[Philadelphia, Pa] It was Philadelphia that Ben Franklin called home when he tied a key to a kite, flew it during a storm, got struck by lighting and discovered the harnessing power of electricity. Since then, the City of Philadelphia has not only been known as the birthplace of our country but a haven for thinkers, innovators and misfits looking to create the next big thing. Commonly known as the City of Brotherly Love, it was here that Todd Carmichael, founder and CEO of La Colombe Coffee, felt he could live up to his full potential.
Last Friday morning, Todd joined the Innovation & Entrepreneurship Institute’s Executive Director, Ellen Weber, for a sit down conversation about what it takes to be an innovator, changes in the coffee industry, and the core values he championed when starting La Colombe Coffee. Todd began by explaining how he views innovators, and his belief that “innovation favors the restless and the unhappy.”
When Todd moved to Philadelphia in the 1980’s, he was at the bottom and so was the city. “Everything starts with an urge, and if you’re going to get on the elevator it might as well be at ground zero,” explained Carmichael. He moved into a cheap apartment in Rittenhouse Square, and opened his first La Colombe cafe. When he began, all that he knew was that he wanted to be what his grandfather always taught him to be—a decent person. He wanted to create a decent company.
To his surprise, the first several months were spent explaining to customers—used to drinking regular hot coffee—about lattes, cappuccinos, and the many variations of coffee that can make it such a treat. The La Colombe brand began to grow into the industry staple it is today, and Carmichael noted that its always been clear to him that innovation played a role in continual market shifts—even if they weren’t always thought of as “innovations.” The biggest of them all? What Carmichael referred to as the “ice age” of coffee—the beginning of drinking your coffee cold, now a societal norm.
In realizing the importance of innovation in the continued success of any large company, Carmichael makes it a priority in La Colombe’s overall business strategy. “In any company, innovators have to be in close proximity to the decision makers,” Carmichael emphasized. He meets with his innovation team twice a week, for at least four hours each time. “If you lessen the importance of the innovation team, they become cost savers, less like dreamers, and your company will get left behind.”
The Innovation Leader Speaker Series is an on-going series that features breakthrough leaders in innovation from a variety of industries from food and beverage to the medical industry. For more information on additional upcoming events from the Innovation and Entrepreneurship Institute visit iei.temple.edu or email us at firstname.lastname@example.org.
On Wednesday, February 19, Owner of Genzer Associates, Rick Gezner, came to Fox to speak to students about how to create a competitive business analysis by discussing perceptual maps, competitor matrix, industry structure and environment.
A leader of business and technology since 1986, Rick has held roles ranging from software engineer to executive vice president and chief technology officer. As an independent management consultant, Rick has also started five of his own businesses in the Greater Philadelphia area.
Throughout the workshop, Rick put an emphasis on the significance of competition in the business industry. He explained how important it is to define, understand, address and develop strategy for your company as well as know who, where, what, how and how much the competition is to your business.
Rick explained the biggest problem in all business is the “last mile,” also known as shipping and transportation. This is because it has a geometric effect on cost and the smallest disruption will cause a problem. He advises, “If you are in a new market with a new product, you have to educate the entire market. If you jump in where competition exists, you don’t have to explain. Don’t shy away from competition.”
As a last key note, he shared entrepreneurs must always stay on message and be very crisp, no matter the circumstance!
In a recent day-long visit to the Fox School of Business, legendary business strategist Michael E. Porter addressed two different audiences – Fox MBAs and Philadelphia executives – on two different topics: creating shared value through business and addressing the looming challenges of U.S. competitiveness.
While his presentations differed in substance, they were unified in a single call to action: Make business, and thereby the world, better.
“Making a profit is the most fundamental, powerful thing on this earth for making life better,” Porter told Fox graduate students in an afternoon presentation March 11, adding later, “If we can get businesses in the business of solving societal problems – as businesses – we truly have something exciting.”
Porter, the Harvard professor most renowned for his Five Forces analysis – a pillar of business strategy globally and taught to nearly every business student – visited Fox as part of the school’s ongoing Innovation Leadership Speaker Series (ILSS).
Mercedes Delgado, assistant professor of strategic management at the Fox School, facilitated Porter’s visit. Delgado, whom Porter called a “stunning young scholar,” is a partner on Porter’s research on innovation clusters and competitiveness as a senior associate of his Institute for Strategy and Competitiveness at Harvard Business School.
In his presentation to Fox MBAs, Porter discussed the role of business in society as creating shared value (CSV), which he described as the next step to corporate philanthropy and social responsibility in that CSV offers more impact because it addresses significant societal needs through scalable business models.
For example, Porter said CSR would see fair trade as paying a higher price to farmers and certifying the goods as such. This, Porter said, is redistribution of wealth. CSV, meanwhile, would transform procurement and provide more collaboration with farmers, therefore improving quality and yield. Farmers could charge higher prices for higher-quality goods, and higher yield would increase quantity, improving the supply chain.
“These companies aren’t being good guys. They aren’t giving a donation,” Porter said of the CSV approach. “What are they doing? Capitalism.”
And that was his underlying message to the MBAs: Social needs represent the largest underserved market opportunity, and businesses can’t approach profit and societal impact as tradeoffs. They’re one in the same.
“Take the discipline of creating economic value but apply it to a larger aperture – that’s real purpose,” he said.
At an evening event at the Union League of Philadelphia with approximately 200 business leaders, Porter discussed the looming challenges of U.S. competitiveness. A fundamental threat: Living conditions for average Americans aren’t improving. “It’s not the recession,” Porter said. “It’s not temporary. It’s structural.”
America’s weaknesses, Porter said, include its tax code, K-12 education and its divisive political system. The country’s decisive strengths are the protection of property rights, innovation and entrepreneurship, universities, and innovation clusters, such as Wall Street, Hollywood, and Silicon Valley.
“I’m deeply optimistic, because the hard stuff, we’re good at,” Porter said. “But we’ve let the basics be taken over by politics and false divisiveness.”
And that divisiveness is contributing to America losing its competitive edge.
The Fox School’s Department of Strategic Management, Innovation and Entrepreneurship Institute, and Office of Research, Doctoral Programs, and Strategic Initiatives organized Porter’s visit. The Fox Innovation Leadership Speaker Series seeks to transform organizations into innovation-driven industry leaders by turning innovation research into practice. Speakers are internationally acclaimed experts who share their insights in applying proven and effective management tools for firms, large and small.
The next ILSS event, on April 24, will feature Michael E. Raynor discussing Strategy vs. Innovation: A Scientific Approach. For details, visit www.fox.temple.edu/innovation