In an article on Google website Julia Rozovsky, a People Operations, Analytics and HR Strategy Leader at Google wrote (circa 2015) about the 5 keys to a successful team at Google. They set out to examine what makes Google team effective. This research was conducted over two years, 200 interviews, 250 attributes and 180+ google teams. I share this statistics to assure that the outcome has some solid basis.
As one looks at folksy quotes from Warren Buffet it was interesting to see what has been the reaction to the 2019 Berkshire Hathaway Annual General meeting at the CHI center at Omaha Nebraska where as tradition goes Warren Buffet(88) and Charles Munger (94) answered shareholder questions for 6 hours (link to entire proceedings courtesy Yahoo Finance, below). I am not a stock market buff and I went looking for native wisdom that might have been shared by the two legends. Here is what I found as I read around.
Peter Drucker, the original management thinker came up with the idea of Management by Objectives popularly known as MBO in the 1950’s. It seems Andy Grove adapted the basic tenets of MBO to create his OKR approach, inspired by Drucker’s The Practice of Management.
Ever wonder why Hubspot gives away most of their software for free? Their CRM, Sales Automation, Calendar applications are all available for users without charge. Joel Spolsky, Founder of Stack Overflow, identified what would be recognized as a major pattern in technology business in his post ‘Strategy letter V’ (in June 2012) – “companies seek to secure a chokepoint or quasi-monopoly in products composed of many necessary & sufficient layers by dominating one layer while fostering so much competition in another layer above or below its layer that no competing monopolist can emerge, prices are driven down to marginal costs elsewhere in the stack, total price drops & increases demand, and the majority of the consumer surplus of the final product can be diverted to the quasi-monopolist.”
The huge growth in funding to Asian startups since 2013 has resulted in some monstrous exits. 5 of the 10 to be exact which included 2 from China ( none in 2013) and the humungous $21B Walmart acquisition of Flipkart in India – one of the largest VC backed M&A exits. The growth in startups and their value creation is now all over South East Asia. Between 2017 and 2018 Asia saw the birth of 65 Unicorns with 3 from Indonesia.
I started my daily posts on 1st Jan this year with Jeff Bezos letter to shareholders written i. n 2018. Yesterday he wrote his annual letter for 2019, and he attributed Amazon’s success to the above traits (Intuition, curiosity, and the power of wandering) which he says is in the DNA of the company. As usual there are ideas and lessons. Some points may be to counter anti trust moves in the horizon, some to fight popular perceptions of bad pay and work environments. Here are the key takeaways :
It not breakthrough tech, it is breakthrough business models that will create the real winners of tomorrow.
John Elkington, the Founding partner of Volans, a future-focused business working at the intersection of the sustainability, entrepreneurship and innovation movements wrote a very interesting piece (watch the video below) in Fast company sometime back and I went back to it to pick up some powerful ideas.
Necessity is really the ‘Mother’ of invention. NPR puts out this great podcast “How I built this” hosted by Guy Raz, which I have referred to in the past. I love the stories which are dealt with in great details and Guy has this way to ask the most delicate questions to his very successful guests, who reciprocate with candid answers.
$100 invested in Nike (IPO:1980) is now $6.07M, while in Alphabet (Google; IPO:2004) it is $2.6K. $100 in Walmart IPO in 1957 is now $1.24M while in Amazon (IPO:1997) it is worth $120.6K. In both cases the time period is obviously not similar. $100 invested in Apple (IPO:2002) is currently $43.4K. So what is the point? First, Tech companies are historically not the best Return on Investments (at IPO for retail investors, VC’s typically would have taken their share out during the IPO itself).