The Four by Scott Galloway
The Four by Scott Galloway was an interesting book subtitled The Hidden DNA of Apple, Facebook, and Google and it's noted on the book jacket that Galloway an entrepreneur who has founded nine firms and a professor at NYU's Business School. Along with a look at each company, The Four includes ideas from Galloway that aren't specific to any one of the companies, both on business in general as well as how people should go about their careers, and below covers some of the things that stood out.
1. Maniacal focus on operations: Galloway writes of Amazon's investment into last-mile infrastructure, effectively removing friction for a customer. Additionally noted is the focus on robotics, using technology to improve steps in the supply chain process, and using AI to move towards zero-click ordering, where a customer would receive boxes containing what algorithms believe are desired, and then sending back what isn't. Also on this topic is how Amazon profits by selling access to their operational expertise and ecosystem, with AWS and Amazon Marketplace examples of this.
2. Investor storytelling: Noted is how storytelling between the company and investors is at the level where markets have bought into the idea of continuing to invest money in automation and operations for the future. Hugely risky and expensive risks, like floating warehouses, likely won't pay off, but have enormous returns if they do, and Amazon has the trust of the market to spend on such enterprises. Galloway mentions later in the book the power of a CEO who can capture the imagination of the markets, and have people who show incremental progress against that vision.
3. Avoiding commoditization: Amazon has done an excellent job of moving more into multi-channel with integration across web, social, and brick and mortar as the problem with pure e-commerce is brand loyalty is out the window, and it costs much more to acquire new customers than to keep loyal ones. The Whole Foods acquisition an example of this multi-channel approach, and Amazon Prime an example of the company moving way past being just another website to buy from.
1. Turning a commodity into a luxury item: The biggest thing that Galloway write of around Apple is how it's unique in having a luxury brand, but with commodity materials costs. The company has managed to develop an aura of cool and innovative, enabling it to charge prices and achieve margins that would be otherwise unattainable.
2. Using stores as a competitive advantage: Apple stores are noted as being a huge driver of point one above, with them a sort of physical manifestation of cool, and as of 2017, the 492 Apple stores worldwide drew in one million people daily.
3. Having an operator in charge: Galloway covers later in the book how leadership of a firm is best served at different points in the life cycle by different types of people: an entrepreneur, visionary, operator, or pragmatist, with it being hard, but not impossible for someone to transition from one type to the other. He notes that Apple hiring an operator in Tim Cook as CEO was key to it's continued rise, as if the company wanted another visionary, they would have made Jony Ivy CEO.
Facebook & Google - the ideas written of on each feel to blend together
1. Becoming ubiquitous: The platforms of each company, with Google's main page and Facebook or Instagram feeds, have become the respective places to go for search (with the exception of product searches on Amazon) or social. It's noted in the book that as of 2017, one in six people alive are on Facebook, so when someone wants to do this sort of interacting with others, there's simply not somewhere else they would go.
2. Knowing your users through data: Each company has a huge amount of intelligence about the people who use it's respective services, and is really good at data. Facebook in particular uses that data for behavioral targeting, something that can be very effective, as well as controversial at best, and insidious at worst.
The Four closes with Galloway's view of what he sees as individual personal success factors: emotional maturity, curiosity, an ownership of details, credentials, grit, being loyal to people, following your talent, going where your skill is valued, and asking for and giving help to others. While the book may be a little bit dated with it having been published in 2017, Galloway's notions on individual success as well as what's driven these four companies seem quite insightful and relevant today.
Labels: book review, Scott Galloway, The Four
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