Home » My 8 weeks at Harvard Business School's Advanced Management Program » Day 30 – Value is irrelevant……..in the absence of scarcity

Day 30 – Value is irrelevant……..in the absence of scarcity

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David Yoffie’s lecture was the most interesting today.  Talked about sustainability of an organization’s strategy.  I found the subject of this blog the most interesting statement made during the lecture.

To create the effect of scarcity De Beers, the largest diamond producer in the world employs a strategy whereby it keeps a large, very large inventory of diamonds in their London vault.  The value of this is somewhere between $5B and $8B.  While this creates the ‘scarcity’ through supply control, it also serves the purpose of putting pressure on the competitors.  The competitors are threatened by the risk of ‘flooding’ the market with a particular category of diamonds if required.  It seems that not a single diamond has been taken out of the De Beers vault in years.

There was a distinguished speaker at HBS today – Bob McDonald, President & CEO of P&G.  Some fascinating statistics about P&G – $80B in revenue and claims to have a reach of 4B people with an average spending of $12/year in 200 countries.  Now don’t do the math because it does not add up to $80B of revenue! Their goal is to reach 5B consumers with an average spend of $14/year.

Bob is a very good speaker and an inspiring one I must say.  What surprised me is the amount of ‘business books’ he reads – he mentioned several during the course of his presentation.  One of the readers of this blog will be amused to learn that he referred to Steven Covey and his ‘seven habits’ 3 times during his presentation :).  You know who you are and Bob’s mention does not change my view on Covey and his money making antics 🙂

One of the slides on his presentation focused on P&G’s social responsibility – Did not talk about a question in my mind – what kind of damage is Pampers causing to the environment?  Diapers in landfills!

All in all a very good and refreshing presentation – his energy level was great!  A very accomplished man.

Here is Bob presenting to a packed auditorium.

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2 Comments

  1. Hey – you have been having front row tickets to quite a distinguished line up here ! Here is a suggested weekend assignment for you (as if you don’t get enough from your HBS professors already): can you perhaps think back and reflect on the various industry luminaries that you have had a chance to observe first hand, and let us know maybe three traits they all had in common ? It will be a very interesting (even if subjective and unscientific) analysis for those of us in the bleachers to know if a common thread runs through these doyens of industry.
    Also, Stephen Covey writes about the habits of “highly effective people”, and it seems like Mr. McDonald would “qualify”. ’nuff said 🙂

  2. sraina says:

    I will attempt to do this – good idea.

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