I recently had the opportunity to sit down with Amy Kenly, Vice President in Kalypso’s Digital Innovation Practice. Kalypso is a global consulting firm that guides some of the world’s largest brands on their path to Digital Transformation. While their experience spans high technology, life sciences and industrial manufacturing, a large portion of their clients are in retail as the industry shows increasing interest in new technologies.
While the retail industry outlook doesn’t seem as dire as it once was, it’s more important than ever for retailers and brands to execute to really thrive. In my recent articles, I’ve written about the investments retailers and brands should consider for the funds from their corporate tax savings. My conversation with Amy uncovers some additional perspectives for retailers to consider.
GP: We’re seeing a lot of conflicting reports on the current state of the retail industry, with some claiming it’s a Retail Renaissance, and others saying we’re still in survival mode. What’s your view?
AK:Everything seems to be moving in a positive direction for the retail industry. The NRF has predicted 3.8 to 4.4 percent growth, which is strong. What continues to be challenging and volatile for traditional retailers is capturing their share of the growing revenue.
Innovative startups like Stitch Fix and Trunk Club, for example, are capturing a growing percentage of retail sales, as are new direct-to-consumer business models that put suppliers in direct competition with retailers. With the closing of Toys R Us for example, Mattel – who used to distribute through Toys R Us – is now going direct to consumers.
This is making it very difficult for big, traditional retailers who are trying to find ways to differentiate themselves. While Walmart and Target are focused on figuring out e-commerce, which is good, it’s not a differentiator anymore.
Further, while larger retailers have a renewed commitment to private brands and new differentiated products in line with consumer demand, it can be harder for them to pivot toward new, digitally-enabled business models. We’re seeing them starting to acquire startups instead. Walmart ’s recent acquisition of Bonobos as well as Target ’s acquisition of Shipt are good examples.
Origami Labs co-founders Emile Chan, Marcus Leung-Shea and Johan Wong wear their Orii rings. (photo courtesy of Origami Labs)
When you think wearables, the first things that come to mind are probably smartwatches and fitness bands. Wearables surfaced as a mainstream consumer electronics trend about four years ago, but eventually the trend tapered.
One Hong Kong startup, Origami Labs, is widening the wearables wardrobe with a finger ring that answers phone calls.
The ring, called Orii, receives any kind of smartphone notification, like a text message. The wearer can use the device to take a call or activate a phone’s voice assistant, hearing by placing the ringed finger close to one’s ear. The ring communicates with a phone via Bluetooth, with the user’s finger bones conducting the sound (painlessly).
Orii functions something like a wireless earbud but never has to be taken off until the battery dies after about 48 hours of standby time.
“It’s truly a wearable in that it serves as a notification device,” co-founder Johan Wong said at the 2.5-year-old firm’s booth at the InnoVEX tech show in Taipei this week. It’s ideal, he adds, “in a private setting, or [if] you’re outdoors or you’re on the go.”
After the user presses a button, he says, “then [the ring] will either read out whatever info,” audibly like a text message, “or you can just jump on the call.”
What got it going
The four Origami Labs founders got the idea as students at the Hong Kong University of Science and Technology. Wong’s father, now in his 50s, had trouble seeing and wanted some way to use smartphones without looking at the screen.
The product that launched late last year has sold 5,000 boxes–of four to 10 rings each–with another 5,000 expected to move by the end of August. Orders are coming mainly from Singapore, Hong Kong, Japan and Taiwan as well as Europe and the United States.
A set of rings sells for $160 after production in Taiwan and final assembly in China.
Magic ring or just another wearable?
Whether Origami Labs will see further funding, increased orders, or even an IPO is hard to say. Wong says the point for now is to make a “kick-butt” product.
The ring’s success could come down to fashion. The boxy Orii ring looms larger on the finger than the average wedding ring, and Origami Labs demos it by encouraging people to use the index rather than ring finger.
“It’s always neat to see creative ideas like this,” says Bryan Ma, Vice President of Client Devices Research with the market analysis firm IDC. Ma points out that Bluetooth headsets have become accepted in day-to-day life, “as awkward as they might’ve looked at first.”
“As with many wearable devices though, tech and fashion don’t always mix together very well, and society might not quickly accept the idea of putting your finger next to your ear either,” Ma says.
An Orii ring is tried at the Slush start-up events in Tokyo, March 28, 2018. (Alessandro Di Ciommo/NurPhoto via Getty Images)
Mark Shuttleworth looked good at OpenStack Summit in Vancouver. Not only were his company Canonical and operating system Ubuntu Linux doing well, but thanks to his microfasting diet, he’s lost 40 pounds. Energized and feeling good, he’s looking forward to taking Canonical to its initial public offering (IPO) in 2019 and making the company more powerful than ever.
It’s taken him longer than expected to IPO Canonical. Shuttleworth explained, “We will do the right thing at the right time. That’s not this year, though. There’s a process that you have to go through and that takes time. We know what we need to hit in terms of revenue and growth and we’re on track.”
OpenStack has been very, very good for Canonical, which is more than you can say for many companies that tried to make it as OpenStack providers or distributors. “With OpenStack it’s important to deliver on the underlying promise of more cost-effective infrastructure,” Shuttleworth said. Sure, “You can love technology and you can have new projects and it can all be kumbaya and open source, but what really matters is computers, virtual machines, virtual disks, virtual networks. So we ruthlessly focus on delivering that and then also solving all the problems around that.”
So it is, Shuttleworth claims, that “Canonical can deliver an OpenStack platform to an enterprise in two weeks with everything in place.”
What’s driving Canonical growth on both the public and OpenStack-based cloud is “machine learning and container operations. The economics of automating the data center brings people to Ubuntu.”
That said, “The Internet of Things (IoT) is still an area of investment for us. We have the right set of primitives [Ubuntu Core, Ubuntu for IoT and Snap contanizeried applications] to bring IoT all over the planet.” But, it’s “not profitable yet”.
Shuttleworth thinks Ubuntu will end up leading IoT, as it has the cloud, “because a developer can transfer their programs from a workstation to the cloud to a gateway to the IoT. I want to make sure we build the right set of technologies so you can operate a billion things with Ubuntu on it.” To make this happen, Shuttleworth said Canonical currently has just short of 600 full-time developers.
As for the desktop, Shuttleworth finds it a “fascinating study of human nature that Unity [Ubuntu’s former desktop] became a complete exercise in torches and pitchforks. I’m now convinced a lot of the people who demanded its demise never used it.” That’s because, while “I think GNOME is a nicely done desktop,” many Ubuntu users are now objecting to GNOME. Shuttleworth also had kind words about the KDE Neon, MATE, and LXDE desktops. Still, “I do miss Unity, but I use GNOME.”
Shuttleworth would like to see the open-source community become “safer to put new ideas out into it.” Too often, “it’s obnoxious to someone else’s labor of love.”
That said, in business competition, Shuttleworth said, after people criticized him for calling out Red Hat and VMware by name in his OpenStack keynote speech, “I don’t think it was offsides to talk about money and competition. OpenStack has to be in the room where public clouds are discussed and Ubuntu has to be in the conversation when it comes to cloud operating systems. No one has questioned the facts.”
In a way, though, having given up on innovating on the desktop and on the smartphone market has been a blessing. “I can work with more focus on cloud and the edge and IoT. We’re moving faster. Our security and performance story can be tighter because we can put more time on both them.”
One thing that Shuttleworth believes Canonical does better than his competition is delivering the best from upstream to its customers. “Take OpenStack, we didn’t invent a bunch of pieces. We take care of stuff people need by trusting the upstream community. People find this refreshing.”
Canonical also succeeds, he thinks, because they eat their own dog food. “We learn stuff by operating it ourselves and not just developing it. We experience what it’s like to operate many OpenStack and Kubernetes stacks. We then offer these complex solutions as a managed service, and that reduces the cost for users.”
The result is a company that Shuttleworth is sure will lead the way in the cloud and container-driven world of IT.
Business relationships are tricky. Sometimes they are transactional; simply interacting as a means to an end. Other times they are relational, and centered on having meaningful engagements that build and maintain the relationship. And they can even be a combination of the two.
Transactional interactions can be collaborative or competitive. When collaborative, you and your counterpart walk away feeling good about the transaction, like you were treated fairly and more likely to engage with one another in the future. On the other hand, if competitive, you might feel like you were treated unfairly, cheated or nickeled and dimed. In such cases, you probably will not want to engage with this person again.
In relational interactions, you care about the outcome, but also about your colleague. In turn, your colleague cares about you, too. This means you are paying attention to the process and quality of how you are both communicating, not just interacting as a means to an end.
Framing these engagements as a collaborative, relational process helps you build and maintain relationships. Here are five components of collaborative relationships and how you can develop yours to be more mutually beneficial.
1. Fostering open communication.
Communicating in an open and honest manner, in any relationship, is critical. You want to experience the authenticity of your counterpart and you want that person to see you for who you are.
You want to be prepared and honestly acknowledge what it is you know and do not know. Admitting you do not have an answer and saying you will look into it and get back to them establishes credibility. Being caught making things up can be considered deceptive and inauthentic.
2. Building trust.
Building trust allows you both to feel safe sharing information. Trust does not come overnight. It is time-consuming to build, but can be easily compromised.
One way of building trust is to find out what is important to your counterpart and commit to providing something for them. It can be a key data point, a book reference or an introduction to a colleague. Whatever you promise, make sure it is something you can actually deliver on and that will build your image of being reliable.
3. Managing the pace.
Relationships take time. There is a window within which you will feel comfortable about the pace to establish rapport, and build trust and confidence in each other. Signing an important contract the next day can feel rushed, while meeting for three years before closing a deal can feel like an eternity.
It is useful to determine the “what” and “when” of milestones you can use to measure the pace of building your relationship. Your short- and long-term goals will need to be taken into consideration to identify these milestones and when you would like to reach them.
4. Controlling your emotions.
Engaging in new relationships can feel exciting, make you anxious or both. You will not know how to interpret some comments made or actions taken, nor how to communicate your own feelings because you do not know this other person well.
Identify practices you can use to feel more comfortable even in the uncomfortable moments. Try to slow down your breathing or visualize a soothing scene. This will keep you calm and buy you time to think of a suitable response to dig deeper and clarify your understanding.
5. Creating mutually-beneficial outcomes.
At the end of the day, mutual benefits are the payoff for investing time and energy into business relationships. Maybe you learn from each other. Maybe performance increases when you are around each other. Or maybe there are other tangible benefits.
Think about the aspects of the relationship you find valuable and want to retain. What are your contributions? What are theirs?
It is the mutually-beneficial relationships that prove to be most valuable in the workplace, and in life.
When Elon Musk was a kid, he had so much trouble managing his time, that his younger brother Kimbal would lie to him about the bus schedule. Elon would show up a few minutes after the supposed arrival—and have just enough time to hop aboard. A few decades on, the whole world knows about Elon’s habit of blowing deadlines. And he admits it can be a problem.
“This is something I’m trying to get better at,” he said from the stage of Silicon Valley’s Computer History Museum on Tuesday afternoon, at Tesla’s annual shareholders meeting. “I’m trying to recalibrate these estimates.”
A few days after a Twitter rage fest aimed at the media, a month after refusing to answer questions about Tesla’s financial state during an investors’ call, and two months after getting in a public spat with the feds investigating a deadly crash in one of his cars, Musk’s attitude when he appeared before his fellow shareholders was conciliatory. He even seemed emotional at times. “We build our cares with love,” he said, with a slight quaver in his voice. And he noted how brutal the auto industry can be, especially to newcomers. “It’s insanely hard just staying alive.”
For an hour and a half, Musk patiently fielded questions on just about every part of Tesla’s sprawling business. He said the Model 3 production rate will hit the long-promised 5,000 cars a week rate later this month, predicted an enormous increase in battery production, announced upgrades to the Autopilot semi-autonomous system, and even appeased PETA. If you missed the meeting, here are the key takeaways.
Elon Retains the Reins
The official business of the meeting included voting on the reelection of venture capitalist Antonio Gracias, Elon’s bus-catching brother Kimbal, and 21st Century Fox CEO James Murdoch to Tesla’s board of directors. (Only a third of the nine board members come up for election at a time—it’s like the US Senate that way.) Last month, activist investor the CtW Group urged Tesla shareholders to replace the trio with people who had automotive and manufacturing expertise. Another investor, Jing Zhao, filed a proposal to strip Musk of his position as Tesla’s chairman, which he has held since 2004 (he took the CEO job in 2008). But the shareholders stuck with Musk, reelecting the board members and nixing the leadership change by an overwhelming majority. (Tesla will file the exact vote count with the SEC in the next few days.)
The loss didn’t surprise CtW executive director Dieter Waizenegger, who argues control of Tesla is too concentrated in people tied to Musk. “This opinion is shared by a significant number of shareholders of Tesla,” he says. “We expect the final vote tally to reveal that.” Even if he’s right, Musk remains fully in charge.
More Model 3
Musk’s acknowledgement of his timeline trouble didn’t stop him from announcing that, by the end of the month, Tesla will be building 5,000 Model 3 sedans every week, which should be enough to start turning a profit on the car. The uptick is thanks to Tesla’s rebalancing of the workload between humans and robots in its factory in Fremont, California, where the company is adding a third Model 3 production line. It is also planning to open a factory in China, to go with its plants in Fremont and the Netherlands.
Meanwhile, Tesla is gradually expanding options for Model 3 owners, who so far have been limited to the version with an upgraded battery and premium interior, which starts at $56,000. By the end of this year, Musk hopes to start production of the version closer to the car’s $35,000 base price, with the smaller battery pack. Also coming soon: right hand drive.
Even as it struggles to build the Model 3, Tesla is planning on three new vehicles: the Semi truck, the revived Roadster, and the still mysterious Model Y. Musk told shareholders he’s hoping to start production of all three in the first half of 2020, though he has yet to specify where he’ll do that, or how. He’ll unveil the Model Y in March (it will be “something super special”), and expects the truck and the sports car to deliver better specs than the already very impressive numbers he announced last fall. Oh, and he’ll never build an electric motorcycle.
Without getting into details, Musk said Tesla is making steady progress to improve its Autopilot feature, and is now working on adding the ability to change lanes and handle highway on- and off-ramps (Musk noted he was testing new software around 1 am this morning). For drivers who aren’t sure they want to spend $5,000 on the feature, Tesla will soon start offering free trials. Musk also reaffirmed his distaste for lidar, the laser shooting sensor most autonomous vehicle developers say is key to building a safe, capable robo-car.
Tesla now runs nearly 10,000 Supercharger stations around the world, the stations where its drivers (and no one else) can plug in and charge a depleted battery to about 80 percent in 30 minutes. And Musk is working to keep improving charge times, saying a three- or four-fold improvement is possible. (That’s only true for relatively new cars, he added, disappointing the 2012 Model S owner who asked him about it.)
Unlike many automakers, Tesla has been offering leather-free versions of its cars for years, appealing to its vegan and vegetarian fans. But it’s still using some leather in its steering wheels, and a People for the Ethical Treatment of Animals (PETA) rep took the mic to press Musk on it. He explained Tesla can make leather-free steering wheels, but the work has to be done it its design studio, making it something of a pain. But he promised it’ll be easier once the Model Y comes around. Now he’s just gotta hit that 2020 goal.
On Monday, June 4, Apple will lift the lid on its Worldwide Developers Conference, the annual showcase for all the shiny things being churned out in Cupertino.
The WWDC 2018 keynote address kicks off at 10 am Pacific (1 pm Eastern). We expect to hear news about macOS, iOS, watchOS, cloud services, and some new initiatives to help you curb unhealthy levels of phone use. Read our full rundown of what we think is coming.
The livestream can be found on Apple’s website. You can stream the two-hour keynote to your Mac, iPhone, or iPad, or to your Apple TV through a dedicated app. No matter which method you use, there’s usually a slight time delay in the feed. And of course, you should also follow along with our liveblog, where we’ll give you all the news in real time, plus our own commentary and analysis.
Watch on a Mac, iPhone, or iPad
Watch the keynote on any Mac or iOS device using Apple’s own Safari browser. Your Mac needs to be running macOS Sierra 10.12 or later, and iOS devices need to be running iOS 10 or later.
Watch on an Apple TV
If you have a newer Apple TV (fourth generation or later), download the free Apple Events app for Apple TV. If you have an older Apple TV, you should see the Apple Events option appear in your Apple TV’s homescreen automatically. Neat, right? Click into the app just before 10 am Pacific and you’ll see the live feed appear.
Watch a Windows PC
Use the Microsoft Edge browser, which is the only Windows browser that can display Apple’s WWDC livestream. Of course, this requires Windows 10 on the desktop. You can always try using Chrome or Firefox—we’ve gotten those browsers to work in years past, but there’s no guarantee the feed is going to show up in any browser other than Edge. Be prepared with an alternative option.
STOCKHOLM (Reuters) – Swedish biometrics firm Fingerprint Cards on Monday announced a new round of big cost cuts on the back of weak market conditions for capacitive sensors for smartphones and heavy price pressure.
The company said it expected the new cost cuts to yield savings of 350 million crowns ($39.8 million) on an annual basis, with full effect at the end of the fourth quarter.
Fingerprint Cards said it will cut around 179 staff, and the restructuring costs are seen at 65 million crowns, which will mainly be taken in the third quarter.
“We are continuing to adapt our operations to the fundamental and rapid change in business conditions, with the objective of returning to profitable growth,” Fingerprint Cards Chief Executive Christian Fredrikson said in a statement.
“The cost reduction measures we are communicating today are important in order to strengthen our competitiveness,” he added.
The company also said it would make an inventory write-down of around 336 million Swedish crowns and a 143 million crown write-off of capitalized research and development (R&D) projects.
During the first quarter of 2018, Fingerprint Cards implemented another cost reduction program, seen generating cost savings of 360 million crowns this year.
Fingerprint Cards’ shares are down 60 percent so far in 2018 year on the back of rapidly falling sales and earnings.
The drop in General Electric‘s (GE) share price is yet another buying opportunity in my opinion. The industrial company has seen a considerable rebound in investor sentiment after the release of better-than-expected first quarter results, and the recent sale of General Electric’s rail business to Wabtec puts the company on the right track. GE will likely continue to shred more assets in the next several years and apply a laser-sharp focus on the restructuring of its power business. I see General Electric as an appealing contrarian rebound play with up to 40 percent upside potential over the next twelve months.
Rebounding Investor Sentiment…Until The Last Week Of May
General Electric’s shares started to rebound in April and May, after falling rather consistently throughout the first three months of 2018. Concerns over weak cash flow, a struggling power unit, and uncertainty after the dividend cut in Q4-2017 have weighed on investor sentiment at the beginning of the year.
That being said, though, investor sentiment is improving after the industrial company reported better-than-expected results for Q1-2018. Most recently, however, GE’s share price has dipped again on concerns that the power restructuring will take longer than expected.
Year-to-date, General Electric’s share price has dropped ~19 percent.
The recovery in General Electric’s share price looked fine, until May 23, 2018 when John Flannery, Chief Executive Officer and Chairman of General Electric, said that he expects GE’s power division to continue to struggle in the near future. Further, the CEO cast some doubt on its dividend, which made investors ditch the stock yet again. GE’s stock, meanwhile, tumbled more than seven percent.
Investors were quickly rattled by the CEO’s remarks about the restructuring of its power division, but there were few things that were actually new. The power division, as all investors know, has been a drag on GE’s earnings and margins, including the first quarter of 2018.
General Electric is running a hard restructuring, laying off people and reducing overhead costs. The company has guided for $1 billion in segment cost reductions in 2018, and has put a set of measures in place aimed at boosting performance, including driving better execution, taking margin actions, and selling non-core assets.
I think General Electric is doing the right things as far as the power restructuring is concerned, and investors should give the industrial company some time to turn the ship around.
Are There Risks To The Dividend?
General Electric slashed its quarterly dividend payout 50 percent from $0.24/share to $0.12/share in November 2017, which was the second time since the financial crisis that the company slashed its dividend.
Is the dividend sustainable?
Frankly, that depends to a large degree on whether General Electric can engineer a cash flow turnaround.
Here’s GE’s industrial cash flow from 2012-2017.
Source: Achilles Research
Asset sales, however, could play a major role in boosting GE’s cash flow, at least over the short haul. General Electric recently sold its 111-year old rail transportation unit to Wabtec in an $11.1 billion deal. The industrial company will receive a $2.9 billion cash payment associated with the deal.
What To Expect Over The Next 12 Months
Obviously, General Electric will be tempted to sell more assets and raise its cash levels. I don’t think that management will want to cut the dividend again unless cash flow unexpectedly and significantly deteriorates.
Further, General Electric is strongly focused on driving the power restructuring home, but it may take a couple of quarters for investors to see meaningful results. That being said, GE’s laser focus on improving margins in the power business through cost controls and asset sales will likely lead to an incremental improvement in cash flow throughout the year. GE certainly deserves the benefit of the doubt.
General Electric’s shares are cheap, selling for less than 14x next year’s estimated profits while investor sentiment is probably still near multi-year lows.
I am still positive on General Electric’s ability to turn things around in the power business in 2018/9. Hence, I reaffirm my $20 price target on GE, implying ~40 percent upside.
General Electric’s share price slumped after Flannery’s comments at an industry conference last month, and the drop is a promising opportunity to consider a speculative long position in my opinion. General Electric will likely sell more non-core assets in 2018 and drive a hard, cost-centered restructuring in the power business. GE’s shares are relatively cheap on a forward P/E-basis, and there is room for improvement in investor sentiment, especially if the restructuring yields cash flow gains. Strong speculative Buy.
If you like to read more of my articles, and like to be kept up to date with the companies I cover, I kindly ask you that you scroll to the top of this page and click ‘follow‘. I am largely investing in dividend paying stocks, but also venture out occasionally and cover special situations that offer appealing reward-to-risk ratios and have potential for significant capital appreciation. Above all, my immediate investment goal is to achieve financial independence.
Disclosure:I am/we are long GE.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
A year ago, Hulu announced that it had hired Joel Stillerman away from AMC to expand the streaming platform’s slate of original programming.
On Friday, Hulu announced that the chief content officer was leaving the company.
The departure of Stillerman, who worked on The Walking Dead and Better Call Saul while at AMC, was part of a broader reorganization at the Santa Monica company. There has been some tumult in the upper ranks at Hulu, which saw its chief executive, Mike Hopkins, depart in October to become the head of Sony’s television division. Randy Freer, the former COO of Fox Networks Group, replaced Hopkins—who had hired Stillerman—and recent reports suggest that Freer and Stillerman didn’t get along.
Following Stillerman’s departure from Hulu, the company’s chief content officer role will disappear. Craig Erwich, Hulu’s senior vice president of content, will oversee original programming. Tim Connolly, Hulu’s SVP of partnerships and distribution, and Ben Smith, SVP of experience, will also depart the company. Additionally, CMO Kelly Campbell will assume more responsibility, Jaya Kolhatkar will become Chief Data Officer, and Dan Phillips will become CTO.
Hulu is co-owned by Comcast, Time Warner, Disney, and 21st Century Fox, which itself agreed to be acquired by Disney earlier this year. (If Disney prevails, it would become Hulu’s majority owner.) That complicated ownership structure, rather unlike rival Netflix, has been characterized as a drag on the company’s ability to make decisions.
Hulu now reaches more than 20 million subscribers, and its service has expanded to include live television, more original programming (e.g. The Handmaid’s Tale), and deeper reserves of popular TV shows including 30 Rock and E.R. But Hulu remains unprofitable—almost $1 billion in the red last year—as it battles Netflix, Amazon, Google, and Time Warner-owned HBO for market share.
“Hulu has an enormous opportunity to lead the media and advertising industries into the future,” Freer said in a statement.