Five Loaves, Two Fishes and Six Chicken Nuggets Page 5

  It’s not just food. Air travel is now within the financial reach of most people. What the year 2001 taught us was that a big plane, full of fuel, in the hands of a trained pilot who has a profoundly different opinion on the sanctity of human life than most of us, is a fearful weapon. One of the reasons air flights are so (relatively) cheap, is that the security practices required to completely avoid those circumstances are expensive and, therefore, under-resourced.

  Cheapness that involves exploitation and/or risk is not value. In my world, chicken, salmon and air travel (as a start) would cease to be commodities. They should be mandated to cost five times as much as they do, and become special again. They would become special again because they could be done properly. We will re-discover what chicken tastes like. We will save up for, and celebrate, a piece of salmon. Air travel will become something you look forward to.

  Wow. Is there no stopping me? First, our children, and then wealth creators. Now I’ve done consumers. Next, I will take on soccer players’ salaries, followed by the whole ‘bling’ concept.

  14. What a load of haggis

  To Scotland – by my calculation, the fiftieth country I have visited. Many of my US readers will not have been there, but most will have mental images of all that wonderful Scottish stuff – kilts, St. Andrews golf course, malt whisky, the Highlands and Mel Gibson. I fell in love with the place twenty-five years ago when my wife and I had a bed-and-breakfast touring holiday in the Western Isles. We were introduced to a concept called ‘high tea’, and I put on about forty pounds in ten days.

  In the winter, it’s a bit of an effort for an ex-Florida dweller like me to brave the climate and go there – but I was determined so to do. The event was to celebrate the winners of a bunch of prestigious corporate training awards, and I wanted to hoot and holler my support. In these parlous and difficult times, when discretionary spending budgets have all but disappeared, these companies had been brave enough to raid the corporate coffers to invest in developing their people.

  The images of September 11, now almost five years old, are still horribly fresh in our minds, but what happened immediately afterwards seems a bit blurry. There was a load of political rhetoric and military posturing. Consumers changed a lot of buying habits overnight. Financial markets reflected a surge out of equities. Many companies seemed frozen in the headlights, simply – and understandably – not sure of the implications for them. If you re-run your memory-movie, however, you will recall that a few of them moved rapidly and within a couple of days had announced huge layoffs – some of them in double-digit thousands.

  Now then, I’m willing to make a bet. If you took those companies that made such a move and scoured their previous corporate communication documents or the transcripts of their shareholder meetings, my bet is you would find the words ‘our people are our greatest asset’ somewhere in there. So we have this strange pattern of behaviour – if you are suddenly faced with a crisis, you decide to face it without your best weapon, i.e. your greatest asset.

  Of course, the whole ‘greatest asset’ thing is a load of haggis (while I’m in Scotland …). It represents the cynicism of modern business at its worst, and has now overtaken ‘empowerment’ as the biggest gap between walk and talk in industry today. But I found that particular round of layoffs a wee bit more sinister.

  I can tell you, from experience, that mass layoffs are complicated things to do properly. The company’s behaviour and actions are, rightly, governed by employee contracts and legal regulation – which varies, sometimes by local statute as well as national law. It needs careful planning, communication and consultation. If a company announces a specific figure of x-thousand layoffs, as a reaction to a specific event, within a couple of days of that event, it tells me that such companies were reading from one of two scripts.

  The first script is that the plan already existed in detail, and the company was waiting for an opportune moment, or an appropriate set of circumstances, to put it in the public domain. These would be defined, of course, as circumstances that enabled the company to blame something other than its own woeful performance for the cutbacks. Am I saying some corporate big cheeses actually welcomed the September atrocities? Absolutely not. That would be a crass accusation. Am I saying a few took the chance to hide existing bad news behind the chaos? Absolutely.

  There is another scenario: a detailed plan didn’t pre-exist. In which case the number of announced layoffs had little or no science, thought or planning behind it. The eventual number probably had its genesis in a CEO banging a table and yelling that the company needed ten thousand off the payroll. Now. Today. Two days later, a figure of twelve thousand (‘Err on the side of aggression – this may not happen again’) is announced – which is no more than a swish in the air in an attempt to address perceived future market slowdown and shareholder paranoia. If you can think of a better way to make the wrong decision for the wrong reason, e-mail it to me.

  None of this is new. Most businesses treat employees as the accountants force us to – as expenses, not assets. And I’m not daft enough to suggest that the variable cost of a company’s labour force shouldn’t be constantly scrutinised to make sure it is effective and efficient. Sometimes you do have to reorganise or restructure your business to reflect rapidly changing circumstances. And, yes, that can involve workforce reductions and it is the right decision for all stakeholders. What I’m saying is we need to find a better way to live with that.

  In all but a few enlightened and/or small businesses (like the ones I celebrated at the start of this chapter), the employee contract now represents a marriage of convenience. There is little or no loyalty, respect or affection. There is an understanding that one party needs the other to create respective wealth, and a secondary understanding that if either party could do without the other one, it surely would. Personally, I have no problem with that because it reflects the real world. What I would like is way less rhetoric and humbug to suggest something else exists when it palpably doesn’t.

  Ouch. I have just tried to re-read the last paragraph, and my head hurts. It’s the day after my trip to Glasgow. One thing I forgot to mention about the Scots – they know how to party.

  15. Prophecies, prophecies

  A generation ago, we entered the Age of Aquarius. I remember the moment vividly, as the cast sang about it in a controversial stage musical of the day called Hair. It was controversial because the same cast took their clothes off. This nakedness lasted for precisely nine seconds (I timed it), during which time they were bathed in a blue spotlight. This made the men look very cold.

  As we entered this exciting new age, many wise people made prophecies. They examined the deep-seated trends of the day and multiplied them by the square root of the zeitgeist. It is amazing, as we look back now, just how none of them came to pass. And by how much they missed the mark. Let’s have a closer look.

  We were all going to enjoy vastly more leisure time. Yup, the plan was that all the technology developments would enable those of us working in the developed and civilised West to cut back on working hours. The primary industries would move over to the developing nations, and we would create the same relative wealth as before by working in money markets or selling pizza for a couple of days a week. Our big new problem would be knowing what to do with all our new-found leisure time. People wrote books on this exciting new social challenge. Thirty or forty years later, we are still waiting for it to arrive. If anything, it looks more distant.

  What happened, of course, was that the primary industries did disappear, as did large herds of administrative employees. Which left two camps of people – those who kept a job (who found themselves working longer and harder for the same money) and those who lost their jobs (who found themselves doing two or three minimum-wage jobs to survive). And the Age of Aquarius was batting 0 for 1.

  Now here’s one that was a real banker. It was forecast that women would cease to be women and become persons. This would have major social implications i
n the home, as the career woman would irrevocably change the face of family architecture. It also had huge implications for business. There would be no distinguishing women from men in the workplace, and long-established discriminations would quickly erode and disappear. A quick look at the results indicates 0 for 1 becomes 0 for 2.

  Let’s take the two fundamental measurements – equal pay and representation at the highest decision-making levels in business. Take pay first: at micro level, on both sides of the Atlantic, each woman’s pay level can be justified up the Wahoo. It has to be, legally. But guess what: at the macro level, as a race of Persons, they are still behind. As for boardroom representation, a scan of the top executive positions in the Fortune or FTSE list of blue-chip companies shows an alarming stereotype when it comes to key executives: white, male, somewhere around fifty years old, and with a bucketful of stock options. Oh, and while we are at it, the similar prophecies that disabled people and minorities would also make progress, and become persons in this latter category, have also lost a wheel.

  Now here’s a prophecy that surely must have come good – that we would all become far healthier. The constant whining of do-gooders, the overdose of information on what’s good and bad for you, the ready availability of nutritious food all the year round at prices that are affordable, and the carpet bombing of media with photographs of what you should look like and articles on how you should live was irresistible, n’est-çe pas?

  Er, no. Highly resistible, actually. Obesity is rising, more kids smoke, diabetes is rampant, the volume of alcohol intake might be down, but strength is up – and soft drugs are only marginally less common than cheese crackers. During my time on the bridge of the good ship Burger King, we tested putting low-fat mayo on the Whopper. For a week or two, I was on the FBI’s most wanted list. So that’s 0 for 4.

  Aha! But what about telecommuting, I hear you ask. That was forecast, and that surely happened, didn’t it? Thousands of administrative workers, previously glued to a chair in a cubicle, now with the freedom to work in their jimjams, would be able to link seamlessly with their Korean suppliers or their German customers while applying ointment to little Billy’s zits. Er, no, actually. That not only hasn’t happened, it shows no sign turning up. Less than one half of one percent of the eligible workforce now telecommute. It would seem that either they don’t like it or the company doesn’t like it. My theory is that neither of ’em like it. I can understand both points of view: for many workers, there is actually an attraction about leaving the house and having another life with another bunch of people. Sure, they’d like a better balance, with more time at home – but not the Full Monty. As for employers, the benefits of having your people together are perceived to still outweigh the potential real estate savings. 0 for 5.

  Poor old Age of Aquarius … but I still love it. One of its attractions is that it has fooled us all. I grew up with an Iron Curtain across Europe that has now gone – quite unbelievable, along with many other unpredictable developments. Of course, I don’t like all that has happened, from the failure of the forecast breakthrough of women into the boardroom to the nightmare of global terrorism.

  On balance, though, it’s a wonderful Age, and we should celebrate it. It has certainly taught me some valuable lessons. For example, if circumstances are such that you are inclined to remove your clothes with somebody watching, make sure there is not a blue light on.

  16. Danger! Genius at work

  I hit the entrance to big business in the 1970s, armed only with a pair of flared trousers and an MBA. As I remember it, the trousers were of respectable quality and lasted a few months before I discarded them, moving on to the safety pins and rags of punk rock. The MBA, however, lasted only a week or two. It took just that long to realise fancy stuff was of no use in the real world of business. Whenever I mentioned regression analysis, people would blush and turn away as though I had left my flies undone.

  As I progressed up the ladder of big business, I found my inspiration in other sources. Strangely, the higher I got, the more the works of the great philosophers played a part. When I reached the shores of the United States, captaining the good ship Burger King, I found that the Stoic school of thinking was suddenly appropriate – summarised here as: Things will be Bad. Plan on that basis. Later, my leadership became inspired by the ideas of the gloomy German philosopher, Hegel, summarised here as: You are born wet, hungry and crying; then it gets worse.

  Over the past few years I have cheered up a bit. Trying to figure out what I wanted to be when I grew up, I read a book by Charles Handy called The Empty Raincoat. In it he outlines his thoughts on how the basic structure of business people’s lives has changed in the last generation. It used to be three stages – dependency, job, dependency – and then the big finish with death. Now, it is more likely to be a four-stage process – dependency, job, something else, dependency, and then the Grim Reaper. Many folk are now finding that their basic careers are over – either by their own choice or somebody else’s – by the time they are fifty. People are also living longer. There is, therefore, a big gap to fill, which previous generations never had to think about. I’m right slap-bang in it, and loving it.

  It’s not a big jump to move that thinking on and to align it with another life model theory – again, relatively new. This idea suggests that modern life is like filling a glass with stones. You start with big ones, but you can only get one or two in (main career? main relationship?). When you can’t get any more big ones in, you start filling it with smaller ones. Finally, when no more of this size will go in, you finish filling the glass up to the rim with grains of sand.

  That’s the model I’m following, and I’m at the stage where I’m finding a whole variety of mid-sized stones and jamming them in my glass. It’s stuff I’d never contemplated while I was working on the big-stone phase.

  Now then, it was only when I’d had my fifth beer (Boddingtons, to be more accurate) that I realised we might have invented a viable business model here. This actually works for the development of many businesses (in general) and brands (in particular).

  Let’s take my old favourite, Burger King, as an example. The business and the brand were both born in the 1950s, and the founders, Jim McLemore and Dave Edgerton, filled the glass with big stones almost at once. The Whopper flagship sandwich, the chain broiler, and the ‘Have it your way’ sandwich-making process were in place from the start. Fifty years on, these three still make up the basic building blocks of the system. On the journey, of course, many more stones were added to the glass, although it is arguable that none of them matched the size and significance of those original three. Drive-throughs came along, as did breakfast, chicken products, international development, bundled-up value meals, and kids’ marketing – all these, in my mind, making up the mid-sized stones. Dotted around these have been countless marketing initiatives, new product launches, reorganisations, kitchen developments, and so on, which form the grains of sand.

  What this theory tells us is that the big, structural elements that give a brand or a business sustainable distinction are usually in place very early, but the journey doesn’t stop. There is room to add smaller stuff around the main elements, which enables you to get nearer fulfilling the real potential. And when you are tapped out with those, you can still add the grains of sand – almost ad infinitum.

  Just stand back for a minute and look at your own business. Whether it be large or small, it is likely that the ‘Big Idea’ came at the start and, if you have survived this far, that BI proved distinct and sustainable. Not one BI, however, has stood the test of time without being added to and developed. Even the daddy of ’em all, Coca-Cola, has seen can and fountain technology developments, the introduction of Diet Coke, and a ton of smaller initiatives being added to its glass over the years. Where does your business stand? What’s needed? More mid-sized stones? Or are you down to tweaking by adding grains of sand? The bad news is that there is no do-nothing choice. Nobody survives on cruise control today.<
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  I honestly feel that this breakthrough in business modelling may warrant a Nobel Prize of some kind, an honour for which I am long overdue. There is, however, one flaw in my brilliant theory. It relates to my two sons. They actually started their lives filling their glasses with sand, they have stayed with sand, and, it would seem, intend to stay with sand. Their message to me, written in sand, is this: Sand is cool. So shove your theory where the sun don’t shine.

  17. The week that was

  We writers stand accused of two crimes against humanity. First: when we are excited by an idea, we often witter on for ages in pursuit of a full stop. Second: we whine a lot. I’m currently in the latter mode.

  Here’s the problem. You will be reading this quite some time after I’ve written it. This normally precludes me writing about anything too date-specific. Frankly, there’s nothing worse than reading stuff that can only see its shelf life in the rear-view mirror. Two things happened during a recent week, however, that are giving me an excuse to break the rule. So please bear with me.

  The week was the second week in February, 2002, when we saw Kenneth Lay, late of Enron, holding up his hand in front of members of the elected government of the United States and hiding behind his mum’s apron – whoops, I mean pleading the Fifth Amendment. In the same week, Anita Roddick lost control of her business. She was founder and, until then, the principal conductor of one of the world’s best-known brands: The Body Shop (which has now been sold).