1 For Warren Buffett, a half century at Berkshire
(Straits Times) Berkshire Hathaway shareholders on Saturday celebrated Warren
Buffett's 50th anniversary running the conglomerate, as the billionaire fielded
questions about the company and its future, and explained some business
practices.
Berkshire owns more than 80 companies including the
Burlington Northern railroad, Geico car insurance, Benjamin Moore paint, Dairy
Queen ice cream, Fruit of the Loom underwear, and See's candies, and owns more
than $115 billion of stocks.
But Buffett's status as an investing legend, and his
plain talk and humour, are key reasons why people trek to Omaha for what
Buffett calls "Woodstock for Capitalists." Berkshire's annual meeting
is Omaha's top annual draw other than baseball's College World Series.
Buffett, 84, and his second-in-command Charlie
Munger, 91, spend hours at the annual meeting in a downtown arena answering
questions from shareholders, analysts and journalists about business, the
economy, current events and life.
Buffett did offer a defence of Berkshire's
partnerships with Brazil's 3G Capital, which critics say ruthlessly cuts jobs
at companies it acquires. In 2013, Berkshire and 3G bought H.J. Heinz, which in
turn is now buying Kraft Foods Group. "The 3G people have been successful
in building marvellous businesses," Buffett said. "I don't know of
any company that has a policy that says we're going to have a lot more people
than they need."
Buffett as usual milled about the displays prior to
the meeting, trailed by dozens of print and TV journalists, where he ate (and
paid for) a Dairy Queen vanilla orange bar, and tossed newspapers as he once
did as a boy. Bill Gates, Microsoft chairman and Berkshire director, tossed one
too.
2 When a million desert McDonald’s (Rupert Neate in
The Guardian) On Monday, Steve Easterbrook, the new British chief executive of
McDonald’s will reveal his strategy to turn around the 60-year-old company
which is rapidly losing customers. The Golden Arches are looking increasingly
tarnished. After decades of expansion that saw McDonald’s march into China,
Russia and expand around the world, the burger brand is no longer flavour of
the month.
A million people have turned their back on
McDonald’s in 2014, and profits went with them. Last year McDonald’s’ annual
net income dropped 15% to $4.7bn - making 2014 one of the worst years in the
company’s history.
Financial analysts and restaurant consultants reckon
that McDonald’s main problem is that it has largely ignored the changing tastes
and ideals of its core American customers - and thus backed itself into the
stickiest of corners. Easterbrook will find it hard, they argue, to catch up
with the new wave of hipper, rival fast-food chains like Shake Shack, Panera
Bread and Chipotle, while at the same time staying cheap and fast enough to
satisfy its remaining loyal customers.
Can it be done? I’m just not sure it can,” said
Patty Johnson, global food analyst at market research firm Mintel. “McDonald’s
is such a huge operation, it’s not easy to turn around the Queen Mary or even
make slight changes in direction. “The consumer has evolved from wanting
everything cookie-cutter. We are now all about innovation and
individualisation. [People] want gluten-free, vegetables, hold-the-mayo, we
want ‘this’ but we don’t want ‘that’, we’re very specific. But providing for
that will push up costs and wait times, jeopardising McDonald’s’ core values of
speed and time.”
Johnson said McDonald’s’ biggest challenge is
winning over the most fought-over demographic: millennials (people who became
teenagers around the year 2000). “These are the people having kids right now.
They have a whole different value equation, it’s not just about price and
quality. “It’s about morality and ethics and wanting a healthy lifestyle,” she
said.
3 The future office (Padraig Belton on BBC) First,
the technology sector gave us Google's bean bags and Facebook's feted ping-pong
tables. Now these companies are raising jousting skyscrapers into the Silicon
Valley skyline. Facebook has just this month moved into new headquarters
designed by Frank Gehry, designer of Spain's Guggenheim Museum.
Its chief executive, Mark Zuckerberg, describes it
as the largest open-floor plan in the world. Atop it lies a nine-acre rooftop
park. Google, Amazon, and Apple are also creating their own new colossal
headquarters. Google, searching for more space, will move shortly into its new
"Googleplex".
Apple's "spaceship", a vast watchstrap
fashioned like a flying saucer, has already attracted the moniker of 'death
star' from the unkind. And Amazon's Seattle glass-dome biospheres, planned to
open in 2016 and 2017, play none-too-subtly on its name. Each is a stab at
capturing an imaginative futuristic high ground - and employees - from
competitors.
But this brave new world of work has critics. For
some, open plan spaces suggest managers on the room's sidelines, watching
workers huddled in the middle like prey on the African savannah. Seattle
architecture firm NBBJ is behind the Google and Amazon buildings, as well as
the new Guangdong headquarters for Chinese internet titan Tencent. Offices are
moving away from the idea that time at a desk is a measure of how productive
you are, says Ryan Mullenix, an NBBJ design partner, and the chief designer of
the new Google building.
And more broadly, away from ideals of industrial
efficiency associated with early twentieth-century American mechanical engineer
Franklin Taylor. Sometimes a longer walk to get coffee may be better than a
shorter one. "It's who you see on the way to coffee, and movement which
charges your brain, which is really valuable and part of work," says Mr
Mullenix.
The social side of work may soon be the only reason
we have office buildings, says Scott Wyatt, NBBJ's chairman. "Getting
together with people in teams is where innovation happens, and makes us
happy," he says. "You're not going to be happy holed up at home doing
all your work. "The company which gives the employees the choice at any
given moment to optimise their effectiveness is going to win," says Mr
Wyatt.
Millennials "are used to different ways of
working, sharing, and collaborating, even from an early age," says Elaine
Rossall, head of London market research for property consultants Cushman &
Wakefield. She thinks there has been a retreat from the last decade's
enthusiasm for working from home, and points to growing so-called
"worktivity" amenities, from running tracks to social, play, and
eating areas, "to kind of keep people in the building".
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