|
|
|
catalyst blog
|
|
Tuesday, 03 February 2009 11:50 |
A friend sent me this article about the Hulme supercar which, like many supercar projects, has run out of investment prior to launch.
There's a lot to be said about the pitfalls of designing and manufacturing supercars: - it's not unlike a cliff business that Seth strongly suggests most of us avoid,
- it requires an impossibly broad range of skills,
- most cars are vanity, ego-driven projects rather than customer-focused designs,
- road safety compliance is almost impossible to obtain,
- low volume production inefficiencies result in a world of pain, and
- the start-up investment required is orders of magnitude higher than most estimate.
Very few low-volume car businesses survive. Even the names you know have struggled - Aston Martin commenced business in 1913 but apparently made its first profit under Ford ownership in the 1990s. That's some cliff.
The cautionary tale I want to tell today, however, is of escalating commitment.
In her extraordinary talk on negotiation practice and pitfalls, 'Winners don't take all', Margaret Neale tells us that we escalate our commitment when focus on our sunk costs - the costs that are by definition unrecoverable - instead of our opportunity cost, the value of the alternatives that we do not follow. As a result we send good money, good resources and good opportunities down the drain. Margaret's strong advice is "Ignore sunk costs. Pay attention to opportunity costs."
The Hulme supercar story reeks of escalating commitment - as Jack Freemantle says in the interview: "I've got guys that when we first talked about it, came up and gave me their life savings. We got 300 grand in a month. Those guys need to be looked after. You can quit on yourself, but you can't quit on other people." Jack's commitment to his investors is laudable and I can relate to his position more than most, having personally lost money launching a European sports car in New Zealand. The question that he needs to ask himself, however, is whether the best way to make money for himself and his investors is to seek even more investment in this project (which in my and clearly others' opinion has a low chance of success), or to seek an alternate and more favourable opportunity. Ignore sunk costs. Pay attention to opportunity costs.
|
|
|
behind the image
|
|
Monday, 02 February 2009 12:24 |
|
A model on a front end loader. It's one of my favourite portfolio images, probably because I attempted to make a dramatic image of contrasts without crossing over into absurdity (and felt that I succeeded). It's also because as I look at it there's nothing I want to change - as a perfectionist this is a rare pleasure. Even without a client looking over your shoulder shooting this kind of scene can be stess-inducing - there's a model, assistant/makeup artist and site staff waiting for instruction and you have 15 minutes to find a scene, set up, take the shot (including backups, variations, etc), pack up and leave to do it all again somewhere else. In this case the concept came quickly but the details were difficult - the hair on her cheek, the stance with more weight on the forward foot, where she should look, the height of the tripod to locate the height of the rubble in the background, etc. I'd show you the location of the worksite but as you'll see from other images in this series, we took images only metres from fast-moving, rock-crushing machinery and I dare say that this was not in full compliance with work safety requirements. I can tell you, however, that only security clearance required to enter a dangerous worksite is a tall model in a short black dress. James Bond movies are not as far-fetched as you think. |
|
learning resources
|
|
Tuesday, 27 January 2009 12:24 |
|
As found on Scott Berkun's site, here's a short video from Honda on how they use failure to succeed. It's an ad for Honda, of course, but it's worth 8 minutes of your time. |
|
behind the image
|
|
Monday, 26 January 2009 00:00 |
|
I love being alone late at night in the city - carrying 15 kilos of gear around for hours on end is the only downside. I noticed the beautiful light on one set of columns in Sydney Town Hall vestibule one night and spent the next hour or two setting up this shot under the watchful eye of a security camera. This time of finding and setting up an image is precious to me - it's an opportunity to dwell only in that moment and have respite from my brain's constant connection of ideas. Also I find that photography (and, occasionally, sketching) gives me that 'permission' to sit and contemplate an object or space for long periods of time, permission that I would not otherwise grant myself. Most of the setup time was taken in selecting the best column, the best angle, optimising depth of field and then carefully lining up the camera to make it truly vertical - while it's straightforward to rotate and skew images on a computer, you lose significant image area in the process. If you went to see this in real life, you'd be disappointed - the columns are a dirty brown, the lights a horrible orange and there was a small amount of graffiti on the column that I needed to photoshop out. Through the magic of black and white film, however, it looks strong, pure and timeless. |
|
behind the image
|
|
Monday, 19 January 2009 11:03 |
|
As soon as I saw the overgrown grass on my recce, I knew that this was the image I wanted to take. At the time it represented potential - a young person dreaming about what their life would be like. Now it reminds me of the beautiful moments in life that are transitory - the perfect afternoon at the beach, your wedding day, your first visit to Paris ... moments that can be captured in images but never replicated. The model was 13 at the time of this shoot - right in the demographic of Dolly magazine who bought an image in this series for $200 back in '96. I don't know if it was ever published but if it was, I hope the advice in the article was better than is normally the case. |
|
catalyst blog
|
|
Thursday, 15 January 2009 23:50 |
|
Many of us (myself included) love Steve Jobs, but that's the problem - we can't imagine Apple without him.
"Apple's stock going down every time after time someone thinks Steve Job is sick? That's a huge ego play for Steve - he shouldn't do that. Steve should have a bench of eight people who are leading the tribe in eight really useful different directions so it won't matter - he's going to retire one day and you have to plan for that."
The Telegraph says that Apple needs to act fast on Steve Jobs succession plan, but that would make it a reaction rather than a plan, right? A succession plan is something that you organise before the CEO gets sick, avoiding a drop of 8% in the company's share price.
I think everyone should have a succession plan, including employees. For a few years now I've had the attitude of making myself redundant in any role I find myself in - if my employer or client still needs me after a long period of time, I can't have done my job properly.
If in two years I'm the only one who can do my role, I've failed to share information and train others. If I'm the only champion for an idea after six months then I've failed to either create a valuable idea or to spread it. Instead of attempting to cling to my current role, I should be looking to outgrow it, ready for the next challenge. And as I do this I'll add more value to my employer/client by sharing my knowledge and skills with other employees. In turn this makes more valuable to this client and my next - it's a virtuous cycle.
Of course, I've never succeeded in making myself redundant, but I'm slowly getting better at it. Maybe one day you and I can make the share price of company go up on the day we leave, rather than down.
Get well, Steve. |
|
catalyst blog
|
|
Thursday, 15 January 2009 16:23 |
|
In the book 'U2 by U2', Bono speaks about the song 'With or without you':
"The lyric is pure torment. One of the things that was happening at the time was the collision in my own mind between being faithful to your art or faithful to your lover. What if the two are at odds? Your gift versus your domestic responsibility? [...] I remember thinking: 'Is the life of an artist? Am I going to have kids and settle down and betray my gift or am I going to betray my marriage?'"
Adopting 'art' to mean the broadest sense of the word - our passions and raison d'etre - I suspect many of us feel this conflict and some of us are deeply affected by it. Fortunately Bono goes on to answer to his own question:
"I thought these tensions were going to destroy me but actually, in truth, it is me. The tension, it turns out, is what makes me an artist. Right in the centre of a contradiction, that's the place to be. [...] If I had cut loose, what would have become of me? I remember looking at [artists who had] acted with abandon, and had lost marriages, bands, friendships, all in pursuit of the muse. But the muse is taciturn and can abandon you, leaving you with nothing. My muse has different demands. If I'd gone that route, many of my best songs would have gone unwritten. Or if I'd taken the other road, which is straightforward, given myself over to the domestic side of life, the songs would have been lost. It's the tension between the two that keeps me sharp. You don't have to resolve them, just don't go too far either way."
I suppose this is one aspect of maturity - to be content with and use this tension rather than go to extremes to avoid it. No doubt the angst in the meantime is another dip to push through in order to be successful in both aspects of our lives. |
|
catalyst blog
|
|
Wednesday, 17 December 2008 00:00 |
I grew up on Sanitarium Weet-Bix for breakfast - my folks bought it because it was healthy with only 3.3% in sugars. Moreover, Sanitarium took the high moral ground in the 80s and 90s, waging war with Kellog's Nutrigrain and others by pointing out that their high sugars content (33% for Nutrigrain) was not at all nutritious.
Since then Sanitarium have presumably decided that making money is more important than health, and have released two Weet-Bix Crunch products - Honey and Cocoa - in which the sugars content is 29.4% and 28.7% respectively. Ultimately that doesn't bother me - it's their brand and they can dilute it if they want to.
What does bother me, however, is that having set the brand expectation of low sugar products over many decades of commitment to that brand promise, the packaging for the 28.7% sugar Weet-Bix Crunch Cocoa tells me only how good it is:
I used to be able to trust Sanitarium to tell me what was healthy for me - I could buy any of their products without reference to the nutritional panel. Now I can't. Now I must interpret what they say about their products, and compare?the nutrional content of their products to those of other brands. And as soon as I'm forced to do that, I have no brand preference for any of the entire Sanitarium product range.
The dumbest part of this is that we'll all find out anyway, so it can be stated upfront. Find a way to prominently state that it's got a higher sugar content than we expect and we might buy it as a treat for our kids anyway.
Trust needs no interpretation or comparison. |
|
catalyst blog
|
|
Wednesday, 19 November 2008 10:10 |
|
Curiosity is, by definition, the willingness to explore something new without knowing if there's benefit in doing so (otherwise it's pragmatic self-interest). Will you learn something if you listen to a particular podcast, subscribe to a certain blog, go to that conference or read that new book? Will you benefit from trying a different method, meeting that new person or collaborating with a given group of people? Most people never find out - they remember the time that their curiosity was not rewarded, view curiosity as a poor investment and opt for mainstream, low risk experiences. If, however, you approach curiosity as a long series of small investments - try many podcasts, many blogs, many conferences, many books, many methods, meet many new people and/or collaborate with many groups - you'll find that in spite of some experiences being useless, your attitude of curiosity pays handsome dividends in the long term - new knowledge, perspectives, insights & opportunities. Perhaps, then, an attitude of curiosity is actually pragmatic self-interest after all. |
|
catalyst blog
|
|
Monday, 17 November 2008 15:32 |
"Back pain can really get in my way. That's why I rely on new Panadol Back & Neck. It's active ingredient works where I need it fast so I don't need to hold back. Panadol back and neck is my choice."?
What's the "active ingredient" in Panadol Back & Neck? 500mg of paracetamol. That would be the same as the Panadol that first went on sale in the UK in 1956. So what's "new"? The name & packaging.
Head & Shoulder's have just started advertising a "new Hair Retain for Men" shampoo product (a subject near and dear to my heart). The active ingredients? The same as normal Head & Shoulders. So what's "new"? The name & packaging.
I can understand the need to remove consumer's uncertainty - a consumer stands at the supermarket shelf looking for a product that solves their particular problem. If it's back pain, they want to find a box that says 'relieves back pain'.
And I can understand the need to promote the benefits of a product - no doubt there's some link between scalp health and reduced hair loss that the Head and Shoulders team can point to (but seemingly not on their website). And I don't doubt for a second that Panadol Back & Neck relieves back and neck pain.
What's not reasonable, however, is to imply that you have a new product with remarkable benefits, when it's the same unremarkable product that you've been flogging for years. In doing so these companies are purchasing a short term boost in sales by withdrawing part of the trust they have deposited with us over the years. And with this kind of behaviour, there isn't much trust left. |
|
|
|
|
|
|
Page 4 of 8 |
|
|
