Ged Carroll

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  • Bullwhip effect aka Forrester effect

    Bullwhip effect

    I came across the bullwhip effect as a descriptor recently in discussions around the global chip shortage. Bullwhip effect is a concept that is well known in supply chain circles.

    The bullwhip effect is also known as the Forrester effect. Disruption ripples back from the retailer, through the wholesaler, manufacturer, on to their suppliers and so on.

    The usual causes for the effect are:

    • Demand forecast updating – this might be where a company might want to change their product mix to match consumer demand, if a product is very successful or grossly underperforms
    • Order batching – where members of the supply chain round up, or round down the quantity of orders. This happens with the periodic memory gluts or shortages affecting the technology sector
    • Price fluctuations – price discounts can encourage non-linear increases in purchases as it becomes worthwhile for customers to stock up, hedging against increased prices down the line. Oil reserves would be a classic example of this phenomenon
    • Rationing and gaming – buyers and sellers delivering over or under their order quantities. An example of this would be the actions of Enron in US electricity markets. This could be used in a positive way to promote changing the supply chain like renewable sources of electricity generation
    My, what a big holster you have.

    What caused the global chip shortage that is driving the bullwhip effect?

    There were three causes to the global chip shortage

    1. Partial shutdown – The semiconductor industry went through a partial shutdown because of the COVID-19 epidemic. This meant that there was a smaller supply of chips.
    2. Unusual increase in demand – Home working drove an increase in demand: increased sales in PCs, wi-fi routers, external hard drives, mice, keyboards, printers and so on. There was also a corresponding increase in home entertainment as consumers upgraded smart TVs, Apple and Roku set top boxes. This all coincided with the launch of the next generation of gaming consoles by Sony and Microsoft – which can usually drive a squeeze on their own
    3. Supply chain disruption – A fire in Japan at Renesas Electronics. A trade war affecting Chinese semiconductor manufacturers. Freezing winter weather in Texas disrupting employees and their businesses. Now there is a drought in Taiwan affecting TSMC – the world’s largest semiconductor foundries

    More related posts here.

    More information

    Chip shortage is starting to have major real-world consequences 

    Global chip shortage: everything you need to know | CAR Magazine

    The global semiconductor shortage can be explained by the bullwhip effect 

    Chip industry pressures spur Renesas to diversify | Financial Times

    Taiwan’s chip industry under threat as drought turns critical | Financial Times

    Texas winter storm blackouts hit chip production | Financial Times

  • OrCam + more things

    OrCam

    OrCam Read – Transform the Way You Read – YouTube – I watched this video and wondered if this was a sign of failure in the education sector in terms of literacy. As far as I can tell, OrCam is a dedicated OCR appliance that reads back the text to you. In essence it is playing the same role as a scribe to a medieval lord. I suspect that OrCam is a product looking for a market and this is a skewed pitch

    Business

    Chinese investment in UK assets estimated to be £135bn : CityAM 

    Another One Bites The Dust: Why Verizon’s Divestiture Of AOL And Yahoo Is No Surprise | Forrester – Verizon’s sale represents a giant write down. I remember the uproar when Tumblr got wrote down from $1Bn to zero. This is a greater write down in absolute value.

    Consumer behaviour

    Are some personalities just better? – All-blues might really be happier and healthier. If so, it could a result of late modernity, or it might have always been true. Still, that doesn’t mean that evolution will favor all-blues, or that all-blues are “more successful”

    Economics

    The Failed Promise of Malaysia’s New Economic Policy – Asia Sentinel – Malaysia’s 49 year affirmative action programme for the Malay majority failed and helped precipitate a brain drain of Malaysian Chinese overseas (paywall)

    Ideas

    How the U.S. Government Can Learn to See the Future – Lawfare – Research over the past decade funded by the U.S. government demonstrates that “keeping score” by quantifying the probability that a potential event will or will not happen leads to improved forecasting accuracy. This is especially true when that scorekeeping is paired with training to reduce cognitive biases, as well as tools that combine the forecasts of many people together, harnessing the “wisdom of crowds.” These methods are not just for carnival games and stock trading. They can provide clearer insight on national security questions – it looks like prediction markets might be getting their time in the sun again

    Security

    Sweden drops Russian hacking investigation due to legal complications | The Record by Recorded Future – Swedish government dropped today its investigation into the 2017 hack of its sports authority, citing the legal constraints that would have prevented prosecutors from charging the Russian hackers responsible for the intrusion, which officials claimed were mere pawns operating on behalf of a “foreign power.”

    China-linked hackers used VPN flaw to target U.S. defense industry -researchers | Reuters

    Chinese military unit accused of cyber-espionage bought multiple western antivirus products | The Record by Recorded Future 

    Apple brass discussed disclosing 128-million iPhone hack, then decided not to

    Wireless

    Opinion | Steve Jobs Never Wanted Us to Use Our iPhones Like This – The New York Times

  • Bill Bernbach & things that made last week

    Bill Bernbach

    Advertising pioneer Bill Bernbach in conversation with Helmut Krone talk about advertising with some interesting examples of what we’d now call challenger marketing. I have been reading Bill Bernbach Said this week. Its a book of quotes from Bernbach that advertising DDB compiled over his time as a leader. The Avis ads were famous to me as they were cited by my lecturers in college.

    I want my MTV

    George Lois talks about ‘I want my MTV’ and Lee Clow talks about working on Apple‘s advertising in the 1980s in a panel at the 2013 Cannes Lions. Interesting lines about the courage to fight for your work, which is much harder to do now. I want my MTV is an example of creating demand pull from consumers through the cable TV companies.

    Steve Jobs apparently referenced Bill Bernbach in meetings with Lee Clow, which is unusual for 25 year old non-marketer, even today. From the beginning Jobs was citing the Sony brand as an influence.

    Skate birds

    RTÉ News made a short film on how Irish women are taking up skateboarding and making the sport more inclusive by nature. The skate park looks like one of the original concrete ones from the first era of skateboarding popularity during the late 1970s. Skateboarding had a small but dedicated following, probably less so than the UK.

    Storytelling in County Clare

    Great archive footage of Irish storytelling in 1979, shot in a pub in Co. Clare. Seanchaí (shan-a-key) were Irish storytellers, they entertained crowds in pubs and local households before television. With recordings devices, researchers travelled around the countryside capturing oral history, songs and stories for National Folklore Archive, now kept at University College Dublin. In the 1960s at tourism picked up in Ireland, there was increased interest in their craft.

  • Standard Chartered + more news

    Standard Chartered

    Standard Chartered to cut branch network in half – Standard Chartered is to reduce its global branch network by half to around 400 to cut long-term costs after the UK bank reported a stronger than expected first quarter profit. The Asia, Africa and Middle East-focused lender, which had as many as 1,200 branches worldwide in 2014, said today it will shrink the network to a third of that total as it also gives up office space worldwide – this move by Standard Chartered seems to be a short term move to try and please investors

    Temple of Mamon

    Consumer behaviour

    Sex sells: China farm region becomes ‘lingerie capital’ | Hong Kong Free Press HKFP – around 2013, volumes soared as younger Chinese consumers began discovering their sensuality, Lei said. Most buyers are now between 22 and 25. Initially, loose-fitting, not-too-revealing designs were favoured in China. Today, semi-transparent, “body-hugging” numbers dominate

    Why are South Korea’s young men turning against Moon Jae-in and his ruling party? | South China Morning Post – Unpopular housing policies and a backlash against Moon’s perceived ‘feminist’ agenda has seen support for his Democratic Party administration collapse among Korean men in their 20s and 30s. Not so among young women, however – meaning victory for the opposition is far from guaranteed at the next presidential elections set for March 2022

    As boundaries between work and home vanish, employees need a ‘right to disconnect’

    Glancing at your phone quickly prompts other people to do the same | New Scientist – Such a rapid, automatic response is probably due to people mimicking each other without realising it – what scientists call the “chameleon effect”. While such mimicry is thought to have evolved in human societies to help people bond with each other, mimicking mobile phone use might have the opposite effect, says Elisabetta Palagi at the University of Pisa, Italy. “We have a need to follow the norms imposed on us by people around us, to [match] our actions with theirs in this automatic way,” she says. “But smartphones can increase social isolation through interference and disruption with real-life, ongoing activities.” – digital yawning

    Economics

    The panopticon of Germany’s foreign trade: New facts on the first globalisation, 1880–1913 | VOX, CEPR Policy Portal – The history of globalisation is usually told in two parts, separated not only by two world wars but also by changes in technology, institutions, and economic logic. This column reconsiders that narrative. Using detailed new evidence on Germany’s foreign trading practices from 1800 to 1913 (the ‘first’ globalisation), it finds that most growth took place along the extensive margin, while 25–30% of trade was intra-industry. If the first globalisation saw substantial heterogeneity within countries and industries, it may be time to re-think the ‘classical’ versus ‘new’ trade paradigm

    Ethics

    Mediatel: Mediatel News: An ill-advised alliance & cross-media measurement pinch-points – Bob Wootton on the moral bankruptcy of P&G circumventing audience privacy measures on Apple devices in China

    Finance

    E-Residency joins campaign against IBAN discrimination | Estonia E-Residency Blog

    Media

    WordPress Saves Creative Commons Search Engine From Shutting Down 

    Pandemic propels Thai mom with ‘nothing to lose’ into internet pornstar | Coconuts Bangkok – And when the internet sees a woman posting sexy nudes, it usually assumes she does porn. At first Fernie hated those insinuations. She felt insulted and would block anyone called her a “porn star.” But it eventually wore her down and, in the way of internet grooming, became a kind of self-fulfilling prophecy as the messages kept pouring in. “When I got them that frequently, I started to think of them as compliments,” she said with a giggle. “Then the thought of, ‘If I sell nude pics, I might as well sell porn,’ came to my mind, because they’re similar anyway.” More content related to adult entertainment here.

    Security

    Havana syndrome: NSA officer’s case hints at microwave attacks since 90s | Espionage | The Guardian

    China’s regulator names 33 apps including Baidu, Sogou, iFlytek, Tencent for unauthorised data collection | South China Morning Post – Thirty three apps from Tencent, Baidu, Sougou and more are among the latest to receive scrutiny over user data. App makers will have to comply with new privacy regulations banning collection of data and forcing user consent

    April 30, 2021 – Letters from an American – really interesting post on information warfare and the way the US body politic is looking at it

    Taiwan bans recruitment for jobs in China to combat brain drain – Nikkei Asia 

    Technology

    Toyota will showcase its hydrogen-powered Corolla at Super Taikyu event – Toyota is definitely thinking about a hydrogen future due to the limitations of lithium ion battery cars. Motorsport is where a lot of research and development happens for car and commercial vehicle manufacturers

    Why has TSMC’s Nanjing expansion plan stirred up a hornets’ nest in Beijing and Taipei? | South China Morning Post – TSMC says expansion will help it address chip shortage, particularly for automotive sector. One analyst says move could stifle domestic chip development on the mainland

    Baidu will offer first paid robotaxi service in China next month, letting people hail rides without drivers

  • Porsche 911 GT3 & things that made last week

    Porsche 911 GT3

    Yes the Porsche 911 GT3 is a car faster than most people can drive. Yes they all look very similar unless you are a truly devoted petrol head. But I was struck by this review of the Porsche 911 GT3 by Chris Harris.  In the early part of his review, he ran the car in to put 1,000 miles on the engine. During that time he focused on the simple joy of driving, which gave me a real hankering to get behind the wheel of a car again. What really struck me was the comments Harris makes about that primally magic time for driving as the light goes down in the evening or the sun comes up in a morning.

    Some of my most visceral early memories are of being in the back seat of the family car (unencumbered by a back seat seat belt) during this time. The magic of the early dawn light on winter clouds and wisps of smoke from rural houses as we drove back to the family farmstead in Ireland. Harris’ Porsche 911 GT3 review brought it all rushing back to me.

    Media ideas

    Thought provoking interview on the future of media, ‘lazy-endism’, balancing hyper-personalisation with wider insight and empathy, and the power of context in media. You won’t necessarily agree with all of it, but it took my thoughts on marketing to interesting places for exploration. Jerry Daykin heads up media for GSK’s consumer business across EMEA.

    C-suite’s diminishing appreciation of brand

    The Financial Times and the Institute of Practitioners in Advertising put together research on the c-suite’s lack of appreciation of marketing. The decline has been taking place over decades.

    China’s telecommunications ambitions

    Interesting roundtable on information technology and communications which provides great power advantage. Interesting perspective around standards and technology advantages looking at past case studies. China explicitly talks about its desire to project power through the ICT industry basic inputs, supply chain, standards and applications. It looks to build leverage internationally and independence domestically. They want to lock-in their power. It isn’t just about spying but international coercive control.

    Hands free airline toilet door

    ANA the Japanese airline have rolled out a kit that turns airplane toilet doors into hands free operation. It’s a brilliant piece of design. The work was done by JAMCO – a Japanese company that specialises in the design and manufacture of aircraft interiors.