Six Ideas That Made Us Think

1. Why Marchionne Mattered

The death of Fiat Chrysler CEO Sergio Marchionne has spurred an outpouring of tributes and warm recollections. Marchionne, credited with saving both companies, has become recognized as the most consequential figure in the auto industry. Here is the Financial Times:

Perhaps because he had never internalised the culture of the industry, he recognised what needed to be done and had the audacity to think it possible. The car industry is brutal. New generations of products must be introduced constantly, each better than the last, yet not more expensive. It is violently competitive. Marchionne saw two things: that Fiat’s consumption of investors’ capital was out of control, and that it could never produce cars that were competitive on price or quality without increasing its scale.

And Richard Johnson in Automotive News: 

He's the CEO of the Century in the auto industry, so far at least, and 80 years from now he may still be. He has been FCA's revered, infallible spiritual leader and guide, a rigorous and premeditated calculator of chance and opportunity. He saw opportunity at bankrupt Chrysler in 2009 and pretty quickly had the company teetering on the edge of stability.

2. The Cultural Revolution of JD.com

It is impossible to understand the upheaval in rural China without accounting for JD.com, according to Jiayang Fan’s masterful report in The New Yorker. JD has become the third-largest tech company in the world by fusing the ecommerce platform of eBay with the distribution network of FedEx:

Rather than competing on price, in a marketplace steeped in counterfeit goods and shoddy service, JD has focused on developing a reputation for dependability. It maintains a much publicized “no-fakes” guarantee, and works hard, if not quite infallibly, to keep its site free of them… “The couriers are the faces of JD,” says founder Liu Qiangdong. “They come to your home. You have to trust them.” The success of this network, combined with the notorious unreliability of the Chinese postal service, means that JD Logistics is now itself a product—a service that other e-commerce players pay to use.

3. Is Lagos the Future of Africa?

Armin Rosen offers a riveting profile of Lagos, Nigeria. “By most accounts,” he reports, “Lagos has twice as many people as London, along with a GDP greater than all but six African states.” The city is, in many ways, a microcosm of the growth and turbulence of Africa, replete with hustlers, poverty, gated communities, decaying infrastructure, and uninterrupted chaos:

Things change quickly, for better and worse. Beaches, roads, buildings, and entire neighborhoods appear and disappear without clear explanation. Even something as seemingly trivial as the ride-sharing market, a service unaffordable for most Lagosians, suggests how the city lurches between possibilities: Uber had conquered Lagos, until drivers defected en masse to Taxify, an Estonia-based Uber clone, in mid-2017.

As one local writer puts it, “Lagos was built to be Copenhagen but ended up like New York. It’s already a lady wearing a dress five sizes too small.” A great read for understanding emerging economies.

4. The Opening of Windows

No computer history nerd will want to miss The Digital Antiquarian’s five-part chronicle on Microsoft Windows. As Jimmy Maher shows, Windows broke through when the “Excel” spreadsheet program became a business addiction:

The most surprising new Windows product of all actually bore the name “Microsoft Excel” on the box. After struggling fruitlessly for the past two years to get people to write native applications for Windows, Microsoft had decided to flip that script by making a version of Windows that ran as part of an application. The new Excel spreadsheet would ship with what Microsoft called a “run-time” version of Windows 2, sufficient to run Excel and only Excel. When people tried Excel and liked it, they’d go out and buy a proper Windows in order to make all their computing work this way. That, anyway, was the theory.

So much history here, both on the company and the people who made it. On Gates, Maher writes: “The fact was that when it came to business sense, the young Bill Gates was miles ahead of the young Steve Jobs… Gates knew something which Jobs had apparently yet to realize: if you control the operating system on people’s computers, you can potentially control everything.”

5. Frankenstein Lives

Collette Dedonato reassesses Mary Shelley’s Frankenstein and demonstrates that the 200-year-old story holds lessons for every age:

But Frankenstein isn’t just a cautionary tale about the dangers of invention. It’s also a story about bad parenting and what goes wrong when you don’t offer love and a proper education to your offspring. In 2018, the story is more relevant than ever: a guy with an unchecked ego goes a little too far, ignores the consequences of his actions, refuses to accept responsibility for what he’s created, then makes disastrous decisions that destroy everything around him. Shelley understood one of the great ironies of our time: that we make our own monsters, and that we usually have only ourselves — and maybe reality TV these days — to blame for the mess.

6. Fear Not Amazon

Felix Salmon plunges headlong into the conventional wisdom that Amazon is unstoppable. Not so fast, he says:

The prevailing logic is that Amazon is such a formidable competitor that no company can do well while competing with them. Except, that logic isn’t really borne out by any kind of evidence… Just because Amazon spends a huge amount of money on, say, trying to create a social network, doesn’t mean it’s going to have any visible success doing so. After Amazon spent $545 million to acquire Diapers.com, it ended up shuttering the business, claiming it couldn’t make it profitable… Amazon isn’t a disruptive force so much as it’s just a big, rich company which spends a lot of resources trying a lot of things.

The myth of the Amazon juggernaut, according to Salmon, has less to do with how it eats entire industries and more to do with what industry it’s known for eating: “It’s a testament to the cultural salience of the publishing industry that the books precedent looms so large in the mind of the public and stock traders, because today, 24 years after Amazon was founded, the company has failed to achieve similar market power in any other sector.”

Websites Worth Reading

Y Combinator Reading List What to read this summer

Trip Advisor's Best Beaches Where to read this summer

Netflix August Releases What to watch when not reading on the beach this summer

Feeds We Follow

@ClintLCarter Fitness writer. Better than most.

@ZannyMB Links from Economist editor

@BaldingsWorld American economist at a Chinese university