Friday, March 25, 2011

Testing solar without teaching it

Today we had the finals of the Lucas School entrepreneurial case competition, where 11 teams competed to orally present their analysis of a standard business case.

The case we used was Nanosolar, published in 2009 by Harvard Business School Press. The teams were asked to analyze Nanosolar’s strategies and recommend what it should do going forward (from 2009).

Today was the finals between the two remaining teams. I was fortunate to be selected as the faculty judge, along with two industry judges:
  • Brian Stone is VP of sales and marketing for Nanosolar. A former manager of Siebel Systems and marketing VP for SunPower, he has an MBA from UC Berkeley
  • Mike Balma is a consultant to Skyline Solar, has been active in SolarTech and previously held a range of marketing jobs at HP. He has an MBA from Stanford.
Actually, I was more of a moderator and emcee: I vowed beforehand that if our industry experts agreed on the winner, then I wouldn’t even vote.

The final two teams were:
  • Dan Doung, Adam Harlow, Chris Heuser, John Shippy, and David Van Der Steen from our full-time MBA-One program;
  • Jason Chan, Weiwei (Vivi) Chen, Dylan Crutchfield, Dion Jefferson, and Kellen Yeung, a hybrid between the MBA-One and our on-campus evening MBA.
Normally when I teach solar, I use my own industry note (available upon request) that describes the economics and (simplified) technologies of PV companies. I also lecture to discuss the industry.

Today, our teams only had the Nanosolar case to work from. There were a few problems in the case (that Brian plans to send back to Harvard). But even if we’d used the more up-to-date Nanosolar case from Stanford, it was clear the students would have had problems understanding a complex industry from 12½ pages of text.

Mike, Brian and I take for granted that everyone understands issues such as the relative efficiency of thin film and crystalline solar and the interdependence of PV cost, substitute costs and subsidies upon PV adoption. The students picked up some of these points from the case but on other issues had to make assumptions (that sometimes were wrong).

Of course, three years ago I would have made the same mistake. It was only by immersing myself in writing my own solar case in the Fall of 2008 that I came up to speed — followed by more teaching, blogging, and researching academic papers.

This comes back to a more general point that I’ve been trying to make as the College of Business and our Lucas graduate school update their curriculum. It’s hard to prepare students for the sort of tech industries that populate Silicon Valley without having some industry-specific knowledge. If you want to get a job in solar (or semiconductors or software) you need to know something about it.

This raises the question about whether we offer electives for all the various possibilities, provide a survey course that covers a range of industries, or integrate this material into our regular courses. We may end up using a combination of approaches.

After we heard the presentations today, Brian explained what happened to the company and why, while Mike offered more general industry observations. Then I got to announce the winner: team #2, the team of Chan, Chen, Crutchfield, Jefferson and Yeung.

Even the students who didn’t win felt like they learned a lot. Perhaps that’s the final take-home: beyond preparing the case, there are learning possibilities from listening to others and (in other cases) industry experts as guest speakers.

Friday, March 18, 2011

SJSU insights into slow solar adoption

On Friday, SJSU students and other industry experts presented their latest thoughts on how to speed adoption of residential solar power in the Bay Area. The occasion was a live Internet broadcast entitled “SolarTech Consumer Perception Webinar.” (About 90 people logged on to the broadcast.)

The webinar built on the consumer survey done by five Sbona Honors Program students: Faith Ebrahimim, Irene Foelschow, Morgan Hancock, Jennifer Sarvian, Tam Tran — in the marketing program supervised by Prof. Rob Vitale.

At the webinar, Sarvian introduced the group’s findings. Moderating the live session was Bob Couch of Orogen Marketing, the industry marketing guru who guided the students to their successful conclusion. All the prepared slides for the webinar have been posted to the SolarTech website.

Their presentation was supplemented by an industry panel consisting of Doug Payne (SolarTech), Jeanine Cotter (Luminault), Jessie Denver (City of San Jose and SJSU) and Andrew Yip (PG&E and the California Solar Initiative).

After the students pretested their survey, they diversified their risk by distributing the survey using three separate approaches: mailed (postage stamp and everything), email link and then in person. They obtained 224 answers, but limited their analysis to the 163 respondents from Santa Clara County.

The demographics were generally representative of potential solar buyers: 81% ages 45-64, 81% with some college degree, 74% making $100+K. The only concern was that — compared to the averages for Santa Clara County and for homeownership — the survey dramatically underweighted Asians and somewhat underweighted Latinos. (There is no reason to believe that race plays the same role as income or education in buying a $20K power system.)

Of the respondents, 11% already own solar systems. A total of 55% had done some research into solar purchase, and 49% intend to buy a solar power system.
After Sarvian presented the demographics, Payne summarized some of the other findings. Not surprisingly, consumers were most concerned with price (97%), followed by reliability (94%), warranty (94%), customer service (93%) and financial incentives (91%).

What distressed the panelist was that 83% of those planning to buy a systems won’t do so for at least two years. Yip (a SJSU EE graduate) noted that among California counties, Santa Clara County has by far the greatest adoption under the CSI subsidy program, with 15.3 megawatts and 3,472 systems. (The next largest was Fresno with 9.7 MW and Alameda with 2,065 systems.)

Cotter (CEO of a leading San Francisco installer) also was surprised about the reliability concerns, given that systems subsidized by CSI are required to have a 10-year all-inclusive warranty.

As with other SolarTech-sponsored projects completed by Sbona Honors students, the full report will be posted to the SolarTech website. Still, the webinar and the slides gave a sense of why several industry professionals found the SJSU student findings surprising and provocative, with important implications for how the industry should move forward in the future. (If anyone’s interested, several of the students are graduating in the spring and available for hire.)

Update: the report and slides are available to SolarTech members on the SolarTech website.

Sunday, March 13, 2011

New insights from SJSU student researchers

During the fall semester, a team of SJSU marketing students from the Sbona Honors Program surveyed Bay Area homeowners about their knowledge of residential solar panels, particularly focusing on their costs and benefits.

After working with SolarTech, their advisor and sponsor concluded that they had identified some important new insights about the challenges faced in winning adoption of solar panel in California.

On Friday, our students will be presenting their findings at a free webinar broadcast by SolarTech. Their written report will also be posted to the SolarTech website after the webinar.