Episode Summary

In this episode of Forward Looking Business, Kevin and Nick welcome to the show business columnist at StarTribune, Lee Schafer to discuss Alfred P. Sloan and the model he implemented at General Motors. They discuss the concept of bureaucracy for good, the importance of investing in activities that create value and the theory of goal displacement.

What We Covered

• 00:36 – Kevin and Nick welcome to the show, Lee Schafer who speaks to his background as a business columnist and his thoughts on the concept of bureaucracy for good
• 10:34 – Lee talks about the importance of understanding opportunity costs and where your business’s money is going
• 15:53 – Lee expounds on the brilliant business model that Alfred P. Sloan created for General Motors
• 23:54 – The mindset of money and capital allocation as a business and an entrepreneur
• 32:35 – Kevin and Nick thank Lee for joining the show

Tweetable Quotes

“If you go back to the nineteen teens and the nineteen twenties, Detroit was Silicon Valley. It was the Wild West.”

“Your line managers are always gonna be – or they should be anyway – optimists. They should be strategic. They should be looking for opportunities to grow their operation. But ultimately they do compete, and they compete for their parent company’s checkbook.”

“Which kinda makes the achievement of (Elon) Musk and Tesla pretty remarkable. That’s not a normal guy. You can tell that capital has been very much a part of their whole story…he’s the most interesting figure maybe in my lifetime.”

“And they (Target) still do that. You can still listen to those folks talk about investment capital and ask ‘are we gonna invest in our store or are we gonna invest in our distribution capability for online?’ This is the methodology where you go about doing it.”

Links Mentioned

AmpliFi Capital Corp Website

Kevin’s LinkedIn

Nick’s LinkedIn

Lee’s LinkedIn

Books Mentioned

My Years with General Motors