Book review: BRICS and beyond, executive lessons on emerging markets

A few months ago I was surprised and pleased at the same time to receive a complimentary book from Wiley in my mailbox. I was wondering why – maybe because this blog is meant for MBA students (something mentioned on the back cover) and I wrote many posts about BRICS countries? Well actually it was the result of a participation to a monthly competition at Business Because – so you too you can participate and win! And thanks, Business Because, for the very interesting book!

130224-BRICS-bookHere are the technical details about the book: “BRICS and BEYOND” by Stephanie Jones, Wiley 2012, ISBN 978-1-119-96269-4 (also available as e-book). Dr Stephanie Jones is Associate Professor of Organizational Behavior at Maastricht School of Management. She lived and worked around the world (Hong Kong, China, India, Australia, Dubai and Kuwait according to her bio) and has therefore a good background to write this book. The first thing that strikes with this book is its cover: it basically states that every step of a product life cycle is now happening outside the US or the EU (except consumption perhaps).

The Vlerick Business School curriculum is not really focused on BRICS (nor emerging markets). However the full-time MBA has lots of participants coming from these countries. And even in the executive MBA (with mainly Belgians), there is (in my opinion) a certain interest in these countries (it is sufficient to mention that the study trip to China is fully booked in a few minutes …). And Western MBA students are clearly the target population of this book.

The structure of the book is somewhat classical. There are tree main parts: risks, opportunities and practise. You will be able to make links with – or more appropriately: make extensions of – several classes taught at Vlerick (and in all MBAs): CSR, marketing, entrepreneurship, innovation, strategy, operations, etc. But don’t expect to find any 2-by-2 matrices: this book is more about learning from experience than applying glossy frameworks.

This brings me to what I liked in this book: you have many ways to read it …

  • You can read the second cover and you will have very quickly 8 “must-know” sentences.
  • You can read “Executive Lessons” at the end of each chapter and you know a bit more.
  • Or you can just read one chapter you fancy at a time, on a specific topic – and there you go.
  • (and of course you can take some time and read it from the first page to the last one).

Something I also appreciated in the book is to have many practical “mini cases” (called “brief worked examples”). They illustrate each of the lessons detailes in the previous chapter. Very often MBA textbooks explain theory and concepts in great details but fail to deliver very practical examples you can relate to in your everyday life. Not here. This is again another illustration of the power of storytelling.

Some regrets? Although corruption and bribery is covered, there is nothing about regular finance and accounting. The topic is obviously very technical and vary in each emerging market. But you better know it before. And the author may have struggled to give a balance in the different countries to discuss. China and India indeed occupy the majority of examples. This is obviously normal as they enjoy great economic powers and a large part of the world population. However BRICS and emerging markets deal with other countries too. Most of these other countries are cited in one or several examples here and there – but at the end of the book the reader should expect to know more on India and China than Congo or Brazil for instance.

In a nutshell? “BRICS and Beyond” is a book you will enjoy reading if you are interested in emerging markets. It will give you an interesting introduction as well as key points to focus on when doing business there. And it will be complemented by more specialised reading (e.g. targeting a country or a topic specifically) but more importantly by your own experience!

Welcome to Daniel and Miguel in the Vlerick blogosphere!

I often ranted about the (relative) absence of Vlerick MBA students in blogs, twitter, etc. This year it seems the school did a special effort to recruit bloggers and/or that more MBA students are aware they can blog. The result is that, on top of Robert (FTMBA), Daniel (FTMBA) and Miguel (EMBA) joined the official Vlerick blog platform as well. A warm welcome to them – they  started with a bang: 3 posts already in February 2013!


Amazon: a case for each e-supply topics

Prof. Muylle’s course on e-supply is just over and here comes a very interesting presentation in my mailbox: Amazon, the hidden empire. It has everything, from A to Z:

  • A vision
  • Customer-focus and -loyalty (with a digital twist)
  • Digital-driven supply chain
  • Ecosystem
  • e-Procurement marketplace (the end of TradCom?)
  • High-margin, low-prices
  • Insourcing the value chain
  • Limitless inventory
  • Logistics
  • Pricing strategies
  • The long-tail
  • Using internet as a lever to outperform competition
  • Vertical integrations
  • there is even a kind of 2-by-2 matrix!

More on innovation, e-supply of scientific papers …

This second year in the EMBA at Vlerick Business School it seems that the point is more on innovation (somewhat like the focus was on finance during the first year). We had classes like Entrepreneurship (last year – pretty straightforward title) or Innovation Management this year. But even in courses like Operation Management or – more recently – Integrated E-Supply Management, we are faced with handling innovation.

I don’t know for you but very often I think the word innovation is over-used and also in any kind of situation (i.e. very often for something not innovative at all). So I was a bit apprehensive when I read that the course of Integrated e-supply management would – again – talk about how to innovate / embrace innovation / whatever (but fortunately very little about Apple). But I must say that the two sessions were so far very interesting, Prof. Steve Muylle sharing his passion for the “e” in e-supply.

As if it was meant to illustrate that, getting Prof. Muylle’s article on planning e-business initiatives in established companies is an example of a clash between the old model and the new one … In the old publishing model, you had a subscription to a journal  and you received your quarterly paper version delivered by your postman. I don’t know what will be the level 3 of e-publishing but right now the article is just available behind MIT’s paywall ($6.50). But Google (and any kind of search engine in fact) is disrupting this model by presenting you any result containing words in the title of the paper. It may happen that some results are not entirely relevant to your initial search but it may also happen that the electronic version of the paper is available somewhere, archived by some Irish professor for his class.

One can argue that this is theft! And they would be right: the paper’s copyright clearly states no one can copy it. But others could state that it’s just a collection of 0’s and 1’s, that it has a meaning because we are giving a meaning to it, that taxpayers’money paid for this research etc. This reminds me of one of the posters that is now hanging in the Vlerick campus: “If content is free, how can you make a living in a content-driven world?“.

Screenshot 01:02:13 01:41-3

Vlerick Global MBA now 84th in the FT rankings …

Well, preceding episodes in the serie are here and here. The FT Global MBA ranking 2013 is here (Vlerick specifically here). You can forge your own opinion by yourself.


Happy New Year 2013!

Happy New Year 2013! May it bring joy, happiness and success in your lives! And good luck to current Vlerick MBA student, especially those who will graduate this year: the delivery is now closer (or the beginning of a new life!) :-)

I’m right! is now launched!

After some intense work and a group session, our Communication Skills assignment is finally launched! You saw the trailer previously, now you can discover the whole story here:


It is about (mis-)communication, the employee-boss relationship, frustration, unsaid things and lower performances. I had a lot of fun doing it with Sammy, Peter, Bart and Stijn. Thanks, guys!

Btw, Merry Christmas! :-)

The Saflex case

What I call the “Saflex case” is in fact the presentation Roger Bloemen did for us during the last course of Operations Management. I already mentioned that it was very good. I wanted to know more about the case that can be summarized as: “how to use operations to save and put back to profitability a company under chapter 11“.

You can find some sweet videos of the 80’s on Youtube:

(No animal were hurt during the shooting of this movie)

More interesting is the infomercial video made by Metascreen in which heads of Saflex were interviewed (Roger Bloemen did not appear). The emphasis on Saflex people is also there, in the end …

But when you dig further it is not that easy to find something about the Saflex case, even if you choose other names for this case. Because, if I’m right, there is no Saflex case per se. “Just” some academic papers on a MIT professor Yossi Sheffi’s website. You will find these papers by looking for Roberto Perez-Franco in Sheffi’s page about publications (ok, direct links here and here – they might break if Sheffi is changing his webpage). These paper deal with the evaluation of the supply chain strategy of companies. Already if companies had a supply chain strategy, it would be nice (and not the one you think of just in the middle of a crisis – the one you design and nurture for some time when times are good, forecasting maybe when times will be bad).

In fact Sheffi’s other publications are well worth reading (and could have been the source of inspiration for a group presentation if discovered earlier – a hint for next year students? ;-)).

I’m right!

It seems that some group are starting to seriously work on their Communication skills group assignments … Does that look familiar to you? Do you have other issues with your boss? Do you sometimes struggle to resolve them?

Sleep another 4 nights and you’ll soon know more :-)

Some thoughts about Santa Claus operations and supply chain

Son – Papa! What are you doing the whole evening at your desk? Can you play with me and Lightning McQueen?
Dad – I’m studying, son! Like you I go to school and as you’ll know soon enough, there are exams …
Son – What are exams, papa?
Dad – That’s when your teacher ask you questions to see if you understood correctly.
Son – Oh, like when Madame Danielle is asking if we read our book?
Dad – Mmmmm, kind of …
Son – And what are you reading?
Dad – Operations Management and supply chain
Son – And what is Operation supply chain?
Dad – Well, son, you see …

Damn, how to explain what you are studying to your 4-years-old son? Operations management? That’s when one try to optimise the delivery of goods to the supermarket where the family goes shopping on Saturday? Huh? Well, I tried and it doesn’t work. However as Saint-Nicholas came on December 6th, it was a good opportunity to explain how the real world works …

5176 Guess Whooo's coming to town! (My Number 1) All time as of  11/24/2012 - 2,419 ViewsSaint-Nicholas or Santa Claus are facing approximately the same issues in terms of operations, supply chains and logistics. However Saint-Nicholas chose to restrict his market focus to mainly the Benelux only. This made things easier for him. For instance he did not need to find a large warehouse (or at least not at large as Santa Claus’) as he only has to deliver to fewer children. This choice was very clever because such large warehouse would have immediately attracted attention in such crowded countries like Belgium. Another important difference is that nobody really knows who is working for Saint-Nicholas. For Santa Claus, it’s easy: elves are working for him. But maybe Saint-Nicholas choose to have a Triple A supply chain where he operates only the last segment (the warehouse) (or not even the warehouse!). There would then be nobody working for Saint-Nicholas – everything is outsourced! So let’s focus on Santa Claus (most of the discussion below also applies to Saint-Nicholas however).

There are two main features about Santa Claus: The Goal and inventory.

Santa Claus did indeed read Eliyahu Goldratt’s “The Goal” (you know, son: one of the thick books on papa’s desk). He must also have followed Prof. Boute‘s class as everybody can clearly see that his strategic position is on Time and Variety/Flexibility. He’s not really interested in price (neither his customers btw): he’s giving what children request to him (after all, he’s not the richest man on earth for nothing). And quality is not necessarily a major criteria for Father Christmas’ gifts: children (and people in general) are mostly happy because they receive something (it probably has something to do with the fact it prooves the world they were kind during the last 12 months). This allowed him to send gifts manufactured in China (althought I think now all toys are manufactured in China nowadays).

And despite this Santa Claus still has a major issue regarding operations. He indeed still have a myopic view on value creation. As we will see below, he is only focusing on resource utilisation while he most probably completely forgets about sales growth and margin. There we come back to an element already mentioned: no financial incentive. Hence no real financial measures possible. How can you improve then? (another question is: does Santa Claus really need to improve his operations as kids receive their gifts on time and usually / sometimes what they requested so why bother?)

walmart distribution centerBut a major divergence from the course is about inventory! In Anupindi’s book, the first sentence of the summary on inventory is: “Inventory accumulates whenever there is a mismatch between supply and demand”. And the chapter goes on on how to reduce this mismatch (as part of Prof. Vereecke‘s classes). But actually Santa Claus needs this mismatch. Just because he only needs to deliver his goods during the overnight of December 24. Not before, not after (especially not for Easter!). In my opinion Santa Claus needs to accumulate this inventory during the year in order to be ready to distribute everything in one night. Then you can debate if he has a ultra-secret, ultra-large, ultra-modern warehouse next to the North Pole (which is nice because you can reach most US and European countries easily) or if he has a cloud of flexible warehouses dispatched around the world. Given the number of Santa Claus that we start to see at each corner of a street, I would favor this last option – these little Santa being responsible for a small subset of the delivery chain. I guess their performance is measured in terms of seconds being in advance / late for delivery or the number of children they delivered on time (again I guess no P&L responsibilities).

The content of this stock as well as the way it is built also depart from any classical business. Indeed although the product range is quite wide (and also varies from country to country), there are some broad categories that you can classify in the different types of inventories. For instance, you can classically think of perishable goods as obsolete stock (however why bother since Santa Claus would certainly not poison children with goods perished since last year). But you can fill Santa Claus’ safety stock with classical toys like Lego, Playmobil, Fisher-Price, puppets, cars, etc. And Santa Claus’ cycle stock would consist of toys like Buzz lightyear, Lightning McQueen (and other toys for girls that I’m not aware of). The build up of these different stocks could be schematically represented as the following:


If now we look at the little information we have about operations inside Santa Claus headquarters (see movie below), we see that he is indeed the jolly man we know.

Althought the first seconds show you a highly enthousiastic, qualified and kind of “clonable” workforce (the elves), the first step of the operation is a nightmare. Santa Claus is indeed reading each and every letter. This is a happy confirmation for all the kids. But from an operation perspective, this creates a huge bottleneck and this is clearly visible with the amount of letters on the floor! After this step, the work is fortunately segregated between several lines of production where the specialisation of each elf is well put forward. On top of that it seems elves worked very well to reduce waiting times to nearly nothing between each station. Did they apply the lean methodology? It is hard to say: it might as well be the result of years of refinements.

Then we realise there is again another bottleneck at QC/QA, done by Santa Claus himself. However, althought it seems the throughput of production of the different toys is quite fast, only a few of them arrive at QC per minute. What happened with the other toys? Are there other lines of QC but not managed by Santa Claus himself (so they did not dare to show them)? Of is the defect rate quite high that only a few reach the final QC?

The inventory management seems also to be quite disorganised. Fortunately every toy seems also to be aware of its role and its own destination. So they finally end up in Santa Claus’s big bag!

Finally given the lack of order in the bag but also given most children will apparently receive what they asked (talk about customer focus! – except for Billy Brown who will receive a cake of soap), DHL, UPS and other (fast) postal services might have some lessons to take from Santa Claus in terms of speed and reliability ;-) But how exactly Santa Claus does that is still highly debated amongst scientists in the world (others also tried to put numbers e.g.):

Anyway, have a Merry Christmas (a few days in advance) and enjoy the holidays break!

Photo credits: 5176 Guess Whooo’s coming to town! (My Number 1) All time as of  11/24/2012 – 2,419 Views by bsabarnowl, on Flickr (license CC-by) and walmart distribution center by Mr. Wright, on Flickr (licence CC-by-nc-sa)

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