Analyzing Data Part 1: Product Tracker Sheet

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This is the Product Tracker Sheet discussed in the latest episode of Uncut! Your’s for free. Some of the cells are locked due to automatic calculations. All you need to do is to plug in the data required and you will be able to analyse it very easy from the start! I recommend doing these sheets every month with your new products or categories to see what working well over time!

Granted, If you have a fresh store without any customers like me, it might take some time in order to get some raw input (like sales) consider running the product test for a longer time.

 Click here to download the Product Tracker analyzesheet

Business Brand and Cost sheet

resources_exAs shortly discussed in Episode 2. Here’s the Business brand and Cost sheet you can use for free. Simply fill in all information. Always good to have handy when you starting to use more then just one email, Shopify store etc.

You’ll find the cost setup at the end. Simply plug in your monthly numbers and the calculator will do the rest. Let me know in the comments if you have any other questions regarding this (for example if you and your business partner splitting monthly cost).

Business brand setup Cost

The innovation of Blockchain and Financial Innovation: Disruptor’s for the regulated future?

Introduction

Almost, if not all scholars, organisations and nations are today coherent of the economic and social benefits of innovations.  Granted, innovation happens on a regular basis and thus drives the development of products and services further interdependent of the nature of the innovation. In this essay I’ve taken one innovation (Blockchain) that is very novel and one innovation (Financial Innovation) that is more of an umbrella approach to innovation – These from first sight, have the potential to be disruptive and/or fundamentally ground-breaking in its nature, thus making them fascinating for further research.

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The Blockchain innovation

The internet of today is a communication exchange protocol, the Blockchain is a value exchange protocol, and that is a significant difference.
Hence, we need to divide the internet of today and tomorrow based on these protocols. Simply put, the internet we know today is the internet of information. The Blockchain technology will be the internet of value. (Evry, 2016; Cortese, 2016)

The value derives via a protocol or ledger that cryptocurrencies like bitcoin are built upon, however the innovation can further be developed to valublockchaine beyond “money”. What made the internet of communication so successful was that the technology was open and available for everyone. The same principal goes for the innovation of Blockchain. The availability of value for everyone with access of internet and a smartphone or computer is a ground-breaking new ideology that fundamentally can change the entire financial industry. (Wessel, 2016)


Value however is very broadly defined. The crypto currency like bitcoin, makes value monetised, a standalone currency, free from regulations and mediators. The value will always be based on how much people or users of it think its worth, leaving it volatile and unpredictable. Much like the internet of communication made the exchange of ideas of information available to send instantaneously to anyone, everywhere, the Blockchain will open up the availability to transmit value instantaneously to anyone, everywhere.

The notion that we now can build innovative ideas around the very essence of financial instruments, that is public, unregulated and geographically unbound is for now a bit daunting, but nothing than revolutionary.

Additionally, Blockchain technology can be utilized by institutions or government if managed right.
A protocol in form of a scannable QR-code, could essentially be used as a voting code/token, making it a very attractive form of voting. Single unique usable codes for government elections allows for a democratic, transparent and eventually incorruptible balloting, open to the public. The open public ledger has potential for users or citizens to track elections live and thus making the election progress civic. It has the potential to fundamentally change less democratic countries when it comes to corruption and how people view and trust their nations government.

In the developed world, we take our matured banking and payment system for granted. Almost all of us have a bank account, and heavily relies on those institutions to function without interruptions, ever. The plastic cards in our wallet holds all of our financial information and the use of cash trades are declining steadily. Thus, we have faith that the system will work at any time of the day and year, and that the implemented rule of law will protect us if anything would happen. The western nations also hold the favour of having currencies most people want constantly more of, making trade profitable.

Scoping out to the developing parts of the world, this picture will look very different. The banking and financial industry is less advanced and most of all less widespread. The ATM innovation or the plastic card payment availability is still underdeveloped and the current currency is not considered as valuable as actual goods. Current Q2 2016 examples are Venezuela where the Bolivar is next to useless and people seek other forms of value instead. A crypto currency perhaps could not change or automatically fix the current problems within Venezuela. However, it could help to stabilize the economy as well as bring a very open and public perspective on their nation’s economy. Ersham argues that the possible outcomes for using bitcoin in central America that in some parts struggles with hyperinflation “Since Bitcoin is decentralized, there is no risk of policyinduced hyperinflation.” (Ersham, 2015)

The issue or possibility however is the overall infrastructure of the Blockchain technology. As a consumer, we can’t utilize the service until the groundwork has been laid out. Similarly, the internet was not really useable until the browser or email client came for the ordinary internet user. Same idea applies for Blockchain, where entrepreneurs and innovators now have to embrace and develop the technology in order to further develop the framework for the user.

Furthermore, the innovation is not without its problem. The cryptocurrency, and thus Blockchain, brings with them the anonymity of the internet and opens up for shadow based and of-the-grid markets. Bitcoin, as volatile as it is, are often blamed for being one of the number one used currency’s in online drug and weapon trade being very hard to track. This puts the questions about true anonymity and regulations on the top of the Blockchain evolution. The true essence in this innovation is the un-regulated idea with no intermediate in transaction. However, this can potentially give far too much control to the buyer or seller, making the idea of buyer and seller rights (such as return or payment rights) very difficult to enforce. (Negurita, 2014; The Economist 2014; Drake, 2014). Edward Budd, chief digital officer of Deutsche Bank, argues that regulators are not yet comfortable or knowledgeable enough about the entire technology, hence having a hard time “regulating” it in a way that major institutions can take advantage. (Macknight, 2016)

However, new types of start-ups should be in the forefront of adopting the innovation. Blockchain has a potential to be a breakthrough innovation, where start-ups can build disruption ready innovations built on this technology. Journalists and music creators could essentially get paid a few cents every time someone read or listened to their songs if the technology allows them to. (Cortese, 2016) Spotify applies the same principal, but essentially acts as an intermediary between the parties, without that 3d party the artist would receive 100% revenue allocation. Something that the artists have requested when being put on streaming services.  (Price, 2015)

Australia have the potential to be on the forefront and lead the way in order to harness the full power of the new technology. However, Australia needs to embrace and adapt quickly. The ASX are talking the first steps in order to do so and currently implement ways to integrate Blockchain with its settlement of equity trades, opening up opportunities. ASX chief executive Kupper points out;

“We think if we can get this right, we can get very close to real-time settlement. You should be able to sell shares at your desk right now and walk to the nearest ATM to get your money. That is our mission. The moment we are able to do that; we remove a lot of risk from the system.” (Eyers, 2016)

While it is exciting that government and large scale IPOs are embracing the technology, it is perhaps when the Blockchain start-up companies fully embrace the market-creating innovations really ground-breaking ideas will blossom. This, of course, is the hardest to achieve (Mezue, 2015)

The financial Innovation

Talking about financial innovation leads to problematic stances. It is a very powerful subject to grasp and much research in the academic world is yet to uncover the real influence it can have on the world of economics. Since it can influence changes or be indirect linked to disasters such as the global financial crises, it is yet to have some real breakthrough scholars around? (Wyman, 2015) financial-innovation-undeniable-role-in-society

So how do we outline financial innovation and how do we measure it? Research shows that financial innovation always seem to have two sides of the coin. The ATM, the credit ratings for both businesses and private individuals and reduced agency costs are all products of financial innovation. However, taking into account that these innovations can also have a darker side. The ATMs only work when the financial system work drawing examples of Greece and Malta where credit limits where imposed in order to protect the banks stability. Credit ratings can also impose a threat to general economic stability and easily create bubbles if not to tightly controlled, as we’ve seen in the more recent GFC and the devastation of subprime loans. (Elliot, 2010; Wyman, 2015)

The GDP for emerging economies can also greatly reap from the benefits of financial innovation and thus progress faster towards. Consequently, we can argue that the nation will be more reliant external finances and R&D thus making the entire industries more volatile when relying heavy on financial innovation. As a result, an entire nations banking section can become overly exposed to currency fluctuations and political instability and punish small scale businesses and bank users.

As finance really cannot be described as a tangible product, more of a method or system in order to handle the markets around the world. Nor can you describe finance as making money. It is about supporting activities. It is hard to think about any activities that can be maintained without financing.

So what makes Financial Innovation innovative? Much of financial industry are heavily regulated by rules and regulations. Even more so by every financial crisis or crash. These are natural precautions to ensure that same mistakes do not happen again. However, one can argue if the innovation in finance is merely tools to get around the new set of rules and regulations. It seems to be a constant cat versus mouse game where regulators trying to eliminate risks that the financial industry set up in the past.  It is important to outline in order to further put more research in the implications or opportunities of it. (Elliot, 2010; Macknight, 2016)

Australia have had a carful approach to the innovation system in the financial sector. The banking and finance environment is heavily regulated, leaving it one of the most controlled in the world. It is though important to point out that regulation per se is not a bad thing. It will automatically build control, stability and confidence around the entire sector. Australia proved this by being better of many other western countries when the GFC hit the worst. Consequently, with regulations barriers for disruption in the financial sector are larger and harder to overcome (Ciolek et al. 2015). However, in order to now boost Australia out of it’s current decline in manufacturing and other export industries, maybe a de-regulation of sort needs to take place in order to aspire new innovative growth?

The benefits of the financial innovations can be easy to outline. The growth of emerging and poorer countries GDP. New ways and solution to deal with wicked 2$-a-day population (Bottom of the Pyramid) problem who still is estimated to 12% of the world population (The world bank, 2016). The constantly aging population of the west are in dire need of innovations in order to mitigate the fears that the government and organizations won’t be able to pay out retirement funds when time comes.

Developing countries have especially hard to adapt to innovations. Necessary resources are naturally lacking, in order for innovations to truly blossom, and it is not often we see financial innovations coming from these countries diffusing into the wests, and it is often the other way around. Microfinance could be an innovation that further helps developing nations. (Wyman, 2015)

This could be one of the biggest difficulties to truly make financial innovation grow in developing nations. Research show that the longer two populations are separated, the more they will begin to differ from each other. This is an issue as the population and its characteristic will act as a barrier when trying to diffuse financial knowledge across borders (Ang et. Al, 2013)

Another issue that can derive from financial innovation is the sheer Darwinistic nature of competitiveness within financial institution. Innovation might indeed strive from it, but the collaborative nature might not be the first order of importance for organisations and firms. Hence, the small players, or start-ups can have a hard time establishing before being outplayed by larger corporations as discussed by Brown and Giandidois, based on Browns earlier research in the 2000. (Brown, Giandiois, 2013; Brown, 2000)

Conclusion and Discussion

Whilst financial innovation can happen all the time, the Blockchain technology has the power to forever change how the financial innovation will develop. While being breakthrough in its shape, the Blockchain has much like the financial innovation a vague definition of value. Indeed, as previously mentioned the value does not only equal to monetary value. Both having disruptive characteristics can fundamentally drive the technology further, and it is perhaps when both of these innovation landscapes really ground-breaking things can happen.

It is not without problems. As described both innovations are more or less prone to avoid regulations and thrives when are left by itself. Therefore, ironically, it might be the financial institutions who really embraces Blockchain, even though they essentially giving up being the middle man or mediator between peer to peer, and given the recent decline in trust in the banking system, the openness and transparency of Blockchain could really change that trend (Economist, 2015). Enterprise Innovation recently published a journal pointing that;
“Blockchain technology could save the financial services industry more than US$20 billion annually by 2021. […] investment in new Blockchain-enabled financial technologies will more than quintuple over the next four years, from an estimated US$75 million in 2015 to US$400 million by 2019.” (Enterprise Innovation, 2016)

Further articles from Eyeres’ and Senior executives from Bank Of England confirms these predictions to be true, making the Blockchain technology a very lucrative businesses to pair together with functions within the financial innovation umbrella. (Eyeres, 2016; Ali. Et al, 2015)

Furthermore, the Blockchain and financial innovations faces major publicity problems. The trust for the financial industry is continually declining. The latest GFC’s took a very personal role for many people, where entire city’s turned into ghost towns. The youth unemployment rate is yet to recover to sustainable levels and ongoing refugee crises are taking its toll on the financial and public sector. We see movements like occupy wall street as a direct reaction to this as part of non-capitalist movements and right extremist gaining authority in government demanding to tightening border control as a reaction to fix their nations rising unemployment and public service cost.

Media plays a great role in this and needs to portray the eventual good sides of the innovation in order to catch the larger audience.

“The most important financial innovation that I have seen the past 20 years is the automatic teller machine, that really helps people and prevents visits to the bank and it is a real convenience.” (Wall street Journal, 2009)

Paul Volcker, a former FED chairman explains the current financial innovation climate. He might be on to something, but it is ironic that one of the frontrunners in the Blockchain innovation trend now is the bitcoin ATM.

Indeed, it seems that both innovation presented are seamed in together, disrupting each other, and thus perhaps in the future will merge as a financial Blockchain innovation. Perhaps it is also then where the finical innovation will truly add more actual value to the global economy? It is then the industry will unlock scalable and transformative uses, and when real ground breaking innovation can occur. (Enterprise Innovation, 2016)

In the light of this, The World Economic forum argues that disruption is not a one-time event. Indeed, it needs to be a constant process of innovation(s) that changes and moulds business and customer behaviours, models and the long term structure of the affected industry (World Economic Forum, 2015)

The market-creating innovation are the hardest to execute, even though it will bring the most reward. The pursuit for non-consumers requires heavy investments for developing countries infrastructure and radical social change and perhaps even a new democratic system. The strategy’s involved takes years, if not decades to execute making the stakeholders vulnerable to geo political change. However, it is this type of innovation that will build nations (Mezue, 2015)

In order to further develop the developing world value needs to come from both the people and the government. The world as we know today, benchmarks this via GDP driving value from the nation’s economic growth and performance. However, issues with GDP and how well it echoes in today’s service orientated economy brings the question if another more current benchmark instrument.

This shows the importance of start-ups and early adoption in entrepreneurship that constantly shapes industries but that a collaboration between regulators and incubators is key in order how innovation further develops. The importance of the two working in the same time spectrum will harness the best outcome, as both are dependent of each other. However, policy and regulation-making often lacks the efficiency that it’s counterpart have, making this a very challenging issue. (World Economic Forum, 2015). OECD further argues that “Government policies can support innovation by continually reforming and

updating the regulatory and institutional framework within which innovative activity takes place. […] Other studies suggest that specific policy breakthroughs (by) removing anticompetitive regulations,” (OECD, 2007)

The heavy focus of de-regulation has been a centralised key factor in order to generate long term innovation and something that policy makers enforce.
It is clear that the performances of innovations are a fundamental part for competiveness and national progress, both in the developed and developing world (When applied with previous research from OECD). Globalized organisations like the OECD, UN and scholars addresses this as a key factor to further progress the world, and thus mankind, to face wicked problems such as climate and sustainable evolution and development. (OECD, 2007; Fagerberg 2010; United Nations, 2015)

Blockchain and financial innovation cannot and will not be the only resolution to these issues, but they can certainly be a part of the solution. It is then we can truly see real social and monetized value, for an open justly transparent and globalized world.

HOW CAN WE EFFECTIVELY LEAD IN A CROSS BORDER ENVIRONMENT COMBATING DIGITAL WARFARE?

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Defending borders where you can’t identify the absolute threat is a daunting task. The digitalization in modern warfare is an immediate danger to all nations, but too combat and neutralize the enemy might be harder than your traditional armed conflict. (Cohen, 2016; Jones, 2016)

To lead and manage these threats needs thus a good mediation between cross border political projects as well as private players who acts on different set of rules then your government organizations. Hence, the cooperation between private and government organisations is crucial in the digital warfare as the share of internet activity and space is about 80% private commerce and 20% government (North Atlantic Treaty Organization, 2013).

Working and leading on a global level means integrating new ways of communication and authenticity in order to properly capture and harness full capabilities large scale. Not only does the leader or manager convince organisational and/or political leaders. The public needs to be fully aware of the current threat and have the immediate threat translated to them in a way they can fully grasp.

It is crucial that this funnelling of technical information gets communicated in a way to fully engage the public. Most people, even small children are aware of the devastations of war. Even if a very small percentage of the entire population, will ever actively experience war the outcome and effects of bombs, weapons and mines is understood at a very early age.

However, try to explain the danger to adults of DDoS attacks, or vulnerability without 2 step authorising processes within email hosting (Cohen, 2016) and the comprehension will be far less.

Moving into the global working environment, it is crucial that we now educate leaders on a global scaled platform instead of just solving the national focused areas in management dealing with “small” scale organizational problems. Recognizing the need for multicultural perspective goes hand in hand with upscaling the national mindset but might also work for and against national and international demands (Rocksthul, 2011).

Digital warfare might be a way for this platform to truly grow. Putting leaders in an online environment where cultural and ethnical background is not truly apparent can prove invaluable in the ways online leadership and communication.

A rough estimate of global annual attacks goes to 90 million (104 reported in Australia) and has been rising to the most common type of illegal activity in the US (The Economist, 2015). The increase in internet connectivity might be linked to the number of attacks towards nations and organization.

Another reason might be that the anonymity the internet brings makes it very hard to point at a single source where the harmful attacks are originating from. This makes the war on a digital scale, a war in the shadows.

The future of warfare and the commonly known battlefield will most likely undergo severe changes in the upcoming decades. Small scaled resources can bring a different level of devastation than your current military ways, where casualties will remain physically unharmed but affected on a broader scale. The financial, banking, infrastructures and electricity technical structures are exposed towards digital threats pointing towards varied possible outcomes in specific attacks.

The business behind warfare is one of the most profitable industries generating US$402 billion (100 largest arms-manufacturers) a year (Fronlich, Lieberman 2015). The lucratively of digitalized warfare is not any different often needing smaller resources thus making small scale organisations or groups more attracted to engage.

United states expenditure in cyber warfare is now divided into several divisions, however the simple protection-cost ran for about US$3.4 billion (Perera, 2011) in 2011. The security investment is trying to combat the US$ 575 Billion annual global cost of cyber/digital warfare. (The Economist, 2015). Along this, the digital security industry is thriving in new fund threats to defeat and the industry is estimated to turn over US$ 170 billion in 2020.

When looking at the special organisation of cross-border military defence the North Atlantic Treaty Organization often comes to mind. The direct output of NATO’s involvement in conflicts or participation is often regarded as a crucial matter in the definite outcome of the situation. NATO have taken the cyber and digital warfare seriously in the past years, and outlines the absolute key factor in the new threat aspect. Policy advisor Christan-Marc Liflander explains “What is special about the cyber field is when you talk about the whole notion of deterrence — for example, we are able to count the tanks, the planes, the ships, we know what the opponent has. But when it comes to the cyber issue the moment you show what you have you lose it. So that is making the case difficult how do you signal resolve how do you signal your willingness to respond without giving away the very capability that you have? That is making the situation not very transparent — it is difficult to see what is there and what is not.” (Ranger, 2014)

How shall you lead in the online environment of cross border intervention? In traditional warfare, the factions often have a clear leadership structure and hierarchy, where ranking systems, defence budgets or commonly agreed ways of action are set. However, in the digital cloud these borders, agreements and capabilities are blurred. Vigilantes, striving for their sake or the perceived common perception may be as effective in warfare as an entire state, making it hard to define the clear alliance or opposition. People, states and organizations might have different views on how to successfully lead or take charge of a certain situations and restrictions will be hard to enforce due to the openness of the online environment.

The transformational leadership style might prove effective in this environment, as it has a proven rerecord within cross-border leadership (Athina, 2011), however transformational leadership is very much built around cultural differences outlined by Rakesh (Rakesh, 2015). Furthermore, the framework of anonymously leadership need further investigation on how much people are willing to trust and depend on an anonyms leader.

An insight into Authentic Leadership

imagesTo be considered a successful manager or leader I believe that authentic leadership can be of great value. Following the very core values of the model of authenticity such as trust, self-awareness, ethics, morals and transparency gains trust and respect to followers.

However, I believe that it requires all parts of the organisation to be of the same mind-set. Might it be values, morals, visions or in some effect generations? Simply changing leadership routines over a short course of time might have devastating effects. Lloyd and Walker talked about generational shifts and how the “flag is passed on”. Core values of the organisations might not be set in stone.

However, gradually shifting over to a more trustworthy, honest and authentic person is recommended, this can be done through seminars, as well as surveys with the entire staff force.

I have confidence in that authentic leadership is based on trust. People define each other on how well they can trust each other in the common workplace (Colquitt et al. 2007). Trust exercises are consequently to be prioritised first and foremost.

Kruse in Forbes wrote similar, how can managers and leaders be surprised when employees do not trust them, when they change from one person to another, being on and off work? (Kruse, 2013). The quote illustrates the importance of authenticity as well as transparency. Managers and leaders need to show that they don’t switch faces or appearance on and off work, as this “shifts” the very image the leader is trying to project. Does this mean that managers and leaders can’t distance themselves enough in order to have a personal life? Coming to terms that “sharing” one’s personal life or values of the leader will benefit the organisation might help to introduce less secret managers and leaders to a more open and shared environment.

This notion in the field of managers and leaders is something new and will need time to take full effect. As my researched showed, of just 4 employees, the picture or idea of yourself might not always be the one that is projected in the eyes of the viewer. Then imagine the same survey in a large corporation with a few hundred employees. Leroy, Palnski and Somins quotes Shakespeare for the same concept “being true to one self is an important precondition to being true to others[..]” (Leroy et al, 2011). I believe my exercise with a close friend business owner of mine showed that authenticity can fade over time and it is then up to the leader to actually “refresh” these values, sometimes with the help of external stakeholders. This is something I need to take with me further into my career and remember!

It also illustrates that people need to take both themselves and others into extra consideration when applying authenticity as their choice of leadership. I argue that applying this will be harder than expected, as the bias of the strong and almost almighty leader will forever stain the culture of managers and leaders. However, to grow, one must deal with this issue, through education, understanding of social phycology as well as more hands on surveys and seminars. I argue that a constant development in the field of management education will be a driving force of authentic leadership. HR and CSR will consequently play a very important role for the management field in the upcoming decade as human resources and ethics play a larger role every corporation.

Furthermore, Lloyd-Walker and Walker point towards a stressful and complex working environment. This, in our day and age, is not uncommon, especially in a leadership position. Authenticity might help as a booster of productivity from your team but also in dealing with self-help. However I believe it is important to define various areas that are “time stealers”. Even from a week of meditation exercises I understood that my own attention span and listening were far worse than expected. The psychology test showed that I am in an area of average “According to your score, you sometimes have difficulty maintaining your focus on a task and following it through until completion.” It is something I have to take into account dealing further down business strategies as well as decisions. Once again, self-realisation and awareness is keys to authentic leadership.

With so much information being sent at all times in organisations that needs to be dealt with, I’d like to raise the idea that it perhaps is one of the greatest backlashes in the information age, that we are not yet fully aware of. I propose the idea that to further develop authentic leadership one must also come to peace with the concept of “boring”. To be bored and accepting it is a trait not yet fully examined in the academic world. Much focus, if not all, is aimed towards focus and results. However, to really find ones focus, boredom might be a hidden key to realise ones full potential. Schubert argues about this, in 1977, in the Journal of Creative Behaviour, pointing to findings like increased boredom might lead to increased creativity. However the results are very vague and done in a time where the information age was yet to unfold.

Meditation might help if conducted over a longer period of time and making it into a daily routine. Although, I don’t believe the aim for meditation is to be bored, rather it is a tool for self-relation and awareness.

It is therefore hard to draw conclusions about my own statement, but I believe it is an area that could help people to further understand themselves as well as improve their own image of themselves, attention span, concertation and listening ability.

Inventory managment and Naked Wines

inventory-management-9I’ve been researching crowdfunded companies for a while and I found one that is truly remarkable. Naked Wines. I really admire what they are doing but came to some conclusions upon investigating the company further. 

Here are my findings

Inventory management, proper forecasting and operation planning seems to be at the core of any type of supply chain. Hidden away from the naked eye the ongoing operations to keep track, forecast the future and manage capability in order to optimize are a tough but never the less a vital task. (Kraxenberger, 2081)

A common belief are that the management of the supply chain automatically leads to cost savings, mainly by reducing the inventory. Indeed, the cost of inventory has fallen by about 60% since 1982 and the transportation cost by about 20%. (Dooley, 2005). A direct cause of this and the financial crisis was by many companies slashing their inventor in a “slash and burn” tactic, but perhaps because it was a necessary evil at the times in order to survive and not the brilliant strategic move that strategic management points to today (Csco, 2011). Currently, much have been learnt from the crisis but I do question if firms have fully understand the whole nature of demand, inventory cost and capabilities?

Even if organizations use an inventory control or flow management it seems like many companies does not actively control stock on hand nor inventory. This especially in the food industry (Dooley, 2005). Naked wines does keep their stock on hand depending on the demand from its customers, but can’t in the same way handle the ongoing pressure to increase their “angels” or direct investors.

Uncertainty, insecurity, and poor forecasting in demand are three real and thought provoking issues that firms must face to properly manage inventory and therefore their supply chain. Naked Wines have a huge opportunity to properly restructure the fine wine market in Australia, proper yield management is one key element for them. I believe customers reached a stage and are ready to pay a premium price or even a small founding for the company to grow. We are again and again reminded by the successes of crowd funded project (IBM, 2012). Naked wine is already at a crowed founded stage, but perhaps this time the organization can take this to the next level?

vTgrDS18Upon investigating Naked Wines we quickly came to the conclusion that the demand to join the now exclusive club is enormous. Can Naked Wines benefit from this demand instead of seeing it as a problem?

Are consumers willing to pay $5 extra for wine for a period of time or even open up public shareholding in order to raise capital to grow?

I believe the forecasting and capacity planning have failed on a staggering level for Naked Wines. Undeniably, the success is great and the model works, but the firm unquestionably lack the tools how to manage their demand. No matter the strategy used in the beginning, the underestimation of the Australian wine market seems to have come as a surprise for the firm. Why else is there a waiting list to join a wine club, which by the day becomes more exclusive as the firm gaining more attention?

Looking further into the lifecycle of products it is clear that the nature of this framework is to quickly gain enough profit to make up for start-up cost and retain that profit for as long as possible before finally seeing a decline in demand. Does this apply in a service economy? Can we use the same framework that has been going on for so many decades and that did not take globalized ideas like crowdfunding, bitcoin and further interdependence of economies?

In the end firms like Naked Wines must understand that the cost of stock-out as well as correct levels of stock on hand correlates to effective inventory management and directly affect the high level of customer service that is now demanded from customers. I believe this can be achieved via Lag strategy for Naked wines, due to the fact of the vast demand from their customers as well as the constant inflow of new customers. It will also be an effective framework as the shelf life of quality wine is extensive. (Ohlager et al 2001) I propose that this must be evaluated more often than the traditional 3-5 year change in supply chain to as often as every financial year or perhaps even every quarter if there is any indications of change in the model. The adjustment strategy will always come too great use for those type of situations where demand fluctuates and might be a great model to have as a back-up plan.

I can also see the benefits of adding a further development into a competent ECR system. as The information flow between customers and suppliers are one of the backbones in Naked Wines model. An implementation of cross docking stations around the country in order to minimise waiting time and spread out more evenly throughout Australia is also recommended. If you combined these two with a real time synchronised production system where a cloud platform makes the supply and demand a minute based operation would open up new interesting solutions to Naked Wine. How about an auction system in real time much like eBay for angels? Actual stock on hand deals where customers can see how many bottles are left before ordering completely eliminating the cost of stock-out. (Kraxenberger, 2011) Can they develop drone like supply methods much like amazon plans to implement to make their delivers something extraordinary?

Naked Wine have the potential to become something extraordinary. The main question for me after this analyze is that if they have the drive, know-how and innovation to do it? Indeed, they run a model that is sustainable and truly remarkable but I question if that is enough for the next upcoming years?