A Touching Story for Veterans Day

November 11th, 2019

Last week, William Wright, a Vietnam Veteran in Northeast Ohio, passed away.  Through the internet and local radio stations, word spread that he had no family.  Over 1,500 people attended his funeral service, a vast majority of whom had never met him.

In an era where the internet is blamed for creating division among Americans and we seemingly cannot agree on anything, this story reminded me that we are still capable of doing good when we unite around a common cause.  

Please click the link below.  The video will bring tears to your eyes.  Rest in Peace, Airman Wright.  Thank you for your service.  Thank you to all of our veterans. 

https://medina-gazette.com/news/178202/even-in-death-no-soldier-left-behind-video/

Career Advice

November 4th, 2019

Last week, we were asked to host a group of students from a local college that are interested in business.  I put together some talking points to share with them.  I have shared similar advice with new hires at I.D. Images.  It has been well received.  Let me know what you think.

Below are some thoughts I put together for our discussion.  Remember, free advice is worth what you pay for it!

  1. You and only you own your career.  Not HR.  Not a parent.  Not a significant other.  You.  Invest in you.
  2. We are taught to think linearly.  Second grade comes after first grade, etc.  Careers aren’t linear.  When I was 23, my long term goal was to own a business.  I took steps to get there.  Those steps weren’t linear.  Think of your career as hiking up or climbing a mountain.  Sometimes you go down before you go up.  Focus on the summit.  Have goals.
  3. The more helpful you are, the more people will want to help you.  Figure out where there are needs and help fill them.
  4. Ask questions.  The worst you’ll hear is no.  Most people want to help and want you to succeed.  Take advantage of their willingness to help.
  5. The axiom, “Showing up is half the battle,” is mostly true.  I would change that statement a little, “Showing up with a positive attitude is more than half the battle.”
  6. Learn your industry.  You don’t need to become an expert in your industry but you have to be knowledgeable.  Subscribe to trade publications.  Talk to industry veterans.  Learning doesn’t end when you leave school. 
  7. Network, network, network. See #3 and 4.  Network within and outside the company.  Network within and outside your industry.  Networking isn’t just connecting on LinkedIn.  Networking isn’t asking for help.  Networking is understanding the other person and figuring how you can help him or her.
  8. Have fun!  Not every day will be fun.  But as a general rule, if I’m having more bad days than good days, I think that’s a sign to change something.  If you are consistently having bad days, change something or let someone know. 
  9. University of Chicago Booth School of Business education summarized in two statements:
    1. Options (meaning choices) are valuable.  Create options for yourself.
    1. CIMITYM.  Cashflow Is More Important Than Your Mother.

Profits Matter

October 28th, 2019

Over the next few weeks, the economy will be at the forefront of the news.  The Federal Reserve meets this week.  Jobs data comes out Friday.  Expect a lot of noise about the US and the world economy. 

As I’ve written, I think the US has already entered a slowdown, certainly on the industrial side.  A slowdown does not mean a recession (classically defined as two consecutive quarters of negative GDP growth) but it could be a precursor to a recession.  If we have a recession, I expect it to be relatively mild, especially compared to 2008 -2009. 

I came across a great chart that is pictured below.  It came from the Daily Shot from the Wall Street Journal.  It is a great resource on all things finance and the economy. 

Corporate profits are falling.  That’s never a good sign.  Despite what some presidential candidates keep saying, profits are a good thing.  Without profits, there is no investment.  That means no new equipment, no raises, no hiring.  Profit is not a dirty word! 

As my statistics professors repeated over and over, “Correlation does not mean causality.”  The decline in profits might not be the cause of a recession but the correlation over time certainly makes me think this is a metric worth paying attention to. 

https://blogs.wsj.com/dailyshot/?mod=djemDailyShot

A Positive Retail Experience Proves the Need for Bricks and Mortar Stores

October 21st, 2019

I often find disappointing customer service experiences to write about.  Given consumers’ obsession with low costs, many traditional retailers have cut training and staff.  Fortunately, Best Buy appears to have invested in service to differentiate itself.  

About a year ago, we bought our son a cover for his phone.  Knowing how a teenage boy operates, we bought him one that had a lifetime warranty.  I remember thinking there’s some catch to the guarantee we had. 

As expected, he dropped his phone for the umpteenth time and the cover broke.  We finally got around to taking him back to Best Buy this past weekend.  We showed them the receipt, which they said they could have looked up, and he had a new phone cover installed in a few minutes.  It was such a positive experience, we looked at televisions.  After explaining what we were trying to do, a helpful customer service rep in the TV department offered a free in-home consultation. The pleasurable experience dealing with an inexpensive phone cover might lead to a large sale of an in-home theater system. 

To state the obvious, online sales are going to continue to grow, especially if companies are willing to subsidize delivery costs.  But “bricks and mortar” retail still has a place.  Returning or replacing items online can be a tortuous process; that’s why the biggest e-tailer in the world bought a retail store chain and has partnerships with others for product pick-ups and product returns.  The best way for traditional retail to compete is to offer great customer service.  As our world becomes increasingly impersonal, there’s a great opportunity for all businesses to create connectivity through world-class service. 

Common Sense Isn’t So Common

October 14th, 2019

I was traveling with my wife recently.  Displaying chivalry, which I rarely do, I grabbed my wife’s backpack as we boarded the plane.  I had a backpack on and placed her backpack on top of my roll on bag.  As I started down the jet way, the gate attendant said, “Sir, I cannot let you board the plane with three bags.  You’re only allowed two.”  The gate attendant saw me take my wife’s bag.  She knew I wasn’t traveling alone and trying to sneak a bag on.  After giving the gate attendant a quizzical look, I handed my wife her backpack, saying nothing.  The gate attendant checked us in.  As soon as we passed her, I placed the backpack back on my roll on bag. 

I don’t know if the gate attendant was having a bad day or just didn’t like me.  Fortunately, I thought the better of making a comment and the situation did not escalate beyond thirty seconds of annoyance. 

I really wish I made stories like this up.  I understand “the rule” that you are only allowed two carry-on bags per person.    A functioning society needs rules.  A functioning society also needs common sense.  Without both, bad things happen. 

The Manufacturing Slowdown is Here

October 7th, 2019

On July 22, I wrote a blog with the title, “Has the Industrial Recession Already Started?”  Freight companies started warning about a slowdown. 

Recent data from the ISM (Institute for Supply Chain Managers) US manufacturing purchasing managers’ index indicates manufacturing contracted in August and September.  These are the lowest readings of this index since June 2009.  Tariffs matter.  When costs go up, people buy less.  While manufacturing is a small part of the overall US economy, do not underestimate how closely tied many service industries are to manufacturing.  Expect the service sector to see a slowdown soon. 

Job creation has slowed.  During the last three months, an average of 145,000 new private sector jobs have been created in the US versus 214,000 per month in the same period last year.  To continue expanding (absorbing new entrants into the workforce, it is estimated the US needs to create 150,000 jobs per month.  Also, job growth statistics have been revised down for two of the last three months.  On a positive note, labor force participation continues to edge up, indicating more people currently outside of the workforce are looking for jobs. 

Bill Belichick, the incredible coach of the New England Patriots has a few sayings I like.  The first is, “I can only go by what I see.”  The numbers are reality.  The economy is slowing.  I don’t expect a protracted or terrible recession, especially compared to 2008 – 2009, but the economy has slowed.  The second “Belichikism” I love is, “Do your job.”  None of us can control the macro economy.  We do have some control over our own micro-economies.  Focus on doing your job and you’ll be fine.

https://www.cnbc.com/2019/10/01/us-manufacturing-economy-contracts-to-worst-level-in-a-decade.html

https://www.wsj.com/articles/u-s-private-sector-added-135-000-jobs-in-september-11570021586?mod=article_inline

Are We Losing the Ability to Connect with Each Other?

September 30th, 2019

On a recent business trip, I stayed at a hotel that was hosting a conference for a large company.  Signs welcomed attendees.  Attendees had badges and shirts that identified they worked for the company.  I got on an elevator with 5 or 6 people wearing the company’s shirts and the conference badges.  Everyone one of them was looking down at his or her phone. There was not a word to be said or even a friendly smile to the others on the elevator. 

Demonstrating my superior diplomatic skills (or as a friend often says, my ability to “stir the pot”), I asked a man next to me where he was from.  He mumbled something that sounded like Seattle.  I asked if all the others on the elevator were from Seattle.  He said, “I don’t know any of these people.”  I responded, quite loudly, “Aren’t you here to meet these people?”  He gave me a dirty look and shrugged his shoulders.  Everyone else pretended to ignore the conversation and bury themselves deeper in their phones.  Our elevator ride ended.  I think two of the people were so glued to their phones that they rode it back up!

I’m sure an HR executive planned team building activities during this conference.  There were probably “trust falls” or some other activity in which an overpaid facilitator creates an environment meant to encourage bonding.  How about banning phones on elevators or in meetings?  That might encourage people to interact and bond with each other.  And it’s free. 

The Real Class Warfare is About to Begin: Non-Government vs. Government Workers

September 23rd, 2019

During the upcoming presidential race, we are going to hear more than ever about inequality and the division it creates in the US.  Virtually every candidate for the Democratic Party presidential nomination has talked about increasing taxes on the “rich” to reduce income and wealth inequality.  A few candidates have even proposed wealth taxes.

I have yet to hear a candidate talk about the real inequality in this country: the benefits and pay government workers earn versus the benefit and pay private sector workers earn.  Ohio is proposing adjusting requirements a government worker must meet to receive full retirement benefits.  A description of the proposed changes is below.

Under the changes under consideration, a new, non law-enforcement hire would have to wait until they’re 62 and have 35 years of service credit before they could retire and receive their full pension benefits. That compares to an equivalent new hire now, who has to work until they’re 55 and have 32 years of service.

https://www.cleveland.com/open/2019/09/ohio-may-cut-benefits-for-future-state-employees-as-part-of-public-pension-fix.html

Today, an employee of the state of Ohio that has worked 32 years and earned $50,000 a year can retire at 55 with a LIFETIME pension of approximately $35,000 per year.  A private sector worker cannot touch his 401k plan at the age of 55 (unless it is a hardship) but if he could, it would require a balance of about $880,000 to create the equivalent pension the government employee will receive.  Considering the average 55 year old has less than $200,000 in a 401k account, I’m pretty sure very few will achieve lifetime income of $35,000 in retirement.  https://www.bankrate.com/retirement/average-401k-balance-by-age/

Many municipalities and states have significantly underfunded pension plans.  I won’t even try to fathom the underfunding of healthcare plans.  These government entities have to raise taxes, cut benefits, or a combination of both.  It’s not going to be pretty when private sector workers finally realize a significant portion of their taxes go to funding retirement benefits of government employees.  That day of reckoning is coming soon. 

A Sign of the Times: Oregon Union Wants to Limit Self-Checkout Machines

September 16th, 2019

Last week, the Oregon AFL-CIO announced it is preparing a ballot initiative to limit the number of self-checkout kiosks allowed in a grocery store.  If the union is successful in gaining enough signatures, the initiative will be placed on the November 2020 ballot. They cleverly named their proposal the “Grocery Store Service and Community Protection Act.”

I encourage you to read the entire text of their proposal.  It starts with,

  1.  Grocery stores provide many people with their primary place of social connection and sense of community. This is particularly true for the elderly.
  2. The increasing use of self-service checkouts – where the customer does not interact with a human — contributes to social isolation and related negative health consequences;
http://oregonvotes.org/irr/2020/041text.pdf
https://www.portlandmercury.com/blogtown/2019/09/04/27091112/proposed-2020-ballot-measure-could-limit-self-checkout-machines

I never associated self-checkouts with negative health consequences.  I think my blood pressure rises when I can’t scan something but I think it rises when a store clerk can’t scan something too.  At least in my case, I think the negative health consequences are no different than in a checkout line.  Maybe I’m the exception. 

Automation disrupts jobs.  That has been occurring since tools were invented.  No legislation will stop that.  Instead of fighting technological advances, the union would better serve its members and the public by developing training programs that teaches skills for today’s workplace environment.  But that doesn’t generate headlines.  Especially in an election year, headlines trump substance. 

(Packaging) Appearances Matter

September 9th, 2019

Given my occupation, I pay attention to packaging.  I watch how items are portrayed in advertisements.  I look at items on store shelves.  I pay attention to how items are shipped.

My wife recently ordered pillows and blankets from a high-end retailer.  The package arrived at our house looking like it was meant to go in the garbage.  I know freight companies are notorious for damaging and then repacking packages.  That was not the case in this situation.  The box and tape identified the retailer and it was clear it was not repackaged.  Whoever filled the order (the retailer or its fulfillment company) tried to put too much stuff in one box.  Fortunately, it was pillows and blankets, so nothing was damaged.  Unfortunately, the retailer is more known for its kitchen wares (figure it out yet?).  Do you think we will order plates or other breakable items from this retailer? 

In most businesses, packaging and shipping are treated as cost centers that need to be minimized.  In the age of e-commerce, they are often the only physical point of contact many customers have with a brand or retailer.  I know the world obsesses over hard dollar costs.  The extra few dollars the box would have cost pales in comparison with the lost sales dollars this retailer just experienced.  I believe the old expression is, “Penny wise and pound foolish.”  That statement defines how most companies treat packaging and shipping.