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November 17, 2006

Inconvenience Store

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The Smoking Gun has a video of a confrontation at a Florida convenience store between a machete-wielding would-be robber and a machete-wielding clerk:

On Tuesday (Nov. 14), a man wearing a blue sweatshirt and baggy jeans approached the counter of the Lil' Saints store in Stuart and pulled the weapon from his pants. After he moved away from the counter for a moment, clerk Guillermina Sanchez, 46, grabbed her machete from under the cash register. After a 20-second standoff (during which time the man frantically pressed keys on the register in a bid to open it), the robber left the business. Detectives believe the suspect in the November 13 incident was also behind a mid-October robbery at the store which netted him about $500.

This description is deficient in at least three regards. First, it fails to mention is that the robber didn't leave the business until the Guillermina's machete had been passed (out of view of the camera) to a fairly burly man, presumably her boss or co-worker. When he appears behind the counter with machete in hand, the robber bolts and it looks as if the man gives chase. Second, the description fails to mention that there was briefly another female clerk behind the counter with Ms. Sanchez. Finally, it neglects to state that the store was somewhat busy at the time. There were two customers helped immediately before the attempted robbery and at least one more immediately after. Thus, this was anything but a late-night stand-off between a robber and a clerk.

These facts are noteworthy because of a serious debate that has been underway for several years between the National Association of Convenience Stores (NACS) and various state and local government agencies responsible for workplace security. The particular bone of contention is whether or not the presence of multiple staff members deters crime in convenience stores. Not surprisingly, the NACS thinks it does not. Interestingly, on its "Industry Resources" page one can find detailed talking points arguing against the "two-clerk" solution. And on another page that take exception with the Occupational Safety and Health Administration's "Recommendations for Workplace Violence Prevention Programs in Late-Night Retail Establishments", circa 1998.

OSHA asserts that the presence of two clerks is an effective deterrent to robbery. No reliable basis exists for that proposition. Rather, factors such as effective cash management, adequate lighting, and customer traffic are far more effective in deterring robbery. Because the location and environment of each outlet is unique, different strategies are appropriate for different outlets. OSHA's apparent belief that "one size fits all" is completely unrealistic.

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October 17, 2006

Google, YouTube, and the Questions of Value

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In his formulation of the resource-based view (RBV) of the firm, Jay Barney lays out four conditions by which a firm can achieve strategy's Holy Grail - sustained competitive advantage. He frames the conditions as questions.

  • The first is the question of value: do a firm’s resources and capabilities enable the firm to respond to environmental threats or opportunities?
  • The second is the question of rareness: how many competing firms already possess particular valuable resources and capabilities?
  • Next is the question of imitation: do firms without a resource or capability face a cost disadvantage in obtaining it compared to firms that already possess it?
  • And finally there is the question of organization: is a firm organized to exploit the full competitive potential of its resources and capabilities?

According to Barney, the answer to all four questions must be "Yes" in order for a firm to have a basis for sustained competitive advantage, i.e. to significantly outperform its competitors over some extended time period.

While Barney's theory can be and often is used to analyze a firm's entire portfolio of resources and capabilities, it can also be used to analyze subsets of them. Point in case is Google's recent acquisition of YouTube.

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