Tag Archives: Digression

What Every Business Can Learn from the Social Media Efforts of @Delta

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It was about 6:30 last evening when I found myself at the Delta Sky Club in Tampa, Florida. I was booked on Delta’s 7:45 flight to Atlanta (where I am speaking to a group of Ford dealership managers about Internet processes this morning). I had a yearning for a cup of coffee, but I really didn’t think indulging in a caffeinated beverage that late in the day made sense. (Between my upcoming flight and the strange bed I was soon to be sleeping in, it would be hard enough for me to get any rest. As it ended up, I got a solid six hours.)

I grabbed a clean cup at the self-serve coffee station and placed it under the decaf jug’s spout. Pushing down on the lever I discovered they were out of decaf, so I moseyed to the bar to let the Delta bartender know this fact.

“Oh… thank you,” she replied.

I got a glass of water to hold me while she made the decaf and headed back to my seat in the lounge.

Twenty Minutes is Plenty of Time to Make a Pot, Right?

At about ten minutes before seven, I headed back to the coffee station only to discover that the decaf jug was missing. Clearly, the bartender just forgot to return it after she made a fresh pot, I surmised, so I walked over to the bar to ask her if the decaf was ready.

“Oh… it’s too late to make any decaf,” she replied.

I looked at her and just blinked my eyes for a couple of seconds to get my bearings.

“Um, isn’t nighttime when people usually drink decaf?” I asked.

“Well, I was told it’s too late to make any more decaf tonight,” she replied smiling.

Would You Like a Double Gin & Tonic instead?

I figured that a pot of decaf must cost Delta all of two dollars, so I wondered why they were being so cheap. Had I been ordering double Gin & Tonics all night they wouldn’t have batted an eye – even though my drain on their profits would have been much greater.

Since I really wanted that coffee – to the point that I could actually taste it on my way back to my seat – I decided there was nothing I could do but sit down, shut up and be a good Delta customer. In other words, I was fuming. Not because I didn’t get my precious coffee, but because of the arbitrary nature of how the Delta team at the Tampa Sky Club chose to create rules. They didn’t want to have to clean the pots after a certain hour (I surmised), so they invented a rule that you couldn’t make decaf after six.

They reminded me of a bunch of teenagers working at any fast food establishment fifteen minutes before closing: “Oh shit, here comes another customer. Don’t they know we close in like fifteen minutes?”

Vent or Die

I could keep my now rage about being denied a cup of decaf inside me or I could let it out. I chose to let it out. Of course, rather than throw chairs around the Sky Club or even demanding to speak to a supervisor, I decided to just Tweet about this experience to my 1,200+ alleged followers. (Because it was a Friday night, I was pretty sure that no more than 1 or 2 would even read the damn thing. I just needed to vent.)

I followed that message with one more Tweet a minute later to complete my thoughts about the whole affair:

Feeling somewhat content having gotten this off my chest; I sent a couple of emails, packed up my belongings and headed for the departure gate.

A few minutes after I settled into my seat and cracked open an unsatisfying bottle of water, a Delta agent came to my row and asked for me. Instinctively, I just knew I was going to hear some regurgitation of why they don’t make decaf after 6:00 PM and how sorry she was but that “the policy was important to ensure the blah, blah, blah…”

“Mr. Stauning?” she asked.

“Yes?” I replied.

She followed with “We were wrong not to make a fresh pot of decaf for you in the Sky Club this evening. Can you tell me who it was that told you this?”

I was floored. She admitted they were wrong and actually wanted to know which of their employees needed some additional training on customer service.

After I told her my experience and the brief conversations with the bartender, she thanked me for being a loyal Delta customer and handed me a $12 meal voucher for Atlanta. (Delta knows, you see, that I am flying out of Atlanta today after my meetings and so they correctly assumed that I might have to grab a bite in the airport.)

For the cost of a few minutes’ time and $12, Delta was able to completely resolve a minor situation with a long-time customer (and often vocal critic). Moreover, the half-dozen or so people who heard the exchange on the plane were undoubtedly impressed.

#TheLittleThingsThatMatter

As I hashtagged in both of my Tweets, it’s the little things that matter. Not making decaf for your frequent fliers is a little thing; but it genuinely pisses customers off. Telling your customers you were wrong and offering to buy them a $12 lunch the next day are little things; but these are what customers remember and appreciate.

The lessons that all businesses – whether they’re a B2C or B2B establishment – can learn from how @Delta handled this “little thing” are these:

  1. Be diligent and genuine about your social media pursuits. If you’re going to be on Twitter or Facebook, don’t do it for branding or marketing purposes; and don’t just become another spammer. Be social. React genuinely. Solve problems. Or shut the hell up.
  2. Be quick and don’t escalate the little things – SOLVE THEM. I don’t know who made the decision to greet me on my plane and present me with a meal voucher, but this decision did not have to be reviewed by a committee. Imagine if the team that monitors Delta’s Twitter account had simply waited until the next day and responded to my Tweet with “Dear Mr. Stauning: blah, blah, blah…” That would have been infuriating (I know, because another minor issue with a company last week was handled just that way. They would have been better off ignoring my Tweet than to send me down the customer service path of hell I am currently on.) Delta has empowered someone to make quick decisions in the field to solve minor customer issues. This seemingly tiny act can do more to defuse a bad situation than all the “we’re sorry you feel this way” emails and calls from insincere customer service drones.
  3. In all relationships, it’s truly the little things that matter. This is especially true in the realm of customer relationships. The customer is not always right… but, they are always the customer, and when it’s your fault that they feel bad you need to tell them it’s your fault, and then you need to fix the problem.

But The Steakhouse Did So Much More…

Some of you may be familiar with a similar, albeit more extravagant, response from an overpriced steakhouse to a loyal customer who also Tweeted his desires from the Tampa airport. The differences in this case are that Delta (in my opinion) wasn’t looking for publicity, just hoping to satisfy their customer. Additionally, Delta operates on a much smaller margin and deals with many more customer service issues than a chain of restaurants, so sending a guy in tuxedo to deliver me a porterhouse dinner would not have been fiscally responsible. Finally, the guy who Tweeted about steak was just a whiny traveler who wanted something he couldn’t have.

(Well, I guess the two stories do have a little in common.)

The 10 Douchiest Job Titles in America

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The 10 Douchiest Job Titles of 2012

For as long as I can remember I’ve wanted to keep my business cards free of my title. I feel this way for a couple of reasons: primarily, I don’t want those outside of my company getting hung up on my title; also, I really don’t give a shit what you call me inside the company; so long as the work is challenging and fun – and that my role can somehow influence the company’s results.

Of course, I understand I’m in the minority here. There’s an episode of Cheers that humorously magnifies America’s love for important sounding job titles when Woody, Sam and Carla individually go into Rebecca’s office to demand a raise; only to come out overly satisfied with nothing more than artificial titles.

So, while I get why some people want a title and want to proudly display it on their business cards, I struggle to understand why anyone would want a title that basically screams to the world “Hey, look at me: I’m a major douchebag.”

Do you have a douchie title or do you know someone with a douchie title? If so, please share them here. For now, here is my list of The 10 Douchiest Job Titles of 2012:

10. Lifetime Value Business Leader – This title is douchie for so many reasons, not the least of which is that I have no fucking idea what it means. To me, this title sounds more like something that would be inscribed on a crappy award you get from the Fort Wayne, Indiana, Chamber of Commerce than something you would print on a business card. Chances are, if you’re a Lifetime Value Business Leader, you probably can’t lead and likely provide no value to your business (even in the short term).

9. Talent Acquisition Expert – I have two major problems with this total douche bag title: first, if your title shows that you are an “expert” anything it means you are exactly the opposite; and second, the title “Talent Acquisition Expert” springs from the same political correctness that brought us such classic douchebag titles as “Sanitation Engineer” and Subway’s oxymoronic “Sandwich Artist.”

8. Director of Customer Experience – Taking care of customers should be Job One for everyone at your company; but if your business actually names someone their Director of Customer Experience, your front line employees are likely just paying lip service to the actual customer experience. Of course, that’s not what makes this title so douchie. What makes this title really douchie is that the role can only be filled by complete and utter douchebags. Think about it: have you ever met a Director of Customer Experience who didn’t annoy the fuck out of everyone around them? Sickie sweet phoniness does not make for a great customer experience.

7. Chief Motivational Officer – Similarly to the Director of Customer Experience role, if your company needs anyone with any variation of the word “motivation” in their title, then you have a real motivation problem. In fact, your lack of genuinely motivated people will not be solved by giving some made-up title to someone who cannot execute; but he’s really fucking nice so you named him your Chief Motivational Officer. Fire this guy and use the money you save to buy the employees a pool table for the break room and pizza every Friday.

6. Entrepreneur – This title is certainly douchie on the surface: it screams “look at me; I’m a real risk-taking maverick.” Yet these risk-taking mavericks who call themselves entrepreneurs are using the more cultural (mostly incorrect) definition of the word as “someone who starts a business that promises economic gain, but also entails great risk.” In fact, the word actually describes any manager or owner of a business – regardless of actual risk or gain. Putting “entrepreneur” on your card is equivalent to putting the non-descript “manager” as your title; only way more douchie.

5. Company Evangelist – The only people who should be allowed to have “evangelist” on their business cards are those hell-bent on saving our souls and taking our money. (Just taking our money is not enough to make you an evangelist.) In all seriousness, if you don’t spend your Sundays on television speaking to a bunch of sheep and fleecing them of their life savings, then you need to leave this off your business card.

4. Guru – The word is Sanskrit, and if you did not know that, then you’re not a fucking Guru. Moreover, this type of douchebag title is one of the “self-anointed” kinds. This means that no one ever called you a Guru (unless their tongue was firmly planted in their cheek) – you gave yourself this title; and for that, you are a douchebag of the highest order. In fact, you might just be the Guru of douchieness.

3. Mentor – What in the world would prompt someone to put this drivel on their card as their title? It is the job of everyone in your company to mentor to those with less seniority, knowledge or experience than themselves. However, if any douchebag put “Mentor” as their job title on their business card, then they are just announcing to the world that they really value their experience and opinions a whole lot more than the rest of us. I can honestly say that I have not learned a thing from a single person who ever “tried” to be a mentor to me. The true mentors in my life never tried, it just came naturally to them – and they gladly mentored without fanfare or the need to be officially called a mentor.

2. Visionary – Putting this on your card literally screams that what you lack more than anything else is vision. Because… if you had any vision at all, you’d see what a douchebag you look like with this on your card. Let me break this to you gently: being right about a few things does NOT make you a fucking visionary; knowing more than your boss about technology or the Internet does NOT make you a fucking visionary. “Visionary” is a title people bestow upon you at death (think Steve Jobs), not something you call yourself when you’re still alive and annoying the rest of us.

1. Thought Leader – The King of all douchebags, the “Thought Leader,” is another self-anointed position. Those who use this title to describe themselves really see their place in your industry as Socrates meets Einstein. They believe – generally because they have a below-average IQ – that they are both philosopher and genius. While the rest of us see the obvious for what it is, the self-proclaimed “thought leaders” point out the ordinary as if they’ve cracked the genetic code. Deep inside I think many “thought leaders” are truly just “do nothings” who gave themselves the title of “thought leader” because they don’t want to do any real work; they just want to regurgitate what others have published.

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Generally speaking, I think the Internet magnifies the self-importance that the douchebags who proudly display any of my Top Ten douchie titles tends to feel and feed upon. Make no mistake, I get that many of you who read this think I’m a douchebag for my often ranting style of writing. The difference between me and the douchebags that might desire one of the above as their titles is that I know whatever I write will be douchie to someone.

Of course, if you happen to be one who thinks my writing is douchie, then I feel good that I could help you feel superior to someone; even if it is just some douchebag who rants when he writes…

Dear Occupy Wall Street Protesters: When Did I Become the Bad Guy?

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It seems that as a pro-capitalism, successful business leader that I am somehow partially to blame for what ails the protesters who’ve joined the Occupy Wall Street (OWS) movement. I am the enemy. I am the bad guy.

While I’ve tried desperately to comprehend both their demands and their end game, I have to admit that I am at a loss. One day someone who seems to be an OWS muckety muck (they don’t have any true leaders as of this writing) is claiming that all of capitalism must go; though the next day the protesters are joined by union leaders (whose members are employed by companies that benefit from capitalism) and the message is that corporate greed must go. (Is there anything more amorphous than “corporate greed?”)

It would be nice, actually, if they only had these two viewpoints; but the truth is that for every smelly twenty-something you see holding a sign (or an iPhone), there is a different take on what it is they are trying to “solve” with these protests.

I put the word solve in quotes because I’m not sure they want to solve anything. They really just seem mad that they don’t have all the same luxuries as the successful people in our society (the bad guys). Most of them just seem to want those of us who’ve worked for what we have to give it all back to “society” so that we can all be equally miserable doing without.

When Did I Become the Bad Guy?

By most protesters’ definition, I am a bad guy. I have my own business and I make a good living. My children have cool gadgets and we live in a nice house; in a nice neighborhood. I am really very satisfied with my life. A life, I might add, that did not happen by accident. So I need to know: When did I become the bad guy?

As an eight-year-old in 1971, I began selling candy door-to-door in Glendale, Arizona. I’m not sure how much I made, but it was probably somewhere around $10 per week. (We were poor when I was growing up, so if I wanted to buy anything, I had to earn the money to buy it.)

Is this when I became the bad guy?

From around 1973 through 1977, I ran paper routes (sometimes one route in the morning and one in the afternoon) and sold magazines, newspaper subscriptions and seeds door-to-door. I used my money to buy sports cards, comic books, bicycle parts and candy.

Is this when I became the bad guy?

Throughout my high school years (77-81), I worked at fast food joints, a minor league ballpark and an amusement park. (I doubt there was ever 20 consecutive days that I was out of a job.) I used the money I earned in high school to buy a motorcycle, then a car, fill those with gas, buy beer (yes, illegally) and eat at Jack-in-the-Box or McDonald’s on occasion.

Is this when I became the bad guy?

From 1981 until 1985, I served in the US Marine Corps; mostly on the island of Guam. I was a Russian Linguist in the Corps and I worked what some civilians would think was not only a weird schedule, but probably inhumane. It was called a “2-2-2 and 80.” With this schedule, you worked two day shifts (8AM-4PM); two mid shifts (12AM-8AM); and two eve shifts (4PM-12AM); then you had 80 consecutive hours off. You only had eight hours between your second day shift and your first mid shift; likewise after your second mid shift. I used the money the Marines paid me to buy beer, a computer, stereo equipment, a car and some pretty cool Christmas presents for my family every year.

Is this when I became the bad guy?

After the Marine Corps, I enrolled at Arizona State University where I took a full class load while I worked fulltime to pay my bills. (During my time at ASU – among other equally glamorous jobs – I drove a taxi, worked as a security guard and even sold manure.) As my money got tighter, I took fewer classes and worked more jobs. I studied business, though because I eventually ran out of room on my credit cards, I left ASU deeply in debt and a few credits short of a bachelor’s degree. Ready to just join the workforce and not worry about college, I accepted a job as the manager of an aircraft parts warehouse and worked very hard to do my part to help this Mom & Pop operation become successful.

Is this when I became the bad guy?

A couple of years later, in 1991, my soon-to-be wife and I moved to Chicago so that I could begin work for a beer distributorship as a salesman. Once I arrived, I made sure that I always worked harder and smarter than any of my coworkers. As a result, I was promoted to a territory sales manager position and given a nice raise.

Is this when I became the bad guy?

After I got married in 1993, I decided to go back to school and finish my degree at Governor’s State University. I endeavored to finish my education by working during the day and going to school at night (and on some Saturdays). About a month before my first son was born in July 1994, I finally earned my bachelor’s degree.

Is this when I became the bad guy?

By the time I left this beer distributorship in mid-1997, I had worked my way up to Vice President of Sales earning $73,103 in 1996 (when you included all my bonuses). Even though I now had two sons at home, I was working more than sixty hours each week to better myself.

Is this when I became the bad guy?

From mid-97 until mid-2001, I owned a tiny minority stake in an equally tiny beer distributorship in Missouri. As the managing partner of this wholesale operation, I often arrived at work before 5 AM to load the beer trucks. Once I finished my morning paperwork, I would go out into the field to meet with retailers and convince them to carry my product (which was not easy since the previous distributor had gone bankrupt and left the market without my brands for more than eight months). I was a business owner in name only (because the banks really owned the business) and some nights I worked past midnight. Over the four years that I ran the operation, we were able to dramatically grow our sales (easy to do when you start at the bottom) because of hard work and a lot of perspiration. We sold the brands we distributed in May 2001 to a couple of competing wholesalers, and I reentered the corporate world.

Is this when I became the bad guy?

From 2001 through 2009 I moved my way up through various companies by always outworking my counterparts. I not only worked harder, but I also studied (as I had been doing since 1991) all the industry information and business success literature I could get my hands on. I was a voracious reader of the likes of Tom Peters and Stephen Covey. I am convinced that my success over that period was due to the hours I dedicated towards working hard and studying equally hard. In 2009 I reported to the CEO of a Fortune 500 company.

Is this when I became the bad guy?

In 2009 – during the worst recession of my lifetime – I left the safety of the corporate world and started my own business: part consulting and part developing products to make others more successful. Over the last two years I’ve routinely worked more than twelve hours a day, including most weekends; and my travel schedule, while not as grueling today as it was in 2009, still earns me 1st Class upgrades on nearly every flight. I feel like I’m finally bringing in enough money to help my sons (I have three of them now) get a better head start than I got; to help them to not run out of money while going to college; and to help them choose a career that’s fun for them, rather than taking the route I took and always having to work to pay the bills. My business is doing so well that I expect to start hiring fulltime workers in 2012 (provided the economic and tax situations make that a feasible decision). I have no debt (other than a house I’ve been trying to sell in Atlanta) and we’re putting away a good amount for our retirement.

If I hadn’t become the bad guy before now, then clearly it was my decision to chase the American Dream (and my ability to catch it) that made me the bad guy to the Wall Street protesters. Just so I can get this straight: It’s okay to chase the American Dream, but if you happen to catch it, be prepared to be asked to give it all back to those who weren’t willing to sacrifice as much as you were…

…

I wish I had some great wisdom to bestow on those protesters who think I’m the bad guy. I wish there were words to ease the minds of those who are (in effect) protesting the fact that my “greed” will someday create jobs for them – jobs that will allow them to chase the American Dream if they so desire.

Unfortunately for the protestors, the words they need to hear will not ease their minds. They should have heard these words years ago from parents who should have taught them about hard work and dedication to a job well done.

The words I have for the Occupy Wall Street crowd is simply this: Stop bellyaching; retract your outstretched paw looking for a handout; go home and shower; and (as I did my entire life) seek out any job you can get. Once you’re in that job, work harder and smarter than everyone else and good things should happen for you.

And if they don’t, then you start over.

AskTheManager Book Review: Staging a Miracle: A Practical Parent’s Guide To Surviving an Autism Diagnosis

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Call this post a digression (if you think this book has nothing to do with leadership) or call it a stretch (if you see, as I do, that this little book has some very big lessons for all of us). I read several books a month – all non-fiction – but few books ever rise to the level of a review on this blog. Most don’t deserve it, they’re just crap; while some cannot be shoehorned enough to be called leadership lessons. Staging a Miracle is one bright and shiny exception.

Author Jason Eden captures beautifully the frustration and trepidation truly dedicated parents feel when they are searching for clues and cures for whatever ails their children. I write “truly dedicated parents,” because – as you’ll learn in his book – not all parents are truly dedicated. For me, this was one of about a dozen leadership lessons that leapt off the pages at me and literally slapped me in the face. For parents of Autistic children (and those who care for the Autistic) his words should slap you into the reality that everything about your child’s progress (or regress) can be laid directly at your feet.

This is not to say that everything is the parents’ fault – that is not what Eden is saying in my opinion. What he is saying, explicitly, is that parental involvement (among many other factors) is critical. What I really like about Staging a Miracle: A Practical Parent’s Guide To Surviving an Autism Diagnosis is that Eden doesn’t just talk about involvement as if it were a bad cliché. Instead, he explains in a step-by-step manner exactly what involvement entails. Everything about this book is presented as plain language, practical advice. And unlike most leadership “experts,” Eden doesn’t just throw out words like involvement or tough love, he explains what they mean for and to the parent, the caregivers and especially the affected children.

“Well Timothy, it looks like Aunt Susan wants you to have the Autism”

In what might be the funniest thing I’ve ever read, Jason Eden sums up tough love with these shocking words in front of a well-meaning, but misguided relative who was undermining the progress he and his wife were making with their child. This is one lesson that all leaders should read and heed. Tough love is something that has been missing in American schools for 30 years, American homes for 20 years and American businesses for 10 years.

…

While I would love to dissect every chapter of this well-written work right here (because the book really is that good), that would leave you little reason to read Eden’s book on your own. Suffice it to say that Eden’s take on Autism care and treatment is a breath of fresh air. Unlike books written by so-called “experts,” Eden has no ulterior motives: He clearly only wants to help his kid live a normal life (my words, not necessarily his). This book takes parents through everything from how to select a school when you have a child with Autism to what you need to say to therapists and others who may not have your child’s best interests at heart.

Unlike the so many misguided books on the subject, he is not selling a thing; and his opinions are based on real results and logic, not on hype and wishes. This is as much a guide for parents with kids on the spectrum as it is a guide for anyone who deals with the Autistic. His advice is sound, and his dedication to helping his son is clear throughout. I highly recommend it.

…

(In the interest of full disclosure, buying Eden’s book using the link in the post above will result in a small commission – generally 4-6 percent – being paid to me by Amazon.com. If you’d prefer not to have me receive the resulting 28-42₵, you may purchase the book via this link. I really don’t care, so long as you buy and read this book.)

 

 

From GoGo to NoGo, Delta Stubs Their ToeToe

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Delta Renames In-Flight Wireless Internet

Dubbed GoGo when released (see our original excited post about GoGo Wi-Fi published on January 12, 2009), it is rumored that Delta has decided to rename their in-flight wireless Internet service NoGo to signify that the service is still not available on all flights nearly nine months since its release. More importantly, GoGo is surprisingly absent from many cross-country flights (where travelers would most welcome it). “It has become clear to us that we should rename the service NoGo,” stated a fictitious Delta executive.

Okay, so this is a rumor that I’m starting, but for good reason. Today I sit on a four-hour, thirteen-minute flight from Atlanta to Orange County on a Delta 737. Once we reached 10,000 feet, I was excited to remove my laptop from its bag, power up and surf to my heart’s content.

Oops, someone forgot to install GoGo on this flight.

Makes perfect sense, right? Why would a planeload of businessmen want to check email during a cross-country flight in the middle of a weekday? My last three flights, all less than 40 minutes in total EDUT (Electronic Device Usage Time), came equipped with GoGo wireless. At just under $10 per flight, GoGo is often not worth purchasing on such short hops. On a flight like today’s, GoGo would be a welcomed bargain that would also help Delta squeeze some additional revenue from its customers.

Leaders Remember Important Lessons

I admit it: I’ve forgotten most of what I learned in college. Much of what I do remember, I have to say, I will never, ever use. I’m hopeful, of course, that I can recall the important lessons when required. The lack of GoGo Wi-Fi on today’s long flight reminds me of one of the first lessons I learned during a basic marketing course in my freshman year in college; perhaps you recall this lesson, as well: it was called The Four Ps of Marketing.

Price, Promotion, Product, Place

With regards to the GoGo rollout, Delta has done a done a decent job with three of the Ps, but they forgot all about one of them.

Price. At $9.95, the service is priced particularly well. A dollar more and they would likely lose 20-30% of their users, a dollar less and they gain nothing.

Promotion. Between the early 40% discounts and the constant bombardment of seat pocket flyers and preflight announcements I have become nearly addicted to the service.

Product. I can surf the web at 30,000 feet. ‘nuf said.

Place. Oops… it’s clear Delta didn’t think this one through. To provide the service during a quick jaunt between ATL and JAX is meaningless to consumers (and probably costly to Delta). However, to not provide the service between Atlanta and John Wayne International is downright criminal. What is Delta thinking? Obviously (as is becoming commonplace with Delta product/process rollouts) they were not.

Like the on-again/off-again Breezeway rules, Delta leadership doesn’t seem to grasp simple concepts. Is it because running an airline is so complicated? I have no doubt it’s damn tough to achieve much of what Delta has achieved, though I find it incredibly disappointing when they fail at the simplest of tasks. (As a frequent Delta flyer, I’m just hopeful they don’t screw up like this on the important stuff.)

The Truth about Cash for Clunkers

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Leadership Decision Making and The Law of Unintended Consequences

Certainly you’ve heard the axioms “nothing happens in a vacuum” and “for every action there is a reaction” before. We’re pretty sure that every thinking adult not only understands these sayings, but also believes them to be true.

Cause and effect, means and ends, seed and fruit cannot be severed; for the effect already blooms in the cause, the end preexists in the means, the fruit in the seed – Ralph Waldo Emerson

RWE is correct, but he fails to mention that each cause actually has multiple effects; every mean leads to numerous ends; and that each seed can bear bushels of fruit. Cause and effect, like means and end, can imply both good and bad outcomes; and both scenarios – unlike the planting of a seed – often create results that are unintended and unforeseen.

The law of unintended consequences is not a new phenomenon, and it’s especially not new to government action. History has shown at every turn that government intervention, regardless of the benevolent intention, leads to numerous unforeseen and unintended consequences. Certainly, some of the outcomes are beneficial, though the vast majority are not.




The Truth about Cash for Clunkers and The Law of Unintended Consequences

In a nutshell, the US Government created a program that requires taxpayers to spend $3 billion help 750,000 people to buy a new car. The program, officially the Car Allowance Rebate System (CARS) though more commonly known as Cash for Clunkers, was created solely “to energize the economy; boost auto sales and put safer, cleaner and more fuel-efficient vehicles on the nation’s roadways” – this, according to the government’s official cars.gov website.

While nearly everyone in Washington was breaking their arms patting themselves on their collective backs after just two weeks of CARS, the truth is that this program, like all government programs, has already spawned numerous unintended consequences (and none of them positive). Here are just a few:

  • Kelley Blue Book analysts are predicting a bubble in used car prices as a result of the CARS program. This means the cost for a used car is going to be higher, creating a burden on the working poor and lower middle class.
  • Charities are reporting that donations of used cars are down 20% since the start of the CARS program.
  • Already hurt by the economic downturn, used car lots are seeing an additional 20% drop in sales since the beginning of the program – these lots are more often owned by local businesspeople and not large corporations.
  • Some independent auto repair shops – precisely the kind that would service an older car – are reporting up to 25% decreases in their business.
  • Because of the increased demand for many models, car dealers are not discounting beyond the required manufacturer’s rebate. This means that all consumers are paying more for these models.
  • Economists blame the drop in overall July retail sales on the CARS program; arguing that consumers spent on new cars, but cut their spending elsewhere – deepening the recession the program was meant to help stop.
  • The top new model sold so far under the Cash for Clunkers program is an SUV – the Ford Escape – and two large trucks (Ford’s F-150 and Chevy’s Silverado) and a Jeep are among the Top 10 new models sold. (Hardly the pro-green movement for which the government was hoping.)
  • 750,000 working automobiles will be taken out of service and replaced with 750,000 new vehicles. The process of manufacturing each new car (when you account for the acquisition of all material required) is a much more polluting proposition than driving each old car until its natural demise.


It’s clear that Cash for Clunkers will do little, if anything, to stimulate the overall economy; but what about the nation’s car dealers and manufacturers? While dealers are making more per car sold and manufacturers are seeing their inventory backlogs shrink, both of these benefits will likely be short-lived.

The increased demand created by the CARS program cannot be sustained without better economic news. The dip in overall July retail sales signals to us that the end is not as near as we had all hoped. Instead of kick-starting the US Auto Industry, Cash for Clunkers likely pulled ahead many consumers who would have purchased later this year and in 2010. This means many dealers should look for softer than expected new car sales from September through the end of the year.

For the manufacturers, it seems they never learn. Ford announced this week that as a result of the “success” of the program they are ramping up production in the US. While this should be good news for the economy, it likely signals that Ford will be cutting production more than usual this November and December. Rather than enjoying the higher prices brought on by the momentary (and sure to be short-lived) spike in demand, Ford plans to run with the standard Detroit playbook and chase demand by building more cars, trucks and SUVs in the next couple of months. It’s as if Ford is proclaiming “Forecasters be damned, the recession is over.”

…

The leadership lesson in all of this is that the world is always more complex than it seems on the surface. Whether we’re talking about the US Economy or the five people in your workgroup, there is an equilibrium that must be considered before major changes are enacted. Understanding how these changes will affect all stakeholders is an important first step towards reaching your goals; but it is only a first step.

It is equally important to make assumptions about the unintended consequences that will inevitably define the success or failure of any major project, program or transformation. While you’ll be wrong more often than you’re right, just knowing that unforeseen outcomes are expected will make you a better leader – if for no other reason than you’ll be better prepared to manage the unanticipated results.

Cash 4 Clunkers Causes Conservatives 2 Clamber 4 Gov’ment Cheese

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Cash 4 Clunkers Causes Conservatives 2 Clamber 4 Gov’ment Cheese

An interesting sociological experiment and a great leadership lesson has emerged from the US Government’s Cash For Clunkers program: We observed the previously fiscally-conservative put their hands way out, looking for their version of Government Cheese.




It is difficult to get a man to understand something, when his salary depends upon his not understanding it.

We love using this quote by Upton Sinclair because it explains so much about how humans, even staunchly conservative ones, act when money is involved. We understand why so many car dealers are fiscally conservative: They want to keep their hard-earned money in their pockets and not in the government’s. We get it, and we agree with them. What’s interesting here, however, is the nation’s car dealers – mostly old, rich white guys – argue against virtually every welfare program and any government involvement in their businesses. But, when it’s their turn to suck from the government teat, they will knock you and me down to get theirs.

No one doubts that without the collective efforts of NADA member dealers …, the cash-for-clunkers program would not exist today. – National Automobile Dealers Association Chairman John McEleney

We certainly don’t doubt it. It seems that greed trumps principle. The same businessmen and women who routinely vote against liberal candidates were salivating last week while lobbying for President Obama and the Democratically-controlled Senate to pass legislation putting another two-billion tax dollars in their pockets. Do they have any sense of who will pay for this? Do they care?

WIIFM – What’s In It For Me?

Not that we expected the nation’s car dealers to react any differently than virtually anyone else would, we just thought it was interesting what strange bedfellows can be made when there’s something in it for someone. In a weird way we half expected that at least the conservative members of the NADA to remain so… Wow, are we naïve.

Leadership Lessons from Barack Obama

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What Business Leaders Can Learn from Obama’s Bad Week

Wow, what a week for the Leader of the Free World. Just as his something-for-nothing-health-care-plan was starting to lose steam on Capitol Hill, one of his friends breaks into his own home, gets lippy with a cop and gets arrested.

In his typical “you never want to let a serious crisis go to waste” fashion, Barack Obama took a page from previous US Presidents and tried to deflect criticism of his health plan with some presidential sleight of hand. Claiming a decorated police officer acted stupidly in arresting his pal Henry Louis Gates, Obama just might have uttered the dumbest thing he’s said since taking office. Thankfully, he’s provided us with a couple of truly basic lessons for business leaders in the process.

Leaders Make Sure Their Feet Are Clear of Their Mouths Before Speaking

“I don’t know all the facts.” Barack Obama stated as he began to weigh-in on Gatesgate during his nationally televised health care press conference on Wednesday.




Leaders know that this is where they should stop commenting. Leaders understand that it’s important to get all the facts before speaking – especially on topics that could be inflammatory.

“… the Cambridge Police acted stupidly in arresting somebody when there was already proof that they were in their own home,” Obama continued later in his misinformed opinion “… there is a long history in this country of African Americans and Latinos being stopped by law enforcement disproportionately. That’s just a fact.”

Clearly, Obama has never seen an episode of Cops, where nearly everyone is arrested in their own homes. The most misguided takeaway of President Obama’s declaration on Gatesgate is that he equated this incident with the stereotypical racist white cop, and even tried to make what happened in Cambridge a microcosm of race relations in America.

You Move Too Quickly

If you’re wondering what that stuff is dripping off the President’s mug, it’s egg. It seems Obama not only spoke without knowing the facts – as the facts came out it became increasingly clear that we had a belligerent old man who was disrespectful of the very police who were called to his home to investigate a possible burglary – he basically called one of the most colorblind policemen in Massachusetts a racist. Boy, I bet he wishes he’d known that before he opened his mouth.

Cambridge Police Sergeant James Crowley, as you may already know, not only teaches academy plebes on how to avoid racial profiling, but he just happens to be the brave officer who performed mouth-to-mouth resuscitation on Reggie Lewis in 1993. Lewis, you see, was black; and Crowley didn’t care as he tried to save the young man’s life.

The President should be calling for other police departments to hire more men like Crowley instead of continuing to second-guess the officer’s actions. Leaders, at this point, would know enough to apologize and explain they spoke too quickly. Even as recently as today, Obama has continued to lay much of the blame at Crowley’s feet. The American People – just as your subordinates would if you were lying to them – aren’t buying it.

What’s The Rush?

The real leadership lesson we expected to learn this week centered on the Obama Health Care Reform Plan. We were looking for the reason that the White House and certain members of congress seemed so adamant about passing the measure before the August break. The plan is one of the most costly pieces of legislation ever to be proposed, and would (by all accounts) change the way most of us access doctors and hospitals forever.

So what’s the rush? Leaders know that getting it right is always, always, always better than getting it fast. That’s not to say that leaders believe in ready, aim, aim, aim…. On the contrary, leaders are all about quick action – they just don’t take this action without understanding the pros, cons and consequences.

One thousand, one hundred and eighteen. That’s the number of pages in the Health Care Reform Bill Obama wants passed this month. With all that’s happening in the economy – and with the trillions already pledged to stimulating it – asking congress to okay a bill that would commit trillions more without expecting them to both read and understand it is unconscionable – and not very leader-like.

Measure Twice, Cut Once

Obama and the congressional leadership should take a page from careful carpenters and make certain they understand the ramifications of all aspects of the bill before signing on. (It’s quite possible President Obama hasn’t even read the bill in its entirety.)

Obama, however, wants everyone in America (especially the congress) to look the other way and let his plan go into effect. Why, we ask? What’s the rush? If health care is so important to Barack Obama, shouldn’t we make sure we get it right the first time?

We’re not even talking about debating the merits of the plan the President has laid out – it could very well be perfect for America – we just want to know that if health care is so important to the President, why did it take him six months to name a Surgeon General? (And why does she seem so overweight and under-qualified?)

Therein lies the leadership lesson. Leaders’ actions speak louder than leaders’ words – and true leaders know this. That’s why true leaders would never try to shove something down their charges’ throats. Instead, true leaders provide the facts, gain consensus and mentor as their teams do the right things. We wish Obama would do the same.