Last August The Dila View about the potential purchase of Hummer by Tengzhong (a privately held heavy machinery company based in Sichuan province) was that the deal was a boon for China, who would get Hummer’s legacy technology at a bargain-basement price for application in the country-wide infrastructure projects China has on the go.

We said, “Chinese regulators, who must OK the deal before it is ratified, are about as likely to reject it as Americans are likely to spend their money right now.”

We were wrong: Government regulators were more conservative than we thought, on two counts:

First: “Industry experts and sources with knowledge of the situation told Reuters Tengzhong had faced questions in China over how a little-known heavy machinery maker with no international experience could buy and turn around a struggling foreign brand like Hummer,” according to a recent Reuters report.

Second: “Many also said that regulators might balk at letting a Chinese firm acquire a U.S. brand known for making gas-guzzling vehicles at a time when China was emphasizing the development of more environmentally friendly technologies.”

(If you voted in the poll about Hummer’s fate last August, you can see how you did by looking back at the survey results.)

The death of the sale will mean roughly 3000 Hummer employees will be out of work by summer 2010.

© 2009 John Dila

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In the beginning, people shopped online because it was “cheaper;” the thinking was that online stores didn’t have the same cost overheads brick-and-mortars had and so they passed on the savings to consumers. This probably was the case, and it likely still is, to some extent.

But the past ten years has brought fierce competition for online dollars, and the online shopping experience is constantly evolving.

Today, “cheap” is not the only (or even the most important) reason why we shop online: Convenience, selection, delivery speed, and even belonging to a “community” of like-minded shoppers (think KarmaLoop and Apple) are today’s reasons for much of the money being spent online.

Getting good, if not stellar service online is more and more important to consumers. Today, if the service sucks, you won’t go back.

Today, The Dila View highlights the launch of a new firm —STELLAService.com–which brings objectivity and transparency to assessing and rating online customer experience on the Internet.

STELLA–launching today–will analyze and rate all online businesses and give each one a STELLARating (a number from 0 -100) indicating how good (or poor) its online service is. Formed in April 2009, the company’s Advisory Council and highly trained analysts represent today’s thought-leaders in the area of online customer service, and bring this focus to bear on the independent STELLARating methodology.

Consumers can look for the STELLASeal on websites and will be able to recognize quality online service immediately–and avoid those companies with poor scores.

In turn, low scores will help poor-performing companies identify weaknesses, improve their service, and attract more customers (especially repeat customers!).

In March, STELLAService’s CEO, Jordy Leiser, commissioned an independent research survey “to examine the value of great customer service in the U.S. economy, with a particular focus on how great customer service impacts the online retail category.” The research concludes:

“Consumers in the online retail category are willing to pay even more (10.7%) for great service, which should come as no surprise given the comfort and peace of mind that most consumers want while purchasing from the seemingly distant and remote online marketplace.”

View the results and dollar figures (it’s not a small number)!

Now that the firm has officially launched, watch for the STELLASeal on sites where you intend to shop. If you see it, you’ll know someone you can trust has closely evaluated the company and has rated its performance.

STELLAService would love your comment and feedback. You can find us on FB, Titter, and all the usual places, or you can contact me directly (jd@stellaservice.com).

© 2009 John Dila

There’s a fascinating report in the Feb27 issue of The Economist about “the data deluge,” which everyone should read.

Photo courtesty of The Economist

Photo courtesty of The Economist

Of course, the article is weeks old by now, and no one is likely to go back to find it.

The topic, though, is fascinating because it’s a snapshot of something that’s been happening for a long time and that’s still in play: As a race, humans are creating more and more data, and we are at a point when we can actually see some of the results of this trend with the naked eye.

In fact, data will only become more important to each of us—individually and as a global community—in more and more practical, structured ways in the coming months and years.

Some economists opine, “Data are becoming the new raw material of business,” and we–teachers, students, buyers, sellers, gardeners, technologists, healthcare workers, bankers, governments, all of us–would be remiss if we don’t take time to understand what this might mean.

Here are a few quotes/highlights from the article, which will spawn several upcoming shorter blogs about these trends in data and policy that are shaping human daily life.

#1

“Torture the data long enough and they will confess to anything.”

#2

“A new kind of professional has emerged, the data scientist, who combines the skills of software programmer, statistician and storyteller/artist to extract the nuggets of gold hidden under the mountains of data.”

#3

“Just as the microscope transformed biology by exposing germs, and the electron microscope changed physics, all these data are turning the social sciences upside down…Researchers are now able to understand human behavior at the population level rather than the individual level.”

#4

“What we are seeing is the ability to have economies form around the data—and that is a big change at a societal and even macroeconomic level.”

#5

“Data are becoming the new raw material of business: an economic input almost on par with capital and labor.”

#6

“The amount of reading people do, previously in decline because of television, has almost tripled since 1980, thanks to all the text on the Internet.”

#7

The data-centered economy is just nascent…You can see the outlines of it, but the technical, infrastructural and even business model implications are not well-understood right now.”

#8

“Best Buy, a retailer, found that 7% of its customers accounted for 43% of its sales.”

#9

“Wal-Mart is a good example. The retailer operates 8,400 stores worldwide, has more than 2M employees and handles over 200M customer transactions each week.”

#10

“Visa, a credit-card company, in a recent trial with Hadoop [a new technology]  crunched two years of test records, or 73 billion transactions…The processing time fell from one month with traditional methods to a mere 13 minutes.”

© 2009 John Dila

Hi–

I have a big favor to ask:

I want you to take a short survey that will help an early-stage startup company that is launching this spring (go directly to the survey!).

Here’s what’s in it for you:

First, you get to help shape the beginnings of a brand-new company by giving your views on important aspects of customer service; second, you can follow the course of an early-stage startup as it enters the market; and third, you can win an iTunes gift card for doing it!

Here’s the background:

I currently have the opportunity to advise this early-stage startup that’s breaking into the online customer service rating business.

Many companies and research firms today are talking about customer service and user experience; this startup is taking a decidedly fresh approach to it.

We’re running a survey to discover your preferences for customer service when you shop online.

The company, which is in stealth mode (meaning, it has not formally launched yet), will use the survey responses to build key aspects of its strategy and business.

Here’s the link to the survey (it takes about 3 minutes to complete):

https://www.surveymonkey.com/s/onlinecustomerservice

Click  EMAIL SUBSCRIPTION over on the right to follow!

Thanks for your help!

JD

We’re eating lunch—me, Finn, and Trish. Finn’s got a bowl of mac’n’cheese. Trish is eating a meatloaf sandwich. I made a turkey wrap, and I was using a salad fork to poke and eat Kalamata olives off my plate. Finn’s been holding his bowl up to his face and trying to lick out the last dozen pieces of tubular macaroni. He’s got “cheese” all over his face.

A fork.

“Not like that, Finn,” says his mother. “Eat like your father.”

“With my fork? Eat with my fork?”

“Yes, with your fork. Don’t lick your bowl; use your fork or spoon please,” his mother said.

“Do you like your sandwich, dad?”

“Yes, I do, Finn; it’s very tasty!”

Turkey wrap with California veggies.

“But whyyy?” he asked, trailing off the y.

“Because it’s got turkey in it, that’s why.”

“But whyyy?”

“And it has delicious vegetables in it, that’s why.”

“But whyyy?”

“Because they’re from California, that’s why.”

San Joaquin Valley crops.

“But whyyy?”

“Because California gets a lot of sun, that’s why.”

“But whyyy?”

“Because it’s on the west coast, and the jet stream blows the clouds past California so it’s always sunny, that’s why.”

“But whyyy?”

A view of the Earth from 36,000 nautical miles away...the San Joaquin Valley can be easily identified.

“Because the world spins on its own axis in the opposite direction and its movement creates the jet stream, that’s why.”

“But whyyy?”

“Because the earth is revolving around the sun and is being pulled toward the sun by gravity, that’s why.”

“But whyyy?”

“Because of the Big Bang, that’s why.

“So you like that sandwich, dad?”

Big Bang schematic.

“Yes, Finn, I like it.”

PS: Click the homepage link to subscribe to The Dila View.

© 2009 John Dila

Why do we do things the way we do—health care, mortgages, credit/debt, US Senate rules, voting rules, foreign policy, and so on?

“Because that’s the way we’ve always done them,” comes the response, couched in educated certitude and embroidered into the fabric of the flag.

It’s why we require 60 votes to block a filibuster—that’s not a law, it’s just the way we’ve always done it. In fact, the U.S. Supreme Court ruled (in the 1890s) that changes to Senate rules could be achieved by a simple majority: “The constitution empowers each house to determine its rules of proceedings,” so we could change this old rule any time. We just have to decide to do it.

To question these things—for some—is sacrilege. Or worse. For others, to question the system seems daunting, complex, unpatriotic even. For yet others, questioning the status quo poses a serious threat to those who reap benefits from the way things are currently done.

But at a time when so many of our systems are on the brink of breaking, are breaking, and are already broken, some step-changes—not incremental ones—might offer the best solutions for our families and our nation.

I was raised in Canada and I remember when the Prime Minister, Pierre Trudeau, led the country to break away from England in 1982. Before that, Canada was governed by a constitution that was a British law! That was a step-change.

Pierre Trudeau does a pirouette at Buckingham Palace five years before he breaks away from Britain.

There is no blanket answer that will solve all our problems. We will not unearth an economic or social panacea. Our economy is a vast system—not unlike Avatar’s bio-botanical neural network that Pandora’s Na’vi are connected to—interconnected not only from within but also to all other economies around the globe. We’re very interdependent today; we act alone at our peril.

Also, it is very possible (likely) some of our fundamental values and systems are fatally flawed (like Canada’s Constitution had become).

But short of a panacea, there is something each of us can do, which can have a large impact, and give us more understanding of the issues, and provide better control and focus to fix things for the long-term.

We can stop sniffing the horse’s ass!

Stop accepting the stock responses we give and get.

Roma!

The Horse’s Ass, in fact, was a key dimension in early Western vehicle design: In Rome, when chariots were the chassis of choice and horses were the state-of-the-art power-plant that pulled them, design was all about the width of the horse’s ass.

Note: Width of chariot's axle = width of horse's ass.

The question, though, is: Why do we still design vehicles the same width (almost exactly) today as we did two-thousand-plus years ago?

Watch:

You’re driving on a road today. It has ruts—made over time by the weight of trucks and cars, all of which were designed with a similar wheel-axle width.

But why that width?

Well because, of course, the roads were designed to accommodate that size, that’s why!

But why?

Well because, of course, before cars were invented those roads were carriage roads, and that’s how wide they were built, that’s why, silly!

But why?

Well because, of course, before carriages were invented for the masses the roads were used by Romans who rode in chariots, and they were that wide, that’s why, silly!

But why?

Well because, of course, Romans designed chariots to be pulled by a horse, silly, and they designed them as wide as—you guessed it—the horse’s ass, that’s why! (I’ve adapted the horse’s ass myth a little for poetic effect.)

A horse’s ass in the ointment

“Why do companies exist?” is a question we ask a lot in business school. And news reporters often ask it after a scandal breaks at a well-known firm, when evidence of “creative accounting,” or fraud, is brought to light.

In the final trimester of our 20-month EMBA—we’d built up to that lofty pinnacle by studying Organizational Behavior, Statistics, Finance, and Marketing first—our cohort studied “Strategy.”

Oooh. Ahhhhh!

Everyone in the class was excited to dig into the texts, read the cases, and discover enlightenment.

That weekend, as I finished Chapter One: Strategic Management: Creating Competitive Advantages, I found this little gem among the exercises and ethics questions at the end:

“A company focuses solely on short-term profits to provide the greatest return to the owners of the business (i.e., the shareholders in a publicly held firm). What ethical issues could this raise?”

Ah, great question, I thought. Finally we are getting to the good part.

I immediately started flipping through our strategy tome looking for the chapter that would address this question.

Baffled, I discovered the chapter did not exist.

Follow the horse’s ass

And we—collectively—beat up Corporate America for its failings, scandals, and that pesky 400-to-1 top-earner-to-bottom-earner salary ratio in many of our firms today.

But it doesn’t have to be that way. Some firms put caps on top earners. At Whole Foods, for example, “No one at the company can have a salary more than nineteen times what the average team member makes.”

Whatever else you might want to label Whole Food’s monetary reward practices, it is an example of the planned abandonment of the standard way of rewarding executives.

Whoa! as you would say to a horse when you want her to stop:

People who studied business texts lead our businesses today, so maybe we should draw a line from those leaders to another horse’s ass:

Maybe our business schools—our professors, committees, and chancellors—and the governments, corporations, and large publishers that subsidize them, are not ready to admit the textbooks we write and curricula we develop are too narrow (or wide) for the global road we’re on.

Why do companies exist?

A business student will always answer, “It depends.”

But if you ask your own children, or a small-business owner, or someone from a different country, the answers will have something to do with customers and their needs and wants.

So now customers are part of the value chain of the horse’s ass.

We (customers) save our hard-earned money to put little Jenny into the very best schools our money can buy. The ones—that’s right—that are teaching the wrong stuff at the wrong time to the wrong generation to solve the wrong problems.

Uhg!

It’s difficult to change a horse’s ass, but you may change horses if you like

Peter Drucker (1909-2005)—a writer and business management professor—developed the notion of “planned abandonment,” by observing how business and government tend to cling to “yesterday’s success” rather than seeing and accepting when something no longer works well.

Peter Drucker...planned abandonment.

Peter Drucker...planned abandonment.

It’s easy to understand why we “cling to yesterday’s success:” It takes time to build a company, a country, and an economy. It takes massive investment—of capital and human resources—and deep commitment.

When we finally build something and really get it humming along with a good revenue growth curve, or GDP, it’s hard to say, “Wait a minute, this isn’t any good any more; let’s change it!”

Yet the pace of change in the world is unprecedented today, across all dimensions: From 1986 to ’96 China had the second highest economic growth in the world (11.4%), but from 1996 to ’06 seven new countries had even higher growth than China; and there’s Moore’s law, which describes the long-term trend of how computer processing speed and memory capacity doubles every two years, driving more, newer, and faster changes in society, enabling new kinds of change, powered by social media, micro-loans, and global economies; and we are using our natural resources faster than ever as more nations emerge as buyers and sellers in the global marketplace.

Planned abandonment is about seeing, accepting, and doing something about the situation, rather than giving—and/or accepting—a Horse’s Ass answer, taking a Horse’s Ass approach, and becoming a Horse’s Ass.

When your gut tells you there’s a Horse’s Ass standing in front of you, don’t just stand there: Put on protective eyewear and call, “Horse’s Ass!”

If you don’t, you may as well be looking in a mirror.

© 2009 John Dila

We all make mistakes. Even leaders. Especially leaders. The important thing is to realize you made a mistake, and to correct it. Hearing a leader admit he’s wrong can be inspiring and freeing for someone who is following. It can establish a human connection and a sense of trust without which deeper relationships cannot develop.

****


The entire exchange took place in the mirror—we never looked directly at each other.

The conversation in the mirror went like this:

“Dad—can I have more toothpaste?”

“Are you going to brush your teeth with it, or just suck on it like last time?”

“Brush my teeth!”

“OK, sure. Here—hold out your toothbrush and I’ll squeeze some out for you.”

“Thanks, dad,” Finn smiled at me in the mirror, and then watched open-mouth as I squeezed a small amount of Crest’s “Original Paste” onto his small-fry bristles.

He didn’t brush, though, he sucked the paste, which made his small inexperienced mouth salivate.

“Dad?” he said, with his brush in his mouth like a doctor’s “Ah-stick.”

“Ya, Finn?”

“Can you see my epiglottis, dad?”

“No, Finn, I can’t. Remember, it’s not an epiglottis, is called a uvula, remember?” I said.

Finn is into Finding Nemo these days, and his favorite part is when Marlin and Dory are trapped inside the whale’s mouth—the whale is actually helping them find Nemo, but they don’t realize that at the time. Well, the whale opens his mouth real wide, and we can see the little teardrop-looking fleshy thing at the back of his throat. “What’s that?!” Finn exclaimed the first time we watched the movie. “Dad, what’s that in the back of the whale’s mouth?”

“That’s his epiglottis,” I said with certitude. I took, but failed, Human Anatomy at university (I was better at performing rhetorical analysis than memorizing the Latin names of body parts). And every time we watched Nemo from then on, Finn would announce the epiglottis at that point in the movie. We even looked in our own mouths one time to see our own epiglottises.

Wanting to know more about the little fleshy teardrop one evening, I Googled it. Then I Googled it again, and to my horror I realized it was not the epiglottis; it was the uvula!

‘How am I going to explain this?’ I wondered, as I poured myself a glass of Justin Merlot one evening after Finn had gone to bed. He’s learned epiglottis; he’s not going to like randomly unlearning that and relearning something else. How am I going to explain I got confused, and the epiglottis is a “is a flap of elastic cartilage tissue covered with a mucus membrane, attached to the root of the tongue,” and not the little thing he can see at the back of his throat?

Back in the bathroom brushing our teeth, I said, “I made a mistake, Finn.”

“What, dad?” he asked, looking directly at my reflection in the mirror.

“I made a mistake,” I repeated. “I thought the little thing in your throat was called an epiglottis, but I was wrong—it is actually called a uvula. Can you say it? Say: U-vue-la.”

“You-vew-la,” he said.

“Right, I made a mistake. It’s called a uvula. Sorry about that.”

“That’s OK, dad,” he said, “I made a mistake, too. It’s called You-vew-la. Sorry about that.”

And that was it–epiglottis was out, uvula was in.

© John Dila 2009