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Tuesday, January 27, 2009

Liar Liar

From television news to the Wall Street Journal we've heard the comparisons of this economy to The Great Depression. This is a historically tough economy, but the Second Great Depression? Seriously?

I know Nashville fares better than many communities in good times and bad, but I pass a lot of $40,000 vehicles on the way to restaurants with full parking lots. I don't recall a robust restaurant industry from video footage of the Depression. There's a serious disconnect between news reports of "how bad things are" (which is the big story of the last several news cycles leading up to the election) and the number of people without jobs and incomes.

Examples of manipulated or hysterically inaccurate news reporting on this economy would make a great doctoral dissertation. The limits of the blog format and my attention span won't allow for that. Here, however, is just one instance of a "fact" offered as evidence of "how bad things are" drilled down to the truth of the matter.

In December the U.S. economy lost half a million jobs, totalling 2.6 million jobs lost for 2008. From the Obama administration-in-waiting to yesterday's Wall Street Journal, this has been reported as "the biggest job loss since 1945." Sounds scary doesn't it?

Well, what exactly does that mean? To history-ignorant Americans (remember, the Social Studies Composit replaced the study of history in most public schools a generation ago), it sounds like more of "the big story" of "the worst economy since The Great Depression" since its the 1940s and The Great Depression was back there somewhere. It sounds awful! The biggest job loss in 64 years! Well, not so fast...

In 1945 the U.S. was in the last year of World War II. While the war in Europe had ended in May, the Japanese surrender didn't come until September. During the majority of 1945 unemployment was 3.0%, or about 1.5% over full employment. Full employment is historically defined by economists as 4 - 4.5% unemployment; this is due to frictional unemployment, or the natural cycle of people in transitional periods of their life (between jobs, maternity leaves, just graduated and looking for your first job, etc...). So the fall of 1945 was a period of historically low unemployment.

Following the surrender of the Japanese and the end of the war, the hot wartime manufacturing economy cooled, women returned from the factories to their homes, soldiers started coming home but were in transition, and the economy "lost" 2.8 million jobs, almost all of it war-related frictional unemployment. This was approximately 2% of the U.S. population at the time (139.9m).

In 2008 the economy shed 2.6 million jobs on a population base of (est) 306m, or .85%. The cause was a rapidly slowing economy (slowing, not imploding) that is expected to continue into much of 2009.

So what's the informative link between 2008 and 1945? Absolutely stinkin' nothing! The 1945 economy wasn't bad and therefore not comparative to our current recession. The job losses in 1945 were, to a great extent, joyous because the jobs themselves were the product of hardship in support of a world war.

The comparison of 2008 to 1945 is a misleading use of facts and statistics to further the big story. There are more examples, but this is enough to make the point. At 7.2% unemployment, we're about 2% less employed than we were eighteen months ago, yet sales in some sectors are off 30%. This is purely a function of psychology, and that psychosis is largely media fed. Since our current President is a scholar of Roosevelt, he might consider resurrecting an appropriate point from that administration; that we have nothing to fear but fear itself.

Thursday, January 22, 2009

Five Secret Weapons of the Corporate Office

We are moving all Nashville office staff and leadership into the Corporate Office building. There we have five secret weapons that, if unleashed, can shorten iteration loops for almost every process. We can react quicker, bring products to market faster and smarter, and cut the man hours it takes to do almost everything.

I learned how to wield these powerful weapons from a Japanese executive for whom I worked in the 90's. I offer those to you, gentle reader, that your career and our company might flourish.

The guru of wielding these secret weapons was "Mr. Oba". I don't know that I ever knew his first name, because the emphasis was on the "Mr." He was the second most powerful man on the org chart when I was a pup. He was the top ranking member of management from one of our joint venture partners and we heard that he was the highest ranking manager from that company ever posted in the U.S. Our President didn't cross him.

He stood about 4' 11" in safety shoes, and looked like a Japanese Yoda wearing a blue company uniform. We hardly ever saw him that he wasn't on his way to or getting back from the airport. He flew overnight to Mexico, toured troubled manufacturing facilities by day, and flew back overnight. He was the most effective Japanese executive I ever met (which is a high compliment in itself) and he had one simple philosophy that we could all quote:

"Go to the actual place,
See the actual situation
Make a good countermeasure"

He was never happy if any of us brought him information that we were given by phone, fax, or email. If we didn't go get it, on sight where the problem was occuring, it held no value for him. We learned the power of going to our co-workers no matter the country in which they worked, talking to them personally, working alongside them to understand their needs and situation, and coming back to Corporate with solid information and recommendations.

Using these methods we can unleash the five secret weapons of the Corporate Office. Those are, in no particular order:

The north stairway
The south stairway
The lobby stairway
The lobby elevator
The north elevator

It takes four minutes to walk from the top floor of the south end of the Corporate office building to the north end of the ground floor. I've timed it. Think about the power in that. Every single non-warehouse employee of the company within four minutes walk from every member of the Executive Leadership Team and the Leadership Team. Every Nashville employee less than 10 minutes walk from the CEO.

Our reliance on email, voice mail, and the rumor mill can be supplanted by the power of face-to-face communication. Cross-functional teams will be just steps away from each other. Got a question? Ask it! If you don't want to ask your supervisor, ask someone else's! After all, everyone in leadership is less than four minutes from wherever you are.

Got a problem with a co-worker or supervisor? HR is in the middle of the building no more than two minutes away. Got a contract issue with an author or agent? Legal is right beside us. Can't get a call returned from a co-worker? Go stand in their cube!

Once we're all in the same building it should be unacceptable to leave voice mail and email for days, or even hours, awaiting a response. Our new corporate tag line should be, “Hit the stairs!”

Monday, January 12, 2009

Mayor Karl Dean on the "English Only" Special Election

The following message was sent last week from Nashville Mayor Karl Dean regarding the Special Election this month on English Only. His message is on-target so I yield this blog post to our Mayor. Many thanks to David Leach for sending it my way.

Dear Friends,

I hope that you and your family enjoyed the holidays and were able to take some time to reflect and appreciate the year gone by.

As I have had the opportunity to say many times over the last year, Nashville is a great city. I enjoy being Mayor and I am grateful to the citizens of Nashville for allowing me the opportunity to make a difference in people’s lives. It has been an exciting year for the city. We’re making progress on my plans for education reform. We’ve added over 100 new officers to our police force. And plans to build a new downtown convention center are well underway, which when completed will give our city a huge economic boost. We face many challenges, but I truly believe that our best days are yet to come.

As we work together to make progress for our city, I want to bring to your attention an issue of pressing importance. Starting today with Early Vote and on Election Day January 22, voters will have the opportunity to go to the polls for a special election on two amendments to the Metro Charter.

One of these amendments makes English the official language of the Metropolitan Government of Nashville and prohibits government services from being offered in languages other than English. The other amendment makes it far easier to amend the charter.
I am strongly against these charter amendments and I want you to join me in voting against English Only and Amendment No. 2.

While I do not question the intentions of the proponents of this initiative, I feel a responsibility as mayor to explain the implications such a radical change in our law could have for our city.
First, let me explain what the English Only amendment is not. It is not a vote on immigration reform and it is not a harmless message to office holders. The proposed charter amendment will have absolutely no effect upon efforts to curtail illegal immigration or to reform current national policy. Rather than permitting voters to send a message to the government, the referendum alters our charter in a way that will create legal, political, social and even moral consequences for years to come.

To me, it is the antithesis of hospitality and an unnecessary drain on taxpayer resources. The issue is divisive and will distract us from doing those things that will help us realize our potential as not just a great American city, but a great international city.

English is the official language of Tennessee. That is not in question. We have too much potential to allow this unnecessary measure to hurt us in so many ways.

Amendment No. 2 will make it easier to change our Metro Charter. This amendment is unnecessary because Nashville citizens already have the power to change the charter and it has been changed, even in the short time I have been Mayor. If this amendment passes, special interest groups will be able to put amendments on the ballot every year, even if they keep losing, and this process will likely make government more expensive and inefficient.

A coalition has formed to fight these amendments. It is called Nashville for all of Us.
They will be sending out information and e-mails about the campaign to stop these changes in our charter. Please sign up to join their effort.

And I hope that you will join me in voting against English Only.

Karl F. Dean
Mayor of Nashville

Address is: Karl Dean's Office 3420 Hampton Ave Nashville, TN 37215

Friday, January 02, 2009

Work From Home and the Corporate Office Move

Most of you who read this blog by now know that by the end of January we will close our Lakeview offices and move almost all office jobs to the Corporate Office Building. This is a tremendous opportunity for our company in terms of savings, teamwork, and tightening iteration and product development cycles, but that's a subject I'll take up in another blog in a few days. For now I want to address how the move to corporate, which was one of my goals for WFH, changes this program going forward. It was a significant downsizing, not WFH, that made this move possible this quickly but I'll take it however it comes.

In my opinion, the move of all office operations into one building leaves us no choice but to accelerate the program into the space sharing phase. It is my understanding that we're getting LVP employees into the Corporate building with about 3 open spaces to spare; that's all. Those spaces will most likely be used for temporary workers and the occasional contractor working on site, which means we have zero room for growth. When business picks up, as it eventually will, every single new job added will have to either work remotely or share space with an existing employee.

Right now we have limited space sharing going on in HR and Production, and this is working well. Were it not for even this limited amount space savings, we would have had to build out offices in the warehouse in order to make the LVP move possible.

After the dust settles on this move I will begin calling meetings with each department head to discuss the how and the who of space sharing. For those of you who are still skeptical, please take a few of these slow post-holiday workdays to come to grips with the choices in front of you for next year; two to a cube or office, an expensive office build-out in the warehouse, re-leasing extra office space and moving your team again, or implementing WFH/space sharing. While I don't have the authority to mandate such a program, I do have a pretty good perch from which to observe trends. In my opinion, this program is quickly becoming inevitable and the discussion must quickly shift from if to how we implement this broadly across our operations.