Category: Entrepreneurship

Merton Miller Applauded Bankers Who Cleverly Evaded Government Interference with Free Markets

(p. 12) . . . Merton Miller, a Nobel laureate economist at the University of Chicago, . . . was in many ways the father of financial innovation. Miller praised complex financial instruments, in large part because they helped institutions avoid the law. He applauded bankers for cleverly avoiding government attempts to interfere with markets.

For the full review, see:
FRANK PARTNOY. “Societal Bonds.” The New York Times Book Review (Sun., MAY 10, 2015): 28.
(Note: ellipses added.)
(Note: the online version of the review has the date MAY 8, 2015, and has the title “‘Smart Money,’ by Andrew Palmer.”)

Entrepreneur Elon Musk Is Determined and Works Intensely

(p. C7) “Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future” isn’t the first biography we’ve had of Mr. Musk, nor will it be the last. But it is easily the richest to date. It’s also the first one Mr. Musk has cooperated with, though he had no control, the author says, over its contents. Mr. Vance is a technology writer for Bloomberg Businessweek. He won over Mr. Musk, who initially declined to be interviewed, impressing him with his diligence after he had interviewed some 200 people.
The result is a book that is smart, light on its feet and possesses a crunchy thoroughness. Mr. Vance can occasionally veer toward hagiography and the diction of news releases. After noting that Mr. Musk’s grand vision is to colonize Mars, for example, Mr. Vance writes:
“He’s the possessed genius on the grandest quest anyone has ever concocted. He’s less a C.E.O. chasing riches than a general marshaling troops to secure victory. Where Mark Zuckerberg wants to help you share baby photos, Musk wants to … well … save the human race from self-imposed or accidental annihilation.”
. . .
The best thing Mr. Vance does in this book, though, is tell Mr. Musk’s story simply and well. It’s the story of an intelligent man, for sure. But more so it is the story of a determined one. Mr. Musk’s work ethic has always been intense. One observer says about him early on, “We all worked 20 hour days, and he worked 23 hours.”

For the full review, see:
DWIGHT GARNER. “Books of The Times; For Industrialist, Sky Is No Limit.” The New York Times (Weds., MAY 13, 2015): C1 & C7.
(Note: ellipses internal to paragraph, in original; ellipsis between paragraphs, added.)
(Note: the online version of the review has the date MAY 12, 2015, and has the title “Books of The Times; ‘Elon Musk,’ a Biography by Ashlee Vance, Paints a Driven Portrait.”)

The book under review, is:
Vance, Ashlee. Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future. New York: Ecco, 2015.

Hamburger Grown in Lab from Cow Stem Cells

(p. D5) A hamburger made from cow muscle grown in a laboratory was fried, served and eaten in London on Monday in an odd demonstration of one view of the future of food.
. . .
The two-year project to make the one burger, plus extra tissue for testing, cost $325,000. On Monday it was revealed that Sergey Brin, one of the founders of Google, paid for the project. Dr. Post said Mr. Brin got involved because “he basically shares the same concerns about the sustainability of meat production and animal welfare.”
The meat was produced using stem cells — basic cells that can turn into tissue-specific cells — from cow shoulder muscle from a slaughterhouse. The cells were multiplied in a nutrient solution and put into small petri dishes, where they became muscle cells and formed tiny strips of muscle fiber. About 20,000 strips were used to make the five-ounce burger, which contained breadcrumbs, salt, and some natural colorings as well.

For the full story, see:
Fountain, Henry. “Frying up a Lab-Grown Hamburger.” The New York Times (Tues., Aug. 6, 2013): D5.
(Note: ellipsis added.)
(Note: the online version of the story has the date Aug. 5, 2013, and has the title “A Lab-Grown Burger Gets a Taste Test.”)

Ed Telling’s Nimble, Intuitive Labor Decisions at Sears

(p. 49) Telling rarely gave a direct order, so the Searsmen near him knew they had to listen hard and learn to read his arcane signals. You had to understand his gnomic comments and apparent throwaway lines, for you would only hear what Telling thought about something twice. The requirement made people scared, because the third time he spoke you were gone. “No need to beat a horse if he’s not able to pull,” he’d say. “Let’s get another horse.”
He had a habit he said he couldn’t do anything about of judging the utility and character of a man the first time he looked into his eyes. Quick-draw decisions like this were a part of the general managerial ethos at Sears. The practice might have descended from the store master’s knack for spotting at fifteen paces a shopper in the mood to spend freely.

Source:
Katz, Donald R. The Big Store: Inside the Crisis and Revolution at Sears. New York: Viking Adult, 1987.

Studebaker Competed with “Unique Designs and Powerful Engines”

LangeGregWithStudebakerPresident2015-04-25.jpg

“Greg Lange, 53, with his two-tone 1955 Studebaker President, near his home in Edmonds, Wash.” Source of caption and photo: online version of the WSJ article quoted and cited below.

(p. D4) I’ve always rooted for underdogs.

. . .
Studebaker wasn’t a big Detroit corporation. It was a smaller company out of South Bend, Ind., and had to be highly imaginative to compete with Ford and General Motors. This resulted in unique designs and powerful engines. The one in my President is called a Passmaster (a 259 cubic inch V8); the meaning is obvious.

For the full interview, see:
Greg Lange as told to interviewer A.J. BAIME. “Studebaker: President Still in Office.” The Wall Street Journal (Weds., April 8, 2015): D4.
(Note: ellipsis added.)
(Note: the online version of the interview has the date April 7, 2015, and has the title “Studebaker: Still Stands Out After 60 Years.” Where the online version differs from the print version, the quoted passage follows the online version.)

Ed Telling Centralized as He Talked of Decentralization

(p. 491) Like de Gaulle, Telling talked of decentralization as he centralized all things beneath him. He pulled the authority of individual stores into the purview of the retail groups, then the power of the groups into the territory, and then the awesome power of the territories up into the Tower–with an assist to Ed Brennan at the end. The killing off of layers of management in many large companies causes the authority to fall down as if by gravity, but Telling pulled it back up manually. Every retirement caused former authority to come up to him.

Source:
Katz, Donald R. The Big Store: Inside the Crisis and Revolution at Sears. New York: Viking Adult, 1987.

To FDA Aging Is Not a Disease, So FDA Will Not Approve Drugs that Extend Life

(p. D1) Some of the top researchers on aging in the country are trying to get an unusual clinical trial up and running.
. . .
The trial aims to test the drug metformin, a common medication often used to treat Type 2 diabetes, and see if it can delay or prevent other chronic diseases. (The project is being called Targeting/Taming Aging With Metformin, or TAME.) Metformin isn’t necessarily more promising than other drugs that have shown signs of extending life and reducing age-related chronic diseases. But metformin has been widely and safely used for more than 60 years, has very few side effects and is inexpensive.
The scientists say that if TAME is a well-designed, large-scale study, the Food and Drug Administration might be persuaded to consider aging as an indication, or preventable condition, a move that could spur drug makers to target factors that contribute to aging.
. . .
(p. D4) Fighting each major disease of old age separately isn’t winnable, said S. Jay Olshansky, another TAME project planner and a professor at the school of public health at the University of Illinois at Chicago. “We lower the risk of heart disease, somebody lives long enough to get cancer. If we reduce the risk of cancer, somebody lives long enough to get Alzheimer’s disease.”
“We are suggesting that the time has arrived to attack them all by going after the biological process of aging,” Dr. Olshansky said.
Sandy Walsh, an FDA spokeswoman, said the agency’s perspective has long been that “aging” isn’t a disease. “We clearly have approved drugs that treat consequences of aging,” she said. Although the FDA currently is inclined to treat diseases prevalent in older people as separate medical conditions, “if someone in the drug-development industry found something that treated all of these, we might revisit our thinking.”

For the full story, see:
SUMATHI REDDY. “To Grow Old Without Disease.” The Wall Street Journal (Tues., March 17, 2015): D1 & D4.
(Note: ellipses added.)
(Note: the online version of the story has the date March 16, 2015, and has the title “Scientists’ New Goal: Growing Old Without Disease.”)

Sears CEO Ed Telling Opposed the “Sloppiness” of Across-the-Board Layoffs

(p. 46) It was never that layoffs were anathema to Telling as such; he just resented the sloppiness of a 10-percent across-the-board layoff when some areas of the company should have been cut by 40 percent and some built up by half.

Source:
Katz, Donald R. The Big Store: Inside the Crisis and Revolution at Sears. New York: Viking Adult, 1987.

Technicolor Entrepreneur Kalmus Was Visionary, Stubborn and “in It for the Long Haul”

(p. C15) Judy Garland opening a door from black-and-white Kansas into Technicolor Oz is one of the most enchanting effects in all of movies. But as film historians James Layton and David Pierce relate in “The Dawn of Technicolor: 1915-1935,” the technology that made “The Wizard of Oz” possible came from people who were looking to start a business, not to make art.
The creators of Technicolor–engineer W. Burton Wescott and MIT graduates Daniel Comstock and Herbert T. Kalmus–were visionary, though stubborn is just as accurate.
. . .
In 1934 Fortune magazine wrote, “Businessmen regard Dr. Kalmus as a scientist, and scientists regard him as a businessman.” Comstock and Westcott eventually left the company in the mid-1920s, but Kalmus was in it for the long haul. . . .
Once perfected, Technicolor had a virtual monopoly on color Hollywood productions, and it did indeed make Kalmus and his investors rich. But it took steel nerves to put money into the unprofitable, ever-tinkering Technicolor of the early days.

For the full review, see:
FARRAN SMITH NEHME. “The Very Thought of Hue; Early color films gave viewers headaches. It took decades to develop a process that didn’t simply look odd.” The Wall Street Journal (Sat., April 11, 2015): C15.
(Note: ellipses added.)
(Note: the online version of the review has the date April 10, 2015.)

The book under review is:
Layton, James, and David Pierce. The Dawn of Technicolor: 1915-1935. Rochester, NY: George Eastman House, 2015.

The Process Innovations of Ed Telling at Sears

There are a fair number of case studies and biographies of important new product innovations. Rarer are the case studies of process innovations. Two great exceptions are Marc Levinson’s The Box and The Great A&P. I have recently read another exception, this one by Donald Katz, about how Ed Telling brought process innovations to Sears from the mid-1970s through the mid-1980s.
In the next few weeks, I will be quoting several of the more useful, or thought-provoking passages.

The book discussed, is:
Katz, Donald R. The Big Store: Inside the Crisis and Revolution at Sears. New York: Viking Adult, 1987.

Leadership Depends on Accumulated Experience as Much as Packaged College Courses

(p. 17) The dominant brand, Harvard Business School, claims to “educate leaders who make a difference in the world.” The University of Michigan’s Ross School does one better, developing “leaders who make a positive difference in the world.” Kellogg at Northwestern develops “brave leaders who inspire growth in people, organizations and markets.” And Duke’s Fuqua says it does what it does because “the world needs leaders of consequence.”
. . .
Which raises the question, once again, of whether leadership can be packaged and taught, rather than accumulated through experience.
John Van Maanen, a professor of management at M.I.T. Sloan who teaches a course named “Leading Organizations,” isn’t so sure it can. “Even today, three-plus decades in, there’s no real definition of it,” he says. “We can make people more conscious of ethical dilemmas in business, of the difficulty of directing people in times of adversity, and the confidence and communication skills necessary to do so. But the idea that such skills can be transmitted so that you can lead anybody at any time, that’s ideologically vacuous.”

For the full commentary, see:
DUFF McDONALD. “Can You Learn to Lead?” The New York Times, Education Life Section (Sun., APRIL 12, 2015): 17.
(Note: ellipsis added.)
(Note: the online version of the commentary has the date APRIL 7 (sic), 2015.)