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Chet Richards (Certain to Win: The Strategy of John Boyd, Applied to Business)
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Nelson Johnson (Boardwalk Empire: The Birth, High Times, and Corruption of Atlantic City HBO Series Tie-In Edition)
many ways, the introduction of Amazon Prime was an act of faith. The company had little concrete idea how the program would affect orders or customers’ likelihood to shop in other categories beyond media. If each expedited shipment cost the company $8, and if a shipping-club member placed twenty orders a year, it would cost the company $160 in shipping, far above the $79 fee. The service was expensive to run, and there was no clear way to break even. “We made this decision even though every single financial analysis said we were completely crazy to give two-day shipping for free,” says Diego Piacentini.
Brad Stone (The Everything Store: Jeff Bezos and the Age of Amazon)
More preposterous is an outlier company like Encana, whose hallucinations led to even more bright optimism. For 2015, the Canadian natural gas behemoth decided not to cut spending at all, taking a complete blind eye towards collapsing prices. Instead, it chose to increase spending for 2015 from $2.55b to $2.8b. In this strategy, Encana is virtually alone in the oil space. CEO Doug Suttles has called the oil drop merely an “annoyance, but not threatening” and is continuing with his two-year plan to increase Encana’s ratio of oil production from natural gas. What made Encana so special? Why was it alone choosing to step on the accelerator while virtually everyone else was feathering the brakes? Well, it probably had a bit to do with Suttles’ mistimed buy of Athlon Energy, a Permian basin start-up company that rocketed in share price in its less-than-two-year life span. In September 2014, Encana had the idea to buy Athlon for an astounding $5.9 billion, paying more than $58 a share for the fledgling company. That buy should have been accepted as a monumental error in timing, but instead has seemed to fuel the Encana fantasy. But if you’ve bought the top of the oil market, as Encana’s Doug Suttles has, then why not—I suppose it makes perfect sense to double down and ignore collapsing oil and gas markets going forward. Encana plans to increase oil production by 26% in 2015.
Dan Dicker (Shale Boom, Shale Bust: The Myth of Saudi America)
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