Friday, May 3, 2024

ABCs against Business Illiteracy

 

There's nothing better for those seeking security in their businesses than being street smart and/or book smart. Experience comes with practice, and to compensate for the lack of hands-on experience, the idea is to have solid business literacy, understanding the most important management theories. However, it's often challenging to contextualize so many books and theories. The purpose of this article is to help you reorganize these ideas to make it much easier to reconcile with practical life.


On the other hand, even with vast practical experience, many individuals find themselves in a state of business illiteracy, which can limit their scope for success in their business lives.

Business administration is based on case studies, whether they're your own cases, cases that happened to your friends, or cases that happened to others, so reading is essential.

However, extensive reading of theories can overwhelm and confuse students and professionals in the field.

Faced with this scenario, there's a need to organize the different schools of thought in business administration in a more accessible and understandable manner. While some theories are widely recognized and contrasting, like Adam Smith's liberalism versus Karl Marx's communism (even if not so antagonistic, there's a comparison of opposites that can be relevant), other nuances of thought can blend and become less distinct for students and professionals.

In this approach, we propose an approach that aims to facilitate understanding of business administration theories by organizing them into theses and antitheses. By presenting different schools of thought in opposition to each other, we hope to create a clear and accessible reading map for those who wish to delve into the study of business administration. Through this approach, we aim to make the vast field of administration more comprehensible and accessible to all interested parties.


1 Liberalism (Adam Smith) vs. Communism (Karl Marx & Friedrich Engels):

The main antagonism in the ideas and philosophies of how to conduct an economy is the antagonism between Adam Smith's liberalism, which advocates economic freedom, free markets, and non-governmental intervention in the economy; and Marx and Engels' communism, which advocates collective ownership of the means of production, the abolition of social classes, and equitable distribution of resources. While liberalism emphasizes wealth generation and suffers from unequal distribution and the pursuit of individual profit, communism prioritizes equality and collective cooperation without as much concern for wealth generation.


2 Scientific Management Theory (Frederick Taylor) vs. Human Relations Theory (Elton Mayo):

The second most important counterpoint is Taylorism, which emphasizes efficiency and maximization of production through scientific analysis of work processes and division of labor into simple and repetitive tasks.
On the other hand, Mayo's Human Relations Theory highlights the importance of social relationships and the work environment in the productivity and satisfaction of workers, proposing a more humanized and participative approach.


3 Organizational Development Theory (Kurt Lewin) vs. Contingency Theory (James Burns, Lawrence Stalker):

Organizational Development emphasizes the internal management of changes, the continuous improvement of organizations through participation and continuous development of people and processes.
On the other hand, Contingency Theory focuses on the external environment; changes must be driven by what happens in the market.

While Contingency Theory emphasizes adapting the organizational structure to the external environment, Organizational Development focuses on planned change and internal organization development through human intervention.

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While Kurt Lewin emphasized the importance of organizational change as a process that involves deconstructing existing norms (unfreezing), introducing new practices or processes (shifting), and stabilizing new norms (refreezing), Burns and Stalker's Contingency Theory emphasizes the idea that effective organizational structure is contingent on specific characteristics of the external environment.

Lewin viewed change as a process involving all levels of the organization and the need for a participatory approach to involve organizational members in the change process. On the other hand, Burns and Stalker argued that different environments require different forms of organizational structure and that organizational effectiveness depends on the organization's ability to adapt to the demands of the external environment.


4 Stakeholder Theory (Edward Freeman) vs. Profit Maximization Theory (Milton Friedman):

Stakeholder Theory recognizes that companies have responsibilities to a wide range of stakeholders, including employees, customers, suppliers, community, and the environment, in addition to shareholders.

On the other hand, Friedman's Profit Maximization Theory argues that the only social responsibility of companies is to increase their profits, as long as it is done ethically and within the law.


5 Competitiveness Theory (Michael Porter) vs. Cooperation Theory (C.K. Prahalad, Gary Hamel):

Porter's Competitiveness Theory emphasizes the importance of competition and the pursuit of competitive advantage in a market. 

In contrast, Prahalad and Hamel's Cooperation Theory highlights the importance of collaboration and the creation of shared value through strategic partnerships and cooperation among companies.


C.K. Prahalad's theory on value co-creation differs from Michael Porter's approach to competitiveness in several aspects:

Strategic Guidance:

Prahalad emphasizes the importance of collaboration and joint value creation between companies and customers. It highlights the need for companies to focus on meeting customer needs in a personalized and innovative way.
Porter, on the other hand, focuses on analyzing competition and searching for sustainable competitive advantages, often highlighting the importance of product and service differentiation and cost leadership.

Customer Focus:

Prahalad places emphasis on customers' active participation in the value creation process, emphasizing personalization and customer experience as key elements.
Porter, although he recognizes the importance of customers, often focuses more on analyzing the external competitive environment and strategies to overcome the competition.

Value Approach:

Prahalad champions the idea that value is co-created in collaboration with customers, recognizing that innovation and personalization are key to uniquely meeting customer needs.

Porter tends to focus more on maximizing value for the company, often through gaining competitive advantages over competitors and maximizing profits.

Long Term Vision:

Prahalad emphasizes the importance of continuous innovation and adapting to changing customer needs and preferences over time.

Porter also values strategic adaptation, but often with a focus on maintaining competitive advantages over the long term.

In summary, while Prahalad's theory emphasizes value co-creation with customers and a more customer- and innovation-oriented approach, Porter's approach tends to be more focused on competition and the search for sustainable competitive advantages. Both frameworks have their own applications and are complementary in many aspects, but they differ in their emphasis and strategic orientation.


6 Disruptive Innovation Theory (Clayton Christensen) vs. Incrementalism Theory (Henry Mintzberg):

Disruptive Innovation Theory, proposed by Clayton Christensen, suggests that innovation often occurs through the introduction of disruptive technologies or business models that challenge existing norms and create new markets.

On the other hand, Incrementalism Theory, advocated by Henry Mintzberg, argues that change and innovation happen gradually through small incremental adjustments to existing processes and structures.

While disruptive innovation aims for revolutionary change, incrementalism focuses on evolutionary progress.


7 Chaos Theory (James Gleick) vs. Order Theory (Henri Fayol):

Chaos Theory, popularized by James Gleick, suggests that complex systems, including organizations, are inherently unpredictable and non-linear, and small changes can lead to significant and unexpected outcomes.

In contrast, Order Theory, proposed by Henri Fayol, emphasizes the importance of organizational structure, hierarchy, and control to maintain order and stability within an organization. While chaos theory acknowledges the inherent unpredictability of systems, order theory seeks to impose structure and control to mitigate chaos.


8 Network Effect Theory (Robert Metcalfe) vs. Natural Monopoly Theory (Michael Waterson):

The Network Effect Theory, formulated by Robert Metcalfe, postulates that the value of a network increases as the number of users or nodes connected to it grows, like Facebook and Google, leading to exponential growth and reinforcing network domination established.

Do not confuse Network Effect with Multi Level Market (MMN) by Carl Rehnborg, creator of Nutrilite in 1934, in which products are sold directly by distributors, who recruit more sellers whose main opponents are regulatory bodies who fear the threat of Ponzi effects.

Carl Rehnborg criou a Nutrilite em 1934

On the other hand, Natural Monopoly Theory, proposed by Michael Waterson, suggests that in certain industries, such as utilities or infrastructure, economies of scale and high barriers to entry result in natural monopolies, like AT&T, where one company dominates the market. 

While network effect theory emphasizes the power of network growth, natural monopoly theory highlights the inevitability of monopolistic control in certain industries.


9 Long Tail Theory (Chris Anderson) vs. Market Concentration Theory (Michael Porter):

Chris Anderson's Long Tail Theory suggests that, in a graph with the number of products (x) and their popularity (y), in markets where distribution is virtually free and infinite, niche products in the "long tail" (highly niche technical books) can generate as much or more profit than popular products in the "short head" (successful films and books like Harry Potter and Star Wars). Niche products and services can be economically viable due to reduced distribution costs and expanded access to diversified markets, leading to a shift away from traditional market concentration.

In contrast, Market Concentration Theory, proposed by Michael Porter, suggests that a small number of companies dominating the market should compete.

While the long tail theory emphasizes the importance of diversity, market concentration theory focuses on the dynamics of a few good companies.



Chris Anderson's "long tail" theory is aptly illustrated by the graph of audience popularity versus number of films available, popular blockbusters like “Jurassic World” occupy the top of the distribution curve with a large number of viewers and high revenue , while successful but slightly more niche films, such as “Blade Runner 2049” still appear at the head of the curve, however, closer to the tail with fewer viewers and lower revenue. 

This is followed by a plethora of documentaries, cerebral films and films aimed at specific niches populating the long tail, forming a diverse range of content that attracts smaller but still significant audiences.

This demonstrates how platforms like Netflix can leverage the long tail to cater to diverse viewer preferences and expand their subscriber base.


10 Product Life Cycle Theory (Theodore Levitt) vs. Market Saturation Theory (David Aaker):

Product Life Cycle Theory, as articulated by Theodore Levitt, describes the stages through which a product passes, from introduction to decline (4 stages - introduction, growth, maturity, and decline), with different marketing strategies required at each stage to maximize profitability.

On the other hand, Market Saturation Theory, proposed by David Aaker, suggests that markets eventually reach a point of saturation where demand stabilizes, leading to a stagnation.

Levitt became famous in 1960 for his article on "Marketing Myopia", in which he argued that companies were too focused on the product and forgot to see the market. Levitt highlighted the importance of looking beyond the product and focusing on the market, arguing that companies often got stuck in the production mindset and failed to understand consumers' needs and preferences over time.

On the other hand, Aaker, who also emphasizes the importance of understanding the market, has a slightly different approach.

It recognizes that products do not necessarily come to an end, as Levitt's product life cycle model suggests, but can reach a point of saturation in the market. At this point, demand stabilizes, leading to intense competition and decreasing profits. Aaker calls this "market saturation" and highlights the need for adaptation and innovation to address this condition.

11 - Theory X and Y (Douglas McGregor) + Theory Z (William Ouchi)


In all of the situations above, some thinkers tended to think in one way, while others practically thought in the opposite way, even if this disagreement was not so sharp in some cases.

However, there are interesting cases in which a single author explores both sides of the coin.

This is the case of Douglas McGregor, who describes in Theory X, a more pessimistic view of employees, suggesting that they have a natural aversion to work and need to be controlled and directed in an authoritarian way. On the other hand, in Theory Y, the same McGregor presents a more optimistic view, arguing that employees can find satisfaction and motivation at work and are capable of self-direction and responsibility.

These two theories represent opposite ends of the spectrum of beliefs about human nature in the context of work. McGregor recognized that both perspectives could be applicable in different situations and organizational environments, and his work helped promote important discussions about people management and leadership.

In addition to McGregor's theories, another important author who discusses additional perspectives on management and leadership is William Ouchi. He introduced Theory Z, which is an extension of McGregor's Theory Y, but with influences from Japanese culture. Theory Z emphasizes values such as loyalty, cooperation and employee participation, as well as a strong sense of belonging to the organization.

Ouchi argues that by incorporating these elements, organizations can achieve greater productivity and job satisfaction.

Tuesday, March 26, 2024

Legendary Ponta da Pirabura, Shipwreck of the Príncipe de Astúrias, and Other Stories

 

The Príncipe de Astúrias fatally damages the ship's hull on the rocks of Ponta da Pirabura; the sinking occurs in less than 5 minutes.

The Curse of Ponta da Pirabura

The Tupis who inhabited Ilhabela were skilled navigators and already knew the mysteries surrounding the dangerous Ponta da Pirabura. It is not known for sure why it is called that name - in Old Tupi, "pira" means fish, and "bura" bubbling, the word 'y-bura means bubbling water, water that springs upwards.


Ponta da Pirabura and Praia da Caveira

Therefore, the name Pirabura could be related to phenomena where fish are thrown out of the water during wave breaks, possibly due to bubbles or water agitation, suggesting a direct connection between the indigenous name and the natural characteristics of the location.

Local residents of the island said that only one ship defied Pirabura and emerged unscathed, it was the British ship Western World in 1931, "we have lost count of how many ships have sunk in that place, where the water is deep and the tide has an enormous force, first it was an English ship, then the Astúrias, the Conca...".

Maenbipe

It's not just Ponta da Pirabura that has its mysteries; the entire island is a great enigma. Ilhabela already had its cases reported even before the arrival of the colonizers. The first reference we have is how the Tupi called it – Maenbipe, the name itself is a mystery.

In Hans Staden van Homborg's Beschrijvinghe van America, it reads: "I went thus alone, and no one paid attention to me, and I could have easily escaped from the rope, for I was on an island called Mayenbipe/' which is about 10 miles away from Brikioka, but later because of the captured Christians, of whom there were still four alive, for I thought, if I escape, they would be angry"(Ich ginch fo alleen/ende niemant en achte opmp/ ende hadde die repse kwel honnen ontloopen/want ich was op een Eplandt Mayenbipe genaemt/'r welchon trent ro. Mijlen meeglis ban Brikioka is/ maer lieter om de ghevangen Christenen wille/ban ben welchen noch vier levendigh waeren/want ich dacht/ontloope ick paer/so wozdenie toornigh).

In the text of Hans Staden's book, Ilhabela, or Maenbipe, is mentioned

Brikioka was how the Tupi called the stretch that went from Bertioga to São Sebastião (mbyriky-oka, stronghold of the muriquis, large and white monkeys that live in the region). However, Maenbipe doesn't make much sense with any word from the Old Tupi, perhaps ... (E)ma'ẽ-e'ymumẽ, which in Tupi means "Do not stop looking (at me)". There's really no way not to look at that beauty in the middle of the ocean.

Perhaps Maembipe is what linguists call a "dialect continuum," in which various related languages and dialects, where two neighboring regions spoke very similar languages, and distant ones spoke more differently. 

The translation that I like most is Mbaembype, from (Mba'e) “something”, (mbype) “thing tha is close”, referring to the island that is so close that you can swim to it, something I have already done sometimes when young.

Without taking Tupi phonetics into consideration, some scholars say that the name has the meaning of “mountain that appears in the canal”, or “place for exchanging prisoners”, which makes a lot of sense because in the tradition of war between Tupi speakers (Tupi versus Tupinambá) Ilhabela (or Maenbipe) would be a neutral place, like Casablanca of the Tupi.

Shipwreck of the Príncipe de Astúrias

The Príncipe de Astúrias was a passenger liner built by Pinillos Izquierdo y Cia., It was the largest and most luxurious ship built in Spain in 1914, had a twin brother, the Infanta Isabel, both had a length of 150.8 meters, double hull, 19.1 meter beam, and 9.6m draft, with a Quadruple Expansion Engine steam engine of 8000 hp, displacing 16,500 gross tons, reaching a speed of 18 knots (33 km/h). Launched on April 30, 1915, it used to depart from Barcelona every February 17, 1916 bound for Buenos Aires.
Diagram of the Prince of Asturias in Section

It is important to note that the world was facing its Second World War, although German submarines were attacking ships in the Atlantic Ocean, they were not involved in this case.

Final Celebration: Foliões (carnival revelers) having fun on the central staircase of the Príncipe de Astúrias during a lively carnival ball, unaware that within hours the ship would collide with the rocks of Pirabura and sink, marking the tragic end for many lives.

The Príncipe de Astúrias was on its sixth voyage to South America, it had already passed the coast of Rio de Janeiro and on Saturday, March 4th, it was approaching Ilhabela, a carnival ball was animating the passengers inside the ship while a strong storm battered the outside. Rough waters churned the waves, lightning illuminated the skies, during the passage from Saturday to Carnival Sunday, March 5, 1916.

In green the original route that the ship should folow and altered rout in red 

According to some reports, the ship mysteriously changed course, circumventing Búzios Island, and stopped in the early hours of the morning to unload a mysterious cargo onto another ship amidst the storm.

The sinking of the Príncipe de Astúrias occurred in less than 5 minutes after colliding with the rocks of Ponta da Pirabura; the crew only managed to release lifeboat number 18, and 17 people immediately jumped into it.

Continuing the journey, the ship passed by Ponta da Pirabura at a speed of 4 knots (the lighthouse we see today was only installed in 1932). Like in the movie Titanic, First Officer Rufino y Ouzain Urtiaga asked "is it land?" upon sighting the rocks at 04:02 hs.

Captain José Lotina was not on the bridge at the time of the incident; First Officer Rufino ordered the helmsman, Antonio Salazar Linas, to run to the telegraph (engine room telegraph - a lever with various positions, which by a system of cables and bells, signaled the engine room what to do), and give instructions to the engine room:

"All astern, ...full left" (another way of saying "port", the left side of the ship, with the right side, where the rocks were called "starboard"), but there was not enough time to maneuver the ship away from the rocks, which were precisely hit at 04:08 hs.

Upon hitting the ledge, a deep gash of approximately 40 meters was made in the ship's hull, immediately flooding the lower decks.

With flooding in the engine room, the boiler exploded, causing a fire. Finally, the ship sank in just 5 minutes.

The crew only managed to release lifeboat number 18, and 17 people immediately jumped into it.

Even with only one dinghy in the water, brave sailors left survivors on the rocks of Pirabura, in a stretch where the waves were calmer, and returned several times to rescue more survivors; many died in the scalding waters of the boiler spreading through the sea, saving only those who quickly moved away to the high seas, as reported by Jeannis Michail Platon in his book "Ilhabela Seus Enigmas" from 2006.

Among the heroes stands out Doña Marina Vidal, a 26-year-old Spanish woman, who despite having asthma, swam all night and saved 4 people, including the only Brazilian aboard, Mr. José Marins Viana.

In the end, only 111 passengers were saved from the 588 officially registered aboard in their official count, but there are reports that in addition to these, there were more than 800 stowaways, fugitives from the war ravaging Europe, not to mention the stokers and coalers who were not listed as part of the crew.

The next day, the closest ship that received the distress calls, the French steamer Vega, from Societé General de Transportes Maritimes, arrived at the scene of the disaster. Its captain, Augusto Poli, ordered the entire crew to participate in the rescue effort, which lasted all Sunday.

Mirror of Principe de Asturias Ilhabela Museum

Officially, 477 people died and their bodies were retrieved and taken to the Saboó morgue, in Santos, but some claim that the total number of dead was much higher, as it is believed that around 800 stowaways were hiding on the lower decks. A few days later, unburied copros began to appear on Toninhas beach in Ubatuba.

A task force was sent to rescue bodies that appeared on the entire east coast of the island and buried them in several points, including Praia da Serraria and Praia da Caveira.

Among the valuable cargo, Asturias had in its cargo shipment 40 million pounds sterling in gold bars, belonging to the British government, in a safe recently installed on the ship, works of art, among them the bronze sculpture "La Carta Magna Y Las Cuatro Regiones Argentina", bound for Argentina.

There are conflicting reports about the fate of the Captain and his first officer, some say they committed suicide by shooting themselves in the temple, there is a code of nautical pride when commanders realize they have made mistakes that make sinking imminent. Others, however, claim that there was a transfer of cargo to a smaller ship, which was seen by some survivors close to the ship that night, perhaps to lighten the load in light of the perceived error, or even because they were involved in some type of criminal action, and fled with the fruits of the robbery, a very plausible situation since the gold in the safes was never found.

Salvage of the Prince of Assturias

The quest for the sunken treasure of the Prince of Asturias has always captured people's imagination, but the sea, with its limited visibility, depth of 30 meters requiring decompression, and strong currents, made diving work highly technical and extremely challenging.

Since the shipwreck, several salvage missions (the name given to the rescue of valuables from disasters) have been carried out, but it wasn't until the 1940s that they began to be conducted in partnership with the Brazilian Navy.

The first famous expedition to attempt the salvage of the wreck took place in July 1951, funded by the Fialdini brothers aboard the tugboat São Bento.

The dives with diving helmets were only sufficient for the rescue of lead ingots and part of the bronze propeller.

Diving legend Werner Krauss in his 1950s diving suit

In 1955, it was the turn of businessman Adolpho Melchert de Barros, who hired diving legend Werner Krauss; the investment was so significant that even a cable car was built to transport rescued pieces.

Krauss's first foray was on April 11, 1955, and it was the most fruitful series of dives, yielding tin ingots, kitchenware like plates and cutlery, and even a doll's head. Unfortunately, the excessive use of dynamite caused significant damage to the ship's structure, compromising potential works of art and china. To give an idea, it took 100 sticks of dynamite just to remove the propeller from the structure.

In 1974, the third phase of dives was launched, with Jeannis Michail Platon leading the way, with much larger investment than all the others. To give an idea, they even brought in the research vessel Stena Constructor, famous for being used in the Challenger rescue.

But the fact is there was no treasure! The gold and other valuable pieces were never found, at least not officially.

Location of the Wreckage of the Príncipe de Astúrias

It is quite possible that some valuables were found by a Greek named Wlazios Diamantaraz, who made several dives at Ponta da Pirabura and at some point disappeared.

Locals also report the efforts of a man nicknamed "the Gringo", who guided by a spiritual guide, made several dives in the region, some of them sponsored by a Portuguese entrepreneur. In the end, when the Portuguese came to collect the fruits of his dives, he said that "the spiritual guide had made a mistake" and also disappeared.

In the official missions, only two of the four statues were rescued - one is now on Ilha das Cobras and the other in Parque Palermo, Buenos Aires.

The twisted forks found in wrecks of old steamships can be attributed to contact with scalding water from the boiler. The extreme heat could easily deform and twist metal utensils, especially if they were exposed for an extended period during the wreck. This explanation appears to be one of the most probable reasons for the phenomenon. - Ilhabela Museum

Recently, the wreckage of the ship was dynamited 15 to 30 meters to open passage for ships in the region.

Praia da Caveira - 'Skull Beach'

In the first days after the shipwreck, several bodies arrived on the east side beaches of the island, mainly in Bahia dos Castelhanos, including Praia da Caveira, 5km from the accident.

Skulls found on the Praia da Caveira "Skull Beach" in Ilhabela

Praia da Caveira, known as the only deserted beach in Ilhabela, is closely linked to the tragic shipwreck of the transatlantic Príncipe das Astúrias. Local legends claim that the souls of the shipwrecked still haunt the beach, keeping visitors away and contributing to its loneliness.

Curiously, the name Praia da Caveira was already known before the shipwreck by this name, as noted on various maps preceding the shipwreck. One legend says that a slave ship, passing behind the island, sank; all the crew, slaves, died, and their bodies floated. A priest passing by boat through the area saw the bodies and buried them under a huge fig tree, whereupon the islanders claim that, at six o'clock in the evening, when passing near that fig tree, they hear "voices of the deceased".

Despite its grim reputation, its clear waters attract divers who practice spearfishing. Moreover, it has approximately 300 meters of sandy beaches that guarantee its paradisiacal aspect.

To this day, there are many legends about Ponta da Pirabura, including the belief in an unknown magnetic force in the region that disorients compasses and sinks ships, known as the 'Magnetic Deviation'. The head of the Port Captaincy of Santos at the time defended Captain Lotina, stating that the French steamer 'Vega' also ended up between Ilhabela and Buzios Island when the normal route should have passed 15 miles east of the islands, in the safety of the open sea.

Sunday, March 24, 2024

Solana Star, Verão da Lata (summercan), coast of São Paulo and Rio from 1987 to 1988



This is the true story of a ship that, threatened by the police, dumps 22 tons of cans containing marijuana on the Brazilian coast in Ubatuba, near the beaches Grande, do Tenório, and das Toninhas, and ends up sounding like a fisherman's tale or even a surfer's story.

They say Brazil is the place where everything happens... and it's true.


It all started in August 1987, when the Federal Police delegate Antônio Carlos Rayol and Carlos Mandim de Oliveira received a communication from the American DEA, the Drug Enforcement Administration, informing them that a ship that had departed from Singapore, the Panamanian-flagged Solana Star, was carrying a large shipment of marijuana destined for Brazil, with its final destination being Miami. It was 22 tons of marijuana vacuum-packed in 1.5kg cans.

The mastermind behind the operation was a criminal from Aspen, Colorado, who had sponsored another trip before this one, departing from Panama and heading to the Philippines via Vietnam, with a shipment of narcotics bound for Los Angeles.

Since the ship was not captured, the operation had been successful and very profitable. The mastermind ordered a second trip, commanded by the same captain named Archibald, who would take a new route this time.

A new boat was commissioned in Australia, a tuna boat named Solana Star measuring 41m x 7m x 3m, capable of displacing 540 tons, with a diesel engine of 1,500 HP and two 350 HP auxiliaries. He sailed with his new boat to Bangkok, via Japan, where he loaded the merchandise, marijuana packaged in grapefruit juice cans, from a front company called "Berri," created especially for the operation.

Once loaded with the cans, he headed south, through the South China Sea, bound for Rio de Janeiro.

Berri Grapefruit Juice - fictitious brand of the cans from the summer of 1987

Hunt for the Solana Star and Can Hunt Operation

On August 8, 1987, at 10:00 a.m., the first hunting mission set sail from the port of Rio de Janeiro, aboard a frigate of the Brazilian Navy in partnership with the DEA. The operation was not successful because the ship had not yet reached Brazilian territorial waters; it was in the middle of the Atlantic due to two storms that hit the ship in the middle of the Atlantic.

New developments led to a new hunting operation, due to the arrest in Miami of the drug lord as he attempted to board a flight to Rio de Janeiro. DEA intelligence indicated that the merchandise should be transferred to another vessel off the coast of Ilha Grande, Rio de Janeiro.

Once again, Delegate Mandim organized a police operation on August 28, 1987. This time, they used the destroyer Sergipe, lent by the Brazilian Navy. Again, the operation was unsuccessful.

How did those cans end up on the beaches?

The most interesting outcome emerged with a report from A Tribuna de Santos on September 19, 1987, saying that in Guarujá, a street sweeper collecting garbage on Astúrias Beach came across a large closed can, moving back and forth in the foam of the waves. Other cans began to be found by fishermen on the coast of Guarjuá, Ubatuba, and Ilha Bela; later, carried by the tide, they began to arrive in Rio de Janeiro as well. Immediately, a clandestine trade of the cans and their contents began, promoted mainly by fishermen who hid the cans in styrofoam boxes full of fish, a much more profitable contravention than fishing.

On September 14, the crew of the Solano Star was informed that the Federal Police, the Brazilian Navy, and the DEA were already aware of the marijuana cargo on board. Afraid of being arrested, the crew – five Americans, one Haitian, and one Costa Rican – dumped the approximately 15,000 cans containing marijuana into the sea, and the episode became known as the "Summer of the Can," marked in Brazilian history.

Solana Star crew tossing marijuana cans into the sea

The story gained media attention and caused a race between the curious and the authorities to see who would find them first. The fact that the marijuana was packaged in metal cans similar to powdered milk made the situation even more unusual.

Solana Star dumping the cans into the sea

Soon, the situation became very popular and comedic. Some said the can, much like what happened with the sailor Popeye, changed reality, bringing special powers to those who consumed it. Others said that what was contained in the cans was considered of superior quality to anything ever seen before. The story became so memorable that it inspired books, songs, and even a mystique on the subject, in which feats were performed with a ritual of opening cans in honor of the product's quality.

Despite the efforts of the authorities to seize the cans and investigate the case, only a small fraction was recovered by the police, as the vast majority was found by bathers and fishermen and subsequently commercialized.

Federal Police managed to recover 3,292 cans. If the final product had reached the traffickers in Miami, it is estimated that the operation would have yielded US$90 million.

Outcome

Of the seven crew members, six escaped through Galeão Airport two days after arriving in Rio. Only the American cook Stephen Skelton was arrested and sentenced to 20 years in prison but served only one year in Brazil before being extradited. The ship involved in the incident was seized and later auctioned off; the Solana Star was eventually sold after the conclusion of the investigation into the marijuana smuggling case. Its name was changed to Charles Henri and, finally, Tunamar II when it belonged to a Japanese tuna fishing company.

American cooker Stephen Skelton was arrested

Strangely, the fate of the vessel was intertwined with Brazilian waters. On October 1994, it met its tragic end, sinking 8 nautical miles off Arraial do Cabo, on the coast of Rio de Janeiro (22º59'240"S / 41º57'250"W), resulting in the death of 11 crew members.

In 2012, the book "O Verão da Lata: Um verão que ninguém esqueceu" ("The Summer of the Can: A summer no one forgot"), by the writer Wilson Aquino, was released, addressing the subject.

Tuesday, January 2, 2024

Prospenomics and Its Impact on World Peace


Positing that post-scarcity is a true catalyst for global pacification, prospenomics is based on the premise that overcoming resource limitations will instill "behavioral plasticity" in humanity, diminishing biological and evolutionary instincts for human conflict. This creates a conducive environment for international cooperation and the promotion of peace and prosperity.

leia esta matéria em Portuuês

Acknowledging our biological heritage, we understand that clan formation generates a "us against them" dynamic – Thomas Hobbes' bellum omnium contra omnes. Hobbes' political philosophy, encapsulated in the expression "war of all against all," is deeply rooted in the belief that humans possess a bellicose and conflict-prone nature. In his seminal work "Leviathan," Hobbes describes a state of nature where the absence of a centralizing power leads to fierce competition, with each individual pursuing their interests at the expense of others.

LIFE magazine whose cover story is the Prospenomics study - covers that never was

The metaphor of "Leviathan," a monstrous figure mentioned in the Bible, represents the need for a powerful and centralized force to subdue the conflict-prone nature of humans. To avoid the chaos and anarchy inherent in the war of all against all, the emergence of a sovereign authority stronger and capable of imposing order on individuals is imperative.

Hobbes' conception is intrinsically linked to the idea of the "social contract." He proposes that, to escape the chaotic state of nature, individuals tacitly agree to relinquish part of their freedom and power to a central authority in exchange for security and social order. This agreement forms the basis of the social contract, wherein citizens give up certain rights in favor of a sovereign authority, creating a pact aimed at maintaining peace and social stability.

Poster for the film Leviathan, by Thomas Hobbes - ads for films that never was

Hobbes' "Leviathan" is not only a feared figure but also a social organizing agent representing the authority of the State. Its coercive power is necessary to keep the selfish and belligerent impulses of individuals in check. Could this force be rooted in our own consciousness?

The First Time We Saved the Planet

The ozone layer, a thin and crucial atmospheric structure formed over ancient eras, shaped by the delicate balance of life since the planet's creation, plays a vital role in absorbing most harmful ultraviolet radiation, protecting life on Earth. Without this thin protective layer, life would be impossible on Earth.

However, the balance of this delicate shield was threatened when, in the 1950s, scientists discovered a class of substances – chlorofluorocarbons (CFCs) – being artificially generated and released by humans. Widely used in consumer products such as aerosols, refrigerants in refrigerators, and air conditioning systems.

In the 1970s, two scientists from the University of California Irvine, Mario Molina and Sherwood Rowland, asked, "What happens to gas particles released into the atmosphere after leaking from air conditioners?" and "What will happen to the enormous amount of gases released by rockets at the beginning of the space exploration era?"

Molina, in particular, questioned the fate of freon particles released into the atmosphere and their impact on the ozone layer when he made a terrifying discovery – the ozone layer providing protection against harmful ultraviolet radiation was being decimated by CFCs.

This led to global awareness of the damage caused by CFCs and triggered an unprecedented mobilization campaign. The realization that the destruction of the ozone layer could result in a global catastrophe, endangering life on Earth, transcending borders and cultural differences, propelled international cooperation.

In 1987, the global community took a significant step with the signing of the Montreal Protocol, not only signed but also faithfully adhered to by all human inhabitants of the planet, regardless of their race, culture, and political orientation.

This international agreement aimed to gradually reduce and eliminate the use of substances that destroy the ozone layer, including CFCs. The mobilization to reverse the damage to the ozone layer became a global priority, with the unprecedented participation of virtually all countries in the world.

The successful social mobilization campaign resulted in the gradual elimination of CFCs, a remarkable story of how awareness, collective action, and international cooperation can tackle the most complex and significant challenges.

How Will We Mobilize for Prosperity in Such a Divided World

Samuel Huntington's book "Clash of Civilizations" highlights the profound division existing in the world, fueled by civilizational conflicts that separate us from each other. This fragmentation not only threatens our lives but also jeopardizes life as a whole on the planet. Faced with this scenario, the crucial question arises: How will we mobilize to achieve prosperity in such a divided world?

Primatologist Robert Sapolsky, providing an in-depth view of human social dynamics, emphasizes that human conflicts have roots in biological factors, such as brain chemistry and hormonal patterns. He identifies four social reasons for belligerence: competition for resources, group selection, establishment of social hierarchy, and reproductive rituals. This thorough analysis reveals the underlying forces of human conflicts, providing crucial insights.

Sapolsky highlights the plasticity of human behavior, emphasizing that, although there are biological predispositions to aggression, the environment and life experiences play crucial roles in the manifestation of these predispositions. In other words, the more a man lives in a prosperous environment, with adequate food, territory and protection from the elements, with a resolved and active sexual life, among trusted friends and a healthy social life, he is able to eliminate all primatological impulses of aggression, part of your original biological programming.

This complex understanding reinforces the need for a holistic approach to dealing with issues of conflict and cooperation, considering multiple factors.

As we become aware of these weaknesses, similar to the successful social mobilization against the use of CFCs, we can pave the way for global prosperity. Recognizing and understanding the biological roots of human conflicts empowers us to develop strategies that promote global cooperation, overcoming divisions, and building a more prosperous future for all of humanity.

But as We Become Aware of Our Nature, We Must Adopt Prospenomic Attitudes and Reach the Post-Scarcity Stage

As our awareness of our nature deepens, it becomes evident that mere consciousness of our bellum omnium contra omnes posture is not enough; it is essential to adopt prospenomic attitudes and reach the post-scarcity stage.

Prospenomics, grounded in the premise that overcoming resource limitations catalyzes global pacification, combined with the plasticity of behavior in the face of awareness of our belligerence, reducing biological and evolutionary instincts that lead to conflicts and wars, this approach not only provides a conducive environment for international cooperation but also promotes feelings of peace and prosperity.

Samuel Huntington, in his book "Clash of Civilizations," points out that the rapid economic development in Southwest Asia in the 1990s initially brought optimism to the world, aligning with the idea that on a planet with more efficient resource use, the likelihood of achieving peace and prosperity increases, and the feeling of animosity and belligerence decreases.

OMNI magazine whose cover story is the Prospenomics study - covers that never was

However, regrettably, the book indicates that this optimistic expectation did not materialize as expected. The reason for this outcome is related to social reasons intrinsic to our human nature, as discussed by Huntington in his work.

Towards Post-Scarcity and Planetary Prosperity

Analyzing the economic mistakes that brought us to the current situation and correcting our attitudes toward a more prosperous planet is what we must do.

Avoiding the mistakes of liberalism, which fails to distribute wealth, and socialism, which falters in generating wealth to be shared, puts us on the path to a more prosperous and equitable planet.

Valuing and respecting civilizations for what they are, encouraging peaceful coexistence towards planetary prosperity, plays well into the role earned by Homo sapiens as the protagonist of the planet, responsible for the well-being of Earth and all species in balance, ensuring a full and healthy planetary evolution. This is our role.

Wednesday, November 29, 2023

Error Free Red Bull Branding

 
Luiz Pagano at the Red Bull Global Headquarters in Fuschl am See, Austria - ft business prs

Red Bull's branding was so well-crafted that it seems to have been created with the help of a crystal ball.


In the early days here in Brazil, I was part of the team responsible for the successful introduction of Red Bull into the market, serving as the first on-premise manager, overseeing establishments such as bars, clubs, and restaurants where beverages are acquired and consumed on-site. At that time, the energy drink market was already well-developed, with significant investments from brands like Flash Power, a company I had worked with from 1997 to 1999 as part of an outsourced team, and Flying Horse.

Facing intense competition, our challenge was to create an introduction strategy in the Brazilian market as creative and powerful as those developed in Austria for the brand's creation. At that time, Red Bull's distribution in Brazil was coordinated by the Madasa company, which held the distribution contract, while Red Bull itself managed marketing strategies.

One of the first Red Bull Vending Machines april, 1999

In April 1999, we traveled to Austria with a team of over 40 employees for marketing training. 

Brazil was a highly valuable market, and the transmission of strategies could not afford deviations like those that occur in the "Chinese whispers" game.

Our goal was not only to introduce the brand but also to ensure a lasting competitive advantage in a highly competitive market. This mission demanded creativity, innovation, and a deep understanding of the local market, resulting in the solid establishment of Red Bull in Brazil, a trajectory that continues successfully to this day. 

The creation and distribution of high-quality content are also key elements of Red Bull's marketing strategy, including press releases, formal news, customer stories, and later, with the advent of more sophisticated social media from 2000 to 2010, blogs and YouTube channels with thousands of videos, further strengthening the connection with its target audience.

Founded in 1987 in Austria, Red Bull quickly became the creator and leading company in the energy drink market, boosting the brand's value through brilliant marketing strategies, reaching an impressive global market share of 38% in 2020 (which was once over 80% in the early 2000s). The company adopted various tactics to achieve this success.

Red Bull's marketing strategy is multifaceted and begins with an inspiring and memorable slogan, "Red Bull gives you wings" (Red Bull verleiht Flügel), created in 1997 and maintained since then.

Encouraging the practice of extreme sports as part of the experience and team formation. Luiz Pagano and the Brazilian introduction team , April 1999. ft business prs

In the late 1980s, surveys indicated that the image of the two bulls confronting each other in the logo was perceived as excessively intense. Faced with this perception, the brand's strategy evolved ingeniously, introducing a self-ironic character in animated advertising films. This character not only brought balance to the intensity of the previous image but also injected a dose of grace and humor, aligning more effectively with the audience's preferences and consolidating the brand's uniqueness. These creative strategies contributed to the brand's uniqueness, and despite facing some legal challenges throughout its history, the consistency in using this slogan strengthened the marketing strategy over time.

Furthermore, Red Bull heavily invested in extreme sports sponsorships, requiring courage, physical, and mental fitness - attributes of the brand. This culminated in the Stratos event in 2012, where Felix Baumgartner parachuted from the edge of space. These events not only broke world records but also boosted company sales.

The innovative and humorous advertising approach, initiated in 2000 with distinctive videos, solidified the brand's identity. Red Bull also excelled in using Guerrilla Marketing, such as the strategy of free drink distribution on university campuses.

Additionally, Red Bull built a strong and consistent brand around the slogan "Red Bull gives you wings," effectively directing its message to young men seeking adventures. The company utilizes word-of-mouth marketing, leveraging extreme sports events to reach millions of viewers and enhance the effectiveness of this form of advertising.

Red Bull Professional Training Center in Austria, April 1999 - ft business prs

In summary, Red Bull adopted a comprehensive marketing strategy, combining quality content, extreme sports sponsorships, guerrilla marketing, innovative advertising approach, strong branding, and word-of-mouth marketing to achieve and maintain its dominant position in the energy drink market in Brazil and worldwide.

Tuesday, November 28, 2023

Maison Program of Pernod Ricard

  
Luiz Pagano at Pernod Ricard in Paris - ft business press

The goal of most corporate strategies is to build a real and lasting competitive advantage by enhancing the quality of customer service.


Maison Program in Canada. ft John Ormston 


In this spirit, the Maison Program emerges as an innovative initiative by Pernod Ricard, representing an approach to improving customer service quality in the bartender community. Aligned with the corporate strategies of building a lasting competitive advantage, Pernod Ricard created the Maison Program as an educational journey to enhance the skills of professionals in bars, restaurants, and mixology, with a focus on customer service.

Luiz Pagano and other contributors to the Maison Program - Paris, July 2013 - ft business press

The innovative partnership between Pernod Ricard and École Hôtelière de Lausanne took its first steps in November 2012 but was officially announced on November 19, 2013. It was marked by the signing of a partnership agreement with the aim of providing excellence in teaching and professional training, gaining recognition in global customer service. The collaboration between Pernod Ricard and École Hôtelière de Lausanne had existed since 2008 when they jointly participated in the "Responsible Party," a consumption program developed by students and later expanded to a European level.

The course to educators consisted of 11 modules, covering categories such as whiskey, gin, scotch, vodka, cognac, champagne, rum, customer service, and Bartender Theater. It concludes with a substantial diploma.

Targeting both novice and experienced bartenders looking to enhance their skills, the program was made available in various countries, including Canada, Australia, Colombia, Hong Kong, Germany, Finland, South Africa, and Gulf countries. Plans for expansion include Switzerland, Austria, Brazil, and France.

As part of the Pernod Ricard brand education team in Brazil, I had the privilege of participating in the first group of educators.

The program's significant strength undoubtedly lies in its partnership with École Hôtelière de Lausanne (EHL), an institution with a prestigious history dating back to 1893, adding an exceptional dimension to the training and reinforcing Pernod Ricard's commitment to excellence.


Pernod Ricard has its own university, a global training function throughout the company for all aspects of personnel development.

During my participation in the educator training at the Pernod Ricard University at the company's headquarters in Paris in July 2013, I was inspired by the lectures of two prominent mentors: Will Pitcforth, Global Maison Coordinator, and Eric Fossard, Global Maison Trainer, whose practical experience and profound insights enhanced my understanding of brands on an equally important scale, despite being a Pernod Ricard employee.

Luiz Pagano in Paris, July 2013 - ft business press

The Maison Program aimed to have an independent perspective on beverage choices, whether from Pernod Ricard, Diageo, or another competitor, focusing on the real benefits of beverages and ignoring marketing guidelines from their respective companies.

This unprecedented approach was supported by a strategic collaboration with École hôtelière de Lausanne, whose Educational Director, Isabelle Martin, played a vital role in the partnership and accreditation.

Furthermore, the innovative iPad technology, developed by the London-based agency Contagious, brought an interactive and dynamic dimension to learning, reflecting the Maison Program's commitment to technological advancements. Educators trained at the Pernod Ricard University distributed iPads in their home country classrooms, controlled by them, unlocking and locking access as the class progressed. This dynamic approach was complemented by comparative tastings and clarification sessions.

Each educator and their local country had approved content translated and ready for use, featuring state-of-the-art graphics allowing the visualization and rotation of over 1000 bottles, reading labels and back labels, in five initial languages, with the expectation of adding more.

Luiz Pagano at the Pernod Ricard offices in Paris, August/July 2013 - ft business press

When the program was still in its pilot format, brand educator Ben Davidson, Brand Education Manager in Australia, conducted 64 Maison training sessions in Australia in 2013, conducting initial tests and demonstrating the global reach of this program.

The Maison Program went far beyond being a simple training course, representing a significant milestone in the global training of beverage professionals. 

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