The Experiential Real Estate of Shanghai

Strike up a conversation with any real estate professional and soon enough the “death of retail” topic will come up. Slightly exaggerated, perhaps, but retailers and the real estate they occupy are facing significant challenges as e-commerce continues to evolve. One message that we received again and again from the real estate experts that we met in China was that bricks and mortar retailers have already gone through many of the growing pains associated with e-commerce and learned the importance of “experiential retail” years before it became a buzzword in the US.

One of our first meetings in Shanghai was with Value Retail at their newly opened Shanghai Village. Located near the Shanghai Disney Resort, the luxury outlet mall is well positioned to attract nearby tourists. Meeting with Caleb Perrin, a Columbia MSRED graduate, and Lillian Cheng, it was clear that value proposition of Shanghai Village was hospitality and experience, rather than just providing a retail offering.

Our hosts began our tour with a discussion in the VIP hospitality room where shopping guest can relax, enjoy refreshments and have a concierge assist them with anything. Shoppers could also register so their purchases will be sent to concierge to be picked up at the end of the day or shipped directly to their home, staving off fatigue from hauling around heavy shopping bags. Boutiques were spacious and uncluttered, reminding us more of 5th Avenue retailers rather than a typical US outlet mall. The one design challenge that our group noticed was the open-air concept. While common in US and European outlet shopping centers, poor weather and air quality keeps customers away. We visited Shanghai Village on a rainy weekday and noticed very few shoppers around.

We built on our experiential retail tour with a tour of Swire’s HKRI Taikoo Hui, a mixed-use development in Shanghai’s vibrant Jing’an District with two office buildings, a retail mall, and three hotels / serviced apartments. The luxury boutiques are well-suited to the high-end neighborhood and contains the world’s largest Starbucks (29,000 square feet). The Starbucks Reserve Roastery is a highly experiential concept. The spaces doubles as a coffee factory and guests can learn about the roasting and brewing process while tasting coffees from all over the world. While coffee shops are not as vulnerable as fashion retailers to e-commerce, the Starbucks Reserve serves as a major draw to both locals and tourists for the shopping center.

Robin Lore ’19

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The group touring Shanghai Village

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The group touring Shanghai Village

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World’s largest Starbucks in Taikoo Hui

Paris and London: pick your side

Paris or London: falling in love with the lovely French accent or being enchanted by the distinctive British humor? Our RLG Paris & London Chazen has come to an end, but we still cannot decide which city stole our heart.

Is it Paris, the capital of luxury, where you can eat a ‘Croque Monsieurs’ in one of the many cafés, where the smell of freshly baked baguettes will reach you from far away, where delicious macarons are served after each meal and where there is always an art exhibition worth seeing?

Or is it London, the fashion capital renowned for its distinctive street style, where pubs are national institutions, where you will never get tired of taking long strolls in one of the many parks, and where the Royal Houses and its inhabitants are among the greatest attractions?

Fascinated by the many distinctiveness, we also noticed the striking similarities: both cities are built around a river (the Seine and the Thames), there is a bohemian neighborhood where artists love to hang out (Montmartre and Chelsea), both cities are home to very prestigious universities (La Sorbonne and HEC, London School of Economies and London Business School), they both have famous amusement parks nearby (Disneyland Paris and Harry Potter World), and there are in both Paris and London globally prestigious Opera Houses (Opera and Royal Opera House).

During this engaging week, we have come to appreciate the beauty of two of the most vibrant cities in Europe: even if the 13 company visits kept us all extremely busy, the romantic atmosphere and the vibrant vibe of these places did not go unnoticed.

G.K. Chersterton said ‘London is a riddle. Paris in an explanation’: why shall we choose,  then, when we can have them both?

~ Alice Signori ’18

Looking back at India

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Having had some time to reflect on our busy week full of guest speakers, coaching, immersion into Indian culture and sightseeing I think I speak for all of us when I say how grateful we are to have been given this extremely unique opportunity. Our week abroad triggered introspection for each of us to think about our purpose, what leadership means to us and how our current life and routines may not be fulfilling our purpose. A few broad takeaways I was left with and will continue to focus on when thinking about my purpose or going about my normal days are the following:

“Detachment from Outcomes” – So often in life we are so focused on the end goal and a successful outcome that we lose sight of how important the journey and quality of work to get there is.

“Time is the most valuable resource” – As Kiran Bedi said when asked about her plans for the future – TIME is our most valuable resource and how we choose to spend our time is extremely important so living in the moment and serving your daily purpose rather then dwelling on the future or past is extremely important.

“Open Source thinking” – As Rajeev explained as we move into changing times of proliferation of communication we need to start changing the way we think about setting goals, reviewing performance and setting organizational direction. We should always be thinking about the 80/20 rule and that not everyone is meant to be the 20% of top performers so we should stop setting trying to get them to be.

“Life is 10% what you are dealt and 90% how you deal with it” – After hearing from Navin Gulia this point resonated with all of us. After becoming paralyzed in an accident, he used this experience to as the starting point for what he would do with the rest of his life and how he would use this experience to change his purpose and the world. We can use Navin as a role model when we face adversity or different outcomes then we have expected in life.

“Importance of being centered and present” – After hearing from the monk and Kiran Bedi the importance of being centered and in the moment, was a key takeaway. While we can spend all of our time planning out our days and what we hope the outcomes will be there is nothing more important that being centered and in touch with one’s self.

“We don’t make tradeoffs we make choices” – When we asked Kirin about tradeoffs she had made between her career and her family life. She responded by telling us rather than making tradeoffs we make choices that are best for that time and that is all we can do and what we should be committed to.

The best part about GIP India is rather than just learning leadership concepts to apply in our lives going forward in a classroom these concepts became extremely tangible and real by meeting with great leaders and immersing ourselves in India’s rich history of leadership.

The trip would not have been possible without all of Professor Wadhwa and our TA Prateek Jain’s hard work in planning and executing on every aspect of the trip. Between navigating Delhi traffic, keeping us safe and mindful, inviting us to hear close connections speak and always having the ability to roll with the punches we were extremely thankful for all the hard work that went into this week.

India was eye opening, extremely welcoming and hospitable and I would highly recommend this trip to anyone looking for self-reflection, new perspectives on leadership and those looking to feel connected with an amazing part of the world.

-Sarah Spear ’18

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What’s Next for Myanmar?

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Yangon: A city under construction.

I’m back in New York reflecting on the view from my Yangon hotel room. Each morning I woke up to a city under construction. Cranes seemed to rise from the streets trying to make up for lost decades—a perfect metaphor for our week in Myanmar, which I left with two major lessons in mind.

  1. Capacity Is Key: We saw this time and time again in both human capacity and capital capacity. In terms of human capacity, the educational systems don’t exist in the ways that are necessary and an entire generation is essentially lost to the decades of military rule. The key now, is to figure out to best educate the next generation. Repatriation can’t be the only answer, but it’s a start. Capital capacity is equally important, and there are many organizations working to solve this through economic and legal reforms that will make it easier for foreign investors. But these two issues work hand in hand, and one without the other will do little to move the country forward.
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At Phandeeyar’s tech accelerator, we heard pitches from six startup founders and got a better sense of the startup scene and the country’s capacity for, and interest in, startups.
  1. The Democratic Government Is Not Where It Needs to Be, Economically or Ethically: Leading up to our trip to Myanmar, one concern rose above all others for me: Why am I visiting a country amid a humanitarian crisis—and does that make me, by default, a supporter of what is happening? I made sure to read as much as possible about it in the English-language press so I could come prepared to ask hard-hitting questions. Ultimately though, it was shocking how much Yangon feels divorced from the controversy. People we met with dismissed it as something that has been going on for years and therefore not a real issue. Others excused Aung San Suu Kyi’s silence as a sign she is working with the military behind the scenes to bring peace, and making a public statement would compromise that position. Their excuses rang false to my ears and if the country really plans to move forward with the help of international aid it’s going to need to reckon with its actions. What I was not expecting, was the sentiments of ex-pats and citizens who missed the efficiency of military rule. People are nostalgic for those days and are critical of how the current government is stacked with party loyalists who are older and not as well versed in many of the issues that they oversee. Bottlenecks in decision making are common, making processes that should take hours or days take months. This comes back to the issues from my first point: Human capacity makes all the difference, and, if you’re not training people and educating them properly, what does that mean for your future?
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A monk takes a break to admire the sunset.

While I seem to be ending on a pessimistic tone, I am hopeful that in the coming years we will see Myanmar reckon with its past. Only then can it truly emerge as the regional leader it once was.

-Miriam Krule ’18

 

Learnings From Cuba

IMG_0038Our class’ 2018 global immersion trip to Cuba was a rare opportunity for a group of 28 US business school students to experience “the real Cuba”.

Though we studied Cuba for 6 weeks in the A term, there was no way we could have gained the perspective and understanding we did without visiting the country.

I’d like to share three key themes of our trip in the hopes you are inspired to learn more about Cuba too.

1. Cubans are proud of their history, and generally approve of socialist education and healthcare. We spoke with many Cubans – a real estate lawyer, a former ambassador, a journalist, an Airbnb host and more – and all of them have extensive knowledge and opinions on the last century of history in Cuba. Given the country has free education, it was no surprise how eloquently each speaker could describe the events leading up to the Cuban Revolution, through the Special Period (when the Soviet collapsed and Cubans lost their support) and up until the Trump administration. Not one person spoke out against the socialist system of free education and healthcare. In fact, most Cubans appreciate what Fidel Castro did for their country. However, a Northern European version of socialism mixed with free market sounded amenable to most speakers over Castro’s fully socialist agenda. Even the urban planner believed in a more European model of planning that will preserve the city’s history (versus Shanghai-type development, riddled with pollution and disregard for historical sites). Ultimately, Cubans were extremely happy when the Soviet Union funded more social programs, but with their collapse came a drop in GDP of 35% and 16 hour power blackouts. Today they are happy with some social programs, but recognize a need to grow GDP to progress as a country.

2. 80% of Cubans have either remittances, a private enterprise or a second job to supplement their $25 monthly average salary – and the US is a big part of how they do this. The US Cuban embargo prevents any business with Cuba (other than tourism). However, some say Miami – which has the largest population of Cubans in the world after Havana – keep Cuba afloat with the estimated $3B+ in remittances sent each year from friends and family in the states. This creates disparity, because the 20% of Cubans who truly live on $25 a month may not, for example, have family who can send $100 each month, effectively increasing income by 500%. A Cuban real estate lawyer shared an example of how this plays out: Cubans used to only be able to swap their houses given the socialist model. They can now sell their houses, but the actual prices paid for apartments can exceed $100-200k+, without loans, mortgages or credit of any kind available to do so. You can take a guess where they are getting the disposable income to do so! Some people are effectively “investing” in Cubans if they float housing costs, because Cubans can either re-sell their houses after making improvements, or turn the house into an Airbnb or “casa particulares”, where they can earn money renting out their homes to tourists.

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3. Icy relations with Cuba simply make it easier for Cuban insularity and for the hardliners in the country to push their agenda. We spoke with the head of our tour group company, Collin Laverty, who also had extensive experience working in Cuban American policy. He believes in relations that are best for the US – not relations that are what the US has had in mind. He spoke about how many Cubans were happy when Obama’s visit to Cuba softened relations. The Cubans in government, on the other hand, did not know what to do. For 50 years, Cuba had cold relations with the US, and Fidel knew how to use that to his advantage. Saying that the US didn’t want to work with Cuba made it easier to convince Cubans to believe in Fidel and keep away from US relations. The Capitalist US influence could have negatively impacted the socialist movement. The Trump administration is a return to cold relations and is a “gift” to Cubans in government who are afraid of opening the floodgates to US business and capital.

Our class had an incredible time and made great friends through this trip. Thankful to have had the opportunity… but also thankful to be back on the grid online and in the states.

Adios y hasta luego amigos!

-Jill Wang ‘18

CBS vs. Bollywood

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Our last two days in Delhi were action packed from Bollywood dance lessons, coaching our AbsoluteData counterparts, hearing from Dr. Debroy a key advisor to Prime Minister Narendra Modi at NITI Aayog and visiting the Taj Mahal in Agra.

On our final class day we spent the morning meeting with our AbsoluteData Coachees first in groups and then one on one to provide them with the feedback we had put together through combining what they felt they needed advice on with things we had observed in our observation sessions. We had spent the evening before compiling feedback and ensuring we could give our coaches concrete examples of concepts, develop deliverables and were confidence enough to talk through each of the concepts we would provide them with to use going forward. At the end of the coaching session each of the AbsoluteData participants had the opportunity to stand in front of the room and tell everyone what their key takeaway from the program was and what actions they were going to take going forward followed by each CBS student having the opportunity to share what we had taken away from the experience. The experience was extremely rewarding, especially to see how much an outside perspective had helped our AbsoluteData counterparts by us being a sounding board for advice.

I think I speak for all the CBS students when I say we had felt we took as much away from the experience as our coachees did and were happy to see that even though we live in very different countries the challenges in the workplace were very similar and that we could all use the techniques going forward. This opportunity to coach others was extremely rewarding and I know many of us will keep in touch with our coaches and check in to see how they are doing.

After our coaching sessions we headed to NITI Aayog (The National Institute for Transforming India) which was formed via a resolution of the Union Cabinet in 2015. NITI Aayog is the premier policy “think tank” of the Government of India providing both directional and policy inputs. Our meeting had been arranged by our wonderful TA Prateek Jain and we heard from Dr. Debroy who is a senior advisor to the India Government. This meeting gave us insight into the history of politics In India, the current political climate, how change is implemented in India and how we should think about the priorities and struggles for the economy going forward.

After our action-packed day we headed to a local Bollywood dance class where for two hours we learned three traditional Bollywood routines. Scroll down for some of the pictures of our sheer Bollywood talent. Despite having a 7 am departure for the Taj Mahal the next morning, a few of us took the opportunity to check out Delhi’s night life as we met up with a few of the Women’s entrepreneur panelists from our session yesterday to show us around Delhi.

On our final day we embarked on the 4-hour bus ride to see the Taj and got to see some of the rural India countryside on the way. We had an amazing guide that gave us the entire history of the structure before arriving so when we got to the Taj we knew the full history of the building, structure and meaning behind it.

One word to describe the Taj –- BREATHTAKING —see pictures attached!!

-Sarah Spear ‘18

 

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So long, Seoul! Final Reflections from South Korea

As I board the plane to JFK, I can’t help but reflect on the last week and everything that I learned about this warm, humble, dynamic country. Here are my top ten reflections from our time abroad:

1. South Korea has come a truly remarkable way in the last fifty years. During the Korean War in the 1950s, much of South Korea was destroyed. Now, less than a century later, an extremely urbanized and industrialized Seoul houses about half of the total South Korean population. It’s incredible to look at the Seoul skyline and remember that very few of these buildings existed when our parents were born.

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Me and Connor Stoval (’19) overlooking the Seoul skyline from the top of Lotte World Tower (the 5th tallest building in the world).

2. South Korea’s corporate landscape is dominated by chaebol, multi-vertical conglomerates that control almost every major industry in the country. There’s nothing like Lotte in the United States. Lotte, which is the 5th largest conglomerate in Korea, holds the highest market share across all its core business areas: food, retail, chemical, and hospitality. Picture CVS, 7-11, Forever 21, The Gap, 3M, Marriott, and Starwood all operated by one parent company—that’s Lotte. Oh, and Lotte owns the equivalent of SeaWorld and Disney World too (there is a full aquarium in the Lotte World Tower and an amusement park next door). It’s a corporate structure that could never exist in the United States due to our pro-competition, anti-trust laws, but it’s the way of doing things in Korea. The five major chaebols—Hyundai, Samsung, LG, SK, and Lotte—control pretty much every major industry in the country and competition is essentially impossible due to government support and intervention.

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Jack Kantelis (’18) asks questions about Lotte’s chemical division

3. The intersection of digital and big data will define the future of South Korea’s corporate strategy. At our visit to Samsung Innovation Museum, we watched a video of Samsung’s vision for the future. It showed a ten-year-old child scaling cliffs in Alaska while her father received updates about her health and wellness from his bathroom mirror. A few days later, at Lotte, we watched a similar video highlighting Lotte’s “Lifetime Value Creation.” In this vision for the future, we saw a couple experience auto facial recognition while checking into a hotel, automatically proportioned meals, and on-demand rental cars and bike shares. One quote from Lotte’s video summed up the visions particularly well: “From the moment you wake up in the morning, you are surrounded by Lotte.” Frankly, it was a tad dystopian in nature, and left all of us wondering about the pros and cons of excessive corporate access to and use of personal data.

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CBS students at the Lotte R&D Center
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At the Lotte Aquarium

4. The desire for innovation and start-up culture is thriving in South Korea across both corporate and social sectors. On Monday, we visited Hanwha’s DreamPlus Center, the Fintech accelerator of the life insurance conglomerate. On Thursday, we visited Hyundai Genesis, the company’s first luxury vehicle and first new brand in about fifteen years. That afternoon, we visited Heyground, a co-working space for social entrepreneurship founded by CBS classmate Kyungsun Chung. Across each visit, we saw an unprecedented desire for South Korean companies to be at the forefront of innovation, both in South Korea and across the globe.

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Me and Einat Aldaag (’18) learn about the strategic decisions behind Hyundai Genesis

5. The current threat of North Korea, as well as the tragedy of the Korean War, is present in the minds of the South Korean people. On Wednesday, we visited the Korean War Memorial and paused to remember the 30,000 Americans and 100,000 Koreans who lost their lives in the conflict. Then, on Friday, we traveled two hours to the demilitarized zone of the North Korean border and met with a North Korean defector who escaped the country through China, leaving her son behind. It was powerful to hear her story of oppression and perseverance and we all left the visit feeling extremely thankful for the rights and opportunities we possess in the United States. We also had the opportunity to travel 300ft below ground into one of the tunnels that North Korea built in preparation for an attack on South Korea, even after nonaggression agreements were signed. Four of these tunnels have been discovered, but it’s estimated that up to sixteen of them are still undiscovered. Finally, we went to a lookout point and looked across to North Korea through telescopes.

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CBS students at the North Korean border

6. The South Korean people we met were extremely humble and generous. At each corporate visit, we were greeted by company leaders who expressed their honor at being able to address students from Columbia Business School. We were all a bit surprised at how impressed they were by us! Moreover, we left every company visit with our arms filled with gifts. At Samsung, we were given mousepads with our group picture painted on them. At Lotte, we were given empty paper bags and asked to fill them with Korean snacks, candies, chocolate, and beer. It was a very unique experience and not one we are used to back in the United States.

7. We love Korean food! Bring on the kimchi, bibimbap, and red bean paste. We had the best time getting to live on spicy Korean dishes for the week. A few times, we especially appreciated the 24-hour Korean spots around the corner after enjoying Korean nightlife 🙂

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Lindy Gould (’19) is an MBA candidate at Columbia Business School.