Business

David Foster had an interesting piece up a couple of weeks ago on organizations, using Moltke’s refusal in August 1914 to turn around the troops on the Western Front to attack the East as an example. Moltke was adamant that the plans in place were at the time irreversible, but the German military railway expert later claimed that he could have turned things around. Whether or not the post-hoc analysis was correct, the actual expert, of course, never got to speak with the Kaiser.

This points to one of the problems of organizations as they ossify – that information gets filtered by each layer in the hierarchy as it passes up a silo. Each layer of spin holds the possibility of not so much adding perspective as simply moving the information content further from reality, and in some organizations any resemblance between actual observations and the information contained in top management briefings is purely coincidental. CW’s NoSuchBlog had a nice post up about that same phenomenon at work in the CIA:

Read more

Mudville notes a run-of-the-mill business exposition, except, well, except its very ordinariness hints at the extraordinary:

The weeklong “Rebuild Iraq 2006” drew some 20,000 businesspeople and more than 1,000 exhibitors from 50 countries – all in search of ways to enter the Iraqi market or increase their business there.

It is easy to satirize what can seem forced or even manic good cheer at Chamber of Commerce gatherings, but such a convention is a sign of health & indicates a practical sense that a strong (& therefore peaceful) economy lies in the future.

Read more

Lately there’s been a lot of online discussion (such as here, courtesy Instapundit) about Microsoft. I don’t know enough about such issues to comment, but I recently had a minor experience that I think points up how Microsoft has changed.

About five years ago I bought a Microsoft trackball. It failed in a few weeks and I phoned one of Microsoft’s customer-service phone numbers. I told them what happened, they asked a few questions and sent me a new trackball. The entire process took just a few minutes and I didn’t even have to send them the broken trackball.

A few months ago the replacement trackball failed, still under warranty. This time I spent a lot of time searching Microsoft’s Web sites for the right phone number. Then it took two calls, during which I spoke with about five people and spent thirty minutes on the phone, to deal with the problem. And Microsoft wouldn’t replace my trackball, which had been discontinued. Instead of offering to send me a different model they said my only option was a refund. And I had to send them the old trackball first. The people on the phone were nice and Microsoft even refunded my shipping costs, but everything was much more bureaucratic and inflexible than it was five years ago, when the guy on the phone had simply said, “we’ll send you a new one” (or words to that effect). I think it would have cost the company half as much this time if the first person I spoke with had had the authority to send me a comparable replacement for my failed product. And it would have saved me time as well.

Companies change. When I bought my trackball Microsoft was still the premier tech company, with a corporate culture based on exponential growth and go-getter employees. Nowadays Microsoft is a mature company in a mature industry. Its stock price has been stagnant for some time and it probably has much more difficulty recruiting the best employees. It’s interesting how these things tend to work. Microsoft is merely following a path that most successful companies follow. (How many of the leading companies tracked by the Dow Jones Industrial Average in 1930 are still around?)

It’s an ill wind that doesn’t blow good to someone. Or is this just another, the oil guys have it made in the shade & we’re just out there sweating?

Several days ago, I posted about an improved variant of sugarcane, designed for use as a fuel and developed by Barbados. The post also discussed the irrationality of the 54-cent-per-gallon tariff that the US currently imposes on imports of ethanol.

Today’s Wall Street Journal has an editorial “What’s Wrong with Free Trade in Biofuels?” which amplifies the point. Excerpt:

Brazil has already established itself a low-cost producer of cane-based ethanol churned out in large volume at the oil-equivalent price of $25 a barrel without any heroic biogenetics involved. Its example is already inspiring copycat behavior by other Latin, Caribbean, African and South Asian countries, with similar conditions that make them potentially prolific exporters of biofuels.

Take the pressure for flex-fuel mandates, requiring auto companies to build cars capable of running on 85% ethanol. Unmodified cars can already burn fuel comprised 10% of ethanol. If we were honestly keen on diversifying supply and squeezing out imported oil, we’d throw open our dense coastal markets to ethanol producers in Brazil, India, Pakistan, Nigeria and Thailand, displacing perhaps 10 billion gallons of current gasoline use without any vehicle modification or taxpayer subsidy at all.

I don’t think the $25/bbl number for Brazilian cane-based ethanol is right; at least it’s not consistent with the $.87/gallon number quoted in the Farm Bureau article (linked from my earlier post)…but even with the $.87/gallon number (cost after ocean shipping charges $1.01/gallon) and considering the lesser energy in a gallon of ethanol vs a gallon of gasoline, the cane-based ethanol sounds like a winner. The tariff should go.