5 ms·

Nearly every long term shareholder understands that, in order to create shareholder value, the company needs to prioritize delighting customers over and over ag

by amin 5y ago

Nearly every long term shareholder understands that, in order to create shareholder value, the company needs to prioritize delighting customers over and over again first and foremost.

simonh 5y ago
Kind of. I wouldn't describe Ryanair as having ever delighted me as a customer. They offer fantastic value, so I suppose you could say I was 'delighted' at not having to pay more, but that comes with a significant dose of resignation at the stress I'm going to go through.
- Filligree 5y ago
  I fully refuse to fly with them, no matter what. Once was enough. I wouldn’t say they’ve delighted, but they certainly impressed.
  - heavenlyblue 5y ago
    Uhm. I come from a pretty poor country. When I was a student I would fly Ryanair because otherwise I would just not fly. Ryanair provided me with a service that would otherwise be not available to me at all if it was not making be nervous. So it provides services to a bunch of poor people who are probably _used_ to being nervous anyway in other situations. "Refuse to fly with them". Would you refuse to fly at all if you could not afford alternatives?
    - Ma8ee 5y ago
      I refuse to fly at all nowadays. Even on a relatively short flight, I would be responsible for more greenhouse gases than all my other consumption and transports for several months give rise to.
      - lotsofpulp 5y ago
        In case you live in an US style suburb detached single family home lifestyle, I feel like suburb living contributes far more greenhouse gases than a short flight, since living in dense communities reduces how far all mass has to move, and suburb living increases how far all mass has to move.
      - Aloha 5y ago
        As an American not flying simply means not traveling anywhere further than 500 miles from home, or it means an extra 2-3 days to get there. It means never really leaving North America, heck, parts of North America are not accessible but by air. I don't have high speed rail options, I can either, take the (slow) train (if it goes there), take the bus, drive or fly. Removing flying also removed the ability for the poor to travel. That doesn't strike me as fair or reasonable either. I do try to minimize my flying time, but, none? That's not a reasonable option for me.
        Ma8ee 5y ago
        Train connections between countries are quite miserable in big parts of Europe too, but with increased demand, they are quite rapidly improving. Maybe that would happen in the US too if people used the trains more. For many relative short distance flights, you don't lose that much time taking the train. If you take into account that most airports are far from the city centers, and you have to be there early to check in luggage, go through security, spend 20 minutes boarding the plane and then wait to get of, wait for luggage and then take the time to get to your final destination from the airport, total travel time by train is often faster than by plane when the flight time is an hour or less. The train usually go from city center to city center, you can show up as late before departure as you dare, no security on no luggage check. The leg room is better and nowadays all trains I have been traveling in Europe have had decent wifi so you can use the time for work or entertaining yourself. And that poor people fly is usually not the problem. They don't go to Hawaii or Singapore or Rome just for fun. I understand that flying is important for some people, in particular when you have family in the other of the country or even on another continent. But we, as a world, certainly can't afford to fly just for pleasure.
    - kinj28 5y ago
      Poor countries would have rich people too!
pixelrevision 5y ago
A lot of large problems tend to stem from picking short term strategies. A relentless focus on quarterly profits likely causes more issues than prioritizing investors though the two are related.
- Ericson2314 5y ago
  Moreover, it is quite unclear whether capitalism is capable of optimizing over the long term at all. Suppose we had two planets. Then if global warming got really bad on one, the other would charge crazy fees to refugees --- turn them into indentured servants to the 5th generation or something, and all the investments on the hot planet would loose their value relative the good planet. Clearly, the hot planet's rich people would not want to become indentured servants like everyone else -- for they have little to offer to the cold planet, and so global warming would be prevented. (Aside, I suppose this is/once was Musk's plan, but his timing is off.) Without the other planet, civilization can mostly collapse, but not ones investments go to shit relative and advanced society elsewhere. I suppose there can be an small states in the far north, but the rich people will get priority to move there and could sill own everything. All our standards of living go down, but they get to keep their relative position in society, which is mostly what they care about anyways (at least as long as the standard of living declines slow enough to not be too salient. Of course, the rich people could still do that if there are two planets, but the cold planet elite will mock and scorn the rich planet elite for being so much poorer holed up in Siberia/Canada. --- We see a similar problem with this chip shortage / lack of inventories. Everyone else did, so no one is loosing market share. The widgets you can sell command a high price, too. What are the consequences? Only when demand crashes do firms suffer.
  - anchpop 5y ago
    > Aside, I suppose this is Musk's plan, but his timing is off. I see people say things like this often but it doesn’t make sense. No matter how bad global warming gets, earth will always be more habitable than mars.
    - Ericson2314 5y ago
NicoJuicy 5y ago
Stock based compensation to an extreme like Palantir does, is not that.
fuzzfactor 5y ago
One of the things to think about is that shareholder value really is supposed to amount to what the company as a whole is fundamentally worth. Maybe about what the company would sell for if it was for sale, or what a comparable company would cost to build. Seems most realistic and still quite difficult to pinpoint a total value. But this is where most private small companies are with an intimate group of partners holding illiquid shares having no market effect. Company growth and building shareholder value are synonymous with each other. Delighting customers has one of the strongest effects. Anything less realistic is going to be an even less accurate estimate and this can happen with highly liquid shares where the market itself has inflated their recognized value well beyond the underlying assets. These certificates can be more like fiat currency, many companies went public so they can print more according to retail demand. And fiat currency has an incredible advantage in its ability to be manipulated. Backed by the full faith & credit of a company believed to be strong. Are all of these people so faithful or creditworthy? Or is their company really that strong after they kick out half the people and sell off the crown jewels and it makes the share price go up? Delighting customers at this point may already be out-of-reach.

by amin 5y ago

Nearly every long term shareholder understands that, in order to create shareholder value, the company needs to prioritize delighting customers over and over again first and foremost.

simonh 5y ago

Kind of. I wouldn't describe Ryanair as having ever delighted me as a customer. They offer fantastic value, so I suppose you could say I was 'delighted' at not having to pay more, but that comes with a significant dose of resignation at the stress I'm going to go through.

Filligree 5y ago
I fully refuse to fly with them, no matter what. Once was enough. I wouldn’t say they’ve delighted, but they certainly impressed.
- heavenlyblue 5y ago
  Uhm. I come from a pretty poor country. When I was a student I would fly Ryanair because otherwise I would just not fly. Ryanair provided me with a service that would otherwise be not available to me at all if it was not making be nervous. So it provides services to a bunch of poor people who are probably _used_ to being nervous anyway in other situations. "Refuse to fly with them". Would you refuse to fly at all if you could not afford alternatives?
  - Ma8ee 5y ago
    I refuse to fly at all nowadays. Even on a relatively short flight, I would be responsible for more greenhouse gases than all my other consumption and transports for several months give rise to.
    - lotsofpulp 5y ago
      In case you live in an US style suburb detached single family home lifestyle, I feel like suburb living contributes far more greenhouse gases than a short flight, since living in dense communities reduces how far all mass has to move, and suburb living increases how far all mass has to move.
    - Aloha 5y ago
      As an American not flying simply means not traveling anywhere further than 500 miles from home, or it means an extra 2-3 days to get there. It means never really leaving North America, heck, parts of North America are not accessible but by air. I don't have high speed rail options, I can either, take the (slow) train (if it goes there), take the bus, drive or fly. Removing flying also removed the ability for the poor to travel. That doesn't strike me as fair or reasonable either. I do try to minimize my flying time, but, none? That's not a reasonable option for me.
      - Ma8ee 5y ago
        Train connections between countries are quite miserable in big parts of Europe too, but with increased demand, they are quite rapidly improving. Maybe that would happen in the US too if people used the trains more. For many relative short distance flights, you don't lose that much time taking the train. If you take into account that most airports are far from the city centers, and you have to be there early to check in luggage, go through security, spend 20 minutes boarding the plane and then wait to get of, wait for luggage and then take the time to get to your final destination from the airport, total travel time by train is often faster than by plane when the flight time is an hour or less. The train usually go from city center to city center, you can show up as late before departure as you dare, no security on no luggage check. The leg room is better and nowadays all trains I have been traveling in Europe have had decent wifi so you can use the time for work or entertaining yourself. And that poor people fly is usually not the problem. They don't go to Hawaii or Singapore or Rome just for fun. I understand that flying is important for some people, in particular when you have family in the other of the country or even on another continent. But we, as a world, certainly can't afford to fly just for pleasure.
  - kinj28 5y ago
    Poor countries would have rich people too!

pixelrevision 5y ago

A lot of large problems tend to stem from picking short term strategies. A relentless focus on quarterly profits likely causes more issues than prioritizing investors though the two are related.

Ericson2314 5y ago
Moreover, it is quite unclear whether capitalism is capable of optimizing over the long term at all. Suppose we had two planets. Then if global warming got really bad on one, the other would charge crazy fees to refugees --- turn them into indentured servants to the 5th generation or something, and all the investments on the hot planet would loose their value relative the good planet. Clearly, the hot planet's rich people would not want to become indentured servants like everyone else -- for they have little to offer to the cold planet, and so global warming would be prevented. (Aside, I suppose this is/once was Musk's plan, but his timing is off.) Without the other planet, civilization can mostly collapse, but not ones investments go to shit relative and advanced society elsewhere. I suppose there can be an small states in the far north, but the rich people will get priority to move there and could sill own everything. All our standards of living go down, but they get to keep their relative position in society, which is mostly what they care about anyways (at least as long as the standard of living declines slow enough to not be too salient. Of course, the rich people could still do that if there are two planets, but the cold planet elite will mock and scorn the rich planet elite for being so much poorer holed up in Siberia/Canada. --- We see a similar problem with this chip shortage / lack of inventories. Everyone else did, so no one is loosing market share. The widgets you can sell command a high price, too. What are the consequences? Only when demand crashes do firms suffer.
- anchpop 5y ago
  > Aside, I suppose this is Musk's plan, but his timing is off. I see people say things like this often but it doesn’t make sense. No matter how bad global warming gets, earth will always be more habitable than mars.
  - Ericson2314 5y ago

NicoJuicy 5y ago

Stock based compensation to an extreme like Palantir does, is not that.

fuzzfactor 5y ago

One of the things to think about is that shareholder value really is supposed to amount to what the company as a whole is fundamentally worth. Maybe about what the company would sell for if it was for sale, or what a comparable company would cost to build. Seems most realistic and still quite difficult to pinpoint a total value. But this is where most private small companies are with an intimate group of partners holding illiquid shares having no market effect. Company growth and building shareholder value are synonymous with each other. Delighting customers has one of the strongest effects. Anything less realistic is going to be an even less accurate estimate and this can happen with highly liquid shares where the market itself has inflated their recognized value well beyond the underlying assets. These certificates can be more like fiat currency, many companies went public so they can print more according to retail demand. And fiat currency has an incredible advantage in its ability to be manipulated. Backed by the full faith & credit of a company believed to be strong. Are all of these people so faithful or creditworthy? Or is their company really that strong after they kick out half the people and sell off the crown jewels and it makes the share price go up? Delighting customers at this point may already be out-of-reach.