitalists have to learn to dance to capitalists have to learn to dance to it.”it.”

Winners and LosersWinners and Losers Monopoly is the enemy of efficiencyMonopoly is the enemy of efficiency Dr. S sez: “What is called capitalism Dr. S sez: “What is called capitalism

might more accurately be called might more accurately be called consumerism. It is the consumers who consumerism. It is the consumers who call the tune and those capitalists who call the tune and those capitalists who want to remain capitalists have to learn want to remain capitalists have to learn to dance to it.”to dance to it.”

The efficient allocation of scarce The efficient allocation of scarce resources that have alternative uses resources that have alternative uses means that some must lose the ability to means that some must lose the ability to use those resources, i.e., typewritersuse those resources, i.e., typewriters

Assignment for Nov. 16Assignment for Nov. 16

Read and study Chapter 9 of Read and study Chapter 9 of Basic Basic EconomicsEconomics: “Productivity and Pay”: “Productivity and Pay”