Stability, a Subway, and the U.S.

If you read articles from several publications and listened to certain presidential candidates in 2016, you might conclude the U.S. is corrupted to its core.  You heard it. Examples like the wealthy control everything. Big business is in cozy partnership with government.  You are wrong. Sometimes it helps to offer some perspective. 

As for the subway, you will find a reference to that at the end of the post. 

Back to stability.  Last week I was reading Bloomberg BusinessWeek and one of the featured articles is on Operation Car Wash. It is an investigation starting out in 2014 as a money laundering operation. It has since grown to a massive corruption investigation with over 100 search warrants issued and arrests of leading public and private leaders. The following article does an excellent job noting the origin of this scandal and where it it apparently headed. Link:

https://www.bloomberg.com/news/articles/2017-05-25/brazil-s-car-wash-scandal-reveals-a-country-soaked-in-corruption

I bring this up because the U.S. does not experience corruption to any degree like this.  Yes, we have investigations, trials, sentencing, etc.  But never to this scale.  Why? I suspect that by and large, the U.S. is a country of laws, not of men.  What does that get you?  Keep reading.

When I started in economic development I had a conversation with an executive associated with the Tandy Corp. Tandy (now known as Radio Shack) was headquartered in Fort Worth, Texas. This was the late 1980s.  At the time Tandy was in the process of moving manufacturing operations from the Far East back to Fort Worth. I asked the executive why, after all, business costs were far less expensive in the Far East.  His answer was stability.  The U.S. offered stability and that was worth the premium a U.S. manufacturing operation may cost.  

Stability.  We cannot always see it. We may not realize it. But when you lose it, you definitely experience it.

On personal note, when I started my career at the Fort Worth Chamber of Commerce, I parked in the Tandy lot and took the only private subway in the U.S. to work.  If you got to a lot early enough, you got a coveted spot under the overpass. That meant your car was shaded.  In writing this, I ran across this piece on the Tandy Subway. It ceased operations in 2002. But for me, it was a real thrill.  Link to story:

http://www.jtbell.net/transit/FtWorth/

Disruptive Technology and Competition

So often we hear about disruptive technology.  Generally, it has a harsh impact to established businesses.  An example is Uber Technologies, Inc.  Uber and Lyft transformed the way people travel for short distances.  In major metropolitan areas Uber is seriously undercutting taxis.  In rural areas it is the defacto taxi service.  Lyft is coming on strong. 

The following article is from Bloomberg BusinessWeek. The author looks at the impact of Uber on Washington DC.  Instead of complaining or trying to stop Uber, government officials chose a different strategy. They are determining how to adapt similar technology and evaluating how it can improve overall service.  Note the active role taken by the local government officials.  One unanswered question is can a government sponsored program continually compete and improve on technology when compared to the private sector.  This will be worth watching in the short and long term. 

Link to article:  https://www.bloomberg.com/news/articles/2017-05-17/square-will-replace-meters-in-washington-taxis

Instilling a Corporate Culture

I am always amazed when I read stories about corporate culture and how successful some company executives are in instilling these values in all facilities.  And the results of when they do not.  How often have you heard "culture eats strategy for breakfast"?  It is very true. According to Globoforce Blog, six mergers were destroyed by the inability to combine company cultures. You know a couple of the more recent ones.  Examples are AOL/Time Warner and HP/Compaq.

Frankly, I think it is a very difficult challenge. How do you transfer a culture from one or two stores to dozens or even hundreds?  Publix is an example of one that did it right.  This appeared in Fortune magazine.

http://fortune.com/publix-best-companies/

Shock

I read a lot of business publications.  Most of the time I am not surprised by what I read. This one shocked me. Seldom have I read an article that at the end of almost every paragraph, I shook my head in disbelief.

This appeared in Fortune magazine under the title of “Hoaxwagon:  How the massive diesel fraud incinerated VW’s reputation – and will hobble the company for years to come.”  I know it is old, but I just reread it.

The hoax and lies were so ingrained and went on for so long.  It is hard to believe how it all unraveled. And now, we watch Volkswagen recover and reset.  This will be worth several detailed stories.

http://fortune.com/inside-volkswagen-emissions-scandal/

A Business Stressing Win-Win with Employees

I love a good win-win story.  This one is about three brothers and the encouragement of entrepreneurship.  It starts with a company called Tasty Dawg. Founded in 1984, it is based in the Chicago area.  Like all successful businesses, it evolved. It became a catering operation and is now called Tasty Catering.  The three brothers continue to run the growing operation.  

However, what is interesting is the "spin offs." I do not mean it in the typical way. Rather, these owners encourage entrepreneurship with existing employees and family members.  It is a very unique culture that comes from the top. 

Take T. F. Processors.  One of the owners did not like the fact that the kitchen went unused for 16 hours. So one of the brothers sought new markets.  He found one, but it required a significant capital investment.  Hence T.F. Processors was born.  The result is a new business catering to schools and eventually for private labels. 

 It is win-win. Existing equipment gets used more for profit making purposes, employees take risks, sales are increasing and complimentary businesses are born.  Well, you get the idea.Examples are That's Caring, Touhy Capital, Rios Ventures, and nuphoriq.

For economic developers, I ask the following:

1. How do we find firms with this culture?
2. What resources can we bring to help existing firms with this culture succeed?
3. How can we encourage other companies to follow this path?

You will enjoy the article and the background. This article appeared in Forbes and was written by Darren Dahl. Link to article:

http://www.forbes.com/sites/darrendahl/2016/06/07/how-tasty-catering-is-serving-up-a-new-generation-of-entrepreneurs/2/#2f8f5664705e

Libertarian Party National Convention: Review of the Candidates and General Observations

Over the past couple of days I watched the delegates of the Libertarian Party nominate its president and vice president candidates. It was live on CSPAN and held in Florida. The national convention had 911 delegates, 76 alternates, and a total of 931 votes.  (Not sure, but I think they may have a few super delegates)

Observations of Nominating the Standard Bearers

On Saturday night (May 28th) the party sponsored a debate of all the presidential candidates.  It was a lively group and diverse group. One was a millionaire businessman, one was a former governor, one was a doctor, etc.  This was an informal, but informative event. The former governor was Gary Johnson, the party's 2012 nominee.  His answers reflected an individual with governing experience.  

I also watched part of the vice president debate on YouTube. It was on the Libertarian Channel. 

On Sunday the delegates voted for their presidential and vice presidential nominees.  Each candidate was given 10 minutes to use as he saw fit. Most had delegates introduce the candidate and/or ran an introductory video.  

Former governor Gary Johnson won the most votes on the first ballot.  A candidate had to get 50 percent plus one to win.  Gov. Johnson won 49.5 percent on the first ballot. The candidate with the lowest number of votes was eliminated.  On the second vote, Gov. Johnson won 55.8 percent of the delegates and was nominated.  

in his acceptance speech Gov. Johnson asked the delegates to vote for former governor William Weld as his running mate. He offered several good reasons to have Gov. Weld on the ticket.  However, in most party conventions the nominee selects his running mate and the convention concurs.  Not this one.  

Gov. Weld had a couple of obstacles to overcome. First, he has not been a member of the party until he was asked to run with Gov. Johnson.  Second, some of his actions as governor of Massachusetts caused concern to several delegates. 

Gov. Weld did well in the vice president debate.  He also showed his Libertarian Party lifetime membership card to demonstrate his commitment to the party.  Several of his actions as governor 20 years ago were libertarian oriented, which was pointed out several times. 

Next was voting for the vice presidential candidate.  Each candidate was given 10 minutes to use as he saw fit.  Gov. Weld went first. He had two delegates speak in favor of him. Then Gov. Weld took the stage, his comments were around 3 minutes.  

Governor Weld got 49.0 percent on the first vote. So this went to a second ballot. On the second ballot a couple of candidates for vice president dropped out.  One of the former vice president candidates pleaded for party unity and the best way to help Gov. Johnson was to vote for Gov. Weld.  On the second ballot Governor Weld won 50.6 percent of the vote.  It was a close vote. 

Throughout the day delegates would approach one of the four microphones and report some Twitter trend or network coverage.  That was always well received by the chair and convention attendees. 

So now the party has its nominees.  If they poll above 15 percent, the two candidates will likely be asked to participate in the presidential debates. 

Observations of the Convention

But this is only part of the story.  The 2016 Libertarian Party convention was, in some ways, a throwback to another era.  In fact, it was held in a hotel ballroom, not a convention center for thousands of people.  No fancy decorations. No shows, fancy podiums, flashing lights, or performances.  

This convention was not a scripted event. Background:  starting in 1972 the GOP scripted the entire convention. By that I mean speeches were pre-filed and timed.  The goal was to ensure that the most important parts and best speakers of each night are on prime time.  Now this does not sound like much, but it makes a big difference. Example, George McGovern's speech accepting the 1972 democratic nomination did not take place until after 2 am.  Since then both major parties attempt to script their conventions to showcase the best in prime time. 

This convention lacked the slickness of democratic and republican conventions. The last exciting convention was the GOP in 1976 when then Gov. Reagan almost beat President Ford and we watched the Mississippi delegation decide if it would vote separately or as a unit. Since then conventions of the two parties have been shiny, clean, tech oriented, and frankly, really dull.  

In addition, the Libertarian Party Convention: 

• was very low tech, 
• on the first vote for the presidential nominee, state chairs sold their state, their nominees or bashed the democratic and/or GOP, 
• the delegates voted for a gift for Ms. Clinton and Mr. Trump (unfortunately I cannot recall what it is),
• had excitement (and I do not mean the stripper),
• had suspense (especially the vice president votes), and 
• had a highly effective chair.

A couple of examples are in order. The votes were checked by each state chairman. This was done by projecting an Excel spreadsheet on a screen in increments of 10 so state chairs could check the votes and vote totals.  The convention chair or vice chair would ask the secretary to scroll to the next batch of votes to review.  

Just think, when is the last time you saw a major party convention go to a second ballot? How about never.  And the Libertarian Party had two!

During the vice president nomination process several delegates asked for non-germane requests which the convention chair swiftly dealt with.  

A word about the convention chair, Nicholas Sarwark.  He chaired the Libertarian Party since 2014 and this would be his first presidential convention.  He was outstanding. He kept the convention moving, dealt with every parliamentary inquiry or other similar matters swiftly and fairly.  He also displayed a sense of humor on both days.  He certainly knows Robert's Rules of Order and did not treat any delegate in a disrespectful manner. 

Mr. Sarwark ran for reelection as chairman of the Libertarian Party and was reelected.  That is good for the party. 

Finally, thanks to CSPAN for showing much of the convention.  One of CSPAN's strongest points is that is shows an event without any commentary or analysis. We, the viewer, can do our own analysis.  It is the best way to watch a convention. Just ask your self this, do we really need all those talking heads?

In summary, I learned a lot about the Libertarian Party. These are dedicated people and dedicated to a cause.  The convention was entertaining and at certain points gripping.  I am glad I watched it. 

Business Consulting - An Alternative

Over the past few months I wrote about Fiverr, Maker's Row and Freelancers.  Today in Bloomberg BusinessWeek I read about the Business Talent Group (BTG).  

According to the description on the website, BTG:

"Business Talent Group is a global consulting marketplace that lets firms quickly harness exceptional independent talent to get critical work done. Our mission is to bring together the world's top companies and independent professionals to enhance business performance and improve people's lives. Since 2007 we've provided leading companies, private equity firms and major non-profits with project-based solutions that are more effective and less expensive than traditional consulting. It's a new way to work, and BTG is leading the charge."

This is a concept very similar to Fiverr, Maker's Row and Freelancers.  BTG matches a company's requirements with the inventory of 5,000 free lance consultants signed up to participate.  It is a brilliant concept.

This is no small potato organization.  BTG does work all over the world. Clients include 20 percent of the Fortune 500 firms. Industries served include (but not limited to) automotive, finance, manufacturing, e-commerce, life science, software and non-profit.

As the BusinessWeek article pointed out, not every consulting gig requires a stable of consultants with the overhead that comes with hiring a top notch firm. Some company CEOs only need specific, short term consulting. 

For companies in rural areas, this is an excellent venue to get the right consultant to review a business challenge and/or help implement a new process or program.  Rural areas may lack the expertise, but no longer.  In addition, BTG should be able to help small and medium sized businesses connect to expertise in a cost efficient manner. 

Lately, I read more and more about this type of business structure. It appears to be a paradigm change.  A company executive can access talent, services, advice, or contract manufacturing when they need it and for as long as the executive team needs it.  Less overhead, more funds for essential and core functions.  

Link to the Bloomberg BusinessWeek article:

http://www.bloomberg.com/news/articles/2016-05-12/when-one-consultant-is-better-than-a-dozen

Link to the BTG website:  http://businesstalentgroup.com/