Japan Earthquake: heartbreaking images -seismologists, structural engineers and nuclear power industry worldwide to learn

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The Japanese earthquake images are heartbreaking and there is an outpouring of immediate support from he UN,US and worldwide, so loved and respected are the Japanese. Japanese management is really most impressive because they are able to implement best practices like no other culture. The most inspiring for this blog   is TQM which was actually invented by the American,Edwards Deming  but really implemented with outstanding success in Japan.

In the professional front here are some comments you might have heard:

  • Geologists-Seismologists recognize that given the best technological sensors that Japanese Geologists-Seismologists have in place, the world will learn a lot more.
  • Structural engineers in the US and around the ring of fire note that tall buildings swayed a lot in the earthquake but stayed up. Remarkable structural engineering.
  • The nuclear power plant meltdown problems are the most horrific. A US nuclear expert noted that even the emergency response is the best known to the world. For example, the emergency responders know that a shower and iodine tablets within six hours can help and are doing their best.

For Japanese businesses  and their global partners this is truly force-majeure conditions but knowing the stoic determination of the Japanese people and the enormous goodwill they have in the world, I am sure  they will recover,stronger than ever.

Deja vu 1982- well not entirely for Tylenol with FDA consent decree

The makers of Tylenol have a consent decree with FDA who will be additional supervisors at three of their plants for primarily following good manufacturing practices. No one has died but sort of brings back memories of the 1982 Tylenol crisis that had almost passed onto history in marketing classrooms.

This time the situation seems like generally out of control at many fronts in the production plant with unlabeled test tubes, ineffective trace back of consumer complaints and other systemic failures. McNeil a division of Johnson & Johnson has been great on the marketing side though,putting the customer first, and recalling whatever products had problems.

The back end of the distribution channel i.e. the factory end is a problem and sort of brings to the fore the need of organizations to constantly look at the market and consumer no matter where they work  from in the value chain. As soon as a consumer complaint is logged it needs to quickly get to quality control and be traced back to the shop floor and if applicable to suppliers and permanent fixes applied.

Clearly in the current McNeil case some real silos have been holding up communication between the distribution channel and manufacturing/quality control. While more news should emerge from the FDA oversight, it would not be surprising that some suppliers were not on the same page as far as what was going wrong in the market for McNeil. Why is this so common and how it can be corrected is a passion of this blog  so we will wait as  more information becomes available. In the meanwhile,the McNeil Marketing and Sales folks might want to spend a little more “bonding” time with production/quality control. Although it might seem like wasting time away from the market,it does pay off hugely.

The good news for McNeil and its customers is that things are not that bad  from a stock point of view and it’s likely that Tylenol and other brands will come out stronger from this challenge .

“Privacy” and social media -SEC to track Facebook and Twitter

The SEC is going (back in 2011) to track Facebook,Twitter,Linkedin  postings. Consider this imaginary scenario, more plausible as the Facebook generation grows up.

[ Note: This post from March 9, 2011 was updated for formatting issues on May 31, 2021]

Imagine that as a Director of a company you are going down the elevator, after an exciting board meeting, talking with a fellow Director about a particularly popular brand’s pricing and how the latest re-branding campaign is going to make sales zoom. Two cleaning employees from the facilities cleaning company join the elevator and hey- they have brooms and the vacuum cleaner and it’s anyway time to clean up! The cleaning folks overhear part of your comments and actually ask you. You sort of clarify,perhaps enthusiastically. And that night these employees (of the cleaning contractor) have something interesting to share among their friends on Facebook and maybe some enterprising friends of friends buy a few shares.There are time imprints for all the Facebook sharing and the online buy orders (OK they are just $100 buys).The Directors, company is in serious violation and probably the poor cleaning contractor is also in SEC violation for sharing private and privileged information.

As information,opinions and pure speculation become instantly accessible  online with the Internet and social media at this third cusp of the information age, its perhaps time to re-look at the regulatory frameworks devised for the telephone age, at  most. The telephone age seems so long ago, right?

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Supply chain norms and incentives should be aligned internally as well

Have you heard of managers paying liquidated damages to  their employer for defective manufacturing under their watch? Probably not, but sure you’ve heard of suppliers paying liquidated damages for defective supplies. Depending on the alignment of incentives and norms of internal folks the external relationships with the supply chain and distribution channel can work better or worse.

In organizations where managers may lose bonuses or promotions fair and square,you can bet that they’ll make sure that suppliers and distributors are on the same page.  Supply chain managers and related  production managers will device both recognition and financial rewards like prefered supplier status in the supply chain and  the marketing and sales folks will organize  a gala golf event to recognize top distributors!

Exploring these ideas  is a provocative lead article in the current issue (March 2011) of the Journal of Marketing where  Alok Kumar,Jan Heide and  Kenneth Wathne gather data from the apparel industry and encourage companies to look not only at individual relationships but across relationships as well.Read the the full paper here.

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Strategic Oil Reserve and the “desultory” Libyan Conflict- Energizing Libyan Entrepreneurs

There was a BBC correspondent who came up with the word “desultory” to describe the Libyan conflict. Today there were visuals from both the rebel and Gaddafi camps that sort of supported this brilliant one word “desultory” description. Should US  put out the 60 days Strategic Oil Reserve for something that might last a few months -maybe years without active intervention ? Intervention seems unlikely with US,NATO forces stretched so thin elsewhere and the reluctance of Libyans to involve other countries. So the US  should probably  hold on to its strategic oil reserve.

An innovative possibility that the oil industry might find worthwhile to explore,  is to encourage Libyan entrepreneurs already involved in the supply chain, to take more leadership roles in trying to separate the “desultory” conflict from oil trade. Perhaps some sections on both sides of the conflict will agree, given that Libya controls only 2% of oil production which while damaging for the world economy, is not a show stopper for oil consumers  worldwide  who’ll start living with higher prices and no oil from Libya.There are no winners here but at least the Libyan people and their oil customers will suffer a little less.

That some of this is happening is the encouraging report from Cairo about a tanker leaving Tobruk in Eastern Libya for China last Monday.

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Unemployment now under 9% -the Science and Math Education Value Chain

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The unemployment numbers are out and the great news is that it is 8.9% – the first time under 9% in two years. The links of the education value chain, the favorite perspective of this blog, can be seen as elementary school-> middle school-> high school->trade school/college-> graduate school and let's explore what can be done to shore up US employment at each link of this chain.

While  I don't agree with everything Fareed Zakaria says,  I do share some of his concern. Here are some ideas to consider across the Science and Math education value chain:

  • The school system needs overhaul, not because teachers don't know their stuff, or have unions, but because the system allows too much student/parent/administrator questioning of the teacher with democracy gone too far. Math and Science departments are unpopular because it’s much harder to get an A or B if you have the problem wrong and the teacher gets blamed for not teaching. I am yet to see a happy Math or Science school teacher, what with the constant bickering.
  • Trade schools are great for a segment of students who are probably better off with trade skills -adding more high tech trade skills will help.  For eg. NASA electrician  skills is better for competitiveness  than  just neighborhood electrician skills. While the latest NASA crash is being investigated , a very large pool of  high end trade skills can't hurt.
  • Under Grad education is another point at which the now “free from parents” college students prefer to switch from science and engineering to other “feel good “ but “no job” fields.  There must be data but just look at your own college or your kid’s college and  ask did the number of engineering/science related majors decline in the same cohort from freshman to junior/senior year?
  • Graduate schools can help if it is possible to keep the brightest local undergrads in school. Big scholarships, comparable to undergrad salaries  can help. A large number of promising foreign students is often required to leave as this story suggests. Incidentally most graduate students in the sciences are foreign students.
  • At the consumption point – i.e. organizations with employees who are already in the workforce – the right "future" oriented training and education is a must. This is the quickest fix but competes with the natural urge of global companies to outsource or move whatever they can to lower cost locations. Just productivity training is not enough here as the American worker is already highly productive. So an  innovation oriented quantum re-training on future skills is needed.

“Worst” companies need to improve their websites: Fortune Most Admired Companies

Tonight those companies which made it to the top spots  in  each Fortune best category are churning out  PR news releases , justly proud of their accomplishments. Those who appear in the “worst” list would be hiding or don’t even know it,I guess.For starters, those companies judged as “worst” should get their websites better organized. When I went to one such “worst” company’s website I was totally surprised to encounter all kinds of slow flash introductions, random pop ups and  even a spam video!

[Note: This post is from March 3, 2011 and was updated for formatting on May 19, 2021]              

The Fortune methodology of ranking seems to be a survey of executives and is a sort of peer rating. The good word gets out  and also the bad or no word would result in a  low survey rating. One wonders if those companies in the “worst” list are that bad or it’s more a question of letting peers know of the good they do.

Obviously the worst companies, mostly foreign ones, do business otherwise would not feature in the Fortune list at all. There is one message for them tonight  : review your websites.

For readers of this blog – here is some fun. Google the worst companies in each category and look at their websites.  Some categories, relevant to this blog, and worst companies are:

 The question is whether these are really “worst” or just not successful in communicating what they do.

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Innovator or Innovation first ? Steve Jobs and the iPad2.

There was a standing ovation (posted March 3, 2011) for Steve Jobs as he walked in from sick leave to unveil the new and dramatically improved iPad2. You would look at the iPad2 and say “wow” to its reduced thickness,reduced weight,two cameras,long battery life and same price as the iPad.

But innovators would be more inspired by the amazing spirit of Steve Jobs. Check out the features of the iPad2 in the report.

Which came first- the innovator or the innovation? Probably no chicken and egg dilemma here… the Apple stock went up on Wall Street  as Steve Jobs walked on stage in California.

 There was a standing ovation for Steve Jobs as he walked in from sick leave to unveil the new and dramatically improved iPad2. You would look at the iPad2 and say “wow” to its reduced thickness,reduced weight,two cameras,long battery life and same price as the iPad.

But innovators would be more inspired by the amazing spirit of Steve Jobs. Check out the features of the iPad2 in the report  and  a longer video here.

Which came first- the innovator or the innovation? Probably no chicken and egg dilemma here… the Apple stock went up on Wall Street  as Steve Jobs walked on stage in California.

About StratoServe.

Getting the customer through the door by cell phone text message

 AT&T wireless  is teaming up  with retailers (March 2010) via Placecast to text messages of shopping alerts of  deals when you are near a store. The cell phone company knows where you are and if you are willing to sign up you’ll get  a text message for that last minute holiday gift or regular grocery item  that you forgot.

Given the huge Internet search and social media sharing of  deals (like Groupon)  this sounds like a good way for the brick and mortar retailers to connect with  a customer  who can take advantage of her/his location., There are privacy concerns,however, as is the possibility of getting a lot of junk messages since to start with AT&T is piloting the program on just age,gender and education. Later, there will be interests which you can outline and hopefully cut down irrelevant messages.

The idea will give a boost to the brick and mortar retail industry that in sectors like electronics and books ,have tough competition from online retailers.

Finding a way to target cell phone users who are unenthusiastic online shoppers could also enhance the reach of this new  physical “geo targeting” media.Prospects seem particularly bright in categories like apparel,homeware,home-improvement   and grocery where retail traffic could be shored up and online retailing is slower. For apparel, the “touch feel” advantage should also work well.

If you think about it, this can be a huge deal for brick and mortar retailers where if a customer actually walks in the door because of a text message, its not a split second “easy click “to leave as it is in online retail!

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Warren Buffet annual letter- America’s best days are ahead

Warren Buffet’s annual letter to shareholder’s is here. The stock market has taken positive note of the Oracle of Omaha‘s views and here is my favorite para from the top of page 4, with the last line in bold:

…..Throughout my lifetime, politicians and pundits have constantly moaned about terrifying problems facing America. Yet our citizens now live an astonishing six times better than when I was born. The prophets of doom have overlooked the all-important factor that is certain: Human potential is far from exhausted, and the American system for unleashing that potential – a system that has worked wonders for over two centuries despite frequent interruptions for recessions and even a Civil War – remains alive and effective.

We are not natively smarter than we were when our country was founded nor do we work harder. But look around you and see a world beyond the dreams of any colonial citizen. Now, as in 1776, 1861, 1932 and1941, America’s best days lie ahead.