The social purpose of an organization is to create value by reallocating resources to a higher valued use. There are essentially three ways to accomplish this: 1) reallocate existing resourcesRead More
Category: Value Creation
On the Creator Economy
One of the most interesting developments of the past two decades has been the rise of the creator economy. But one has to question to what extent content creation translatesRead More
Feed the Rich
A common misconception is that the wealthy are necessarily guilty of hoarding resources that could be better utilized. But this fundamentally misunderstands both the source of and the meaning ofRead More
The (Equal) Importance of Convergent and Divergent Thinking
Imagine a world where there is no market friction or distortions. All resources have been allocated to their highest valued use. If for example, lumber has higher (market) value inRead More
Allocating Your Time
The underlying principle behind value creation is that a successful business identifies activities that generate more value than the opportunity cost of the resources employed. This concept applies equally wellRead More
How Does Brand Create Value
In the train scene from the James Bond movie Casino Royale, Vesper comments on Bond’s watch and asks “Rolex?” To which Bond responds “No, Omega”. What is the point ofRead More
A Superior Product is Not Always a Superior Solution
As marketers, it is easy to become infatuated with a “clearly” better, more elegant market solution. But a human tendency is to project our values onto others. This can beRead More
How Capital Creates Value
For simplicity consider a village where the villagers only grow and consume potatoes. Each year they plant the potatoes they set aside for this purpose to grow more potatoes. TheRead More
How Labor Creates Value
As a business owner, how can you use labor as a source of leverage to increase the impact of your own effort? And does this use of labor create value? Read More
On Entrepreneurship
There are many people productively driving around in automobiles. And many, perhaps most, of these people don’t understand how an internal combustion engine operates, much less how to design orRead More