A Beautiful Mind

I learned Prisoner's dilemma from Dr Poon at my first year in the CUHK. He used Nash Equilibrium to explain a lot of market outcomes. I was amazed and liked him a lot. Despite his mathematical approach and grade killer attitude, I took a few more courses taught by him.

Today Dr Hung introduced this games theory in the class. From the face of most of the learning partners, I could tell that they could not follow.

Dr Hung gave me new insight about the "value of guanxi" in Nash Equilibrium. Nash Equilibrium is a lose-lose outcome. Investing in Guanxi may be able to stabilize the win-win outcome by building on going positive expectation.

Tonight Pearl TV showed movie "A beautiful mind". The story was about John Nash. What a co-incident? I watched the movie a few years ago but I did not remember that I had learnt his theory. When I watched it again tonight, I felt I'm so close to this Nobel Prize Winner.

Competitive Analysis

The professor seems picked a good book and a good focus for the EMBA class. I guess he can't be too "econ" to teach a class full of executives.

Porter's Approach was introduced in the class with Six Forces. How are the forces of my company?

1. Threat of new Entrants
- Possible entry barrier: Brand, Technology (not too strong)

2. Rivalry among existing firms
- A few major players but many small players
- High industry growth

3. Threat of substitute products or services
- Substitute exist such as ERP, Workflow

4. Bargaining power of buyers
- Large

5. Bargaining power of suppliers
- Self developed

6. Complements
- Scanners, server, ...

It seems that we are at a quite competitive industry.