Month: April 2010

A “Flick of the Switch”…could this be the next Nightmare on Main St.?

Everyone you speak with will tell you in one way or another that this time it’s different. It doesn’t matter if they’re talking about personal or business experiences. Doesn’t matter if they’re talking about marriage or divorce, kids or grand kids, TV, radio, or anything else. The line always comes up, but this time it’s different. Well, I’m here to say it’s a lot different from what anyone thinks, and it can get a whole lot scarier than anyone might dream about it also.

Most have never heard the term ” a flick of a switch ” used in terms that denotes a fundamental change in the way businesses can operate in today’s technologically advanced world. Anyone who doesn’t fully understand this term or its implications today had better start trying to learn everything they can about it right now. Its impact will be felt everywhere and time is not on your side.

A flick of the switch means if I have a business in location X, I can just flick a switch and operate in location Y. In years past most companies needed some sort of brick and mortar facility to conduct meaningful trade. That is no longer the norm. As a matter of fact, most of the newer successful businesses of the last decade have been ones that can operate anywhere. Take Amazon for an example. Where are the stores? Where are warehouses? Can you go to a store? No…and do you care where the warehouse is located? Again No.  So if they moved the warehouse to some other location would that impact your sales experience with Amazon? More than likely it wouldn’t, and if you didn’t hear or read about it you would never know.  More than likely as long as your shipment came on time you probably wouldn’t give it a second thought. However, for the thousands of people who work in the warehouse filling orders, or the myriad of other business interactions with other local vendors, one day it’s here, next day it’s gone.

So you’re saying to yourself, OK…that’s a retail business, I get that, but c’mon, we deal with that everyday in today’s world. Yes you do, but think about all the other businesses you deal with. Or all the others you know that fall into a similar category. If your interaction with a company is done primarily online, where the physical business is located is not much of a concern to you. It doesn’t become relevant unless you have the physical, and interactive business transactions with it (think grocery store). Here’s a few businesses that are fundamental to the US economy and think of the ancillary revenues they produce. Doesn’t matter whether you love them or hate them, just a list to make you think.  Imagine for a moment and play out the scenario in your mind’s eye if just this small list of businesses were no longer located in the US.

Ready?…all of Wall St, all Insurance Companies, all Banks, all Online Retailers, all Accounting Firms, all _________ ( you fill in the blank). All of these fall into the “flick of the switch”  type of businesses. They can relocate anywhere in the world in the equivalent of a New York minute. I’m just scratching the surface. I could list a hundred others and so could you, and that’s the scary part. If you think about it, it’s a gamble many are betting wont happen, but the odds favor it could. Think it’s hyperbole? On Friday Steve Wynn, probably the most successful developer and businessman in Las Vegas announced he is considering relocating his business empire to Macau. Yes folks, one of the United States premier businessmen believes he can be treated better, and prosper better in China than here in the US.

If that’s possible, you want to gamble on the rest?  Better hope what can happen in Vegas, stays in Vegas!

Mark

Why GM may never lose the moniker “Government Motors”

Perception is everything. You hear it over and over again, but most forget about its implications when they’re selling. Embellishment is fine, but there is a limit. Once when speaking to a group I stated… ” If it wasn’t for embellishment, people wouldn’t get married.” this caused quite a bit of laughter because people get the joke.

It’s fine to embellish a garment with rhinestone to give the appearance of diamonds. Remember perception is reality. However, if someone asks you if they’re real, only the truth will do. Anything else is a direct attempt in deception. Period!

Now let’s look at General Motors. As I’m writing this article, GM is running TV commercials stating they have paid back the tax payers 100% and with interest 5 years ahead of schedule. That is far from reality. Actually the tax payers still own almost $60 Billion in stock that the US government purchased in order to keep GM from being dismantled, sold off, and put out of business. This repayment equates only to just above 10% of the total commitment. It was the liquid part of the agreement, not the entire commitment of the loan. It’s the equivalent of saying, “The bank loaned us money to buy a business, 90% for the hard assets and 10% for operating expenses . We paid back the 10% so we are now “Paid in Full.”  So if someone asked whether you still owed any more money…what would be the response? And would the answer come from a car salesman, or a politician? I guess now it’s both, but don’t worry, maybe there’s a warranty. Or does that cost extra?

Once perception feels like deception, you’ll lose your customers forever.

Mark

“Experience”…Nice if you can get it!

I think experience will be worth more than the price of gold (or degree) in the coming future. I know, I know. Of course experience is the most coveted of all the attributes when dealing with life, as well as in business. But if that’s so, will someone tell me the answer to these questions, or more to the fact, tell them to the up and coming work force or tomorrows business leaders…

If a young adult can now be classified as a child until the age of 26, and will likely be in a school environment until age 24, that same young adult will not have been able to legally work till at least the age of 16, and more likely than not hold a job till they leave high school at 18.  Once they do get a “job”, more than likely it’ll be with a company that puts them into a “mindless” position ( Want fries with that? ). There they wont be able to go beyond very strict guidelines, or worse, just recite prewritten scripts to beleaguered customers. On top of all this, if one has any gumption at taking an interest in a challenging profession, even to do it for “No Pay” but for the experience to prepare oneself , that will now be just about illegal to be offered. Yes…”Internship” is also being eliminated due to interpretations in the law.

All this will be what both future employers, and  employees will have to contend with in the coming years. One side desperately needing experienced employees, the other side desperately seeking it.

No “higher education” can educate like experience. Worth more than a college education? Heck of a question for the S.A.T.’s of Life.

Mark

“Kicking the Can” but with a broken foot.

The proverbial kick the can reference has been used everywhere as of late. It’s used to describe everything from cleaning the garage to government policies. The problem seems, it’s getting much harder to kick that darn can.

We all procrastinate, however there comes a time when we realize we just can’t wait any longer. Everyone experiences that moment. Whether you’re in bed and suddenly break into a cold sweat realizing you’ve waited to long, or the final realization that if you wait any longer, it will be more painful than just starting right now. Kicking the can implies you can procrastinate forever, but you can’t. Sooner or later you’re going to injure your foot, stub your toe, whatever it may be, but it will happen, and happen at the worst time. Not only will you not be able to kick, but the can has turned into a dinged and dented piece of junk, hence comes a bad ending, and you lose.

It’s one thing to put off unpleasant things for a short time, but you can’t put all things off indefinitely. It doesn’t matter if the items are personal, or they’re the transgressions of governments. Sooner or later when you’ll need  to kick the hardest, that will be the exact moment you can’t kick at all.

In the scheme of life, don’t kick the can. Pick it up as the trash it is, and place it in the garbage where it belongs. Besides, kids nowadays play XBox.

Mark

“They’re on TV, So They Must be Smart” update

As some of you know, I am constantly amazed on what I see on television in regards to “informative information.” One host after another quotes this resource, or refers to this expert. It’s enough to make ones head spin! What’s even more of an experiment in dizziness survival training, is listening to how many people use this information as if it were handed down from the gods above. Holy Moly!

As I watch the Dow Jones and other benchmark industries once again nearing new yearly highs, I get one person after another telling me…”See…see, the markets getting better. You were obviously wrong in any assumptions of reversals of fortune. What do you have to say now?..Hmmmmmmm!

I let about 15 seconds pass after they finish so that they can regain their composure, ( From either down right giddiness, or just plain antagonism.) and state the following…

It’s possible I’m wrong in any forecast I might make. When you want to be taken seriously, you have to be willing to be wrong at times, but be willing to look at why you forecast what you did, and would you stand by those decisions knowing what you know now. The answer to that question is still yes. ( This is where they start to become indignant, and try to talk over me.) I continue on to say, Just because an event is taking place, doesn’t mean it’s taking place for the reasons one might think. In the world of correlations and you can quote me on this ” All correlations work, until they don’t.”

If  the talking heads on television really understood the correlations they tout, wouldn’t they have to rescind those same correlations that you and others were using as ammo against someone like myself? If anyone cares to remember, just a few months ago when the market was rising, these same wizards were touting that a weak US dollar, cheap oil, low bond yields, and a pro growth China were the keys to economic recovery, so who was I to draw concern. However today with the stock market rising the same ones are touting, strong US dollar, high oil prices, high bond yields, and China pulling back its stimulus programs are what’s saving the day.

All I can say is who knows. But what I do know is this. If you take your cues from television and the talking heads who spouse correlations without understanding televisions agenda to get your eyeballs to look at the screen regardless on how that happens,( the financial channels have lost 20% and more of viewership since the 2007 highs and never regained it.)  you now should have a better understanding why your stomach is getting that queezy feeling, rather than a feeling of confidence. Just let me finish with this I said, If I remember correctly, I was one of the only people on the planet stating when the US dollar was heading into the toilet that I felt not only was the dollar going to rebound, but I believed the Euro was not going to be the new reserve currency as others were toting, also I believed the EU could fall apart because of structural deficiencies that I could see, but no one wanted to report. So far, I’m 50% correct on my forecasts, and the other 50% could still be proven accurate. To my math, that’s better than the television experts, and they’re on TV, so they must be smart, right?

Here, have some Maalox (R) and a seat, It’ll soon pass. Next question Please!

Mark

Get a dictionary!

Sounds like the old days when trying to convince  newly found lovers to leave the bar so we could close, only we didn’t refer to a dictionary, but I digress.

In today’s digital age of course everything is on-line from dictionaries to a thesaurus, and everything in between. However what I’m talking about is the old-fashioned book form. No…not the small paperback type, or the collegiate style you might have on your desk. I mean the 6 inch think, 12X16 style. You know, the type if dropped would register on the Richter Scale!

There is something about the experience of looking up words that you either don’t know, or words you’re not exactly sure of. Of course I use all, but it depends on the need at the time. Electronic equals quick reference, paperback for casual reference, but there is nothing like flipping through India Paper four inches between the leather bindings to get a real sense for the definition of a word. I contend it broadens the understanding just from the experience. (Trust me when I say…No one needs it more than I.)

If you can, give the book a place of honor. Put it out in a hallway on a pedestal, put it on a pedestal in your office, or on your desk if there’s room, but put it out and leave it open. You’ll be amazed how often you use it. I read years ago from Tom Peters suggesting this. It was sage advice then, and still is.

Here's mine at my office.

Mark