Atlas Shrugged at 50

Atlas Shrugged, Ayn Rand's great Objectivist novel, turns 50 this year. The NYT marked the event with a story by Harriet Rubin, who founded the Currency imprint at Doubleday and made it one of the leading business book publishers of the 1990s. (Read it here.)

Rubin dug up some notables in the business world who I hadn't realized were among Rand's devotees. One of them is Jack Stack, author of The Great Game of Business, whose turnaround of Springfield Remanufacturing Co. was a primary inspiration for the open-book management movement. He says,“Atlas helped me pursue this idiot dream that became SRC” and “It’s the best business book I ever read.”

Al Vogl at Conference Board Review wrote a feature on the book -- even yanked a couple of quotes from me. In it, he explores the continuing popularity and relevancy of the novel. I liked his opener: "By all rights, Ayn Rand should be the patron saint of American business." The article isn't online, but it's titled In Search of Atlas and it's in the magazine's Sept/Oct 2007 issue.

Envy as a genetic trait?

UC Davis economist Gregory Clark bills his new book A Farewell to Alms (Princeton) as "a brief economic history of the world." Its Darwinian thesis holds that the Industrial Revolution was sparked and caught on in England because its people descended from the upper classes, which over hundreds of years had survived at higher rates than the lower classes. As a result, upper class values also survived and became the basis for a culture that was conducive to an industrialized society. (See the NYT for more on this.)

Clark also cites evidence that shows that happiness is strongly correlated to wealth within a society. (There is little correlation between wealth and happiness between societies. In other words, rich societies are no more happy than poor societies.) Thus, he writes:

The key problem here is the ample evidence that our happiness depends not on our absolute level of well-being, but instead on how we are doing relative to our reference group. Each individual -- by acquiring more income, by buying a larger house in a nicer neighborhood, by driving a more elegant car -- can make him- or herself happier. But happier only at the expense of those with less income, meaner housing, and junkier cars. Money can buy happiness, but that happiness is transferred from someone else, not added to the common pool.

His startling conclusion:

Since we are for the most part the descendants of the strivers of the preindustrial world, those driven to achieve greater economic success than their peers, perhaps these findings reflect another cultural or biological heritage from the Malthusian era. The contented may well have lost out in the Darwinian struggle that defined the world before 1800. Those who were successful in the economy of the Malthusian era could well have been driven by a need to have more than their peers in order to be happy. Modern man might not be designed for contentment. The envious have inherited the earth.

On ethics and Howard Gardner

s+b published a great article on Howard Gardner, the Harvard prof and MacArthur genius grant winner, in its latest issue. The author, Lawrence Fisher, deftly weaves a profile of Gardner and his work into an article that is primarily focused on ethics. The "ethical mind" is one of the five sets of cognitive capabilities people need to succeed in the future that Gardner described in his most recent book. (My post on the book is here.) Unfortunately, according to the article, it's also the one mind that businesspeople seem least interested in developing.

Making sense of marketing chaos

I used to think that marketers, with their big budgets, lack of accountability, and scads of vendor goodies, had it made. But in recent years, three challenges -- the fragmentation of media, the rise of the customer, and the difficulties of figuring out whether the trillion or so dollars that companies spend on marketing actually produces a decent ROI, have made the job a lot harder. I've also been getting a growing stack of books from would-be gurus and other pros that attempt, with varying degrees of success, to address the challenges marketers are facing.

Watch This, Listen Up, Click Here (Wiley) is a story-driven survey of the state of marketing vehicles. Written by David Verklin, CEO of Carat Americas, the world's largest independent media buyer, and the late Bernice Kanner, a noted marketing journalist, it covers the meltdown in traditional media vehicles, such as TV and newspapers, and the emergence of a host of others, such as search, buzz, mobile, product placement, etc., etc. The book is a readable intro to the complexities that today's marketers face when trying to reach customers, but there isn't much prescriptive advice for how to handle them.

Jean-Marc Lehu's Branded Entertainment (Kogan Page) focuses more tightly on product and brand placement in films, music videos, novels, video games, etc. Packed with examples, the book contains both an overview of the development of this fast-expanding vehicle and a practical education for marketers who want to use it. One interesting conclusion: there is no proven and comprehensive way to measure the ROI of these marketing investments.

Richard Laermer and Mark Simmons, the authors of Punk Marketing: Get Off Your Ass and Join the Revolution (Collins), hone in the growing power of the customer in the "brandscape." They say that customers are running the show these days and that traditional marketing bores the hell out of them. The book is full of attitude and fun to read, and there's even an idea or two you might be able to put to work. (See the manifesto here.) But unless you're still marketing like it's 1969, I don't know that it's as earth-shaking as the authors seem to think.

In Your Gut Is Still Not Smarter Than Your Head (Wiley), Kevin Clancy and Peter Kreig, the leaders of Copernicus Marketing Consulting, take on the third challenge marketers face -- how to make marketing profitable. Toward that end, the authors offer a functional makeover that uses analysis and facts to make investment decisions, a basic business concept that marketers have been able to avoid by focusing on the creative side of the discipline. It's good book that imposes some systematic managerial order on the most critical and mysterious business function.

History of Kennedy Space Center

I've been to Kennedy Space Center a couple of times as a tourist and most recently, on a press pass for a shuttle launch that got scrubbed because of a hurricane. It's the most amazing travel depot on earth -- a spaceport, whose scale and mechanics are hard to grasp even when you are standing in the middle of it.

Happily, Kenneth Lipartito and Orville Butler help render what goes on there much more comprehensible with their new book, A History of the Kennedy Space Center, written under the auspices of NASA and published by University Press of Florida. It's a history, but the book is more about the business of KSC, the role it plays in the U.S. space program, and how it has been preparing, testing, and launching spacecraft over the past 45 years. It's a good read in it's own right, but a must if you're among the 1.5 million people that visit KSC each year.

Jim Camp's Top 10 Deal Killers

Publicist Cathy Lewis just sent out this neat short list of deal killers based on negotiation coach Jim Camp's excellent book, No: The Only Negotiating Strategy You Need for Work and Home:

1. DON'T show emotions, such as neediness, desperation, or excitement. Keep your body language and style of speaking emotionally neutral. Prepare your state of mind ahead of time. Repeat the mantra, "I don't need this, I don't need this," until you believe it.
2. DON'T offer a compromise or reveal your position at the start. Once you do this, you are signaling to your opponent that you are ready to give something up in order to get to an agreement, before you're even certain you have to!
3. DON'T give presentations or dominate the dialogue. A presentation is designed to tell the opponent what you think she wants to know. (You might be dead wrong!) While you are presenting, she is forming opinions, making judgments, and gaining valuable insight into you and your position. To maintain the advantage, you should do almost no talking, and ask question after question that gets your opponent to spill the beans instead.
4. DON'T waste your time dealing with "blockers." Blockers are people who will do anything to keep you from meeting with the real leader or decision maker face-to-face. (That may even be their job.) Be diplomatic when sidestepping blockers so you can speak with the person best able to deliver what you want.
5. DON'T think about closing. Despite everything you learned in business school, thinking about, hoping for, or planning for the outcome of this deal will kill you every time at the negotiating table. Your opponent will sense your neediness, perceive it as a weakness, and like spotting a lame animal in the herd, move in for the kill.
6. DON'T try to impress. Name-dropping, sucking up, dressing to the nines, and overstating your qualifications are common ways you might try to pump yourself up in front of an opponent. Such tactics have the opposite effect. Instead, make sure your opponent feels "more okay" than you, maybe even a bit superior. An opponent who does not feel threatened in any way is more likely to give up the goods.
7. DON'T try to be friends. The person sitting across the negotiating table from you is a respected opponent. Thinking about a long-term relationship or dwelling on whether or not she likes you is certain to cloud your decisions, disrupt your emotional neutrality, and keep you from being in the present moment, where you should be focusing, observing, and collecting information.
8. DON'T show up unprepared. Whether it's a phone call, an email exchange, or a face-to-face meeting, never communicate with your opponent without doing extensive research and preparation first. Find out everything there is to know about him, positions he's taken on similar deals, personal history, problems he and his company have and ways you might be able to solve them, and anything else, even if it seems irrelevant.
9. DON'T make assumptions. The quickest way to achieve failure is by forming opinions and making judgments and assumptions about your opponent. If there's anything about the way your opponent looks or behaves that makes you jump to a conclusion, that's a red flag. Banish the thought from your mind. The way to find out whom you are really dealing with is to ask lots of questions. Get her talking, revealing her biases, opinions, wants, needs, and weaknesses. Take copious notes while she talks.
10. DON'T focus on what you want. In any successful negotiation, set your mission and purpose in the adversary's world, not in your own. This is a sure-fire way to win the best result for your side. Focus on how you can help him or her realize that offering XYZ to you will be beneficial to him.

Publisher taps into wisdom of crowds

I complained, a week or so ago, about the undue reliance of publishers on intuition to identify worthy book projects and now, Touchstone, an imprint of Simon & Schuster (whose author-unfriendly book contracts are in the news, too), is making me eat my words. It just announced the launching of Project Publish, a fantasy stock market in which online traders "buy" shares in actual book proposals. Basically, Touchstone will let the market pick the best proposal and then, if its editors agree with the pick come October, award a publishing contract. (More here from the NYT.) Pretty good test -- should be interesting to see what happens.

There doesn't seem to be any categorization of titles by genre, but there is an interesting business/self improvement proposal up for consideration already -- The Thirteen Virtues. It's a good idea for a book based on Ben Franklin's personal self-help program, although the proposal itself doesn't exactly sparkle.

Of widgets and whatchamacallits

Thanks to Al Vogl, head editor over at The Conference Board Review, I got a quick, paid education in the naming business a couple of months ago. The article that resulted is in the May/June issue and is available online, too:

George Eastman's dry-emulsion film simplified and popularized the art of photography. In 1888, he registered the trademark Kodak to identify his film and the cameras that used it, and began advertising their ease of use: "You press the button, we do the rest." By dint of his prodigious brand-building genius, the Eastman Co. soon laid claim to the leading position in a field of more than fifty competitors. Today, the film that created a corporate giant is tottering toward buggy-whip status, but the name Eastman chose still has legs. In 2006, even in the midst of the turmoil caused by the digital revolution, the Kodak brand ranked seventieth in the world in value, with an estimated worth of $4.4 billion, according to the annual Interbrand Corp./BusinessWeek brand survey. Not a bad return on a manufactured word...(read more)

The core curriculum of business, PGA style

Got a kick out of this press release from Perdue University titled "A Bit of Golf Should be Par for the Course for College Grads." Apparently, golf is important to your career, according Tom Templin, professor of health and kinesiology, who says, "Do your homework in advance, dress appropriately and ask for general guidelines about use of the course. Young people entering the work force may find a basic knowledge about the game helpful, especially as the sport's popularity increases and is a place for business."

Normally, I'd ignore this bit of fluff, but then, I read that Templin is the co-creator of the PGA's Golf: For Business and Life program that is taught at fifty universities. Nice work on the PGA's part to get golf on the business curriculum. (The hockey, foosball and curling leagues should take note.) Here's before and after photos of a student who took the course:

Why can't publishers predict bestsellers?

There's an article coming in the NYT's Sunday Business section on the vagaries of publishing, which reprises the usual "publishing as a crap shoot" theme. All the editors talk about how it's impossible to accurately predict bestsellers and the ones who got lucky pat themselves on the back for their canny intuition -- the editor who acquired the mega-million copy bestseller The Secret describes feeling a tingling in her spine. Yea.

Anyway, Shira Boss, the author of the article, rightly points out that unlike most other businesses, publishing houses have simply never bothered to try to figure out what their customers want. Which means that we'll all be reading essentially the same article next year and the year after and so on...until some smart publisher, who is sick of single digit returns on capital, steps up and says, "Wait a minute, we can map the human genome, why can't we figure out whether people will buy a book" and transforms the business of publishing with some market research data and analytics. Now, that'll be worth a story.

A business historian to remember

Alfred D. Chandler, Jr., who founded the field of business history, died on May 9 at the age of 88. His books included:

"Strategy and Structure" (1962) which examined four U.S. industrial giants -- General Motors, DuPont, Exxon, and Sears, Roebuck & Company -- from the 1900s to the 1940s and concluded that "strategy precedes structure.

"The Visible Hand: The Managerial Revolution in American Business" which won the Pulitzer Prize in history in 1977 and traced the rise of management as the "most powerful institution in the American economy."

"Scale and Scope: The Dynamics of American Capitalism" (1990) which compared the evolution of managerial capitalism and the largest companies in the United States, England, and Germany and found that "the first movers in capital-intensive industries kept their competitive advantage only if they made three key strategic investments: first, in large-scale, high-speed production; second, in distribution; and, third, in a management structure that could plan, coordinate, and monitor the company's vast operations."

Getting smart about cases

Not having an MBA, I've often wondered about the case method -- how it works and how it can be applied to solving real business problems. I guess I could go to B-school to figure it out, but it looks like Bill Ellet, the publisher of Training Media Review, saved me a couple of years and tens of thousands in tuition by writing The Case Study Handbook.

Ellet has been teaching students at Harvard Business School how to deal with cases for a dozen years and his practical, well organized book covers how to analyze, discuss, and write convincingly about them. So far, I've just dipped into the book, but I've seen enough to know that it's going into my tower o' reading. Seems like managers who have to deal with these things in the real world would want to read it, too.

Dell's memo says get your resume together

I thought I'd be getting an interesting new corporate communique for my collection when I heard that a memo from Michael Dell to Dell's 80,000 employees was making the rounds. Dell's had a tough year or two and as a result, a bunch of the company's senior leaders were "streamlined." Then, a couple of weeks ago, according to Michael's memo, the "complete Executive Leadership Team" met to discuss the company's future. And, what did they come up with? Well, here's the first thing:

Fix our Core Business to be competitive.

The Direct Model has been a revolution, but is not a religion. We will continue to improve our business model, and go beyond it, to give our customers what they need. We will simplify our organization to make it easier to hear customers and respond to them. We've already streamlined our executive leadership structure. We need to streamline our management structure to speed decisions and remove bureaucracy. We're making improvements in pricing, product development and fulfillment, and customer experience. We reorganized the product group to more effectively listen to our customers and develop end-to-end customer solutions. We are now revisiting our entire design process to improve our speed-to-market and focus on what customers truly value. Our new Global Operations organization, led by Mike Cannon, is working to take our supply chain and manufacturing to the next level of efficiency and quality. This group is also partnering with the regions and the product group to pursue new manufacturing and distribution models to address the unique needs of our customers in all markets. More broadly, we plan to eliminate overlaps in our organization and activities to enable us to deliver even more value to our customers. We also need to improve sales productivity. These won't be merely exercises in cost-cutting. We will re-invest those resources in the customer solutions that will build Dell for the future.

The NYT thinks this means that Dell is "rethinking direct sales," but it sounds more like double talk for major lay-offs to me. Of course, Dell repeatedly promises that "we're gonna do better in the future," but I don't see any hard details. If I was a Dell manager and I got this memo, I'd be looking for a better future somewhere else.

Rand reprised

One of the fun things about being an author is having your books pop up unexpectedly. My wife and I have always been interested in Ayn Rand and in 2000, we wrote a short book about her philosophy of Objectivism and how it might be applied in business. The book came out in 2001 -- just after 9/11, in fact -- attracted a little interest, some good reviews, and as usual with anything Randian, some flack, too. The publisher folded shortly afterward and sold the book to a textbook publisher, which declared the book out of print after selling out the first printing. (So it goes, to quote the late, great Kurt Vonnegut.)

Anyway, I've been keeping an eye out for a publisher who might want to bring it back to life and copies of the book are still floating around. And, today, I ran across this blog post featuring a short review of the book and some pithy comments it generated. Thanks to Howard Hansen for reading and Ed Kless for posting!

Hunting cool online

Marketers, especially the online variety, and anyone else chasing what's cool, will want to read the new Amacom book Coolhunting by MIT Sloan's Peter Gloor and Scott Cooper. There's two interesting things here: their advice for coolfarmers and a software tool, developed by Gloor, that tracks and analyzes online networks.

Coolfarmers, according to the authors, are people who facilitate the emergence of new ideas by tapping swarm creativity thru COINs (Collaborative Innovation Networks). Ben Franklin and VC John Doerr and Linux's Linus Torvalds are examples. Their effectiveness is based on four principles:

• They gain power by giving it away.
• They seed community with new ideas.
• They create intrinsic motivation.
• They recruit trendsetters.

If you want to track coolfarmers, trendsetters, and emerging coolness online, the authors offer a software tool called TeCFlow (Temporal Communication Flow). This program, which you can download free for non-commercial use, enables you to visualize and analyze online COINs by mining their communication logs. So, if you're a marketer, for instance, you could use TeCFlow to identify the topics that most interest the online communities that use your products and services or you could target those people who are trendsetters or you could become a coolfarmer yourself and create your own next best thing. Cool stuff.

Creative blurbing

If you aren't already highly suspicious of the praise that adorns the dust jackets of most books, read the essay on creative blurbing by Henry Alford in this week's NYT's book review section. He's focused on fiction, but the situation is no different with business books. Between the favor-doing and the doctoring, there really isn't any point to reading blurbs. I've gotten more than my share of blurbs from very generous folks, I've written a few myself (I have no idea why anyone asks), and many have been lifted from my reviews. But to be honest, as a reader, I don't find endorsements or review blurbs either helpful or credible. They just take up valuable space that could be used to tell readers something useful about what's between the covers and that might actually help them decide whether or not to buy a book.

By the way, you can sign up here for the Time's free weekly "Books Update" via email. They rarely cover business books, but it's a great place to keep track of what's worth reading in fiction and general non-fiction.

Smart or stupid, rich is better

It turns out that rich people aren't any smarter than the rest of us, according to a study conducted by research scientist Jay Zagorsky of Ohio State’s Center for Human Resource Research. “People don’t become rich just because they are smart,” he concluded based on data from the National Longitudinal Survey of Youth. “Your IQ has really no relationship to your wealth. And being very smart does not protect you from getting into financial difficulty.”

People with higher IQ scores do tend to get paid a little more than others. Like others before him, Zagorsky found that each point of increase in IQ scores is associated with $202 to $616 more annual income. That means that the average difference in income between a person with a normal IQ (100) and someone with an IQ in the top 2 percent (130) is somewhere between $6,000 to $18,500 a year. In terms of total wealth and the likelihood of financial difficulties, however, people with below average and average intelligence are no more or less likely to be wealthy than a genius.

But really, who cares? Smart or stupid, I'm still not feelthy rich.

Quit whining, start selling

I interviewed Martyn Lewis, the President and CEO of Market-Partners, a sales consultancy, the other day. Martyn's served as President and CEO for Drake International in North America, VP Marketing and Sales Services at DEC Canada, and in the major accounts division of ICL in the UK. We talked about what sales execs need to do to move up the ladder to the CEO's office.

Martyn also sent me a copy of his self-published book, Sales Wise -- a paperback of short, story-driven sales lessons. This one, in which he attends his first national sales conference, caught my eye. In it, the corporate VP of sales starts with the standard 'rally the troops' speech and then, abruptly changes gears, saying:

We know in that in some cases our products have a few holes. We know that our competitor's offerings are not that far behind us. We know that at times our customers see certain weaknesses in our overall offerings. We know that at times our competitors leapfrog us in some areas. And we don't need you to tell us--we pay other people to tell us this. Your job is to sell around the holes. If we always had the best products and our prospects and clients always viewed us the best solution provider, we wouldn't need a sales force. The only reason we have you is to sell around the holes.

The lesson, writes Martyn, "Don't waste your time complaining about the competition and other factors you can't control; focus on the strengths of your own offering and what you can control."

IBD covers Achieve Sales Excellence

Just discovered that on Tuesday Investor's Business Daily covered Achieve Sales Excellence, the book that I co-authored with Howard Stevens, the founder and CEO of HR Chally Group. Cord Cooper's article focuses on Chapter 9, which covers the seventh customer rule for sales excellence: "You must be innovative in responding to our needs." Nice summary of the key findings. (Check it out here.) Thanks to Cord, IBD, and whoever turned them on to the book!

The happiest place on earth?

The 2006 General Social Survey from the National Opinion Research Center at the University of Chicago is out. It's the most comprehensive survey of employee satisfaction and happiness. (Press release here.)

So who's most happy? Clergy (67 percent very happy), firefighters, and transportation ticket and reservation agents (both 57 percent very happy). I find that last one hard to believe based on my experiences at airports.

Who's most unhappy? Garage and service station attendants (13 percent reported being happy), roofers (14 percent), and molding and casting machine operators (11 percent). That I can believe. I once spent a month trying to stay awake while carving plastic parts -- their purpose shall remain a mystery to me forever -- on a lathe. Other most unhappy workers include construction laborers, welfare service aides, amusement and recreation atendants...wait, you mean all those folks who work at the happiest place on earth are actually unhappy?

Rackham on the CEO's sales role

Recently I interviewed Neil Rackham, of SPIN Selling fame, to learn something about the process of establishing major accounts. (He wrote the seminal book on the topic back in 1989.) Rackham told me that it costs so much to establish a major account these days that the targeting and planning part of the equation is an increasingly critical element. In fact, he estimates that the job is really 70 percent planning and only 30 percent execution. He also suggested that most sales professionals don't utilize their senior execs as well as they might in major accounts efforts, saying:

A new major account is like gold. It’s one of the most valuable things a company can acquire. So, use your own management to help get you access, to help move things along, to help get you to a higher level of contact. Use the executives at your company.

If you look at the most successful companies, the senior executives spend a lot of time talking to customers and potential customers. And it’s the job of the sales force to set that up in a useful kind of way. Most sales forces aren’t very good at that. So, they use their own executives on a courtesy visit without very clear objectives.

You should use your senior executives in a very targeted way. And to do it properly means that when you decide which accounts you are targeting, you then find a sponsoring senior executive in your own company who is going to spend some time sitting in the team and advising them about strategy, and who is going to spend some time being available to visit the customer. Not just to wave the flag, but in a much more active way…to go in as part of the team with a message that your company is committed to helping your customer and that you really want their business.

Sutton on passion

I read Stanford prof Bob Sutton's new book, The No Asshole Rule, over the weekend and ran across this passage that I think nails an unspoken disconnect that exists in far too many companies. (His blog is here.) He starts by saying the idea of passion is an "overrated" employee virtue and explains:

All this talk about passion, commitment, and identification with an organization is absolutely correct if you are in a good job and are treated with dignity and respect. But it is hypocritical nonsense to the millions of people who are trapped in jobs and companies where they feel oppressed and humiliated--where their goal is to survive with their health and self-esteem intact and provide for their families, not to do great things for a company that treats them like dirt. Organizations that are filled with employees who don't give a damn about their jobs will suffer poor performance, but in my book, if they routinely demean employees, they get what they deserve.

Sutton is articulating better than I ever have my reflexive dislike of business books that advocate "fun at work" and other morale-building schemes. If my employer is going to fire me the second times get tough, cut my medical benefits because the price of insurance will impact senior management's bonuses and shareholder returns, and haggle over a few dollars when its time to review my salary, why on earth would I respond to any of that stuff? In fact, it's an insult that my employer actually believes that I'd be stupid enough to fall for it.

Rittenberg on IBM PC's arrival in China

I interviewed Sidney Rittenberg back in 2005 for story on selling in China after reading about him in the NYT. A Charleston, SC-born octogenarian, Sidney has lived an amazing life. He was in China at the end of WWII, when he hooked up with Mao and his Army. Sidney spent the next 35 years in Communist China, where he witnessed the workings of Mao and his regime and was twice imprisoned for a total of 16 years (once after Stalinist Russia accused him of spying and once during the so-called Cultural Revolution). Then in 1980, he returned to the US, where he wrote a memoir and naturally, became a leading consultant on doing business in China -- he still advises major companies that hope to tap into that nation's huge markets.

Sidney says the number one mistake companies make when attempting to enter China is that they expect to do business as usual. He told me this cautionary tale about IBM's PC unit and its initial foray into China:

When IBM set up the PC company in the early 80s, they went into Beijing and they leased two floors of the Great Wall Sheraton Hotel, which was the biggest hotel in town in those days. (Immediately all prices for foreigners in Beijing went up. So that didn’t make the foreign business community very happy.) Then they literally sat in their hotel suites waiting for the Chinese to call them on the phone and order computers.

I know that from personal experience because we were consulting to ComputerLand, which was then the biggest retailer of PCs in the world. The then president of IBM China actually told us, he said, "We think PCs should be sold by gentlemen in white shirts and dark suits and we are not going to go slogging around through the mud in China to sell them." So, they were just like a basket case.

Then, the most hilarious thing was in 1984 I think. They finally realized that they needed to train Chinese computer salespeople and service people, so that the Chinese could set up their own computer stores because there were none at the time. We got a notice that they were holding the first training session in Beijing and it was going to be on October 1st. So, my wife called them and said, "We wondered if you noticed that October 1st is National Day." It was a total holiday and there was a big parade and nobody was going to show up for a training session.

These are all symptoms. They made a great effort, they spent a lot of money, and a couple of years later, they dismantled the PC operation and went home.

Interesting that 20-odd years later it was Lenovo, a Chinese PC maker, that bought IBM's PC business.

Yugma: Work smart, impress clients

Lisa McCue over at Yugma gave me a guided tour of the company's screen-sharing service yesterday. I was checking it out for a Selling Power story on web-based sales meetings, but quickly realized that it's a perfect enabler of one of my own eccentric goals -- to never leave my home for business purposes.

Yugma's a great service -- fast to learn and easy to use. You go to the company's site, schedule a meeting, everybody signs in via the web and phones in on a conference line at the appointed time (you pay your own phone company for the long distance phone call as usual), and you can share whatever is on your desktop with everyone there. So, say I've drafted a chapter in a book and want to review it with a co-author, we can work thru the document line by line, I can revise as we go and we can both see the changes as I make them, or I can turn the screen over to my writing partner and he or she can use my mouse and keyboard.

The service works with Windows and Mac (Linux is coming soon). Yugma is also working on a videoconferencing option, so one of these days, I'll be able to pop up on the screen, too.

The tour Lisa gave me was a PowerPoint presentation delivered using the service, which seemed seamless from my end. Karel Lukas, Yugma's COO, says that the service works best if you and the people you meet with have fast Internet connections and if what you are sharing does not demand a huge amount of bandwidth -- movies and animation sequences will be choppy. But, they are working on that, too.

Meanwhile, there are applications galore for writers and anyone else who wants to share documents, give software or web demos, make and give PowerPoint presentations, etc. Even better, it's free! You can sign up for different levels of service ranging from zero, zip, zilch to $9.95 to $99.95 per month. You can demo it here.

One more on Circuit City

Knowledge@Wharton has also weighed in on Circuit City's firing of 3400 employees in an April 4 article titled "Short-Circuited: Cutting Jobs as Corporate Strategy." Here are a couple of comments from the Wharton School profs featured in that piece:

Peter Cappelli, management professor and director of the Center for Human Resources at Wharton, says Circuit City may have valid reasons for having to reduce costs, but the way it treated the 3,400 workers was highly unusual. "That's the most cynical thing I've heard about in a long time," Cappelli says. "I like to think I'm cynical, but sometimes it's hard to keep up."

According to Cappelli, Circuit City's decision to replace the terminated workers with lower-paid people is like saying: "We made a mistake in compensation by paying them more than they were worth for their performance, so we're going to get rid of them." Cappelli adds that he "had never heard of that before. Companies have always done sneaky things like getting rid of higher-wage workers with two-tier wage plans, but this ... takes the cake."

Wharton management professor Daniel A. Levinthal points out that Circuit City's decision to cut 3,400 veteran sales people "sounds like a massive de-skilling" of the company. Since the people who will be hired to replace the laid-off workers probably will not know the merchandise as well as the workers who were dismissed, customers who want to know how to set up a high-definition TV or why one music player is better than another might not receive the best advice.

More on Circuit City

Julie Devoll over at Harvard Business School Press mentioned that Paul Michelman also posted on Circuit City on their new blog, Conversation Starter. Paul wondered how the morale of the company's remaining employees would be impacted and how its managers could deal with that impact. That's a good question, but if I was a manager there, I don't know that I would care. I'd figure I was next and start looking for a job with a future.

By the way, here's what one of the fired Circuit City employees commented in response to Paul's post:

I was employed with Circuit City for almost 2 years, and I was laid off due to "making too much for my position." I would have taken a pay cut, no problem, but no, they didn't offer that. They gave me 2 weeks severance pay and off to the unemployment office I go. They did say I was able to come back (if re-hirable) in 11 weeks and get my job back but at a lower range of pay...
- Posted by Sandy K. April 2, 2007 09:38

Could the money Circuit City saves on the wages of people like Sandy really offset the costs of severance pay, unemployment benefits, new employee acquisition, training, and salaries, the presumable drops in morale and productivity, etc.?

Who has the loyalty problem?

There are an endless number of bizbooks on how to recognize, reward, retain and otherwise gain the loyalty of employees, but the bottom line is that companies earn the loyalty of their employees by being loyal to their employees. That's simple enough and shouldn't require undue amounts of pizza.

Of course, then there are companies, like Circuit City, that don't deserve anyone's loyalty. This is a business that just fired 8 percent of its workforce, announcing:

"The company has completed a wage management initiative that will result in the separation of approximately 3,400 store Associates. The separations, which are occurring today, focused on Associates who were paid well above the market-based salary range for their role. New Associates will be hired for these positions and compensated at the current market range for the job."

In other words, these are loyal employees who have stayed with the company long enough to earn a few bucks an hour more than the norm. Circuit City figures that experienced employees are no more productive than inexperienced employees, so why pay more? In a gesture of largesse, the company is allowing the fired employees to reapply for their jobs -- after 10 weeks and at starting pay rates.

An article in NYT says that Wal-Mart is thinking along the same lines. (There's a surprise.) Now, I'm not saying that Circuit City or Wal-Mart shouldn't have the right to treat their employees like disposable raw goods. I'm just saying that nobody in their right mind would want to work for companies that offer no future or patronize their stores or ultimately, invest in them.

Guitar tabs are back

The music ogres bit a chunk out my world last year when they threatened to start suing websites that collect guitar tabs. Already hobbled by minimal talent, the inability to properly read music, and a lack of guitar playing buddies, I was a regular on these sites, which allow players to post and share songs in tab -- a simple system of musical notation for guitar that even I could figure out. The quality of the tabs varied wildly, but they were free and I would be still be playing "Old MacDonald" over and over again without them. Of course, the music publishers decided this was stealing (even tho they hadn't bothered to publish lots of these songs in the first place and the tabs were personal interpretations of the songs) and the best tab sites closed down.

Happily, it looks like they may be coming back, according to an article in yesterday's NYT. The owners of one of the biggest tab sites, MxTabs.net, worked out an ad revenue sharing scheme with the Harry Fox Agency, which represents 31,000-odd music publishers. Now, if the publishers sign up, they get some revenue for the music on which the tabs are based and I get to learn a new song or two thanks to the thousands of generous players who share the songs that they figure out how to play. Good deal.

New headquarters for business at W&M

On Friday, I attended the groundbreaking for Alan B. Miller Hall, the much needed, new home of William & Mary's Mason School of Business. The b-school at W&W was founded in 1967 and I'm told it didn't have enough or the right space from its first day. When I first saw it in 1996, I was shocked -- the library was squashed into a classroom, classes were being held in two different buildings, and the students were holding meetings in the halls. Hardly the b-school that I expected in such a well-regarded college.

Seems like plenty of other people shared that view, including Alan Miller, a 1958 W&M economics grad who founded and runs Universal Health Services, a hospital management company with $4 billion in annual revenues. I interviewed Miller for a story in W&M Business magazine -- he's sharp, of course, but he's also direct, unpretentious, and he's got an infectious laugh. He's not, however, saying exactly how much he donated to make the new building a reality. Dean Larry Pulley said Miller "leads a team of million-dollar-plus donors who are bringing over $35 million to this project." There seem to be about seven or eight members on that team and they ponied up just under half of the entire $75 million cost of the new building, including furniture, equipment, and the kind of cutting-edge technologies you'd expect to find in a leading b-school. Nice to have people like this in the world.

It's a great looking building, from the drawing boards at Robert A.M. Stern's firm, which happily echoes the Georgian roots of the old campus. It's 163,000 sq ft; that's 100K more than the school's current home in Tyler Hall. It's also in a great location -- on the Western edge of the Campus just a mile or so from my house. (Nobody in town is gonna miss the parking lot it will replace.) Due to open in 2009, I expect it's going to attract a faculty and a student base that will put W&M's business program in a position to compete with best b-schools in the country.

A dip in the Panama Canal offers little relief

Books like Confessions of an Economic Hit Man and A Game as Old As Empire (both from Berrett-Koehler) offer a view of the actions and motives of our nation's companies and government that is at such odds with values and ideals that we profess that some part of me refuses to believe them. I don't know why I have a hard time swallowing these unpalatable versions of reality. I grew up with the Kennedy and King assassinations and Vietnam and Nixon. I shouldn't have any illusions and yet, I find myself looking for an out, looking for anyone I can trust who can "say it ain't so."

Anyway, that's why I was interested in reading "What Roosevelt Took," a fascinating working paper by Harvard Business School's Noel Maurer and Carlos Yu. (Read it here.) Maurer and Yu analyzed the economic benefits derived from building and operating the Panama Canal between 1903 and 1937. Who benefited most? The US, they say. And Panama? Panama was shortchanged on the purchase price and overtly excluded from participating in the construction of the Canal; it received almost no benefit whatsoever. In fact, the only significant benefit it received accrued from the campaign against disease, which was undertaken to preserve the health of the non-Panamanian canal workers, not the citizens.

Maurer and Yu's conclusion:

Panama’s experience with the Canal, therefore, holds warnings for modern underdeveloped countries that seek to rapidly develop through the construction of large infrastructure projects, be they pipelines (as in Central Asia and Africa) or “land bridges” (as in Central America). The spillovers from such projects may prove disappointing. Nor is it clear that greater international oversight is an efficient way to insure greater local benefits from such projects...Panama eventually developed the human and institutional capital needed to benefit from the presence of the Canal on its soil, but it was a slow process that took almost a century, and required multiple costly interventions by the United States. It is not clear how long it will take Bolivia, Chad, or Uzbekistan to do the same.

Which, by the way, sounds a lot like a polite way of saying exactly the same thing as the writers of the books mentioned above.

One question: Timothy Butler

I didn't have a clue what I wanted to be when I was a kid. I didn't do much better as a so-called adult, stumbling around careerwise until my mid-30s. The only saving grace was that I was pretty willing to jump off whatever ship I was on and start swimming in another direction whenever wherever I was heading didn't seem fulfilling. And eventually, I got lucky and discovered that writing was right for me.

I could have saved myself a lot of grief and time if I could have read Getting Unstuck: How Dead Ends Become New Paths by Timothy Butler like 30 years in advance of publication. Butler, a Senior Fellow and Director of Career Development Programs at Harvard Business School, has created the best hands-on guide I've seen to dealing with impasse -- that experience of coming to a dead end in your career or life.

It was actually a relief for me to learn that impasse was such a common experience. But because I've always tended to jump ship when I find myself in that position, I've often wondered if I was making a mistake, that if I had stayed the course I might have achieved some greater success. So, I asked Butler, "How do you tell the difference between an impasse that requires a new path and a bottleneck in a path that you should stay on?" Here's his response:

"Very interesting question. Bottlenecks can be approached and worked-through using the problem solving methods that are currently in our repertoire. When we label something a 'bottleneck' we are implicitly recognizing it as a more or less predictable disruption within the model that we are using to understand our work situation. At times of impasse, there is no recognition. We do not understand what is happening around us. Impasse arrives as a sense that we are not making full sense of our situation. It often arrives first as feelings of frustration, indifference, or self-doubt. What we do not know yet is that we are encountering more than our model, of a work or life situation, can explain. It is then that we can begin the work of the impasse-to-vision cycle."

What a racket!

Publishers Weekly reported this nugget yesterday:

In a deal inspired by current bestseller and Oprah phenomenon The Secret, Thomas Dunne has announced that his imprint at St. Martin’s will publish Karen Kelly’s The Secret of the Secret in August. This will be a wide-ranging analysis of Rhonda Byrne’s book; Madeleine Morel at 2M Communications sold world rights.

Kelly, a former editor at Warner Books who has also worked as a ghostwriter, will talk to media and publishing professionals, scientists, psychologists and philosophy experts to help explain the success of The Secret and whether its message, on the power of positive thinking, really works. Kelly will also reveal The Secret’s scientific and religious influences and investigate the lives of eminent figures like Shakespeare, Einstein and Plato to see if these men did, as Byrne claims, all share The Secret.

Do you want to know the real secret? The Secret is rehashed self-help that has been expertly marketed (check out the website) and The Secret of the Secret is based on a time-honored publishing stratagem: you can make easy bucks by glomming onto the success of another book.

The really real secret is you've gotta be crazy to buy either of these books. Did you read the Newsweek article on Rhonda Byrne and the book? Her advice apparently includes this gem: "If you see people who are overweight, do not observe them, but immediately switch your mind to the picture of you in your perfect body and feel it." I, for one, will never again gaze upon any book that isn't a Oprah pick. Instead, I look away and envision my very own bestseller.

Flattery will get you nowhere

A decade ago, Lynda Obst, the Hollywood producer, wrote a forgettable book with an unforgettable title -- Hello, He Lied -- which pretty much sums up my initial state of mind whenever I'm accosted by retail sales clerks. They invariably say one or both of the things that make me grind my teeth: "That's really popular right now" or "That really looks great on you." I'd really rather be ignored.

Happily, it turns out that nobody believes this blather, according to Kelley Main, Darren Dahl, and Peter Darke, a trio of Canadian marketing professors. They conducted a set of experiments using a sunglasses kiosk in which the sales clerks flattered shoppers either during the sale, after the sale, or not at all. Then, they asked the shoppers to rate the trustworthiness of the clerks. Guess what? Flattery, whether it comes during or after the sale, lowers the shopper's perception of the clerk's trustworthiness. In fact, it automatically (that is, without conscious reflection) makes them suspicious.

The professors' results and conclusions were just published under the title "Deliberative and Automatic Bases of Suspicion: Empirical Evidence of the Sinister Attribution Error" in the Journal of Consumer Psychology. They could have used Obst's help there.

The mark of a good agent

I promised a post on how to identify a good business book agent a while back and have been avoiding it ever since. But, it's Sunday afternoon and I finished an article early, so here goes.

1. A good bizbook agent doesn't charge a fee to consider taking you on as a client. I think good agents can take a quick look at your book proposal and your resume and decide if you are worth their time. If you want more than a 'yea' or 'nay,' however, they have every right to charge you for their professional opinions or to read and comment on a manuscript or any of the other stuff that writers seem to expect for free.
2. A good bizbook agent doesn't make you sign away your life in return for representation. A writer's output is his or her income flow. Don't ever give an agent or anyone else control over that flow thru options on your next work or any other contract clause.
3. Once you're signed up, a good bizbook agent tears you up. Unless you're great, a good agent should be able to offer suggestions for fine-tuning your work. You should challenge those suggestions to be sure they make sense, but you should also take them seriously.
4. A good bizbook agent sticks it out. Ask agents about their process. If they dangle proposals in front of the usual suspects once and if nobody bites, forget about the proposal, forget about them. Publishers reject and accept books for all sorts of nutty reasons that have nothing to do with the books. I had one proposal that was rejected and later, accepted by the same editor! Good agents know that the market and the players are always changing and they are always looking for the right opening -- even if it's a year down the road.
5. A good bizbook agent is honest about the offers you get. Many, maybe most, offers from publishers are lousy offers. If you find your agent is saying every offer is great, call him on it or get a new agent.
6. A good bizbook agent reads your contract, makes sure you don't sign anything that is not in your best interest, and is willing to negotiate with publishers as long as it takes. Your demands have to be reasonable, but if they are, your agent shouldn't be the one shutting you down. By the way, the only way you'll know whether agent is shutting you down is if you learn what should and shouldn't be in contracts, refuse to sign anything that is not in your best interest, and are willing to negotiate with publishers as long as it takes.
7. Finally, a good bizbook agent knows that it's far better for you to let off steam with him as opposed to your publisher. So, he lets you curse and yell all you want and never holds it against you. (Thanks for that, John.)

Nazi Germany, thru an economic lens

Eight hundred-page books tend to threaten the already teetering structural integrity of my tower o' reading, so I try to avoid piling them on. But I have to make an exception for University of Cambridge prof Adam Tooze's economic history of Nazi Germany, The Wages of Destruction, released last year in the UK and just now in the US by Viking.

According to everything I've read, the book has broken new ground in our understanding of WWII by tracking the economic forces that both supported Hitler's rationale for war and guaranteed the defeat of Nazi Germany. It has been getting good reviews, too (in the Financial Times here and in the NY Sun here).

Tooze's analysis of Hitler's perceptions of the US suggests that the war was inevitable long before the first bullet was fired. He finds that the rising industrial might of the US led Hitler to believe that Germany must carve out its own empire in order to survive, that the Great Depression's impact on the US offered what seemed like the best opportunity to establish that empire, and that our leadership was inextricably linked to that figment of Hitler's diseased imagination -- the "worldwide Jewish conspiracy." Thus, Tooze concludes, "For Hitler, a war of conquest was not one policy option amongst others. Either the German race struggled for Lebensraum [living space] or its racial enemies would condemn it to extinction."

Gardner on your mind

I'm a fan of Howard Gardner, the Harvard psychologist whose theory of multiple intelligences won him a MacArthur genius grant and created serious doubts about the efficacy of standard IQ tests. I particularly liked his 2004 book, Changing Minds: The Art and Science of Changing Our Own and People's Minds, a thoughtful, authoritative read that offers a model and lots of insight into the mind-changing process without hype or oversimplification. None of that "how to get anyone to do anything you want in 5 seconds" baloney -- a fact that many reviewers complained about! (You can hear Gardner talking about the book on NPR's Talk of the Nation here.)

Gardner's new book from Harvard Business School Press, Five Minds For the Future, just arrived. In it, Gardner describes five uses of the mind that people, especially leaders and teachers, should cultivate if they wish to be successful in tomorrow's world. He calls these uses the Disciplinary Mind, the Synthesizing Mind, the Creating Mind, the Respectful Mind, and the Ethical Mind.

Why are these particular minds important? Gardner writes:

"Individuals without one or more disciplines will not be able to succeed at any demanding workplace and will be restricted to menial tasks.

Individuals without synthesizing capabilities will be overwhelmed by information and unable to make judicious decisions about personal or professional matters.

Individuals without creating capacities will be replaced by computers and will drive away those who have the creative spark.

Individuals without respect will not be worthy of respect by others and will poison the workplace and the commons.

Individuals without ethics will yield a world devoid of decent workers and responsible citizens: none of us will want to live on that desolate planet."

Puzzle pieces

If you've wondered about the origin of the sudoku puzzles that have sprouted like weeds in newspapers and magazines everywhere, check out today's NYT article on Maki Kaji, the father of sudoku and founder of what could end up becoming the next global publishing empire, Nikoli. I was intrigued to read that Nikoli was built on an open source basis; the people who buy its puzzles also refine them and design new ones. By the way, Kaji's US literary agent is none other than my own, superagent John Willig. Hmmm, wonder which one of us generates more commissions?

Speaking of puzzles, the pieces seem to be falling into place over at Portfolio, the massively-hyped new Conde Nast business magazine. According to a post over at Talking Biz News, the first issue, which will stand alone until the presses start running full time about four months from now, supposedly contains a bunch of 5,000 word articles, as well as a 25,000 word piece on hedge funds by New Journalism pioneer Tom Wolfe. For more on the ambitious new magazine, which hopes to expand the genre and broaden the audience, check out Paul Farhi's article in American Journalism Review.

Nice Pando

I signed up for an account at Pando yesterday and in minutes, was set up to send a couple of 30-40 MB audio files recorded during a recent meeting to Sharon Lee Harkey at Purple Shark Transcriptions. Pando offers upgraded services for a price, but the stripped-down free account will handle files up to 1 GB, which is fine for my needs right now.

It's a great service. You download their software, which enables you to upload any file you want to share to their servers and send notification emails with a link to whoever you want to download them. It worked right the first time out and I didn't even have to read the FAQs to figure it out.

Pando competes with a few other similar services, but to be honest, I can't figure out why the niche exists at all. I get all this bandwidth from my cable internet provider, but for some reason, still can't send files bigger than a handful of MBs via email. Why is that anyway?

What apologies?

Friday afternoon was not a good time to be in the Cleveland airport and heading east. The NY flights were all cancelled. But I got lucky, the really bad weather didn't extend down to Richmond.

The 20-minute delay caused when our plane was late from Indianapolis didn't bother me at all. We made it onto the plane and thru de-icing and then, the hydraulics that control the right side of the plane failed. Back to the terminal, where the mechanics were supposed to fix us up. Then, we got de-planed (it was a cold on Cleveland's tarmac), sent back thru the terminal to another gate to catch another plane. Got there, no plane, sent back where we came from. A plane finally did arrive and we left three hours late.

That's actually not too bad compared to what the New Yorkers went thru. But then I saw this NYT article, which focuses mainly on Southwest Airlines, about how all the airlines are suddenly big on apologies. Well, Continental is not one of them. We got a few perfunctory 'sorrys' here and there (sorry, but your plane just laid down and died) but that's about it. The flight attendant who sent us up and down the terminal in pursuit of a new plane never mentioned it. So I guess the real apology is in the mail?