Reading, Writing re: Management: Corporate communiques #1: Howard Schultz

Monday, February 26, 2007

Corporate communiques #1: Howard Schultz

I've been collecting memos, open letters, and other corporate communiques. I know, it's not as exciting a hobby as rock climbing or cave diving, but I'm thinking that I'd like to build a book around them. Messages -- good, bad, and sometimes just silly -- that changed people, companies, industries, even history. Messages like Alfred Sloan's "Product Policy Letter of 1921" that laid out his innovative plan to create cars for every market segment and Robert Wood Johnson's "Industrial Credo" that became the basis for Johnson & Johnson's ethics policy and Bill Gates' whiny "Open Letter to Hobbyists" that said sharing software was stealing and Sherron Watkins' anonymous memo to Ken Lay that became a smoking gun at Enron.

I just added Starbucks chairman Howard Schultz's 'commoditization' memo of Feb 14th to my collection. Somebody leaked it to the Starbucks Gossip blog. Great tagline there: "Monitoring America's favorite drug dealer." Anyway, I like the memo 'cause Schultz questions how and where the company has been drawing the line between cost effectiveness and customer experience and with what results. It's a great question that speaks directly to my experiences with the company as a customer.

Living in a small town, I was late to the whole Starbucks thing. You could get Starbucks coffee on the William and Mary campus, but the company didn't open a real store here until a couple of years ago -- long after we had a half dozen other independent and franchised coffee shops. Maybe that's why I've never really understood why people were crazy for Starbucks. It has never seemed any different than any of the other java stops in town -- same line, same choices, same taste, same price. So I stop at Starbucks when it's convenient and stop at the other places when I'm closer to them.

That's exactly the commoditization problem that Schultz is pointing out: why will people bother to get their coffee at Starbucks when it's just another coffee shop?

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Business in Fiction

"And by this time his financial morality had become special and local in its character. He did not think it was wise for any one to steal anything from anybody where the act of taking or profiting was directly and plainly considered stealing. That was unwise — dangerous — hence wrong. There were so many situations wherein what one might do in the way of taking or profiting was open to discussion and doubt. Morality varied, in his mind at least, with conditions, if not climates." --Theodore Dreiser, The Financier (1912)

"Had not a long, practical struggle with life taught him that sentiment in business was folly?" --Theodore Dreiser, An American Tragedy (1925)

"Be nice to incompetents and they'll be nice back. Be nasty and they'll still be incompetent, so what do you gain by making an enemy?" --John Burdett, Bangkok 8 (2003)

"The world has no pity on a man who can't do or produce something it thinks worth money." --George Gissing, New Grub Street (1891)

"Even the building was creepy: long windowless corridors and flights of stairs that stripped your sense of direction to nothing, tepid canned air with too little oxygen, a low witless hum of computers and suppressed voices, huge tracts of cubicles like a mad scientist's rat mazes." --Tana French, In The Woods (2007)

"Only a lunatic would fail to distinguish between himself and his representative self. This banal distinction may be most obvious in the workplace, where invariably one must avail oneself of an even-tempered, abnormally-industrious dummy stand-in, who, precisely because it is a dummy, makes life easier for all others, who are themselves present, which is to say, represented, by dummies of their own." -- Joseph O'Neill, The Dog (2014)

He had indeed conversed so entirely with money, that it may be almost doubted whether he imagined there was any other thing really existing in the world; this at least may be certainly averred, that he firmly believed nothing else to have any real value." -- Henry Fielding, Tom Jones (1749)

"You invariably find among CEOs that life is business. There is an operative cruelty which is seen as an entitlement." -- E.L. Doctorow, City of God (2000)

"Employers are like horses. They require management." --P.G. Wodehouse, Carry On, Jeeves (1925)

"SECRETS ARE LIES
CARING IS SHARING
PRIVACY IS THEFT"--Dave Eggers, The Circle (2013)

"A desk is a dangerous place from which to watch the world." -- John LeCarré, The Honourable Schoolboy (1977)

"I can well imagine forms of servitude worse than our own, because more insidious, whether they transform men into stupid, complacent machines, who believe themselves free just when they are most subjugated, or whether to the exclusion of leisure and other pleasures essential to man they develop a passion for work as violent as the passion for war among barbarous races." -- Marguerite Yourcenar, Memoirs of Hadrian (1963)

"Because if you truly want to become filthy rich in rising Asia, as we appear to have established that you do, then sooner or later, you must work for yourself. The fruits of labor are delicious, but individually they're not particularly fattening. So don't share yours, and munch on those of others whenever you can." -- Mohsin Hamid, How to Get Filthy Rich in Rising Asia, (2013)

"They copied all they could follow,
but they couldn't copy my mind.
So I left 'em sweating and stealing,
a year and a half behind." -- Rudyard Kipling, The Mary Gloster (1894)

"The only thing you got in this world is what you can sell. And the funny thing is you're a salesman, and you don't know that." -- Arthur Miller, Death of a Salesman

(1949)

"Every exercise of power incorporates a faint, almost imperceptible, element of contempt for those over whom the power is exercised." -- Sandor Marai, Embers (1942)

"Go to a tea shop anywhere along the Ganga, sir, and look at the men working in that tea shop--men, I say, but better to call them human spiders that go crawling in between and under the tables with rags in their hands, crushed humans in crushed uniforms, sluggish, unshaven, in their thirties or forties but still 'boys.' But that is your fate if you do your job well--with honesty, dedication, and sincerity, the way Gandhi would have done it, no doubt.

I did my job with near total dishonesty, lack of dedication, and insincerity--and so the tea shop was a profoundly enriching experience." -- Aravind Adiga, The White Tiger (2008)

"'Alex. Are you still buying advertising space?'
'For as long as the job doesn't require one to have a brain.'
'It's always nice to talk to a man who enjoys his work.'
'Fortunately I enjoy the money a whole lot better.'" -- Philip Kerr, The Pale Criminal (1990)

"'Oilmen are gamblers, most of them, and they'd rather take a little chance than spend a lot of money. Or wait for the technology to catch up.' He added after a moment, 'They're not the only gamblers. We're all in the game. We all drive cars, and we're all hooked on oil. The question is how we can get unhooked before we drown in the stuff'" -- Ross Macdonald, Sleeping Beauty (1973)

"I'm tempted to point out that our dealings, however unusual and close, were the dealings of businessmen. My ease with this state of affairs no doubt reveals a shortcoming on my part, but it's the same quality that enables me to thrive at work, where so many of the brisk, tough, successful men I meet are secretly sick to their stomachs about their quarterlies, are being eaten alive by bosses and clients and all-seeing wives and judgmental offspring, and are, in sum, desperate to be taken at face value and very happy to reciprocate the courtesy." -- Joseph O'Neill, Netherland (2008)

"I think that I shall never see
A billboard lovely as a tree.
Perhaps, unless the billboards fall,
I'll never see a tree at all."
-- Ogden Nash, Song of the Open Road, Happy Days (1933)

"When I go into the back entrance to our business, I smell the beans and the roasters and antiseptic-lacquered-with-fruit smell of the floor cleanser, and then, even more faintly, the strange bleary artificiality in the air, characteristic of enclosed shopping malls. The ion content in the oxygen has been tampered with by people trying to save money by giving you less oxygen to breathe. You get light-headed and desperate to shop. The air smells machine-manufactured, and the light looks manufactured or maybe recycled from previous light." -- Charles Baxter, The Feast of Love (2000)

"Some of us loved killing an hour of the company's time and others felt guilty for it afterward. But whatever your personal feelings on the matter, you still had to account for the hour, so you billed it to a client. By the end of the fiscal year, our clients had paid us a substantial amount of money to sit around and bullshit, expenses they then passed on to you, the consumer. It was a cost of doing business, but some of us feared it was an indication that the end was near, like the profligacy that preceded the downfall of the Roman Empire. There was so much money involved, and some even trickled down to us, a small amount that allowed us to live among the top one-percent of the wealthiest in the world. It was lasting fun, until the layoffs came." -- Joshua Ferris, Then We Came To The End (2007)

"The last line was so far away that the men were specks-bobbing bug-like fixtures, moving in what seemed to be a rainbow-haze of reds and yellows and blues. Those were the spray-painters, Simpson explained, and some of them made as much as seven dollars a day. He did not explain that they had no teeth after six months, little eyesight after a year, and that their occupational expectancy was about three years. In all likelihood he was not acquainted with these facts, and he would have been annoyed at their recital. To the best of his knowledge, there wasn't any law compelling a man to be a spray-painter." -- Jim Thompson, Heed the Thunder (1946)

"Since those birds were up around the top, the top numbers in one of the three biggest agencies in the country, with corner rooms at least twenty by twenty and incomes in the six figures, it had of course been years since any of them had personally dialed a number in an office. To expect them to would be against all reason" -- Rex Stout, Before Midnight (1955)

"What I'm getting at, Bobby, is you may notice, over time, as you study and learn, a certain amount of chicanery in this business of ours. But don't let that dismay you. It's just the nature of the business we're in, part and parcel of the good old capitalist system that's gonna make us both rich men before we die." -- Clancy Martin, How to Sell (2009)

"I'm a bookkeeper, and, the way I see it, there's nothing to life but bookkeeping...One rule is this: that if the risk of a transaction is very great it should not be considered at all, no matter what profit it offers if it is successful. That's one of the basic rules that should never be broken. You apply that rule to the idea of committing a murder and what do you get? There's too much risk, so you don't do it. The idea is no good. It's all a matter of debit and credit..." -- Rex Stout, Prisoner's Base (1952)

"I must look Ralph up and question him. He'll be in hiding by now, of course, but he's worth hunting out. He always has the most consistently logical and creditable reasons for having done the most idiotic things. He is" - as if that explained it - "an advertising man." -- Dashiell Hammett, The Dain Curse (1929)

What Ted has read lately

The Orphan Master's Son

by Adam Johnson

Terrific novel set in North Korea-Orwellian and Dickensian at the same time.

Dealstorming: The Secret Weapon That Can Solve Your Toughest Sales Challenges

Dealstorming: The Secret Weapon That Can Solve Your Toughest Sales Challenges

by Tim Sanders

First book I've seen on what has to happen backstage--within the seller's company--to close big, complex, winner-take-all sales.

American Gods

by Neil Gaiman

Great read that marries mythology with modern-day America

Shakey: Neil Young's Biography

by Jimmy McDonough

A great bio, a must-read for Young fans, and terrific insight into the creative process and how to keep it alive

The Blackhouse

by Peter May

Terrific murder mystery set in Hebrides

Agile Talent: How to Source and Manage Outside Experts

Agile Talent: How to Source and Manage Outside Experts

by Jon Younger

Addresses a big problem: the inability of companies to get full value from external talent. Academic-style read. The solutions are aimed at big companies that hire a lot of outside help.

Some Buried Caesar

by Rex Stout

Nero and Archie get embroiled in a double murder on the way to an orchid competition upstate. Good one

City on Fire

by Garth Risk Hallberg

Adding Hallberg to my authors to watch list. Ambitious and mostly terrific novel set in NYC in late 70s. Could have been cut by a third, but the characters and story-telling pulled me thru.

Reading, Writing re: Management

Monday, February 26, 2007

Corporate communiques #1: Howard Schultz

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