Needed More than New Economy Cockiness to Succeed


Source of book image: online version of the WSJ review quoted and cited below.

(p. A25) Mr. Benioff tells the story of his success in “Behind the Cloud,” a triumphalist memoir and business self-help manual. He makes it clear that, when he was starting out, he followed the standard dot-com playbook: Get some high-profile tech-industry backers and mentors–Mr. Benioff’s former boss, Oracle chief executive Larry Ellison, was one–create buzz and let the revenues flow in. might have been launched with New Economy cockiness, but success followed for solid, old-fashioned reasons: The company’s products filled a market gap.

For the full review, see:

JESSICA HODGSON. “Selling and Software; How a start-up found a new way to deliver computer products to salespeople.” The Wall Street Journal (Thurs., DECEMBER 17, 2009): A25.

(Note: the online version of the article is dated DECEMBER 16, 2009.)

The book being reviewed, is:
Benioff, Marc. Behind the Cloud: The Untold Story of How Salesforce.Com Went from Idea to Billion-Dollar Company-and Revolutionized an Industry. San Francisco, CA: Jossey-Bass, 2009.

Internet Enabled Creative Destruction

(p. R4) To understand the challenges that faced businesses the past 10 years, consider the household names that didn’t make it through the decade: Anheuser-Busch, Compaq, Gillette, Enron, Lehman Brothers, Merrill Lynch, WorldCom.
. . .
As the decade rolled on, the Internet came to be known for destroying businesses. It upended decades-old business models in fields such as media, advertising, travel and entertainment, as consumers and advertisers migrated to the digital world.
But that same shift created opportunity. No one epitomized that better than Google Inc. A mere 15 months old at the beginning of the decade, it morphed from a startup technology company into an advertising and media powerhouse and is now plotting a move into communications. There, it will clash with Apple Inc., which was reborn following the return of co-founder Steve Jobs in 1997. Apple’s iPod and iTunes reshaped the music industry; its iPhone revolutionized communications by opening itself to independent innovators.
“This is what [Austrian economist Joseph] Schumpeter had in mind with his term ‘creative destruction,'” says Paul David, an economic historian at Stanford University. Industrial collapse is a “messy, messy process,” Mr. David says. “It’s a great drama, and watching it play out in this decade has been very interesting.”

For the full story, see:
SCOTT THURM. “Creativity, Meet Destruction; The Decade Rewrote the Corporate Handbook, Thanks to the Web, Globalization and the Collapse of Two Bubbles.” The Wall Street Journal (Mon., DECEMBER 21, 2009): R4.
(Note: ellipsis added.)
(Note: the online version of the article is dated DECEMBER 22, 2009.)

“Powerful Pressure for Scientists to Conform”


Source of book image: online version of the WSJ review quoted and cited below.

(p. A13) In “Hyping Health Risks,” Geoffrey Kabat, an epidemiologist himself, shows how activists, regulators and scientists distort or magnify minuscule environmental risks. He duly notes the accomplishments of epidemiology, such as uncovering the risks of tobacco smoking and the dangers of exposure to vinyl chloride and asbestos. And he acknowledges that industry has attempted to manipulate science. But he is concerned about a less reported problem: “The highly charged climate surrounding environmental health risks can create powerful pressure for scientists to conform and to fall into line with a particular position.”

Mr. Kabat looks at four claims — those trying to link cancer to man-made chemicals, electromagnetic fields and radon and to link cancer and heart disease to passive smoking. In each, he finds more bias than biology — until further research, years later, corrects exaggeration or error.
. . .
I know whereof Mr. Kabat speaks. In 1992, as the producer of a PBS program, I interviewed an epidemiologist who was on the EPA’s passive-smoking scientific advisory board. He admitted to me that the EPA had put its thumb on the evidentiary scales to come to its conclusion. He had lent his name to this process because, he said, he wanted “to remain relevant to the policy process.” Naturally, he didn’t want to appear on TV contradicting the EPA.

For the full review, see:
RONALD BAILEY. “Bookshelf; Scared Senseless.” The Wall Street Journal (Mon., AUGUST 11, 2008): A13.
(Note: ellipsis added.)
(Note: the first paragraph quoted above has slightly different wording in the online version than the print version; the second paragraph quoted is the same in both.)

The book under review is:
Kabat, Geoffrey C. Hyping Health Risks: Environmental Hazards in Daily Life and the Science of Epidemiology. New York: Columbia University Press, 2008.

Luddism in France

(p. 240) Not only was Richard Hargreaves’s original spinningjenny destroyed in 1767, but so also was his new and improved version in 1769.

Nor was the phenomenon exclusively British. Machine breaking in France was at least as frequent. and probably even more consequential, though it can be hard to tease out whether the phenomenon contributed to, or was a symptom of, some of the uglier aspects of the French Revolution. Normandy in particular, which was not only close to England but the most “English” region of France, was the site of dozens of incidents in 1789 alone. In July, hundreds of spinnigjennys were destroyed, along with a French version of Arkwright’s water frame. In October, an attorney in Rouen applauded the destruction of “the machines used in cotton-spinning that have deprived many workers of their jobs.” In Troyes, spinners rioted, killing the mayor and mutilating his body because he had favored machines.” The carders of Lille destroyed machines in 1790; in 1791, the spinning jennies of Roanne were hacked up and burned. By 1796, administrators in the Department of the Somme were complaining, it turns out presciently, that the prejudice against machinery has led the commercial classes . . . to abandon their interest in the cotton industry.

Rosen, William. The Most Powerful Idea in the World: A Story of Steam, Industry, and Invention. New York: Random House, 2010.
(Note: ellipsis in original.)

Mackey Reduced Role in Whole Foods after Being “Drained” by Antitrust Battle


“Higher existing-store sales powered Whole Foods earnings. Above, co-founder John Mackey juggles apples in a New York store last November.” Source of caption and photo: online version of the WSJ article quoted and cited below.

(p. B6) Whole Foods Market Inc. reported Wednesday that fiscal second-quarter profits had more than doubled and raised its full-year earnings forecast. The company also shook up its management team, naming a co-chief executive, though current CEO and co-founder John Mackey said he expects to work “for another decade or so.”
. . .
Mr. Mackey in December resigned as Whole Foods’ chairman after a year of controversy. Last summer, he wrote a controversial opinion article for The Wall Street Journal on his views of health care reform that led to boycotts of the natural grocer by some of his most loyal shoppers. Last spring, the Fair Trade Commission ordered the sale of 37 former Wild Oats Markets Inc. stores, a multi-year battle that Mr. Mackey says left him drained and influenced his decision to appoint Mr. Robb as co-CEO.

For the full story, see:
TIMOTHY W. MARTIN. “Profit Soars at Whole Foods; Grocery Chain Forecasts Sharply Higher Profit, Promotes Two Veteran Executives.” The Wall Street Journal (Thurs., MAY 13, 2010): B6.
(Note: ellipsis added.)
(Note: the first paragraph quoted above has slightly different wording in the online version than the print version; the second paragraph quoted is the same in both.)

Informal Sector Responded Quicker to Quake than Established Companies

HaitianCoalVendors2011-02-02.jpg “In Port-au-Prince . . . , Haitian vendors peddled small bags of coal.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A10) PORT-AU-PRINCE, Haiti — The price of candles in the teeming La Saline market here has climbed 60 percent since last week’s earthquake. A box of matches is up 50 percent. A package of Perdue Chicken Franks has gone up 30 percent.
. . .
Haiti’s huge informal sector reacted faster to the quake than did established companies and banks. Outdoor markets like La Saline are already filled with goods from the countryside, including salt, cornmeal, fruits like mangoes and used clothing from the United States.
. . .
“People want candles because they have no electricity or fuel for their generators,” said Manouchka Wendiwou, 21, a vendor in La Saline who raised her candle prices by 60 percent and made no apology for charging what the market would bear.

For the full story, see:

SIMON ROMERO. “Economy in Shock Struggles to Restart.” The New York Times (Fri., January 22, 2010): A10.

(Note: ellipses added.)
(Note: the online version of the article is dated January 21, 2010.)

Socialism Cut Venezuelan GDP, So Chavez Rejected GDP


Source of graph: online version of the WSJ article quoted and cited below.

(p. A15) President Hugo Chávez wasn’t pleased with data . . . that showed the Venezuelan economy tumbling into a recession. So the populist leader came up with a solution: Forget traditional measures of economic growth, and find a new, “Socialist-friendly” gauge.

“We simply can’t permit that they continue calculating GDP with the old capitalist method,” President Chávez said in a televised speech before members of his Socialist party . . . . “It’s harmful.”
Mr. Chávez’s comments came shortly after data showed Venezuela’s gross domestic product — a broad measure of annual economic output — fell 4.5% in the third quarter from the year-earlier period. It was the second consecutive quarterly decline, and observers have questioned how Mr. Chávez will be able to generate growth without high oil prices.
. . .
“It’s hard to say if [Mr. Chávez] is serious or not,” said Robert Bottome of publisher VenEconomía. “They’ve already tampered with the way they compute unemployment and how they determine how much oil [state oil company] PdVSA exports. So why not tamper with the economy figures as well.”

For the full story, see:
DAN MOLINSKI and DAVID LUHNOW. “Chávez Discounts Accuracy of GDP.” The Wall Street Journal (Fri., NOVEMBER 20, 2009): A15.
(Note: ellipses added.)