Frequently, I read or see something that infests my thoughts and shades my observations for days, or weeks – or life! Those things often find their way into my writing.
Since Saturday it is and has been: Club Sandwiches!
I’ve previously mentioned Tyler Brûlè – the talented editor of Monocle, and his column in the Financial Times. He is always though-provoking, but last Saturday (Come on hotels, use your loaf, - linked to the right of this commentary) Mr. Brûlè introduced a “yardstick” for determining the performance level of a hotel based upon their execution of the Club Sandwich.
Why? Because it is one of those small and simple things, and if they can’t get the seemingly trivial and allegedly easy right, the rest isn’t going to be any better – at least not consistently or long.
Since I am not an hotelier, this led me to ponder the identity and nature of the “club sandwich” in my own business and life. While I ask myself searching questions spurred by the Mr. Brûlé’s comments, I offer them to you too:
“What is the ‘club sandwich’ (i.e. basic, seemingly trivial, and supposedly easy) in my service, industry or business?”
“How consistently well are we making and delivering those ‘club sandwiches?”
“How is the value of that ‘club sandwich’ perceived by our ‘diners’?”
“Where are the gaps?”
“What must I do to close those gaps?” (And please Lon, don’t simply answer, “Employee Training” or “Process Improvement!”)
Effective Next Steps
Last evening, while chairing a board meeting for a mid-sized Utah credit union, and receiving reports from our excellent, but somewhat insulated, senior staff, I was reminded just how difficult receiving and using feedback can be for an organization unused to seeking, receiving and acting on it.
Something I now see as universal in our human nature bristles at criticism or even suggestions. This defensive mechanism often stops us from formulating truly effective next steps.
Often, the feedback received does not fit our own experience. Too often, the anecdotal experiences of one can nullify data that conflicts with it. This can be especially pervasive among senior leaders in an organization.
We may understand that our executives are not the target demographic – or even a customer of a firm, but they often become a “focus–group of one” that overpowers customer complaint data.
Once you have figured out what your club sandwich is, and while you are ordering, tasting and critiquing that experience, remember your experience is no substitute for the feedback of your customer.
Base your next steps on customer perceptions and not on your own very singular (and perhaps “special”) experience.
That is unless, of course, you are planning to buy and eat each and every club sandwich yourself. Otherwise, your opinion should carry no more weight than one data point on the overall plot.
And perhaps, for a lot of possible reasons, you are the outlier.
Wednesday, December 17, 2008
Friday, December 12, 2008
Well said Carly!
Carly Fiorina missed her calling. While clearly a failure as Chairman/CEO at HP – she has shown real insight in her observation and writing on business and the economy. Today, she does a nice job with a WSJ Opinion, titled: Corporate Leadership and the Crisis. (This page includes a link to the right but a subscription is required.)
Reading the whole article is more than worth the effort, but please allow me to share a few quotes and thoughts:
“To earn a bailout, a CEO and board should be held accountable for the decisions they’ve made – or perhaps the actions they’ve failed to take.” Mr. Wagoner, that means you don’t get to show up in Washington peddling the Credit Crisis as THE GM-Killer and try to tie it to your poor performance as CEO since June 2000!
Further, Carly writes, “Employees bet on a company when they show up at work. Shareholders bet when they put their money to work. Customers bet when they buy a product. And now we’re asking taxpayers to bet.” She then goes on to make an outstanding case for full corporate-reporting transparency. Here are the beginnings of a superb next book.
Ms. Fiorina also nails that oft touted but never mitigated scapegoat: short-term earnings tyranny. “Quarterly earnings and share price cannot be the singular purpose of business or metric of success for CEOs.”
She goes on to fill in the blanks on what to do to mitigate it the despotism of the shareholder – one stakeholder in the modern corporation - at the expense of all the others. Most commentators’ leave this scapegoat dangling, expecting it to somehow fix itself because they identified it.
For all the spending, our government, banking and business leaders continue to miss (and therefore have no answer for) the biggest reason this years Holiday Season will be a consumer spending bust. The tyranny of short-term earnings, that is: shareholder expectations of continual growth and need for constant profitability added to limited cash-flow; has or will drive vast lay-off activity.
Layoffs bring earnings contraction to those laid off and economic uncertainty to those who are afraid they will be the other shoe that drops. Said simply – consumers either have no money to buy stuff, or they are afraid they will have no money to buy stuff – so they don’t buy stuff.
Lay-offs and future lay-offs may well be a larger force driving the length and depth of the recession than continued lending contraction.
Don’t misunderstand, I’m not advocating business become a massive welfare program, continuing to employee myriads for whom they cannot actually provide work now or in the future. Everyone with an MBA (isn’t that most of America these days?) knows that a lean organization will be well-poised to come out of the gates when growth returns.
For once I’d just like to see business be able to hang on to some of the “institutional knowledge” they so often cut in lean times. If so, we may not see the negative effects of whip-saw hire and lay-off cycles.
Government may have to stop taking shares in every bank or unprofitable auto company and provide assistance on this front. Frankly, if businesses with a real future could have needed capital infusions, or borrow on their closed or rapidly closing lines of credit, it may not be necessary to talk about incentives to keep staff. All of that may depend upon just how deep we get in the next six months or so.
My recommendation to CEOs would be: If you believe your post-recession capacity will be X then if you can, remain staffed to support X, find marketing solutions to help get to X more quickly than your competitors, and do not cut spending beyond X now.
You’ll not only be poised to get to X, you will also not have to spend future profits on expensive talent searches, new hire training, and on the repair of the damage new employees do to long-term customers. You may also earn a little future devotion from those on staff today who will know you stuck with them.
Perhaps the next Treasury Chief will have some sense of how to make this happen so we get back to business soon.
Ah, forgive me, it must be the Christmas Season – I just keep on dreaming!
Reading the whole article is more than worth the effort, but please allow me to share a few quotes and thoughts:
“To earn a bailout, a CEO and board should be held accountable for the decisions they’ve made – or perhaps the actions they’ve failed to take.” Mr. Wagoner, that means you don’t get to show up in Washington peddling the Credit Crisis as THE GM-Killer and try to tie it to your poor performance as CEO since June 2000!
Further, Carly writes, “Employees bet on a company when they show up at work. Shareholders bet when they put their money to work. Customers bet when they buy a product. And now we’re asking taxpayers to bet.” She then goes on to make an outstanding case for full corporate-reporting transparency. Here are the beginnings of a superb next book.
Ms. Fiorina also nails that oft touted but never mitigated scapegoat: short-term earnings tyranny. “Quarterly earnings and share price cannot be the singular purpose of business or metric of success for CEOs.”
She goes on to fill in the blanks on what to do to mitigate it the despotism of the shareholder – one stakeholder in the modern corporation - at the expense of all the others. Most commentators’ leave this scapegoat dangling, expecting it to somehow fix itself because they identified it.
For all the spending, our government, banking and business leaders continue to miss (and therefore have no answer for) the biggest reason this years Holiday Season will be a consumer spending bust. The tyranny of short-term earnings, that is: shareholder expectations of continual growth and need for constant profitability added to limited cash-flow; has or will drive vast lay-off activity.
Layoffs bring earnings contraction to those laid off and economic uncertainty to those who are afraid they will be the other shoe that drops. Said simply – consumers either have no money to buy stuff, or they are afraid they will have no money to buy stuff – so they don’t buy stuff.
Lay-offs and future lay-offs may well be a larger force driving the length and depth of the recession than continued lending contraction.
Don’t misunderstand, I’m not advocating business become a massive welfare program, continuing to employee myriads for whom they cannot actually provide work now or in the future. Everyone with an MBA (isn’t that most of America these days?) knows that a lean organization will be well-poised to come out of the gates when growth returns.
For once I’d just like to see business be able to hang on to some of the “institutional knowledge” they so often cut in lean times. If so, we may not see the negative effects of whip-saw hire and lay-off cycles.
Government may have to stop taking shares in every bank or unprofitable auto company and provide assistance on this front. Frankly, if businesses with a real future could have needed capital infusions, or borrow on their closed or rapidly closing lines of credit, it may not be necessary to talk about incentives to keep staff. All of that may depend upon just how deep we get in the next six months or so.
My recommendation to CEOs would be: If you believe your post-recession capacity will be X then if you can, remain staffed to support X, find marketing solutions to help get to X more quickly than your competitors, and do not cut spending beyond X now.
You’ll not only be poised to get to X, you will also not have to spend future profits on expensive talent searches, new hire training, and on the repair of the damage new employees do to long-term customers. You may also earn a little future devotion from those on staff today who will know you stuck with them.
Perhaps the next Treasury Chief will have some sense of how to make this happen so we get back to business soon.
Ah, forgive me, it must be the Christmas Season – I just keep on dreaming!
Thursday, December 11, 2008
Of Waiters & Character
If, “you can tell a lot about a person by the way they treat the waiter,” then too many of those who can afford to go out to dinner are lacking in more than basic civility.
It is not just waiters. Several years ago when I had an enviable title and worked for one of the most articulate and seemingly gentle of men, I was perplexed by his poor treatment of not only his own secretary, but mine and his bosses’ too. I never fully trusted him. His behavior was predicated upon education, status and station. And it turned out I was right to be wary.
My father, “The Major” – as my brothers and I fondly referred to him – never, ever told us anything about how we should treat waiters. But Dad used the names of barbers, clerks, dry cleaners, tellers, waiters, busgirls, secretaries, and the attendants who filled his car with gas.*
Dad was always kind and patient, even when there was something wrong and he needed to be firm. He never bullied anyone, even when I thought they clearly deserved it. He never rolled his eyes. He never even sighed loudly. And despite his rank, and even when he gave “lawful orders” to subordinates, he always couched it in terms of a request, complete with a “please.” He always thanks people for what they do.
He is the consummate egalitarian. He really doesn’t believe his education, rank, age, political affiliation, or religion makes him superior to anyone. He is, in short, the gentleman I’d like to be, and a man of high moral character.
One of my own experiences in the military almost three decades ago still evokes feelings of relief and appreciation for my Father. My Training Sergeant discovered he had worked for my Dad. As the realization dawned on both of us, I experienced a feeling you can only understand if you know what it is like to have your life in the hands of an unpredictable and all-powerful NCO.
My relief was obvious when Sgt. Berger told me that my Father was “tough but fair and one of the kindest, most competent officers” in the Air Force. (As a former NCO myself, I know just how rare a breed that “competent officer” is – and a kind AND competent officer is even more scarce.)
I am personally embarrassed and angered, when I see someone berate a waiter, yell at a cashier, mistreat a busgirl, embarrass a secretary, or abuse a teller. I apologize for the bad behavior. I smile and joke with them. (I learned that from Dad too.)
If I have previously associated with the bully voluntarily, I will be far too busy to spend any social time with them thereafter. And if I have little or no choice of association, I am apt to limit the time I have to spend with them to only the necessary.
I’m apparently not alone in my feelings on this subject. I recently came across copy of an article in USA Today from 2006 that I’ve kept with the stuff I just can’t throw away.
The article says that CEO’s overwhelmingly agree with Bill Swanson’s adage about character and the treatment of waiters. **
From a purely observational point of view, I’d say that we are showing less character in public than we were a few years ago, and the trend is getting worse.
If you are interviewing for jobs, you might want to remember that CEOs and hiring managers often pay attention to all kinds of behavior. (JC Penny, a Utah Mason and Millionaire Retailer, apparently would not hire anyone who seasoned their food without tasting it first.)
If an interviewer thinks your character is lacking because you were curt or rude with their admin, it can be as deadly as un-shined shoes.
These days, as we mourn the passing of good economic times, we need more men and women with character and fewer that are characters. And if Bill Swanson is correct, the waiters will know we are getting there before the rest of us.
* Cultural note for my children: In the “olden days” we didn’t fill our auto’s gas tank. Guys in dark uniform shirts, greasy jeans and dirty Converse, poked their head into our driver-side window, usually wiping the grease from their hands with a stained shop-towel, and ask “what’ll it be?” We’d reply something like, “Filler up with high-test,” or something similar. These guys were invariably named “Bob” and I grew up thinking I my parents didn’t want me pumping gas because they didn’t name me “Bob.”
** USA Today, “CEOs say how you treat a waiter can predict a lot about character,” by Del Jones, 04.17.2006.
It is not just waiters. Several years ago when I had an enviable title and worked for one of the most articulate and seemingly gentle of men, I was perplexed by his poor treatment of not only his own secretary, but mine and his bosses’ too. I never fully trusted him. His behavior was predicated upon education, status and station. And it turned out I was right to be wary.
My father, “The Major” – as my brothers and I fondly referred to him – never, ever told us anything about how we should treat waiters. But Dad used the names of barbers, clerks, dry cleaners, tellers, waiters, busgirls, secretaries, and the attendants who filled his car with gas.*
Dad was always kind and patient, even when there was something wrong and he needed to be firm. He never bullied anyone, even when I thought they clearly deserved it. He never rolled his eyes. He never even sighed loudly. And despite his rank, and even when he gave “lawful orders” to subordinates, he always couched it in terms of a request, complete with a “please.” He always thanks people for what they do.
He is the consummate egalitarian. He really doesn’t believe his education, rank, age, political affiliation, or religion makes him superior to anyone. He is, in short, the gentleman I’d like to be, and a man of high moral character.
One of my own experiences in the military almost three decades ago still evokes feelings of relief and appreciation for my Father. My Training Sergeant discovered he had worked for my Dad. As the realization dawned on both of us, I experienced a feeling you can only understand if you know what it is like to have your life in the hands of an unpredictable and all-powerful NCO.
My relief was obvious when Sgt. Berger told me that my Father was “tough but fair and one of the kindest, most competent officers” in the Air Force. (As a former NCO myself, I know just how rare a breed that “competent officer” is – and a kind AND competent officer is even more scarce.)
I am personally embarrassed and angered, when I see someone berate a waiter, yell at a cashier, mistreat a busgirl, embarrass a secretary, or abuse a teller. I apologize for the bad behavior. I smile and joke with them. (I learned that from Dad too.)
If I have previously associated with the bully voluntarily, I will be far too busy to spend any social time with them thereafter. And if I have little or no choice of association, I am apt to limit the time I have to spend with them to only the necessary.
I’m apparently not alone in my feelings on this subject. I recently came across copy of an article in USA Today from 2006 that I’ve kept with the stuff I just can’t throw away.
The article says that CEO’s overwhelmingly agree with Bill Swanson’s adage about character and the treatment of waiters. **
From a purely observational point of view, I’d say that we are showing less character in public than we were a few years ago, and the trend is getting worse.
If you are interviewing for jobs, you might want to remember that CEOs and hiring managers often pay attention to all kinds of behavior. (JC Penny, a Utah Mason and Millionaire Retailer, apparently would not hire anyone who seasoned their food without tasting it first.)
If an interviewer thinks your character is lacking because you were curt or rude with their admin, it can be as deadly as un-shined shoes.
These days, as we mourn the passing of good economic times, we need more men and women with character and fewer that are characters. And if Bill Swanson is correct, the waiters will know we are getting there before the rest of us.
* Cultural note for my children: In the “olden days” we didn’t fill our auto’s gas tank. Guys in dark uniform shirts, greasy jeans and dirty Converse, poked their head into our driver-side window, usually wiping the grease from their hands with a stained shop-towel, and ask “what’ll it be?” We’d reply something like, “Filler up with high-test,” or something similar. These guys were invariably named “Bob” and I grew up thinking I my parents didn’t want me pumping gas because they didn’t name me “Bob.”
** USA Today, “CEOs say how you treat a waiter can predict a lot about character,” by Del Jones, 04.17.2006.
Tuesday, December 9, 2008
Demand Regime Change
What appeared unthinkable as little as two weeks ago now appears to be a near-term reality. Apparently, all the Congressional posturing has been the slight-of-hand precursor to a bailout of the Big Three.
Reading the Financial Times, I see that we’re apparently making $15bn available.
I’m not going to waste any time opposing this based on the ideals of capitalism or evolution. Make no mistake, this isn’t about Ford, Chrysler, or GM. Our government seems to have anointed anything as big as the AIG, or the UAW to be Too Big to Fail.
I am also not going to argue that the American People, through the instrumentality of the Federal Government, ought to take an equity stake in these troubled organizations. If you wouldn’t buy shares in these bungling operations, then why should our National Proxy?
And, I am not going to say this is too much money because it isn’t nearly enough.
Lastly, I am not going to argue that this is unfair to the automakers that have managed their ventures profitably. No one wants to hear about what is fair or just.
I am going to suggest that what our government should extract in return for the bailout is Regime Change at Ford, Chrysler, and GM.
Please join me by calling, writing or emailing your congressional representative and telling them that Rick Wagoner (GM), Robert Nardelli (Chrysler) and Alan Mulally (Ford) AND their senior management teams, need to go before they vote to approve the bailout package.
Why?
Does anyone swallow the argument that the recent fuel price crisis, and now the credit crisis have caused these otherwise well-managed businesses to suddenly become unprofitable?
Do you really think that the same CAFE standards that seem to give Nissan, Toyota and Honda a competitive advantage somehow hamstring the Big Three?
Can CEOs so out of touch with the people they sell to, or lead and manage - that they would take one of the Corporate Jets to Congress for a bailout, have the judgment to run a company Too Big to Fail?
Bottom-line: We’re throwing money down a rat-hole. It isn’t a loan. It won’t be enough. Without massive restructuring it won’t even matter in six months. It will only prop up the inevitable. And worse, it will embolden the Airline Executives who will be at the Congressional Teller Window next …
So, if we really are proffering $15bn to prop up these clumsy, incompetent, and ham-fisted outfits, we ought to at least get bold, new leadership for our money.
Maybe we could attract senior leaders from Nissan, Toyota and Honda into those jobs.
Perhaps new CEOs could put together insightful senior management teams who will take care of the little things, like production capacity to match real demand.
Maybe we’ll even ignore the weeping, wailing and gnashing of teeth we’ll hear while they do what needs to be done.
After all, it’s the Christmas Season – a Season of Miracles! I can dream, can’t I?
Reading the Financial Times, I see that we’re apparently making $15bn available.
I’m not going to waste any time opposing this based on the ideals of capitalism or evolution. Make no mistake, this isn’t about Ford, Chrysler, or GM. Our government seems to have anointed anything as big as the AIG, or the UAW to be Too Big to Fail.
I am also not going to argue that the American People, through the instrumentality of the Federal Government, ought to take an equity stake in these troubled organizations. If you wouldn’t buy shares in these bungling operations, then why should our National Proxy?
And, I am not going to say this is too much money because it isn’t nearly enough.
Lastly, I am not going to argue that this is unfair to the automakers that have managed their ventures profitably. No one wants to hear about what is fair or just.
I am going to suggest that what our government should extract in return for the bailout is Regime Change at Ford, Chrysler, and GM.
Please join me by calling, writing or emailing your congressional representative and telling them that Rick Wagoner (GM), Robert Nardelli (Chrysler) and Alan Mulally (Ford) AND their senior management teams, need to go before they vote to approve the bailout package.
Why?
Does anyone swallow the argument that the recent fuel price crisis, and now the credit crisis have caused these otherwise well-managed businesses to suddenly become unprofitable?
Do you really think that the same CAFE standards that seem to give Nissan, Toyota and Honda a competitive advantage somehow hamstring the Big Three?
Can CEOs so out of touch with the people they sell to, or lead and manage - that they would take one of the Corporate Jets to Congress for a bailout, have the judgment to run a company Too Big to Fail?
Bottom-line: We’re throwing money down a rat-hole. It isn’t a loan. It won’t be enough. Without massive restructuring it won’t even matter in six months. It will only prop up the inevitable. And worse, it will embolden the Airline Executives who will be at the Congressional Teller Window next …
So, if we really are proffering $15bn to prop up these clumsy, incompetent, and ham-fisted outfits, we ought to at least get bold, new leadership for our money.
Maybe we could attract senior leaders from Nissan, Toyota and Honda into those jobs.
Perhaps new CEOs could put together insightful senior management teams who will take care of the little things, like production capacity to match real demand.
Maybe we’ll even ignore the weeping, wailing and gnashing of teeth we’ll hear while they do what needs to be done.
After all, it’s the Christmas Season – a Season of Miracles! I can dream, can’t I?
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