We were looking for a place to get a coffee the other day, and it occurred to me that the experience we’ve been having over the past few weeks of trying to identify and evaluate the new (to us) companies that are doing business in our new home makes an excellent demonstration of the supply and integration problems a business moving into a new market will experience at roughly the same point. Vendors we’ve used for years without a second thought are not operating here in central Michigan, and regional players we’ve never heard of are filling those niches. For us, this represents a change in where we go to fulfill various needs, and will probably end up changing our purchasing habits, as some products and services we’ve used are not available, and some possibly superior ones are. In either a business or a personal context, this may be for the better – or not…
To take the obvious example, the regional coffee house chain and Starbuck’s competitor called The Coffee Bean and Tea Leaf has never extended operations this far east; instead, the most common alternative you will find is Biggby’s Coffee. We haven’t seen a Foxhollow coffee hut operation, either; our best guess is that since Foxhollow’s business model revolves around the drive-through coffee operation, and most coffee house operations here (including many of the Starbuck’s) already have drive-through windows, there would be no special advantage for Foxhollow to come here (and no special incentive to purchasing a Foxhollow franchise here). Similarly, Peet’s Coffee has a couple of stores in Illinois and Colorado, and six in Massachusetts, but is otherwise located entirely on the West Coast…
Now, I don’t drink enough coffee to make my selection of vendors a major issue, but for some folks not being able to get your morning cup of Peet’s (or Foxhollow) is a critical issue. Imagine, then, if you were trying to open a branch of your business in East Lansing, and one of your most common vendors was not operating anywhere within 200 miles or so. You could have your supplies shipped in from Chicago, or shipped overnight from the West Coast, but either option would add delay time and increased cost to your operation. You could attempt to find a local vendor who could fulfill your needs and hope that your local customers were accept the change (or won’t know any better), but you can’t be sure if this will work. Maybe you should have thought about this before you attempted to enter this new market…
On the other hand, coming to the Upper Midwest we have also found an old friend still operating. In Southern California the Bob’s Big Boy chain is all but extinct, having lost market share to a huge range of newer companies offering informal dining (and hamburgers) to the same market segment. There are only a handful of these operations in Los Angeles County, for example (fewer than half a dozen locations in a county of over 10,000,000 residents), but there are over a hundred of them in Michigan, and we’ve run into more of them just wandering around Greater Lansing than there are in all of L.A. If we had some major use for these operations we’d be in a great new position. Similarly, if a new city contains a huge range of old familiar vendors (many more than in your previous locations) then perhaps this was an ideal area for expansion…
Then there’s the potential for finding new vendor types altogether. Since coming to the Midwest we’ve encountered a large number of casual dining restaurants called Bob Evans. They’re incredibly commonplace to people familiar with the region, but completely new to a pair of Californians. They show some similarity to an IHOP operation, or a Denny’s (both of which are also in this market, albeit in relatively low numbers), but what it most closely resembles is a Cracker Barrel -- something which is also unknown on the West Coast. We’ve already found the Bob Evans chain handy for late breakfasts and light lunches, and very convenient (given their high numbers). When you move into a new market, it’s important to keep an eye out for new suppliers and new applications you can use them for…
Now, if we can just find SOMEWHERE to get a cup of coffee…
Wednesday, July 30, 2008
Sunday, July 27, 2008
The Ethics of Bailouts
Regular readers of this space will remember back in June when I mentioned a bailout package that was expected to pass in Congress, effectively offering $4 billion in aid to people being foreclosed out of their homes. This has now happened; the bill passed today, and the President is expected to sign it quickly now that his domestic policy advisors have found a way to blame the delay on Democratic leadership in Congress stonewalling for six years (even though they’ve only had control of Congress for 19 months at this point). We’ve already covered the ethical issues inherent in the bailout, in the sense that it provides wildcat speculators and unscrupulous lenders with as much relief as it does legitimate homeowners and innocent people hurt by the mortgage crisis. But the current set of legislation brings up an even thornier issue…
As noted in an article posted today by the Associated Press, two of the big winners in this maneuver are going to be Fannie Mae and Freddie Mac, the giant mortgage companies threatened by the ongoing crisis. Instead of having an additional wave of foreclosures wipe out their assets (and stick them with real estate they can never recover their losses on), the new bill will allow millions of borrowers to refinance their loans, in many cases receiving better offerings from the Federal Housing Administration. This will, in turn, save thousands of jobs, calm housing and money markets (foreign and domestic), and prevent additional ripples in the economy. All of this is to the good, but critics of the measure have been pointing out that Fannie and Freddie have made (and continue to make) huge profits when real estate markets are good, and have used their money (and political clout) to resist the sort of government regulation and oversight that would have prevented the mortgage crisis in the first place…
Which brings us to our ethical conundrum: if these companies not only fell victims to a crisis they helped to create (by precipitating the mortgage crisis with sub-prime loans) but also helped to undermine, prevent or destroy the Federal regulations that would have prevented the crisis in the first place (with lobbying and other political maneuvering), does the government now have an ethical responsibility to bail them out of their own folly? Even granted that the over-all effects will serve the short-term interests of the country, is it worth the potential long-term risks of large companies doing asinine things, blithely certain that if they manage to create an international financial crisis, the U.S. government will jump in and bail them out?
The problem with most preventative measures is that while the potential risk of harm in the future is not known, the definite harm of spending large amounts of money in the future to prevent that risk IS known. Thus, many people will choose to gamble on a future disaster not happening so that they can spend money on other things in the present. If our government routinely steps in to prevent those disasters from ever coming home to roost, then why should any business venture spent its own money in the present to prevent a potential crisis in the first place?
Of course, the concrete side of this issue is that the bill in question will prevent thousands of people from losing their jobs, millions of people from losing their houses, and (at least potentially) all of the rest of us from having the current recession get even worse. The question is, if the people who caused this mess effectively dug their own pit and willfully jumped into it, do we have an ethical responsibility to make sure they don’t do it again? Or should we just take care of all of the ordinary people threatened by the crisis and not worry about the future?
It’s worth thinking about…
As noted in an article posted today by the Associated Press, two of the big winners in this maneuver are going to be Fannie Mae and Freddie Mac, the giant mortgage companies threatened by the ongoing crisis. Instead of having an additional wave of foreclosures wipe out their assets (and stick them with real estate they can never recover their losses on), the new bill will allow millions of borrowers to refinance their loans, in many cases receiving better offerings from the Federal Housing Administration. This will, in turn, save thousands of jobs, calm housing and money markets (foreign and domestic), and prevent additional ripples in the economy. All of this is to the good, but critics of the measure have been pointing out that Fannie and Freddie have made (and continue to make) huge profits when real estate markets are good, and have used their money (and political clout) to resist the sort of government regulation and oversight that would have prevented the mortgage crisis in the first place…
Which brings us to our ethical conundrum: if these companies not only fell victims to a crisis they helped to create (by precipitating the mortgage crisis with sub-prime loans) but also helped to undermine, prevent or destroy the Federal regulations that would have prevented the crisis in the first place (with lobbying and other political maneuvering), does the government now have an ethical responsibility to bail them out of their own folly? Even granted that the over-all effects will serve the short-term interests of the country, is it worth the potential long-term risks of large companies doing asinine things, blithely certain that if they manage to create an international financial crisis, the U.S. government will jump in and bail them out?
The problem with most preventative measures is that while the potential risk of harm in the future is not known, the definite harm of spending large amounts of money in the future to prevent that risk IS known. Thus, many people will choose to gamble on a future disaster not happening so that they can spend money on other things in the present. If our government routinely steps in to prevent those disasters from ever coming home to roost, then why should any business venture spent its own money in the present to prevent a potential crisis in the first place?
Of course, the concrete side of this issue is that the bill in question will prevent thousands of people from losing their jobs, millions of people from losing their houses, and (at least potentially) all of the rest of us from having the current recession get even worse. The question is, if the people who caused this mess effectively dug their own pit and willfully jumped into it, do we have an ethical responsibility to make sure they don’t do it again? Or should we just take care of all of the ordinary people threatened by the crisis and not worry about the future?
It’s worth thinking about…
Saturday, July 26, 2008
Sometimes You’re the Windshield…
It’s worth pointing out that sometimes, there’s just not much you can do about the problems your business is going to encounter. Sometimes, there’s just going to be a stoned screech owl nesting in your Christmas tree, or some state law that hasn’t been enforced since 1793 that outlaws your new business operation from accepting any money for your services, or some evil genius who has just inserted a “wizard” subroutine into some Microsoft product that will render your entire industry obsolete. And sometimes, it’s going to be turkey vultures…
A story being reported this week in the a Milwaukee Journal Sentinel tells the story of the Orthopedic Hospital of Wisconsin, which has had the unusual experience of having at least three nesting pairs of turkey vultures take up residence on the ledges and windowsills of the building. It’s bad enough to drive up to a hospital in which you are going to receive treatment and see a flock of vultures circling overhead, but apparently some of the patients have been complaining about waking up in the morning (or worse yet, after surgery) and finding a vulture perched on their windowsill…
Now, it’s important to realize that vultures are not known to pose any threat to human life whatsoever; they only eat things that are already dead, and have never been known to even approach a live human. Turkey vultures don’t even carry any forms of disease that could be transferred to a human host; despite their rather demonic appearance (red, wrinkled bald heads, black feathers, impressive beaks and talons, and beady red eyes) these birds could not possibly harm anyone at the hospital. It’s also worth noting that it’s an orthopedic hospital; most of the people there are going to be receiving treatments that have an almost zero chance of a fatal outcome. Still and all, there are probably going to be those people who will panic and run home upon seeing one of these birds. Or at least take their business somewhere else…
In the study of Institutional Failure, which is a specialty under the discipline of Strategic Management, all negative events that can impact your business are considered to have a greater or lesser degree of predictability; that is, some things (like a competitor inventing an alternative product or just reverse-engineering yours) are fairly predictable, while others (like a scientific breakthrough that eliminates your entire industry) are rather less so. Exactly how one goes about determining how likely a specific event is to happen makes up a large part of the studies I am starting on, and I won’t weary the reader with the details here. I’ll just note that a major factor in the survival of any business is how well you can anticipate the threats to your business – and which ones you develop plans to deal with…
Some events are so unlikely as to be not worth bothering about; events planned for Los Angeles in August are not going to be snowed out, for example, nor is your new aircraft design likely to be endangered by an unprecedented marine sponge migration. There have been any number of “Winter Festival” events that have been spoiled by unusually warm (or, at least, snow-free) winters over the years, however, and the second B-1 bomber prototype was destroyed by a flock of snow geese making a completely unprecedented migratory flight in the middle of the summer, to take only the obvious example. There is also the case of a well-know lawnmower company that almost went under because they attempted to introduce a line of snow blowers during a run of unusually warm winters...
In my working life as a manager and a management consultant I have done a lot of strategic planning, and I am always amazed by how many people spend their time and effort worrying about the trivial, the bizarre, and the completely unlikely, while losing track of things that can actually do them in. If your hospital provides the best care available for orthopedic patients, people are going to come there no matter what is perching on the windowsills, and if it is possible for bird strikes to disable your airplane, you must take into account that sooner or later, someone is going to fly it into a flock of birds. But sitting around and whining about things is not going to help much with either problem. Just keep in mind that in business, as in any other aspect of life, some days you’re the windshield, and some days, you’re the bug…
A story being reported this week in the a Milwaukee Journal Sentinel tells the story of the Orthopedic Hospital of Wisconsin, which has had the unusual experience of having at least three nesting pairs of turkey vultures take up residence on the ledges and windowsills of the building. It’s bad enough to drive up to a hospital in which you are going to receive treatment and see a flock of vultures circling overhead, but apparently some of the patients have been complaining about waking up in the morning (or worse yet, after surgery) and finding a vulture perched on their windowsill…
Now, it’s important to realize that vultures are not known to pose any threat to human life whatsoever; they only eat things that are already dead, and have never been known to even approach a live human. Turkey vultures don’t even carry any forms of disease that could be transferred to a human host; despite their rather demonic appearance (red, wrinkled bald heads, black feathers, impressive beaks and talons, and beady red eyes) these birds could not possibly harm anyone at the hospital. It’s also worth noting that it’s an orthopedic hospital; most of the people there are going to be receiving treatments that have an almost zero chance of a fatal outcome. Still and all, there are probably going to be those people who will panic and run home upon seeing one of these birds. Or at least take their business somewhere else…
In the study of Institutional Failure, which is a specialty under the discipline of Strategic Management, all negative events that can impact your business are considered to have a greater or lesser degree of predictability; that is, some things (like a competitor inventing an alternative product or just reverse-engineering yours) are fairly predictable, while others (like a scientific breakthrough that eliminates your entire industry) are rather less so. Exactly how one goes about determining how likely a specific event is to happen makes up a large part of the studies I am starting on, and I won’t weary the reader with the details here. I’ll just note that a major factor in the survival of any business is how well you can anticipate the threats to your business – and which ones you develop plans to deal with…
Some events are so unlikely as to be not worth bothering about; events planned for Los Angeles in August are not going to be snowed out, for example, nor is your new aircraft design likely to be endangered by an unprecedented marine sponge migration. There have been any number of “Winter Festival” events that have been spoiled by unusually warm (or, at least, snow-free) winters over the years, however, and the second B-1 bomber prototype was destroyed by a flock of snow geese making a completely unprecedented migratory flight in the middle of the summer, to take only the obvious example. There is also the case of a well-know lawnmower company that almost went under because they attempted to introduce a line of snow blowers during a run of unusually warm winters...
In my working life as a manager and a management consultant I have done a lot of strategic planning, and I am always amazed by how many people spend their time and effort worrying about the trivial, the bizarre, and the completely unlikely, while losing track of things that can actually do them in. If your hospital provides the best care available for orthopedic patients, people are going to come there no matter what is perching on the windowsills, and if it is possible for bird strikes to disable your airplane, you must take into account that sooner or later, someone is going to fly it into a flock of birds. But sitting around and whining about things is not going to help much with either problem. Just keep in mind that in business, as in any other aspect of life, some days you’re the windshield, and some days, you’re the bug…
Friday, July 25, 2008
Meanwhile, back in the Public Sector…
If you spend enough time reading, writing and learning about business, you’re going to encounter a lot of really stupid ideas coming from the Private Sector. You’ll see things like the mortgage industry “adjusting” the rates on a whole bunch of adjustable rate mortgages at bad moments, resulting in a huge number of foreclosures that need never have happened, personal bankruptcies, failed lending institutions and a general increase in our current economic crisis, all because these lenders could not be bothered to consider if the small increase in income they would get by “adjusting” the interest rates would be worth the potential risk. You’ll encounter half-baked business promotions like selling pizzas for 23 cents and not being ready for hoards of people showing up, resulting in riots. You’ll hear accounts of customer service personnel who are not only stupid enough to continue mispronouncing the customer’s name after being corrected three times, but are also stupid enough to then question if they are actually talking to the customer himself…
You will even find documented cases of companies (not just individuals, but actual corporations) playing “practical jokes” on paying customers…
But as bad as all of these stories (and three dozen others that you can review by selecting the tag for “Stupidity” at the bottom of this post) are, there are cases in the public sector each year that are at least as bad, if not worse. Take, for example, the case being reported this week by The Edmonton Sun website, about a performance artist who received a grant for $55,000 from the Canada Council for the Arts (the Canadian equivalent of the National Endowment for the Arts in the U.S.) to build a 300-meter inflatable yellow banana and place it into geostationary orbit over Texas…
Needless to say, a project like this would cost a lot more than $55,000; about $1 million more, in fact, when the cost of lifting the banana into Earth orbit and then inflating it is included. The artist claimed to have failed in his attempts to raise the rest of the money, and announced that therefore there would be no orbital banana. But since CCA policy does not require the grant recipient to actually produce anything, there is no obligation on the “artist” to return the grant money. As far as I can tell, he has produced nothing except a project proposal and a press release, and walked off with the money…
You have got to wonder what, exactly, the granting agency was thinking on this one. In the U.S. the NEA is fairly loose with its money; so long as the work (or in this case, installation) produced is vaguely artistic and bears even a nodding relationship to the work described in the proposal, they’ll probably be okay with it. And they don’t seem to be all that picky about what constitutes something “artistic,” either; I call to mind projects using human waste products as art supplies that were both approved for grant money and enthusiastically received. But even under an NEA grant, you still have to actually produce SOMETHING more than a press release…
Now, I understand the importance of fostering an artistic community, promoting the creative and conceptual freedom to pursue non-traditional art forms, and supporting free thought. I will even, for the sake of argument, accept that art projects that appear completely absurd to a layman like me might have some artistic merit under some strange definition that includes human waste products as anything anybody would ever want to see. But if we’ve reached the point where explaining your idea for an art project but not actually doing one is worth $55,000 to an otherwise rational government agency, then it’s time I dusted off my proposal that the NEA pay me $55,000 to jump around a major metropolitan area pelting randomly selected people with chunks of rump steak and yelling “Ya-HA! Ya-HA!”
Or, I suppose, I could just ask the Canadians to support my project…
You will even find documented cases of companies (not just individuals, but actual corporations) playing “practical jokes” on paying customers…
But as bad as all of these stories (and three dozen others that you can review by selecting the tag for “Stupidity” at the bottom of this post) are, there are cases in the public sector each year that are at least as bad, if not worse. Take, for example, the case being reported this week by The Edmonton Sun website, about a performance artist who received a grant for $55,000 from the Canada Council for the Arts (the Canadian equivalent of the National Endowment for the Arts in the U.S.) to build a 300-meter inflatable yellow banana and place it into geostationary orbit over Texas…
Needless to say, a project like this would cost a lot more than $55,000; about $1 million more, in fact, when the cost of lifting the banana into Earth orbit and then inflating it is included. The artist claimed to have failed in his attempts to raise the rest of the money, and announced that therefore there would be no orbital banana. But since CCA policy does not require the grant recipient to actually produce anything, there is no obligation on the “artist” to return the grant money. As far as I can tell, he has produced nothing except a project proposal and a press release, and walked off with the money…
You have got to wonder what, exactly, the granting agency was thinking on this one. In the U.S. the NEA is fairly loose with its money; so long as the work (or in this case, installation) produced is vaguely artistic and bears even a nodding relationship to the work described in the proposal, they’ll probably be okay with it. And they don’t seem to be all that picky about what constitutes something “artistic,” either; I call to mind projects using human waste products as art supplies that were both approved for grant money and enthusiastically received. But even under an NEA grant, you still have to actually produce SOMETHING more than a press release…
Now, I understand the importance of fostering an artistic community, promoting the creative and conceptual freedom to pursue non-traditional art forms, and supporting free thought. I will even, for the sake of argument, accept that art projects that appear completely absurd to a layman like me might have some artistic merit under some strange definition that includes human waste products as anything anybody would ever want to see. But if we’ve reached the point where explaining your idea for an art project but not actually doing one is worth $55,000 to an otherwise rational government agency, then it’s time I dusted off my proposal that the NEA pay me $55,000 to jump around a major metropolitan area pelting randomly selected people with chunks of rump steak and yelling “Ya-HA! Ya-HA!”
Or, I suppose, I could just ask the Canadians to support my project…
Wednesday, July 23, 2008
Just Another Day
We bought a house today. It sounds so simple, doesn’t it? Like you walked into a shop, browsed through a couple of aisles, found something you liked, and whipped out your credit card. Actually, considering that we’ve only been in this State for a bit less than two weeks, it probably does look that simple, at least from the outside. But the fact is, our current home-buying venture was so front-loaded that it’s a wonder the whole thing didn’t tip forward onto its metaphorical face, and it serves as an excellent example of how doing something with style, precision and speed is usually just a matter of really good preparation…
And of selecting the right business partners, of course. In this particular case, I can’t take a lot of credit for the fact that 13 days into our time in Michigan we’ve already selected, made an offer on, inspected, agreed to terms and conditions, and closed escrow on a house; most of the heavy lifting was the work of two (or four) other people. First, of course, was our wonderful California-based Realtor team, Steve Smith and Martha Alonzo, who not only sold our house in Redondo Beach in a market where nothing seems to be selling, but also vetted Realtors here in Central Michigan to find us someone truly exceptional…
Second, Karen Fisher-Austin, our local Realtor (who is, in fact, truly exceptional), started sending us property listings two months ago, including pictures, comparable property information, and virtual tours. Starting with this small mountain of data, Angie and I spent several weeks pouring over the property listings for East Lansing, as well as looking around the neighborhood and surrounding areas on Google Earth and other sites. As a result, we arrived in town already knowing the dozen or so properties we wanted to visit, and were able to select one in just four days…
Most of the credit for our success has to go to my wife, who put her amazing abilities as a manager and administrator to work on this project, starting with the initial contact phone calls back in Redondo and following through to getting all of our documents together at the end of the close meeting today. Now I suppose I could ask for some credit in having the impulse that led to our meeting Martha, the gall to ask our California realty team for help finding an agent in the upper Midwest, or the good sense to have married somebody this amazing in the first place, but the fact is I’d have done all of it anyway; I’m just lucky that my emotional choices have worked out in so many other dimensions…
It has often been said that it’s better to be lucky than good, and goodness knows I’ve proven the truth of that more than once. But it is also commonly remarked that we make our own luck, and while it might look like in this case we were lucky to blow into town and fall directly into what we were looking for, the truth is that Angie and I have spent long days, difficult nights, and a week on the road getting to this place, and none of the things we’ve done are anything that another home buyer or seller (or pair of them, anyway) couldn’t have done…
Now, I’m not going to tell you that selling a house in a declining market like Los Angeles is easy; or that packing up a large house, arranging movers, contacting an agent in your new city, learning the terrain, finding a new home, purchasing a house, or moving in are necessarily easy. I am saying that even a task as complex, arbitrary and emotionally difficult as moving to a new city can be done with speed, efficiency, and style – provided you also have a good plan and the right people to help. If you need a good Realtor in LA or East Lansing I can refer you to one, and if you need a good plan, I can probably help walk you through the process. But if you need a partner as good as mine, you’re going to have to get your own…
And of selecting the right business partners, of course. In this particular case, I can’t take a lot of credit for the fact that 13 days into our time in Michigan we’ve already selected, made an offer on, inspected, agreed to terms and conditions, and closed escrow on a house; most of the heavy lifting was the work of two (or four) other people. First, of course, was our wonderful California-based Realtor team, Steve Smith and Martha Alonzo, who not only sold our house in Redondo Beach in a market where nothing seems to be selling, but also vetted Realtors here in Central Michigan to find us someone truly exceptional…
Second, Karen Fisher-Austin, our local Realtor (who is, in fact, truly exceptional), started sending us property listings two months ago, including pictures, comparable property information, and virtual tours. Starting with this small mountain of data, Angie and I spent several weeks pouring over the property listings for East Lansing, as well as looking around the neighborhood and surrounding areas on Google Earth and other sites. As a result, we arrived in town already knowing the dozen or so properties we wanted to visit, and were able to select one in just four days…
Most of the credit for our success has to go to my wife, who put her amazing abilities as a manager and administrator to work on this project, starting with the initial contact phone calls back in Redondo and following through to getting all of our documents together at the end of the close meeting today. Now I suppose I could ask for some credit in having the impulse that led to our meeting Martha, the gall to ask our California realty team for help finding an agent in the upper Midwest, or the good sense to have married somebody this amazing in the first place, but the fact is I’d have done all of it anyway; I’m just lucky that my emotional choices have worked out in so many other dimensions…
It has often been said that it’s better to be lucky than good, and goodness knows I’ve proven the truth of that more than once. But it is also commonly remarked that we make our own luck, and while it might look like in this case we were lucky to blow into town and fall directly into what we were looking for, the truth is that Angie and I have spent long days, difficult nights, and a week on the road getting to this place, and none of the things we’ve done are anything that another home buyer or seller (or pair of them, anyway) couldn’t have done…
Now, I’m not going to tell you that selling a house in a declining market like Los Angeles is easy; or that packing up a large house, arranging movers, contacting an agent in your new city, learning the terrain, finding a new home, purchasing a house, or moving in are necessarily easy. I am saying that even a task as complex, arbitrary and emotionally difficult as moving to a new city can be done with speed, efficiency, and style – provided you also have a good plan and the right people to help. If you need a good Realtor in LA or East Lansing I can refer you to one, and if you need a good plan, I can probably help walk you through the process. But if you need a partner as good as mine, you’re going to have to get your own…
Tuesday, July 22, 2008
Some Simple Ideas
We are still adjusting to our new surroundings in Michigan, and as a result we have been wandering around looking into businesses both new and familiar. Most of the national chain companies you would expect to find anywhere have already colonized Michigan, but the regional businesses one would expect to see in the Southwest are absent here, and not all of the same niches are being filled. The business climate of the upper Midwest seems to be different from any of the other regions I have visited, and even some of the familiar companies are doing things differently here. I have already noted several relatively simple concepts that are unheard of in Los Angeles, and yet appear to have great potential, especially in this environment…
Take, for example, the sandwich company known as Jimmy Johns. They appear to have franchised operations running in about 35 states, including California, but have not reached the West Coast cities yet. It’s a fast-food sandwich company that would compete for market share with Subway, Quiznos, or Blimpie. But where the competition has attempted to widen their product line, offering salads, soups, wraps, hot/toasted sandwiches, cookies, and other products, Jimmy John’s appears to have narrowed their focus to just making sandwiches (and chips and drinks, of course). Instead of offering a wider range of food products, the company concentrates on speed and high-quality ingredients. As a result, their production time is faster than any of the competition, and the limited number of traditional sandwiches they do offer taste better than any of the competing products…
Now, this is hardly an advanced, high-tech concept. The company has effectively abandoned those segments of the lunch market that want salads, wraps, soups and the like to their competition, and is instead offering a lunch service so fast that anyone should be able to make use of it, and food that is generally superior to the competition’s equivalent. If you are looking for any of those other food products you would probably not select this chain, but if you just want a simple turkey sub, for example, I can’t imagine why you would go anywhere else – especially on a short lunch break. It’s unusual to see a company electing to emphasize both speed and quality in their business model, but within this context it works very well – and it’s worth noting that the Jimmy John’s we visited was also cheaper than the competition (presumably because of the simpler equipment and supply requirements)…
The other new idea we encountered last week was even simpler: a large, empty room with seating for about thirty or forty people around several large tables. What makes this a business concept is that the room is located in the basement of the Barnes and Noble location just off campus in East Lansing, and signed “Spartan Reading Room.” It’s a study center, ostensibly for students from the giant university across the street (Michigan State’s athletic teams are called the “Spartans,” and therefore so are all those who attend the school), but actually open to anyone who wants to come down there and quietly read or study. It’s probably not much of a draw during the summer, when school is out and the town’s population has dropped by more than half. But I’ll bet you can’t get a seat down there during finals week each semester, and it’s probably a hugely popular location any time the library is crowded or the weather is bad – which is going to be fairly often…
Now, I realize that both of these are relatively simple concepts, and may not be anything that your business can make use of. But they do beg the question: what simple innovations could YOU come up with, if you thought about it? In both cases, we’re talking about simple ideas that do not cost the company anything to provide (in the first case they actually lower operations costs), but offer increased value to the customer. It’s an idea worth thinking about…
Take, for example, the sandwich company known as Jimmy Johns. They appear to have franchised operations running in about 35 states, including California, but have not reached the West Coast cities yet. It’s a fast-food sandwich company that would compete for market share with Subway, Quiznos, or Blimpie. But where the competition has attempted to widen their product line, offering salads, soups, wraps, hot/toasted sandwiches, cookies, and other products, Jimmy John’s appears to have narrowed their focus to just making sandwiches (and chips and drinks, of course). Instead of offering a wider range of food products, the company concentrates on speed and high-quality ingredients. As a result, their production time is faster than any of the competition, and the limited number of traditional sandwiches they do offer taste better than any of the competing products…
Now, this is hardly an advanced, high-tech concept. The company has effectively abandoned those segments of the lunch market that want salads, wraps, soups and the like to their competition, and is instead offering a lunch service so fast that anyone should be able to make use of it, and food that is generally superior to the competition’s equivalent. If you are looking for any of those other food products you would probably not select this chain, but if you just want a simple turkey sub, for example, I can’t imagine why you would go anywhere else – especially on a short lunch break. It’s unusual to see a company electing to emphasize both speed and quality in their business model, but within this context it works very well – and it’s worth noting that the Jimmy John’s we visited was also cheaper than the competition (presumably because of the simpler equipment and supply requirements)…
The other new idea we encountered last week was even simpler: a large, empty room with seating for about thirty or forty people around several large tables. What makes this a business concept is that the room is located in the basement of the Barnes and Noble location just off campus in East Lansing, and signed “Spartan Reading Room.” It’s a study center, ostensibly for students from the giant university across the street (Michigan State’s athletic teams are called the “Spartans,” and therefore so are all those who attend the school), but actually open to anyone who wants to come down there and quietly read or study. It’s probably not much of a draw during the summer, when school is out and the town’s population has dropped by more than half. But I’ll bet you can’t get a seat down there during finals week each semester, and it’s probably a hugely popular location any time the library is crowded or the weather is bad – which is going to be fairly often…
Now, I realize that both of these are relatively simple concepts, and may not be anything that your business can make use of. But they do beg the question: what simple innovations could YOU come up with, if you thought about it? In both cases, we’re talking about simple ideas that do not cost the company anything to provide (in the first case they actually lower operations costs), but offer increased value to the customer. It’s an idea worth thinking about…
Saturday, July 19, 2008
Public Remarks
Suppose for a moment that you had been arrested, tried, and ultimately convicted for driving while under the influence, and were awaiting sentencing for this crime. If the court is satisfied that you are properly contrite and will never take such a stupid, risky action again, there’s a good chance that you might be let off with two years probation and a suspended license; you would almost certainly avoid any serious jail time. On the other hand, if the court believes that you are not sorry for what you’ve done or even that you are not taking the proceedings seriously enough, you could easily receive two years in prison. If that were the case, would you post pictures of yourself partying and drinking, possibly dressed up in costume as a prisoner, in a public place? Where anybody, including the judge and the prosecutor, could see you behaving like an unrepentant alcoholic idiot?
There was a very interesting article being reported on the Associated Press wire today about a series of cases in which the defendants did just that. Of course, the public place in all of these cases wasn’t a bulletin board at the supermarket, or a classified ad in the local paper. Rather, these people placed these possibly damaging photographs of themselves on the Internet networking sites, Facebook and MySpace. In all of the cases referenced, the intent was innocent enough: the pictures weren’t compromising or pornographic; the people in them weren’t doing anything more illegal than under-age drinking (and generally not even that). These were just people sharing pictures of themselves with family and friends; they clearly didn’t expect to have anyone beyond that small circle of acquaintance see these pictures. But they forgot one of the most important properties of the Internet…
When you post information, including pictures, to any public web site, you have to assume that anyone who really wants to can access that information, and that not all of those who do are going to mean well toward you. Posting pictures of yourself behaving in anything other than a properly contrite and penitent manner while you are awaiting sentencing for a crime is completely idiotic; refusing to take down such pictures after being advised to do so by your attorney is so far beyond asinine that I can’t even think of a bad metaphor to explain how stupid it is. These pictures had no bearing on the guilt or innocence of the people who posted them, and should not have affected the sentence they were given, but a factor that goes into any sentencing is the court’s opinion of the defendant, and these people had done the cyber equivalent of misbehaving on the courthouse lawn the night before that opinion was reached…
Now, I’m not suggesting that any of you would do anything this stupid, particularly in a business context; no one out there is likely to post damaging information about their companies, their personnel or themselves on a public website. I’m just pointing out that regardless of whether or not there should be a presumption of privacy on the Internet, there generally isn’t one – and any website that you can specifically use to share information with other people can not have one. If your business depends on presenting any sort of professional image, you must assume that images or video of yourself that contradict that image can damage your business, and that anything you post to the Internet can return to cause you trouble in the future. Networking sites are only the latest and lowest denominator of the problem; anything you make available to the public in this fashion will remain in play indefinitely…
In the long run, all you can do is put the company’s best foot forward and hope for the best. If your employees are professional and contentious, you should be able to afford the worst of these problems. Just remind them to take down their party pictures before their court date comes up…
There was a very interesting article being reported on the Associated Press wire today about a series of cases in which the defendants did just that. Of course, the public place in all of these cases wasn’t a bulletin board at the supermarket, or a classified ad in the local paper. Rather, these people placed these possibly damaging photographs of themselves on the Internet networking sites, Facebook and MySpace. In all of the cases referenced, the intent was innocent enough: the pictures weren’t compromising or pornographic; the people in them weren’t doing anything more illegal than under-age drinking (and generally not even that). These were just people sharing pictures of themselves with family and friends; they clearly didn’t expect to have anyone beyond that small circle of acquaintance see these pictures. But they forgot one of the most important properties of the Internet…
When you post information, including pictures, to any public web site, you have to assume that anyone who really wants to can access that information, and that not all of those who do are going to mean well toward you. Posting pictures of yourself behaving in anything other than a properly contrite and penitent manner while you are awaiting sentencing for a crime is completely idiotic; refusing to take down such pictures after being advised to do so by your attorney is so far beyond asinine that I can’t even think of a bad metaphor to explain how stupid it is. These pictures had no bearing on the guilt or innocence of the people who posted them, and should not have affected the sentence they were given, but a factor that goes into any sentencing is the court’s opinion of the defendant, and these people had done the cyber equivalent of misbehaving on the courthouse lawn the night before that opinion was reached…
Now, I’m not suggesting that any of you would do anything this stupid, particularly in a business context; no one out there is likely to post damaging information about their companies, their personnel or themselves on a public website. I’m just pointing out that regardless of whether or not there should be a presumption of privacy on the Internet, there generally isn’t one – and any website that you can specifically use to share information with other people can not have one. If your business depends on presenting any sort of professional image, you must assume that images or video of yourself that contradict that image can damage your business, and that anything you post to the Internet can return to cause you trouble in the future. Networking sites are only the latest and lowest denominator of the problem; anything you make available to the public in this fashion will remain in play indefinitely…
In the long run, all you can do is put the company’s best foot forward and hope for the best. If your employees are professional and contentious, you should be able to afford the worst of these problems. Just remind them to take down their party pictures before their court date comes up…
Subscribe to:
Posts (Atom)
