Category Archives: Business

CTO-I & II

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CTO-I

CTO stands for Chief Technology Officer.
CIO stands for Chief Information Officer.
CSC stands for Cyber Security Czar.

I own Motorola stock. The reason this disclosure is important will become obvious below.

Dear Mr. President:

Welcome to your new stature as the nation’s Number One Temporary Employee.

Business Week reports that you have two executives in mind for your newly minted position of federal Chief Technology Officer, one from Cisco Systems and one from the Washington, D.C., government.

Padmasree Warrior was CTO at Motorola before joining Crisco. She directed research for the Motorola “semiconductor unit and ran its energy systems group before being appointed CTO in 2003—when she was placed in charge of a 4,600-person R&D lab.”

She has impressive qualifications on paper. The facts on the ground look a bit different. During her tenure at MOT, the number of innovative products dwindled, the stock price tumbled, and the company slashed employment including reportedly more than half the R&D staff. Motorola employees are … wary … of Ms. Warrior. And I have lost thousands of dollars on Motorola stock. On paper.

Ms. Warrior “could sing and dance ably, but her words and ideas were empty,” one Motorolan told me.

Mr. Kundra looks just as good on paper. He has served as a technology officer for Virginia and, in D.C., runs “his 600-person staff like a startup, experimenting in … cutting-edge technologies.” He already advises you on technology issues.

Common sense suggests we need people in government who innovate and build. Due diligence means we need people who look even better on the ground than they do on paper.

Be very wary; the bright and shiny object you want may be a mylar balloon filled with hot air. Please choose wisely.

CTO-II
President Barack Obama is the first geek to become president; we real life geeks and nerds certainly applaud his personal knowledge of the Internet and his hands-on skill with the Barackberry (even I don’t have a smartphone). The only other politicians who come close may be Senator Patrick Leahy (D-VT) and former DNC Chair Howard Dean.Mr. Obama will focus heavily on technology early in his new administration. That’s a good thing. He intends to create a Chief Technology Officer (and the accompanying Chief Technology Office) to complement the federal Chief Information Officer (and her accompanying Chief Information Office) and the equally new federal Cyber-Security Czar (and the accompanying Cyber-Security Office). That may not be a good thing.

“The President-elect clearly recognizes the importance of technology,” Technology Association of America’s Jeff Lande told BusinessWeek, “and is elevating them to the appropriate level of importance in his Administration.”

Swell.

Why does the Federal government need so many high level people to build empires that do pretty much the same job?

I may be a bear of very little brain but I have some trouble finding enough honey in the tree to keep all these offices out of each others’ hair.

If it were my job, I’d form a committee to create an office to consider the problem of studying the offices. No. Scratch that. If it were my job, I would spend 30 or 40 seconds of Deep Thought (>==note big blue pun) and realize that I can handle only so many direct reports. I would decide that the Cyber Czaring is a Homeland Security issue. I would determine that the Information Office and Technology Office are complementary bodies that need a single head.

OK, I’m done. I may not have solved all of the problems of the Federal Gummint but I have whittled them down a little.

2008 Bail Out

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We’ve heard of the Year of the Rat. The ancient Chinese welcomed the Rat as their protector and source of material prosperity. 2008 was the Year of the Thieving Rats.

I don’t usually like to see a year end. I love sunsets because the sky colors light up my life at the end of the day but the end of 2008 just means I’m another year older and deeper in debt.

I started out the year with a Schwab One account and now have a Schwab .015 account.

Speaking of our financial institutions, we also started 2008 with a credit fiasco when some mope lifted Herself’s wallet in Philly; the credit card processing center kept sending substitute cards they wouldn’t let us activate.

“What are the last 4 digits on your card, Mr. Harper?”

5884.

“This looks like a replacement for a card that was lost. That’s your old card number.”

No, my old card ended in 3399.

“That’s not right. I show the old card as 5884 and the new card as 6091. Let me put you on hold.”
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“Thank you for holding. We value this opportunity to service your call. Please continue to hold for the next available advisor.”
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“The current hold time is approximately 8 minutes.”

At least they had a nice symphony playing as their hold music.

I found out later that, while I was on hold, the banks scored $700 Billion on my other credit card.

Start a spreadsheet. Right now. Immediately. List every credit or debit card you have. All of them. Include the card number, the institution name, the institution phone number, the full name in which it is issued. Include its expiration date. Make a column with every autopay you pay with each card. In a spreadsheet.

Did I mention to do it in a spreadsheet? Spreadsheets are cool.

Brett Favre, who is Herself’s favorite quarterback of all time, lost his last ever Championship hope with an illegal forward pass yesterday. On the other hand, the rest of the Jets did complete more lateral passes in a single play than anyone had seen in a professional football game this year. If they hadn’t been using their hands, we would have thought it was professional soccer.

I bought my first hard disk-based “Personal Video Recorder” this year so I could pause the news and Herself could pause fuhball.

Built in China, of course, so I did my best for the economy.

This may be the second most irritating product on the market. The operating system was designed to operate bulldozers instead of showstoppers and the remote control pretty much doesn’t. Despite that, I wanted to buy two of them and the seller shipped two of them but only one arrived. Somebody stole the second “in transit.” And now this brand is off the market. Maybe if I had ordered three or four…

Our neighbors decided a couple of years ago that my project to rebuild the North Puffin garage “disappointed” them so they sued us. In the process of beating on us with their lawyers they magically grew their postage stamp sized camp lot by a few feet to the South and a few more to the North.

We lost a few feet of land on our southern boundary and our other neighbors lost a couple of feet of land on their northern boundary but at least we have finished that episode and are done with them.

I bought General Motors stock earlier this year. Automakers and auto dealers immediately tanked. GM suspended its dividend; later Congress decided to suspend GM. I didn’t understand it then but I understand it now; I spent 100 hours and $200 selling a $1,700 used car for $1,400 this Fall.

Regular readers will recall that I had had a yen for a special plate and expected, when I bought this particular KeysCar, that I would get one. After all, DICK was available in Vermont.

Unfortunately, Vermont said I’m not a Dick.

I listed the car on the free craigslist classified advertising site. Three legitimate buyers called. I sold it to one of them for a stack of $100 bills. 15 Nigerians or Nigerian-trained operatives offered cashier’s checks. Every last one of those bounced.

Gasoline flirted with $5/gallon about 20 nanoseconds after I decided to start driving everywhere again. I have some small hope that the oil speculators who caused that spike (and have now taken it in the ear when oil dropped back to traditional levels) were the same financial wizards who robbed us in the mortgage markets.

Or maybe not. There was very little justice in 2008.

Denny Crane sure was something, though. All he asked for was my interest every week but he earned my respect and he got my vote.

The stories we Pollyannas tell ourselves are more optimistic than these. 2009 is going to better, right?

America Going Chinese

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I spent the day in my closet again. I need a divider wall and shelves to increase my storage capacity.

Nice, painted, real plywood paneling cloaks some of the walls in this house; it has grooves that simulate random width boards. I like the look and planned to duplicate it on the divider wall.

The orange box had no plywood paneling that matched my pattern. They did have a flimsy, MDF panel but that very thin medium density fiberboard (paper) panel has only one advantage: cheapitude. 1/8″ thick. Wibbly, wobbly, swelling, sagging stuff. Coated so it won’t take paint. It does not install well and it certainly does not stand the test of time in this humid, subtropical climate.

I bought a good, smooth sheet of actual plywood for about a buck more than the MDF. It has three core plies and two very thin veneer layers, all sandwiched into 5.2 mm of thickness. It “gives up” 3/64″ on the standard 1/4″ panel but I can live with that. I have a router and just four grooves to cut for each divider panel.

My neighbor came over shortly after I had discovered the “Made in China” label on the plywood. He spent his entire life in the forest products business and built a state of the art sawmill operation, planer mill, and a lumber remanufacturing operation in Wisconsin.

“Oh yeah,” he said, “I’ve seen their plywood plants. They have big, modern presses but no conveyors or material handling equipment.” Of course not. Material handling is a serious expense here. People there are still cheaper than machinery. Skynet would not (yet) get a foothold in China.

He also told me that the veneer logs had been cut in the spring or summer when the sap was running. “Good veneer makers want only winter cuts,” he said. The sap stays in the tree and starts it rotting. These panels have black traces where the rot was. Chinese manufacturers don’t care. The 4×8 panel sold for $11.87 in the orange box and that’s all that matters.

Geno wrote in a comment to an earlier post:

It is a wonder to me that corporate upper-management — both for profit and nonprofit — remains ambulatory after shooting itself in the foot by doing exactly as Dick avers. But let’s face it, the best and brightest are the most highly paid; and since cutting cost is the sole liberal textbook criterion for avoiding bankruptcy, those employees are the first to go…

“Cutting cost is the sole liberal criterion for avoiding bankruptcy.”

Likewise cutting cost is the sole Chinese criterion for making sales.

What a wonderful economic model.

Oh, are we in trouble.

Engineering adage:
There is never time to do it right
There is always time to do it over.
Sometime soon I will harp about bean counters.

Bashing – III

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I love that General Motors has retired two of five corporate jets.

I do not love that Congress spent their time bashing Ford CEO Alan Mulally, Chrysler CEO Robert Nardelli, and General Motors CEO Rick Wagoner for flying privately to the hearings. What should the CEOs have done? Driven to Washington?

Has anybody in Congress ever looked at the Presidential fleet?

Has anybody looked at how Congress Critters prefer to travel? Can you spell c-o-r-p-o-r-a-t-e jet? Or the Air Force C-20? The C-20 aircraft provide “distinguished visitor airlift” for military and government officials. What’s a C-20? That would be a Gulfstream IV. As an aside, General Motors leases the G-IV aircraft Mr. Wagoner used. We taxpayers own the C-20 G-IVs.

Gee, ya think the Congress critters could maybe perhaps be bashing the wrong target?

It is far, far easier to tear down what you cannot possibly create on your own than it is to create something tangible.

I promised a solution somewhere in this series. Here it is.

Warren Buffett says the only possibilities left for the automakers are a bailout or bankruptcy.

Sorry, Mr. Buffett. You’re wrong. Bankruptcy is not an option.

Bankruptcy is attractive because it allows the companies to void their union contracts and turn over their horrendously expensive pension obligations to the taxpayers. The serious downside is that no manufacturing company recovers from bankruptcy. Would you buy a $30 grand widget if you knew there would be no warranty service or even parts available next year? Nobody would. The serious downside is that half of American manufacturing workers will find themselves out of work within 12 months. The serious downside is that some huge number of individual American shareholders (including me) will lose even more from their retirement funds because bankrupt company stocks evaporate.

But a bailout isn’t the answer, either.

I have a three-part plan. 1: Americans need an attitude adjustment. 2: Carmakers need an attitude adjustment. 3: Congress needs an attitude adjustment.

First, remember what your mother taught you: If you can’t say anything nice, don’t say it at all. Bashing a business leader for doing something you know nothing about does absolutely nothing productive. If you do that, stop. The corollary to mom’s adage is simple. If you hear someone else bashing American business, stop them.

Second, American automakers need to get ahead of the curve on market prediction, manufacturing planning, and management.

GM is now working overtime in Texas to make trucks because they shut their truck plants down too early. Not enough of the American auto production lines are flexible. And ongoing layoffs have stripped American companies of their best and brightest workers (that’s not just an automaker problem. At Motorola, for example, product developers with excellent rankings are next up for layoff because all of the “average” and “good” engineers are already gone.)

Finally, the automakers do need some Congressional help. Congress can pass a law. Change labor laws to let the automakers void their union contracts. Then give those horrendously expensive pension obligations to the Fed. That’s going to happen whether we taxpayers like it or not.

Give us that kind of bailout and Messrs. Mulally, Nardelli, and Wagoner can take UAW President Ron Gettelfinger out to the woodshed and beat him until they have appropriate contracts for all the employees as well as for Messrs. Mulally, Nardelli, and Wagoner. After all, if the union folk must give up half their pay, the CEOs can give up most (90%?) of theirs.

We need to do something. Chrysler is probably worth about a billion dollars on the market. Ford’s market cap is $4.04 billion today. GM’s market cap is below Ford at just $1.91 billion. Bill Gates, Mr. Buffet, or the U.S. Congress could simply buy all three on the open market and even though it would be a better investment than the bank bailout has proven to be, that latter is a bleak thought.

Bashing – II

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Politics bashing bidness, otherwise known as the famed and apparently widely sought-after Rectal-Cranial Inversion.

Have you noticed the direct correlation between Nancy Pelosi’s statements and the stock market tumbles? Consider this. Every 400 point drop in the Dow has come immediately after Ms. Pelosi mounted her podium.

Is it something in the water? Is it genetic? What is the matter with politicians in general, with Democrats in particular, and with Ms. Pelosi specifically? Are they just plain stupid or is it their God-given mission to ruin America?

We’ve been riding a couple of horses in this series: bad science and bad management.

Global Warming is a good example of Not-So-Real science. The popular press and the Congress would have us believe that all scientists agree on the causes and outcomes of Global Warming. And yet. And yet the National Climatic Data Center reports that global temperatures in 2006 were the third coldest on record.

Meanwhile, Weather Channel founder John Coleman wrote, “There is no significant man made global warming. There has not been any in the past, there is none now and there is no reason to fear any in the future. The climate of Earth is changing. It has always changed. But mankind’s activities have not overwhelmed or significantly modified the natural forces.” Mr. Coleman may be a whackjob but he is a whackjob with better scientific credentials than any national elected official.

That must be why Ms. Pelosi (with the help of Mr. Gore) will once again proclaim that Congress has more scientific knowledge than the actual scientists. The Democratic Global Climate Control machine just keeps on trucking. So to speak.

And then there is business.

Here’s a typical recent comment: “Automakers don’t need a bailout. Look at the airlines.”

And another: “General Motors doesn’t make cars that people want to buy.”

Hello?

It may be true that American automakers can survive without an infusion of loan funds but that airline analogy is just plain wrong. The airlines are a service business. Automakers make actual products.

Which company sells more cars in the world, General Motors or, say, Citroen? How about General Motors or, say, Volkswagen? Oooh, I know. How about General Motors versus, say, Toyota? Yeah, yeah, there is a real battle between the General and Toyota over which is the largest automaker in the world but the fact remains that millions literally millions of people have bought, are buying, and will buy brand new General Motors vehicles this year. That doesn’t add up to “not making cars that people want” even inside the Beltway.

Econ 101: You can fix labor problems by cutting wages, particularly in a service business. You cannot make fixed assets cost less by cutting income.

Ms. Pelosi is playing pur sang politics with a single objective. I believe Ms. Pelosi understands that she cannot ever look good. Therefore she must make everyone else look bad. If the Global Warming political argument destroys American industry and if she can force the automakers into bankruptcy, she believes she can rescue the teeny-tiny-and-oh-so-grateful remainder.

Assuming that any American employers last long enough to be “saved.”

Is it something in the water? Something in the air? Is it genetic? Maybe we need a government-funded study.

Or not.