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  • Archive for the 'Business' Category

    “. . . the significant, blood-sport destruction of my business . . .”

    Posted by Jonathan on 22nd May 2018 (All posts by )

    Leon Cooperman: Two changes that could help fix what is wrong with our regulatory process:

    It seems logically manifest to me that something transpired between September 2016 and March 2017 that led to the Commission’s dramatically downwardly-revised settlement offer. Despite numerous attempts to ferret it out, I have been unsuccessful in getting a response, either from the current chairman or from his predecessor who oversaw my case (and who told me, when I saw her at a conference after she left office, that even innocent people often find settling with the government preferable to hazarding the system). As an American taxpayer, I believe that I deserve an answer to my question. And as an analytical person, it is hard for me to reconcile the significant, blood-sport destruction of my business that this matter has occasioned without understanding the dynamics behind the resolution from the Commission’s perspective.

    “Something transpired between September 2016 and March 2017” that led the SEC to dial back the brutality of its regulatory attack on Mr. Cooperman’s firm. I wonder what that something could have been?

    Elections have consequences. The Obama administration was so openly hostile to business, and so casually willing to use its power to reward allies and punish critics, that prominent business people were reluctant to criticize the Administration publicly, especially in the early days before the 2010 elections. If I recall, Mr. Cooperman was more courageous than most of his contemporaries in expressing public concern about Mr. Obama’s policies.

    As the man said, this is how you get more Trump.

    Posted in Big Government, Business, Civil Liberties, Civil Society, Crony Capitalism, Law, Obama, Politics, Trump | 1 Comment »

    A Disturbingly-Declining Rate of Return in Pharma R&D?

    Posted by David Foster on 5th May 2018 (All posts by )

    Here’s an interesting analysis

    Posted in Business, Economics & Finance, Science | 8 Comments »

    Worthwhile Reading and Viewing

    Posted by David Foster on 27th April 2018 (All posts by )

    An MBA student who was raised in Communist China reads Hayek.

    Has Silicon Valley hit peak arrogance?

    Is high testosterone inversely correlated with hedge-fund performance?

    Anti-Semitism and the Democratic Party.

    A manufacturing engineer looks at Tesla manufacturing.  Related:  Elon Musk now thinks his use of robots to build the Model 3 was excessive.

    (I wonder if Musk was aware of the history of Roger Smith and the robots at GM when he established his manufacturing strategy.)

    15 facts about Renoir’s Luncheon of the Boating Party.

     

     

    Posted in Business, Economics & Finance, Human Behavior, Judaism, Leftism, Tech | 20 Comments »

    Seismic Upgrade, Moral Hazard and Gentrification

    Posted by Carl from Chicago on 21st April 2018 (All posts by )

    While there has not been a recent major earthquake in the Pacific Northwest, research has proven that the area is seismically active. Building codes were established to withstand earthquake damage and new buildings have been held to this higher standard. However, there is a substantial portion of the commercial and residential buildings which have not been retrofitted to date. This cool interactive map shows earthquake risk in Portland based on the age of construction… and the pervasive color “red” is bad.

    While wood frame houses may fare reasonably well in an earthquake, the highest risk buildings are large structures made of brick. The term for these sorts of buildings in Portland is “unreinforced masonry” or URM for short. They are the buildings that give Portland all of its “character” like classic old apartment buildings and multi-use commercial and residential structures. Many schools, churches and community centers also fit in this classification. This article estimates that it would cost $4.6B to retrofit the remaining URM buildings in Portland. They also note that at the current rate of upgrades, it would take 100 years to complete the effort.

    I read a different local article and an engineer put it most pithily

    The value of an URM building is zero

    I do see some building owners “biting the bullet” and doing a seismic upgrade. When I look out the window of my building I can see many of the older buildings that have been upgraded in this manner, and many that have not. Here is a construction notification for a nearby 5 story masonry building that is being retrofitted.

    There are two threads here that are most interesting to me:

    1. How do owners of apartment buildings, where residents will most certainly be at higher risk of death during an earthquake, sleep at night? They talk about the costs of retrofitting as if it is an abstract event; but not doing so creates an economic externality of human misery that apparently they value very little if at all

    2. Any mandate the city or region employs on URM will almost certainly drive gentrification because owners will have to invest in higher cost apartments and in turn raise rents; ironically, the city’s mandates on re-use and burden of oversight rules will make the future rent increases even more burdensome

    The likeliest solution is some sort of “muddling along” in the near term. For valuable commercial and high rise residential locations, the inevitable commercial upgrades will drive the URM upgrades. For apartment buildings, the future is much dimmer, because if you are a landlord owning an URM building, you can’t raise and invest the money if your local competitors are just going to “accept” the URM risk (on behalf of their residents, ironically). In fact, it makes no sense at all to invest anything more than the cosmetic minimum in these URM buildings, which will move them down the road of being slums at some point in the future.

    Cross posted at LITGM

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    Posted in Architecture, Business, Oregonia | 10 Comments »

    Disruption – The Weed Market in Oregon

    Posted by Carl from Chicago on 20th April 2018 (All posts by )

    Oregon allows recreational marijuana. Originally, there were laws limiting growers to local Oregon companies (when it was a medical marijuana industry) which were effectively eliminated when the transition was made to recreational usage (allowing out of state funding). There was also a relatively small local market for growing cannabis.

    Dispensaries cropped up everywhere, even in seemingly small, out of the way tourist towns with only a few hundred souls. It seems that you can’t go far without seeing the “green cross” that symbolizes a marijuana dispensary. Unlike other states, Oregon apparently allowed anyone who met basic criteria to open a “weed store”.

    While it surprised many of the locals who curated their wares and made custom strains of local cannabis, the free market reared its head and drove down prices on effectively undifferentiated product and storefronts. From the local WWeek newspaper:

    A gram of weed was selling for less than the price of a glass of wine… we have standard grams on the shelf at $4… before we didn’t see a gram below $8… Wholesale sun-grown weed fell from $1500 a pound last summer to as low as $700 by mid-October.

    As a result of this, there is significant consolidation in the market as smaller growers either bow out or are bought up and dispensaries are being purchased by large groups (often vertically integrated with growers) at fire-sale prices.

    (the) Oregon cannabis industry is a bleak scene: small businesses laying off employees and shrinking operations. Farms shuttering.

    One farm profiled in the article went into growing weed with the expectation of selling at $1500 a pound; when they finally had to liquidate most of their crop at a weed auction, they only received $100 a pound.

    The entire Oregon recreational cannabis industry has played out exactly as you would expect in a market with few barriers to entry and a relatively undifferentiated commodity:

    1. Suppliers rush in to take advantage of high prices for crops, turning what was originally a weed shortage (and resulting scarce supply) into a huge spike in supply which in turn drove down wholesale prices to almost nothing on the margin

    2. Retailers who have little or no differentiation are being driven out of business by low profits or being forced to run at a loss

    For me the interesting part of this is not the plain execution of basic market economics (in an industry with low barriers to entry, prices will drive down to near marginal cost of the most efficient operator), but in what that means to “adjacent” industries. For example, if a gram of (high quality) weed is the price of a single glass of wine (actually a lot less at $4… that is probably 1/3 of the price of a glass of decent wine at a standard restaurant), will customers switch from beer or wine to cannabis? From an economic perspective (cost / buzz) this would be a relatively clear-cut choice. Over time economists should chart the impact of low cannabis prices on both prices and consumption in adjacent alcohol industries.

    Cross posted at LITGM

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    Posted in Business, Economics & Finance, Oregonia | 30 Comments »

    Automation, Aviation, and Business

    Posted by David Foster on 10th April 2018 (All posts by )

    A thoughtful post about the impact of automation in aviation, and how some of the problems occurring in this field are also relevant to potential problems with automation in business:

    Since the 1980s, automating various flight management operations has contributed to a profound improvement in air transport safety and effectiveness. But a related human issue — automation dependency — has emerged as a significant challenge to further improvements in safety levels. Automation can contribute to diminishing manual flying skills and increasing complacency, as pilots avail themselves of automatic flight management and navigation systems to aid much of their decision-making.

    In some cases, pilots don’t fully understand the automatic processes controlling their sophisticated aircraft. The ironic enquiry “What’s it doing now?” is sometimes heard in the cockpit, as pilots struggle to figure out the actions of the “automatics”, as these systems are referred to on the flight deck.

    Crucial as this is in the cockpit, automation dependency is equally problematic in many businesses today, whenever there is a disconnect between what managers think is going on and what is actually happening. The automation in question is not just technological, but also pervades the processes, algorithms, and reporting on which managers rely to inform their decision-making.

    Aviation is addressing this phenomenon as a major problem and is seeking solutions. We suggest that many companies should do the same before their “business automatics” put them at risk of losing control.

    RTWT

    Reminds me of this aviation classic, a 1997 talk by an American Airlines pilot:  The Children of Magenta.

    See also: Automation is Fragile, People are ‘Antifragile’ and my posts When Humans and Robots Communicate and Blood on the Tracks

    Posted in Aviation, Business, Management, Tech, Transportation | 19 Comments »

    So, Really Want to Talk About Foreign Intervention?

    Posted by David Foster on 3rd April 2018 (All posts by )

    Much ink and many photons have been spent discussing Russia’s attempts to influence (or at least disrupt) the American 2016 Presidential campaign.  Meanwhile…

    Here’s an appalling story about how anger from the Chinese government led Marriott Corporation to fire an employee who had ‘liked’ a tweet which congratulated the company for listing Tibet as a country, along with Hong Kong and Taiwan….of course, the Chinese regime considers Tibet to be a part of China, not a separate country.

    China forced Marriott to suspend all online booking for a week at its nearly 300 Chinese hotels. A Chinese leader also demanded the company publicly apologize and “seriously deal with the people responsible,” the Journal reported.

    And boy, did Marriott ever apologize. Craig Smith, president of the hotel chain’s Asian division, told the China Daily that Marriott had committed two significant mistakes — presumably the survey listing Tibet and the liked tweet — that “appeared to undermine Marriott’s long-held respect for China’s sovereignty and territorial integrity.”

    He announced an “eight-point rectification plan” that included education for hotel employees across the globe and stricter supervision.

    And the Marriott executive said this to China’s most-read English-language newspaper: “This is a huge mistake, probably one of the biggest in my career.”

    (More here…according to this article, the Chinese suppression of Marriott bookings was in response to the initial listing of Tibet as a country rather than to the tweet approving of this listing)

    The Chinese economy is, shall we say, a little more dynamic than that of Russia, so the government of China has much more ability to strong-arm American corporations (in general) than does the Putin regime.

    Turning now from the hotel industry to the movie industry, Richard Gere says that Chinese pressure due to his stand on Tibetan independence has led to his being dropped from big Hollywood movies.  Also:

    Gere’s activities have not just made Hollywood apparently reluctant to cast him in big films, he says they once resulted in him being banished from an independently financed, non-studio film which was not even intended for a Chinese release.

    “There was something I was going to do with a Chinese director, and two weeks before we were going to shoot, he called saying, ‘Sorry, I can’t do it,’” Gere recalled. “We had a secret phone call on a protected line. If I had worked with this director, he, his family would never have been allowed to leave the country ever again, and he would never work.”

    See also How China’s Censors Influence Hollywood.  Because the Chinese market is so large…(Fast and Furious 7 pulled in $388 million in China, more than it made in the US)…the influence of the Chinese regime on US film production and distribution has become immense.

    In recent years, foreign filmmakers have also gone out of their way not to provoke the Communist Party. For instance, the 2012 remake of the Cold War action movie, Red Dawn, originally featured Chinese soldiers invading an American town. After filming was complete, though, the moviemakers went back and turned the attacking army into North Koreans, which seemed a safer target, at least until last year’s hack of Sony Pictures.

    and

    Ying Zhu, a professor of media culture at the College of Staten Island at the City University of New York, worries China’s growing market power is giving the Communist Party too much leverage over Hollywood.

    “The Chinese censors can act as world film police on how China can be depicted, how China’s government can be depicted, in Hollywood films,” she says. “Therefore, films critical of the Chinese government will be absolutely taboo.”

    In the late 1990s, when China’s box office was still small, Hollywood did make movies that angered the Communist Party, such as Seven Years In Tibet, about the life of the Dalai Lama, and Red Corner, a Richard Gere thriller that criticized China’s legal system. Given the importance of the China market now, Zhu says those movies wouldn’t get financing today.

    Plus, Chinese companies have snapped up Hollywood studios, theaters and production companies.

    Read the rest of this entry »

    Posted in Academia, Business, China, Civil Liberties, Civil Society, Environment, Film, Media, Russia, Science, Tech, USA | 34 Comments »

    More and Better Disclosures!

    Posted by David Foster on 29th March 2018 (All posts by )

    It’s now required for publicly-traded companies to publish the ratio between the CEO’s annual compensation and that of the median employee.  That ratio is, for example,  367:1 at Disney (Robert Iger), 124:1 at Deere & Co (Samuel Allen), and 50:1 for Whirlpool (Jeff Fettig). Link

    These numbers (which, it should be clarified, include seasonal and part-time employees) have caused much alarm in many quarters, and even referred to as heralding a “crisis of capitalism.”

    But why stop at CEOs and other business executives when requiring this kind of analysis?  My idea is that there are many other fields in which high-visibility disclosures could be interestingly required…

    In movies, for example, it should be required that the opening credits include the ratio of the pay of each of the top 5 stars to the median pay of the entire crew that worked on the film–including accounting clerks, boom operators, sweepers, and various ‘assistants to’.

    In professional sports, team uniforms should display prominently the total value of the player’s current contract.  This feature would greatly add to the pleasure of fans, who could instantly and continuously compare the player’s financial value to his demonstrated, moment-by-moment playing-field value.

    At colleges and universities, a sign out front of the president’s mansion should display the ratio of his compensation to that of the median faculty member, which category of course must include the starvation-paid adjunct professors.  (The compensation number for the president should certainly include the imputed value of his university-provided mansion and any other similar benefits, such as cars and drivers.)

    For politicians, the disclosure problem is a little more complicated, since in many cases the main financial payoff for these jobs is in the form of “deferred compensation”, i.e., lobbying positions and consulting contracts offered after the term of office ends, in recognition of services rendered while in office.  About all I can think of for the politician class is that, for all public appearances, they must wear jackets, with the names of their top sponsoring/contributing organizations prominently emblazoned, in a manner similar to the way racecar drivers display the names of their sponsors.

    There are probably a lot of additional possibilities for disclosure and transparency, which the ChicagoBoyz and Chicago Grrrlz and Readerz can surely suggest.

    Concerning those who support the CEO pay-ratio requirement but would object to these further suggestions…I have to wonder if their primary agenda really concerns ‘inequality’ or is really about something else.

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    Posted in Academia, Business, Capitalism, Economics & Finance, Leftism, Sports, USA | 10 Comments »

    Strange Comparison, Dangerous Conclusion

    Posted by David Foster on 25th March 2018 (All posts by )

    About a week ago, the WSJ ran an article titled Mark Zuckerberg is No James Madison.  The article argues that a constitution is similar to a block of computer code—a valid point, although I would argue it is also true of legislation and contracts in general…both the code, and the constitution/law/contract must be sufficiently clear and unambiguous to be executable without reference to their originators.

    Then the article goes on to say that ‘the Constitution understands human nature.  Facebook, dangerously at times does not.  In designing the Constitution, Madison managed to appeal to people’s better angels while at the same time calculating man’s capacity to harm and behave badly. Facebook’s designers, on the other hand, appear to have assumed the best about people. They apparently expected users to connect with friends only in benign ways. While the site features plenty of baby and puppy photos, it has also become a place where ISIS brags about beheadings and Russians peddling misinformation seek to undermine the institutions of a free society.’

    The attempt to create a parallel between Zuckerberg and Madison is a strange one, IMO, given the completely different nature of the work the two men were doing. Madison was attempting to create a new model for a self-governing country, Zuckerberg was attempting to make money for himself and his investors, and maybe to provide a little fun and value for his users along the way.

    What I find especially problematic is the ‘therefore’ that the author draws:

    Facebook insists it is not a media company. Maybe so. But unless it takes on the responsibilities of an editor and publisher by verifying the identities of users, filtering content that runs on its platform, and addressing the incentives to post specious or inflammatory “facts,” Facebook should expect to be policed externally.

    But is Facebook really a publisher, or it is it more of a printer?  If someone..Ben Franklin in the mid-1700s or some corporation today…is running a printing shop, running printing jobs for all who will pay, should he or it be held accountable for validating the truth of the material printed and verifying the identities of the customers?

    Read the rest of this entry »

    Posted in Advertising, Blogging, Business, Civil Liberties, Deep Thoughts, Elections, Law, Tech | 23 Comments »

    Attack of the Job-Killing Robots, Part 3

    Posted by David Foster on 13th February 2018 (All posts by )

    The final months of World War II included the first-ever battle of robots:  on one side, the German V-1 missile and on the other, an Allied antiaircraft system that automatically tracked the enemy missiles, performed the necessary fire-control computations, and directed the guns accordingly. This and other wartime projects greatly contributed to the understanding of the feedback concept and the development of automatic control technology.  Also developed during the war were the first general-purpose programmable digital computers: the Navy/Harvard/IBM Mark I and the Army/MIT ENIAC…machines that, although incredibly limited by our presented-day, standards were at the time viewed with awe and often referred to as ‘thinking machines.’

    These wartime innovations in feedback control and digital computation would soon have enormous impact on the civilian world.

    This is one in a continuing series of posts in which I attempt to provide some historical context for today’s discussions of automation and its impact on jobs and society…a context of which people writing about this topic often seem to have little understanding.

    Read the rest of this entry »

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    Posted in Business, Economics & Finance, History, Tech | 10 Comments »

    The Details of Work and the Realities of Automation

    Posted by David Foster on 5th February 2018 (All posts by )

    An interesting piece on the automation of trucking, with an extensive comment thread.  Many of the commenters have practical experience in the trucking industry and in automation work in other industries such as sawmills.

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    Posted in Business, Economics & Finance, Tech, Transportation | 7 Comments »

    Are Those Robots Slacking Off on the Job?

    Posted by David Foster on 23rd January 2018 (All posts by )

    Much concern is being expressed these days about technological unemployment driven by robotics, artificial intelligence, etc.  But labor productivity numbers have been more in the direction of stagnation than in the direction of a sharp break upwards…see for example this BLS analysis.  Note especially Chart 5, which compares productivity growth in three periods:  1947-2007, 2001-2007, and 2009-2016.

    See also this piece, which looks at total factor productivity across continents.

    So, what is going on here?  Why have the remarkable innovations and heavy corporate and government investments in technology not had more of a positive effect on productivity?  I have my own ideas, but am curious about what others think.

    Posted in Business, Economics & Finance, Management, Tech, USA | 6 Comments »

    Flyoverphobia

    Posted by Sgt. Mom on 17th January 2018 (All posts by )

    So, there has always been a tension existing between city folks and country folks; the tale of the city mouse and the country mouse being an example. Then there are all those jokes about the city slicker and the country bumpkin, the effete city dweller and the down-to-earth country folk, the books, movies and television series painting the city as a glamorous yet spiritually and physically unhealthy place, the country being dull, desperately boring, backwards, even a bit dangerous … all in the spirit of good fun, mostly. But now we have a new and malignant version, and there is nothing at all fun about it. Here we have the bicoastal enclaves, all drawn as the glamorous and fabulously wealthy, sensitive and with-it woke folks … and then you have the flyover country in between, filled with – as the bicoastal see it – with those hateful, stupid looser deplorables, clinging to their guns, and religion, and hating on all those with darker skins.
    Read the rest of this entry »

    Posted in Big Government, Business, Conservatism, Deep Thoughts, Entrepreneurship, Leftism, Trump | 38 Comments »

    Worthwhile Reading

    Posted by David Foster on 4th January 2018 (All posts by )

    Cold Spring Shops:  Losing the Intellectual Tradition.  He cites Joy Pullman, who in turn quotes Hillsdale College president Larry Arnn:

    We’re living in a time as if some blight has come across the earth. Something fantastic, something deep, something old, something elevated, something high is basically being obliterated.

    Also from Cold Spring Shops:  Collaboration creates mediocrity.  I would rephrase this to say that collaboration can create mediocrity, especially when used as an unthinking buzzword and deployed as a pseudo-religion…after all, the purpose of basically all organizations is to allow people to collaborate, in various ways, to do what they could not do individually.  But shallow thoughts about collaboration and de-leveling and de-siloing and de-hierarchicalization are indeed in many cases detracting from the serious work that needs to be done on organizational design.

    At Politico: The secret backstory of how Obama let Hezbollah off the hook.  See also a response to this story from The DiploMad.

    Related, from Roger Simon:  Iran protests expose mainstream media as reationary, not liberal.

    Three from Sarah Hoyt:

    Childhood memories:  The things that stay

    The importance of feedback:  Breaking the Gears

    Of course they do:  When the Left bullies, they pose as anti-bullies

    Posted in Academia, Business, Crime and Punishment, Education, Leftism, Management, Media, Terrorism | 12 Comments »

    Disruption – Amazon Basics and Amazon Essentials

    Posted by Carl from Chicago on 2nd January 2018 (All posts by )

    “Amazon Basics” is a line of low cost products created especially by Amazon. “Amazon Essentials” is an apparel line created by Amazon. This picture has a “basics” speaker and a low cost “essentials” product (the notebook):

    – a portable wireless bluetooth speaker for $19.99

    Essentials dot matrix notebook for bullet journal for $9.92

    I was impressed by both of these items. When you go to Amazon and either the basics or essentials section there is a wide array of products to choose from at amazingly low prices.

    Amazon is choosing which markets and products that they want to compete in directly and they offer what appears to be reasonable quality products at low price points. If you cycle through the product list you can see a lot of everyday products or items that don’t normally have a strong branding component.
    Read the rest of this entry »

    Posted in Business, Tech | 21 Comments »

    Entitled

    Posted by Sgt. Mom on 31st December 2017 (All posts by )

    I see by another link on Insty Saturday afternoon that the United Airlines- Sheila Jackson Lee flap has not quite faded away – much as MS Jackson Lee, AKA ‘the Queen’ or ‘Cruella’ Jackson Lee likely wishes it would. I surmise that this bit of congressional bad behavior is still rattling the newshounds and the commentariat for several reasons. The first of these is that ‘Cruella’ is one of the dumber members of Congress. (The honor of the dumbest must go to Hank “Guam Might Tip Over!” Johnson, of whom it might rightfully said – stealing a paraphrase from the late Molly Ivins about another spectacularly dumb career politician – “Lose any more IQ points, and his staff might have to put him in a pot in the corner and water him three times a week.”) But there’s more! ‘Cruella’ Jackson Lee has been acknowledged hands down for many years as the rudest and most abusive boss on Capitol Hill. Read the rest of this entry »

    Posted in Business, Civil Society, Current Events, Customer Service, Diversions, Human Behavior, Politics | 17 Comments »

    2017 Reading, continued

    Posted by David Foster on 23rd December 2017 (All posts by )

    A Prophet Without Honor, by Joseph Wurtenbaugh.  An outstanding work of alternative history.

    It is now known that when Hitler remilitarized the Rhineland in 1936, his forces were under orders to withdraw if faced by serious opposition by the (then-much-superior) French and British militaries.  But these countries did not take action, being focused on their economic problems and convincing themselves that the German move wasn’t really much of a threat.  But they didn’t know about the Withdrawal Order.  What if they had?

    Some of the characters are fictional, others are real people imagined as following different trajectories.  The central figure is a German officer named Karl von Haydenreich; he has become friends with American officer Dwight Eisenhower and this friendship will prove critical in changing the course of history.

    Very well-done, should not be missed.

    The Hard Thing About Hard Things, Ben Horowitz.  Advice about running a startup from a venture capitalist…the author is cofounder of the VC firm Andreessen Horowitz.  A lot of worthwhile points, some of which should be obvious, others not so much so.

    Understanding what you did wrong if you hired an executive who did not work out:  Horowitz goes through several possible causes of the failure, including this:

    You hired for lack of weakness rather than for strengths.  This is especially common when you run a consensus-based hiring process.  The group will often find the candidate’s weaknesses, but they won’t place a high enough value on the areas where you need the executive to be a world-class performer.  As a result, you hire an executive with no sharp weakness, but who is mediocre where you need her to be great.

    On excessive focus on quantitative metrics:  “Management purely by numbers is sort of like painting by numbers–it’s strictly for amateurs.”

    I especially like Horowitz’s emphasis on the importance of organization design, and the point that all such designs are compromises…indeed:

    The first rule of organizational design is that all organizational designs are bad.  With any design, you will optimize communication among some parts of the organization at the expense of other parts.  For example, if you put product management in the engineering organization, you will optimize communication between product management and engineering at the expense of product management and marketing.  As a result, as soon as you roll out the new organization, people will find fault with it, and they will be right…Think of the organizational design as the communications architecture for your company.  If you want people to communicate, the best way to accomplish that is to make them report to the same manager.  By contrast, the further away people are on the organizational chart, the less they will communicate. The organizational design is also the template for how the company communicates with the outside world.

    The book was inspired by this thought:  “Every time I read a management or self-help book, I find myself saying, ‘That’s fine, but that wasn’t really the hard thing about the situation.'”  For example:

    The hard thing isn’t hiring great people.  That hard thing is when those ‘great people’ develop a sense of entitlement and start demanding unreasonable things…The hard thing isn’t dreaming big. The hard thing is waking up in the middle of the night in a cold sweat when the dream turns into a nightmare.

    Fifty Inventions that Shaped the Modern Economy, by Tim Harford.  Includes not just the sort of things that would typically show up in an ‘inventions’ list, but also such things as double-entry bookkeeping, tradable debt, the welfare state, and the department store.

    Regarding the latter, Harford credits Harry Gordon Selfridge, who worked for Marshall Field, with creating the concept.  Key to the new stores was the idea that “just looking” was okay, indeed was to be positively encouraged.

    Selfridge swept away the previous shopkeepers’ custom of stashing the merchandise in places where sales assistants had to fetch it for you…he instead laid it out in the open-aisle displays we now take for granted, where you can touch a product, pick it up, and inspect it from all angles, without a salesperson hovering by your side…Shopping had long been bound up with social display: the old arcades of the great European cities, displaying their fine cotton fashions–gorgeously lit with candles and mirrors–were places for the upper classes not only to see but to be seen.  Selfridge had no truck with snobbery or exclusivity.  (When he opened his London store), His advertisements pointedly made cleaer that the ‘whole British public’ would be welcome–no cards of admission are required.”

    Harford also mentions an Irish immigrant to America named Alexander Turney Stewart.  It was Stewart who introduced “the shocking concept of not hassling customers the moment they walked through the door. He called this novel policy ‘free entrance.”  Stewart also introduced the concept of the clearance sale and established a no-haggle pricing policy for his good.

    Discussion of inventions such as the department store provides a useful reminded that so many of the things we take for granted–with ‘things’ including assumptions about ways of doing things as well as tangible objects–haven’t always existed; somebody had to think of them and drive them into reality.

    This post to be further continued.

    Posted in Book Notes, Business, Customer Service, Entrepreneurship, Europe, Germany, History, Management, Organizational Analysis, Tech | 4 Comments »

    Technology, Work, and Society – The Age of Transition

    Posted by David Foster on 15th December 2017 (All posts by )

    I recently read an intriguing book concerned with the exponential advances in technology and the impact thereof on human society.  The author believes that the displacement of human labor by technology is in its very early stages, and sees little limit to the process.  He is concerned with how this will affect–indeed, has already affected–the relationship between the sexes and of parents and children, as well as the ability of ordinary people to earn a decent living.  It’s a thoughtful analysis by someone who clearly cares a great deal about the well-being of his fellow citizens.

    Read the rest of this entry »

    Posted in Book Notes, Britain, Business, Capitalism, Civil Society, Deep Thoughts, Economics & Finance, History, Society, Tech | 14 Comments »

    Oh, My!

    Posted by Sgt. Mom on 30th November 2017 (All posts by )

    Seriously, I am stuck for a reaction to the news this week that both Matt Lauer and Garrison Keillor have both been let go, with appropriate force, by their employers for sexual conduct unbecoming and unprofessional in the extreme with women in their respective workplaces. Earlier in the week it was howls for the heads of John Conyers and Al Franken, giving the impression of those gentlemen holding on to their congressional seats by their bare fingertips, while Cokie Roberts confesses that ‘everyone’ knew not to get into an elevator with Congressman Conyers. Jeez Louise, is there anyone in the higher levels of show business, the media and the government who isn’t a total woman-mauling pig? Anyone? And is there anyone in the media specifically charged with covering show biz and politics who isn’t complicit in covering these matters – with a pillow, until they stop moving, in the deathless phrase of Iowahawk? Can we wait until our fearless media fifth-column representatives are cornered like a rat and forced to ‘fess up to deliberately looking the other way? Oh, and thanks, Cokie – for sitting on that bit of intelligence regarding sexual abuse on Capitol Hill. Just couldn’t bear to tear yourself away from the sweet, sweet source of social power in Capitol City, and face the prospect of never being invited to the good cocktail parties again, could you? Between you and Garrison Keillor, I feel like demanding a refund of every single dollar in pledges I ever made to public radio and television. I will keep the Blake’s 7 tee shirt and the La Madelaine cookbook, though. (The tee shirt is trashed, and the cookbook is pretty well-worn.)
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    Posted in Business, Conservatism, Crime and Punishment, Current Events, Feminism, Human Behavior | 13 Comments »

    Worthwhile Reading

    Posted by David Foster on 15th November 2017 (All posts by )

    A law professor writes about undoing the dis-education of Millenials.

    Small liberal arts colleges:  self-destruction via runaway administration.

    Ammo Grrrll doesn’t share the obsession about ‘people who look like me’.

    Are we living in the dystopia that Young Adult fiction warns us about?

    The Assistant Village Idiot has some thoughts about local aristocracy and the nationalization of culture.

    Bolshevism and Militant Islam.  Some thoughts about historical parallels from Niall Ferguson, with comments by Stuart Schneiderman.

    The current Senate tax bill draft contains some very bad ideas about taxation of employee stock options and restricted stock grants.

    Click Here To Save $15 at Ammo.com

    Posted in Business, Economics & Finance, Education, History, Islam, Leftism, Russia, Society | 3 Comments »

    Robot of the Week

    Posted by David Foster on 5th November 2017 (All posts by )

    If you call the front desk at a hotel and ask to have towels (for example) delivered to your room, then a robot may shortly make its appearance at your door.  Savioke Relay can find its own way to its destination, taking the elevator when needed.

    Customer reactions seem to be positive.

    More here.

    Click Here To Save $15 at Ammo.com

    Posted in Business, Tech | 2 Comments »

    Coming: a Battery Supply Crunch?

    Posted by David Foster on 26th October 2017 (All posts by )

    Several governments have signaled their intent to ban or greatly restrict the internal combustion engine from automotive use, requiring instead pure electrics or in some cases hybrids.  These include China, France, and the United Kingdom, as well as the US state of California.  Volvo says that from 2019 all its new models will be electric or hybrid, and General Motors is planning to introduce 20 electric models over the next six years.

    The core of an electric vehicle is the battery, and these are large, heavy objects:  the battery pack for a Tesla Model S comes in at 1300 pounds. Where are all the batteries for the envisaged exponential growth of electrics going to come from?…this question encompasses the mining and processing of the raw materials and the fabrication of these processed materials into battery cells, as well as the assembly of the cells into finished battery packs.

    Here is an analysis of battery components and their sources:  the key materials, in addition to lithium, are graphite, cobalt, and nickel, as well as the more common and less-expensive metals manganese and aluminum.

    Will severe supply constraints for some of these materials put a practical limit on the growth of electric vehicles, even in the face of government subsidies and draconian edicts?  Here’s a recent article in the Financial Times:

    Volkswagen’s failed attempt to secure at least five years’ supply of cobalt highlights the challenge facing the world’s biggest automakers as they attempt to secure the materials needed for their push into electric vehicles.  Last month’s tender came as other carmakers, such as BMW and Tesla Motors, are also trying to lock-in stocks of the metal.  That could test to the breaking point a niche market that is heavily dependent on a handful of mines in the Democratic Republic of Congo, one of the most impoverished and politically volatile countries in Africa.

    Demand for cobalt in EV batteries is expected to grow fourfold by 2020, and eleven-fold by 2025, according to Wood Mackenzie.

    The graph accompanying the article indicates that the price of high-grade cobalt has risen from $15/pound in January of this year to $30/pound in October.

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    Posted in Business, Energy & Power Generation, Environment, Tech | 52 Comments »

    Apple Pay for Better Security

    Posted by Carl from Chicago on 11th October 2017 (All posts by )

    Over the last year I’ve had several opportunities to drive to remote parts of Oregon. Often we stop by a local grocery / convenience store to pick up groceries or a snack. These stores are small and often with a single check out lane and a very quaint atmosphere of old-time store goods.

    A bit of fun for me is to walk up to the credit card reader which usually has the icon for near field connectivity (NFC) and I surreptitiously use my Apple Watch with Apple Pay enabled to quickly pay for groceries without taking out my credit card. The cashier gets flummoxed and wonders what happened, and I show them my Apple Watch with my card image and they laugh.

    What is sad is that Apple Pay works “out of the box” at most of these remote grocery stores but it doesn’t work at many of the large retailers in the city. Instead of encouraging Apple Pay or similar google technologies, the retailers want to control the experience and the data and so they turn off this feature. You have the unfortunate alternative of putting your credit card in the chip reader and waiting for 5-10 seconds which slows the line for the whole process. Worse than the inconvenience is the fact that Apple Pay is much more secure than any card reader – Apple Pay doesn’t provide your “real” credit card to the store, instead it uses a “token” for the transaction.
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    Posted in Business, Economics & Finance, Oregonia, Tech | 11 Comments »

    Kinda Cool

    Posted by David Foster on 7th October 2017 (All posts by )

    Lowes’ Holorooms

    Also in this video

    Posted in Business, Marketing, Tech | Comments Off on Kinda Cool

    Worthwhile Reading & Viewing

    Posted by David Foster on 28th September 2017 (All posts by )

    Things that were once common knowledge…and now are not

    Advice on leadership for Naval Academy cadets…applicable in other walks of life as well

    A time-lapse video of 30 days at sea

    Animated films:  a transition both in technologies and in implicit political messages

    Who murdered beauty?…an analysis of some trends in the world of art

    Cedar Sanderson asks What do Environmentalists, JRR Tolkein, Luddites, and Progressives all have in common?

    Company towns, then and now

    Posted in Arts & Letters, Business, Deep Thoughts, Film, Science, Society, Tech, Transportation | 8 Comments »