FF Daily #463: The price game

September 1, 2021: Why the US lost Afghanistan; How to learn better by moving around; How WhatsApp works

Founding Fuel

[Photo by Artem Beliaikin on Unsplash]

Good morning,

On scanning the retail landscape, we can see there are many deals right now. While we’re not complaining, it did remind us of a passage from Start with Why by Simon Sinek.

“Drop your prices low enough and people will buy from you. We see it at the end of a retail season when products are priced to move. Drop the price low enough and the shelves will very quickly clear to make room for the next season’s products.

“Playing the price game, however, can come at tremendous cost and can create a significant dilemma for the company. For the seller, selling based on price is like heroin. The short-term gain is fantastic, but the more you do it, the harder it becomes to kick the habit. Once buyers get used to paying a lower-than-average price for a product or service, it is very hard to get them to pay more. And the sellers, facing overwhelming pressure to push prices lower and lower in order to compete, find their margins cut slimmer and slimmer. This only drives a need to sell more to compensate. And the quickest way to do that is price again. And so the downward spiral of price addiction sets in… 

“I cannot debate that dropping the price is not a perfectly legitimate way of driving business; the challenge is staying profitable.

“Walmart seems to be an exception to the rule. They have built a phenomenally successful business playing the price game. But it also came at a high cost. Scale helped Walmart avoid the inherent weaknesses of a price strategy, but the company’s obsession with price above all else has left it scandal-ridden and hurt its reputation. And every one of the company’s scandals was born from its attempts to keep costs down so it could afford to offer such low prices.

“Price always costs something. The question is, how much are you willing to pay for the money you make?”

Interesting bunch of thoughts there. Let us know what you think.

Stay safe and have a good day.

In this issue

  • Why the US lost Afghanistan
  • How to learn better by moving around
  • How WhatsApp works

Why the US lost Afghanistan

At the time of writing this newsletter, three friends pointed us to a compelling piece by Matt Stoller on how the US lost the plot in Afghanistan. Stoller is author and director of research at the American Economic Liberties Project. He argues the war was directed by people who had parachuted into the landscape and had text-book notions of leadership in their heads. Stoller compares them to management consultants with no skin in the game and suggests that to understand how things really unfolded there, people watch War Machine, a 2017 satirical movie starring Brad Pitt.

“While there is a lot of back and forth about whether intelligence agencies knew that the Taliban would take over, or what would happen if we left, or whether the withdrawal could be done more competently, all you had to do to know that this war was a shitshow based on deception and idiocy at all levels was to turn on Netflix and watch this movie… 

“In other words, the war in Afghanistan is like seeing management consultants come to your badly managed software company where everyone knows the problem is the boss’s indecisiveness and cowardice, except it’s violent and people die.

“I mean, US military leaders, like bad consultants or executives, lied about Afghanistan to the point it was routine… Basically, look at this photo below, imagine them in camouflage, and that’s the US military leadership.”

Dig deeper

How to learn better by moving around

In The Conversation, Katie Headrick Taylor, Associate Professor of Learning Sciences and Human Development, University of Washington, explains why children learn better when they move around instead of sitting still. She offers these seven tips for those who are designing learning experiences for students. As one goes through the link, it’s clear that these tips might work for those who are trying to build a strong learning culture within their organisations. 

  1. Normalize movement during classes, not just during movement breaks. For instance, make a neighborhood walk the mode of inquiry for the day’s science lesson. Ask students to bring back their observations to the whole group.
  2. Begin every class with time to assemble different materials to think and work with, such as notebooks and different kinds of paper, various writing and drawing instruments, putty and blocks. Incorporate interaction with these tools throughout the lesson.
  3. Encourage and use gestures. If online, invite camera use, and back away to give students a wider view.
  4. Build in time for students to tune in to how their body is feeling as a window into their emotional state.
  5. Provide opportunities for iteration, practicing a task in different contexts and with different tools and people that engage the body in different ways. The content or big idea stays the same, but how and with whom students engage shifts.
  6. If online, try out videoconferencing platforms like Ohyay that try to replicate physical closeness and movement in a virtual space.
  7. Consider the classroom as extending out into the school campus and neighbourhood. Allowing students to experience a familiar location in a different way, with their classmates and teacher, can evoke new perspectives and thoughts.

Dig deeper

How WhatsApp works

(Via WhatsApp)

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Warm regards,

Team Founding Fuel

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About the author

Founding Fuel

Founding Fuel aims to create the new playbook of entrepreneurship. Think of us as a hub for entrepreneurs- the go-to place for ideas, insights, practices and wisdom essential to build the enterprise of tomorrow. It is co-founded by veteran journalists Indrajit Gupta and Charles Assisi, along with CS Swaminathan, the former president of Pearson's online learning venture.