Friday, 31 December 2010

Solve the Wrong Problem - the Redskins and Jennifer Aniston

I have been shut down twice in the last week in my quest to buy life insurance on Rex Grossman. First, Kevin Heilbroner of Liberty Mutual wouldn't sell to me. Next, the chick in the white outfit from the Progressive television commercials shut me down. I'm not sorry about that. She really creeps me out. I was left with no alternative but to call the little green lizard. Here is how our conversation went.

“Hey little green lizard, do you remember the Budweiser frogs? Your days are numbered. The woodchucks are way cuter than you not to mention smarter. Even the little “wee wee” pig makes you look pitiful. Now, how about selling me life insurance on Rex Grossman's life?”

In a snooty little British sing-songy accent it replied,”Chip, chip, cheery O, insurance on Rex? That's a big no go.” Then after a pause it continued, “But we are running a special on David Beckham. How's that mate?” I know the gecko thinks it is Australian, but who the hell knows the nationality of a talking lizard?

This year the Redskins conducted a scientific experiment. They weren't aware of it, but they did. Maybe they should have applied for some government grants. That could have helped pay for the Albert Haynesworth fiasco. “Haynesworth” just got flagged by my spellchecker as misspelled. Here is a good definition for irrelevant. Something is irrelevant when it isn't worth adding to your spell check dictionary. I think “Haynesworth” qualifies at this point.

What makes me an expert on matters of science? In the late 1970's, I flunked out of the University of Pennsylvania as a physics major. How's that – Ivy League no less. I think we can now agree that I am a scientific expert. What experiment did the Redskins undertake this year? First let me define the nature of scientific experiments. Then, I will explain how such an experiment was carried out by my beloved Skins.

In scientific matters, we often make assumptions in the pursuit of advanced knowledge. In this case, let's assume you are the coach of an NFL team with an offense. OK, I know that assumption hasn't applied to the Redskins since about 1991. We are talking hypothetically here. Let's further assume that our prolific NFL offense scores 19.2 points per game through fifteen games. I know this sounds a lot like our Redskins, but have some patience. Our task is to determine if the problem lies with our quarterback or with the rest of the offense. How would you go about determining whether your quarterback is the problem?

Any brilliant physicist, such as Stephen Hawking or Richard Feynman, would tell you to play some games with one quarterback. Then switch quarterbacks for the rest. If your offense performs the same with either quarterback, you have your answer. The problem isn't the quarterback. It's the rest of the team. This isn't quantum physics, which is good since I wasn't good as a physicist. Let's now apply this to the Redskins 2010 season.

Coach Shanahan and his offensive genius prodigy son, Kyle, have graciously provided us with a mountain of data to analyze. From NFL.com, I obtained the following raw scientific data through fifteen games.

Quarterback McNabb Rex the Wonder Dog
Pass attempts 472 89
Completion % 58.3% 53.9%
Touchdown % 3.0% 5.6%
Interception % 3.2% 3.4%
Sacks 37 7
Sack % 7.8% 7.9%
Quarterback rating 77.1 77.4

Hmmmmmmmm. The statistics are pretty even aren't they? When the Coaches Shanahan changed quarterbacks, the results stayed the same. What did we learn earlier? When you change the variable, in this case quarterback, and the results don't change, that means the variable isn't responsible for the results. Therefore, according to Hawking and Feynman, the problem with the Redskin's offense isn't the quarterback. The problem is the rest of the offense.

I could be a cynic and tell you that the Coaches Shanahan are classic perpetrators of the “solving the wrong problem” crime. However, since you know me as well as you do and you know I am just not a critical person, I choose to believe that the Coaches Shanahan were in fact out to prove all along the Redskin's offense isn't very talented. That way, they can go to the owner, Dan Snyder, and tell him the team needs to stockpile draft choices by trading off aging veterans. If I drink a few more Blue Moons (eight or ten), I might actually believe that.

Now let's apply the logic to the great Stitely & Karstetter potty controversy. The last time a bathroom was changed in our office, it was not done under scientifically controlled circumstances. Therefore, any measurement of the change in morale was scientifically invalid. I called Richard Feynman to ask about this. Of course, I'm still waiting for an answer. He's dead, but still more brilliant as a corpse than I will ever be alive.

This time the men of the office have taken up the challenge. We will remodel our bathroom under strictly controlled scientific conditions. Then we will measure the change in morale compared to the base measurement of moral, which is our billings for last year during tax season. If our billings are up over last year by at least 10%, we will know changing the men's dumpster has increased morale. We need a theme for our bathroom remodeling project. The women chose some sort of french theme. The men have chosen a much more patriotic theme – Jennifer Aniston.

We are now accepting donations of Jennifer Aniston memorabilia. Your donations are tax deductible. After all this is in the interest of science. We will also be applying for federal grants to purchase clothing items and maybe fund a personal appearance from Jen to dedicate the facility. Maybe she will christen the commode for us. We would be honored to have Jen squeeze one off for our ceremony. Please keep in mind your donations should be in mint or gently used condition. You know what I mean here. At least, wash them off. We expect the dedication ceremony to be right after tax season. Mark your schedule to come by and visit our shrine to America's most beautiful movie star and my future mistress. Does anyone know where we can find some Friends – themed toilet paper?

Thursday, 23 December 2010

Solve the Wrong Problem

I'm angry with Kevin Heilbroner, my favorite Liberty Mutual insurance agent. He won't sell me life insurance. No – not on my life. I want him to sell me life insurance on Rex Grossman, the anointed savior of the Redskins. He is their new starting quarterback. Why won't he sell me the life insurance? He tells me I don't have an insurable interest in Rex. In order to buy life insurance on someone, you must have some close connection to that person. In other words, the person, whom you are insuring, must be your spouse, child, or maybe your business partner. I believe that as a Redskins fan for over twenty years, that I have a close enough connection to Rex to have an insurable interest. Kevin disagrees.

Here's a financial tip for you. Buy life insurance on Rex and buy it this week. Mortgage the house. Sell off the kids. Rob a bank. Make your wife work the streets. Do what you have to do. Why do I think Rex's life is about to end? At best the Redskins have one offensive lineman, who could start for a quality NFL team. I doubt that any of them could start for the New England Patriots. Maybe none of them would even make the team. Bad offensive linemen are bad for a quarterback's health – any quarterback, Tom Brady, Peyton Manning, Donovan McNabb, and yes, Rex Grossman. A bad offensive line gets the quarterback killed.

If you have been living in a cave, or maybe the White House, you might not know that Rex Grossman didn't start the season as the number one quarterback for the Redskins. The team, with much fanfare, signed Donovan McNabb from the justifiably hated Philadelphia Eagles. Eagles fans are just barely human, but that is a topic for another time. Donovan McNabb had led the Eagles to five conference championship games and one Superbowl. McNabb was going to resurrect the offense running the offensive system brought by new head coach, Mike Shanahan.

After the first thirteen games of this season, the offense, to put it charitably, was not resurrected. In fact, it consistently sucked. Receivers dropped passes. McNabb had to run for his life, because his offensive line couldn't block anyone. All that is before mentioning the defense, which ranks near the bottom of the league in most statistical categories. The Redskins stink. Why do they stink? When the offense is bad and the defense is worse, there is only one explanation. The Redskins players just aren't very talented. Over the past ten years, coaching staffs have come and gone. Offensive and defensive coaches and systems have come and gone. The results have been the same. This tells you the problem is the players.

So how do the Redskins address their lack of talent? They change quarterbacks. Of course that makes no sense. Changing the quarterback won't make them a playoff team this year or next. Neither pretty boy Tom Brady or Peyton Manning could make the Redskins a playoff team. The Redskins are solving the wrong problem. They need to rid themselves of most of the players they have, and find more talented ones. This ought to seem painfully obvious, but - when you solve the wrong problem, the real problem remains. Your results don't change, except maybe for the worse. I see lots of business owners solving the wrong problems, and they wonder why their businesses don't improve and succeed.

Recently, one of our staff told me morale in the office was low. She thought changing the surroundings would help. She wanted to paint her office, renovate the women's bathroom, and just generally reorganize the office. If you know me very well, you know that there are damn few things I care about. I don't care where we eat. I don't care about the color of my car. I don't care about the style of my clothes. Yes, I know that is obvious from the way I look. I absolutely don't give a damn about her office, the women's bathroom, and the general organization of the office. So I said yes as long as it didn't affect me. The office was redone as she wanted, but she still told me morale was low.

Why was morale low? During one of our Friday morning staff meetings, we discussed morale. That is my story. Everyone else in the company would probably say I discussed morale. I was more than a little peeved that we were spending time discussing morale when we had lots of client work to get done. Dealing with morale should have been the last item on our lists. I opined that changing the office surroundings was solving the wrong problem.

I told them about the Hawthorne Study performed by Western Electric in the 1920's. If you had the misfortune to take an entry level management course in college, consider yourself lucky if you have been able to forget it. I have not been that lucky.

The study was originally designed to study the effect of lighting on worker productivity. First, the lighting in the study was increased. Not surprisingly, productivity increased. Then, the lighting was increased again. Productivity increased again. This cycle was repeated several times with the same results. To validate the results, the study's organizers then reduced the lighting. Surprisingly, productivity increased again. What the study proved is that working conditions are not the only driver of productivity. Emotional factors drive productivity as well. The workers were responding to the extra attention they received for participating in the study.

In our meeting I pointed out that morale wasn't low, because the office needed a good reorganization. Morale is low every December – for some good reasons. First, December is a busy time for us. None of us has enough time to enjoy the Christmas holidays. I have become the biggest Scrooge since Bill Murray in the movie. If I could stop Christmas from coming like the Grinch, I would. I'm actually working on it. Second, tax season is nearing, and none of us wants to think about the three and a half months we'll spend in our office dungeon preparing tax returns.

When we reorganized the office, we were solving the wrong problem. Of course, we can't change the date of Christmas or delay the coming of tax season. The only thing we can change is our attitudes My solution to the morale problem was to concentrate on helping clients. When life gets me down, I find happiness in helping clients. In fact, I am happiest during tax season. Life is simple then. Wake up, prepare tax returns, go to bed. Repeat for three and a half months. I timed the conception of my children so that their births wouldn't happen during tax season. Each year, I tell my family, “If you intend to create needless drama during tax season, don't expect me to participate.”

I'm not going to delude myself that I changed many attitudes for the better this December in our office. What I did accomplish, however, was convincing our staff that solving the wrong problem wasn't going to improve morale. At the very least, I feel better – and aren't my feelings what really matter?

This coming Sunday, the Redskins will be led to another valiant loss by Rex “the Wonder Dog” Grossman. My wife asked me where I got the “Wonder Dog” part. I have no clue – probably related to beer consumption in some way. However, I am certain that Rex won't fare any better over a series of games than Donovan McNabb. Rex holds the NFL record for fewest games started by a quarterback the year after leading a team, da Bears, to a Superbowl. They soured on him and so did the rest of the league. He wasn't the solution to the Bear's problems nor was he the savior of the Houston Texans. The Redskins are taking another step backwards by solving a quarterback problem they didn't have. At some point valiant losses just create valiant losers – but losers nonetheless. At least next year, tickets will be cheap and plentiful again. I'm sorry. I forgot - Dan Snyder tells us they are sold out every year. Why do I torture myself every year rooting for the Redskins? The evidence suggests I'm a moron. Shut up all you Cowboys, Eagles, and Steelers fans – even if you are right.

Thursday, 16 December 2010

Treat Your Customers Like Fools – Keith Urban Strikes Back

I apologize in advance for what I am about to do to you. The trend in television shows is to recap everything that has happened previously after each commercial break. I hate this editorial trend. About ten minutes of every half hour shows seems to be nothing be recapping what has happened before. So I am going to do that to you – sorry in advance.

Two weeks ago, I wrote about my experience shopping on Black Friday at Tysons Corner Mall. I recounted my experience jousting for a parking space with an Asian woman in the parking garage. I wrote about pedophile Santa Claus. I also wrote about the line outside Urban Outfitters waiting to enter the store. I wondered if the reason for the line was that people (women mostly) were waiting to dress and undress Keith Urban in the latest fashions. While not a Keith Urban fan, I could understand why people might wait in line for that. I also promised (seriously) to reveal the real reasons why Urban Outfitters was restricting entry to their store.

If you asked Richard Hayne, the chairman of the company, why the store forced people to wait in line outside a relatively empty store, he would give you two reasons. First, entry is limited to make certain the store doesn't get overcrowded. Second, he would tell you entry is restricted to make certain the sales staff can give the personal attention each patron deserves. At face value, these two reasons might seem reasonable. I agree that there are two reasons why entry to the store was restricted, but I absolutely disagree on the reasons.

I believe the first reason for the restricted entry is to create a sense of exclusivity. If people are forced to wait in line outside the store, the store must be really great. This is exactly the same reasoning used by exclusive New York and Hollywood night clubs. Making people wait in line makes the night clubs exclusive and, therefore, desirable. The branding of Urban Outfitters from its founding in Philadelphia in 1970 has been directed towards being fashionably quirky. In my opinion, there is more quirk than fashion in making people wait in line.

The second reason for restricting entry does involve the sales staff. The store wants to assign each customer a personal salesperson. This might seem like just a little harmless overkill in terms of customer service, but I don't see anything harmless about it. They don't want browsers and price shoppers in the store. They know that assigning a salesperson to a shopper almost guarantees sales. Customers don't want to feel they are wasting a salesperson's time and will buy something. A customer, by human nature, doesn't want to disappoint another human being. In addition, customers aren't likely to compare prices with other stores if they know they get to wait in line again if they return to the store.

I'm not really worried that the idea of making customers queue in front of stores will catch on. It is a classic treat your customers like fools concept, and these concepts never survive for long. Let's examine the two real reasons for restricting entry and see why the concept won't work.

Let's examine the assumption that restricting entry makes the store appear exclusive. The first piece of evidence against the concept was the length of the line. There were maybe fifteen people in front of the store. That doesn't make the store seem very exclusive to me. In a mall with stores packed to the point of violating occupancy laws, Urban Outfitters at 2 PM on Black Friday had at most twenty people in the store and fifteen people waiting in line. Most people obviously did what I did. I looked at the line in amusement and moved on. I was shopping for a Christmas gift for my wife. I went right by Urban Outfitters and went directly to xxxxxxxxx. The store name is a secret since my wife reads my blog. We know the concept of exclusivity doesn't work, because if it isn't working on Black Friday in Tysons Corner, it isn't going to work the rest of the year either.

Let's tackle the personal shopper idea. This idea actually works in the short run. People undoubtedly buy things they wouldn't otherwise. However, how would you feel after leaving the store feeling bullied into buying something just to please a salesperson? Will you ever return to the store? Even the prospect of undressing Keith Urban won't get you to return.

You may be thinking, “Frank, what the hell do you know about retail and marketing? Obviously, these stores run customer focus groups and thoroughly research their concepts. They know what they are doing.”

I have heard this argument many times before – usually when I am spouting off about my obvious business genius after a few Blue Moons. Here are a few names refuting your argument: Citibank, Wachovia, Merrill Lynch, Bear Stearns, and AIG. All of these were big companies full of smart people, and they failed nonetheless. Big companies screw up all the time. Entire retail chains go bust like K-Mart and Circuit City.

About fifteen years I was talking to the ex-boss of my now ex-wife. He was a client of my business partner, Paul. A year or so earlier, my ex-wife was working for him at a great little community bank, NVR Savings Bank. The bank was located in McLean, Virginia and catered to the rich little old ladies, who live in McLean. These women expected great customer service. They were accustomed to being greeted by top executives of the bank and expected to be able to walk into the president's office pretty much at will. The parent company of the bank was a real estate company in financial trouble. They sold the bank since it was the only valuable asset they could sell to raise cash.

SunTrust Bank was the buyer. SunTrust Bank is not a bank that caters to little old ladies by providing access to top executives. If you walk into a SunTrust branch, consider yourself lucky if you can talk to the branch manager. I am not criticizing. OK, maybe I am. Do you think this was a great match from a customer service culture standpoint? Of course not. SunTrust doesn't even let you undress Keith Urban after waiting in line.

I was explaining to my ex's ex-boss (that's a lot of ex's) why I thought the sale of the bank to SunTrust would fail. He told me I was full of crap. He was probably right about that. He then told me the SunTrust people had obviously taken into account the differences in customer service philosophies. To be more accurate, he said the SunTrust people were a lot smarter than I am about banking. A year later, the bank was gone and another bank had taken over the McLean branch. I don't know how much research the SunTrust people did, but it wasn't enough. And apparently they didn't know that much more about banking than I did. The rich little old ladies of McLean didn't like being treated like fools, and they took their dead husbands' millions elsewhere.

The moral of the Urban Outfitters story is that you should avoid creating policies under the guise of great customer service that really have the objective of exploiting customers. Treating customer like fools never works regardless of how much market research you do. Keith Urban told me that. OK, I really don't know Keith Urban any more than I know Jennifer Aniston except in that personal fantasy world of mine. It's a wonderful place.

I haven't done any market research about the concept of Jennifer Aniston Outfitters (see two blogs ago), but I know the concept is sound. We could extend the concept to Courtney Cox Outfitters and Lisa Kudrow Outfitters. Maybe we should just consolidate the names and call the chain, Female Friends Outfitters. I am looking for investors to take me away from the CPA gig and let me follow my dreams. I want to be my authentic self. Yes, I have been listening to Dr. Phil tapes. Pimping Jen and the gals is a lifelong dream. I am only $50 million away from opening. If you are a fool, operators are standing by. Call me. You have my number. Make my Christmas merry.

Monday, 6 December 2010

Get Your Priorities Hijacked – This is urgent and your top priority.

I know I promised last week to write more about the alleged marketing strategy of Urban Outfitters. I really intended to write about that subject, but life got in the way. I can't control the material people feed me. A situation happened to me today that made me really angry. So angry that I am sitting here at a bar in the Mirage in Las Vegas writing this. You might legitimately wonder if five or six beers are clouding my brain and judgment. That is not the case. I am not drinking at the moment. My damn waitress hasn't brought my first Blue Moon yet. A few paragraphs from now, I may be pretty whacked. In any case, I promise to write about Urban Outfitters next week – unless I lie again.

Let's start out with a hypothetical situation and then we will consider what happened to me today. Let's assume that Jim has a big decision to make. He has to make a decision that will negatively affect either Jill or Sam. In other words, Jim has to take a big steaming crap on one of them. How does he decide which one?

Here is some more information that may change the odds, in the spirit of Vegas, on his choice of Jill or Sam. Jill is a stark raving mad pig-faced bitch. Dealing with her is about as much fun as a hammerhead shark in a kiddie pool. Sam is a calm, rational team player, who will certainly understand that Jim has big responsibilities and really doesn't want to take a dump on him but has no other choice. If Jim chooses Jill, he can expect a bitter fight to the death with Darth Vader's daughter. If he chooses Sam, nothing much will happen. Maybe Jim can rationalize that he owes a big favor in the future for Sam.

What are the odds in Vegas now on Jim's choice? The odds on Jim picking Jill are less than the odds of the Redskins winning the all of their games for the next fifty years. Of course Jim is picking Sam. But why on a theoretical level will he make this decision? He will pick Sam, because picking Sam is the path of least resistance. Here is a hint for you, before we go any further. When you see a big steamer coming, don't be in the path of least resistance or learn to wear toilet paper as a fashion accessory.

Now here is my story from today. Today, I was sitting in an exciting class on business valuation. OK, there was nothing exciting about it. I was waiting for 5 PM so that I could start drinking again without feeling morally bankrupt. Just after our lunch break, I got an urgent e-mail message on my I-phone that I needed to print out and sign a document attached to the e-mail and return it before 4 PM eastern time. There are only three things in life I “need” to do. They are, in no particular order, eat, breathe, and go to the bathroom. That is the cleaned up version. My need to explain this concept to my first wife probably played at least a small part in our divorce. My therapist made me realize that.

What was so urgent? This document pertained to a large financial transaction that involves my paying money to someone else. Legally I can't go into it more than that – yes I am really being serious. An attorney had drafted a document related to this transaction that must be signed by me and notarized. My instructions were to print it, sign it, and fax it back to the office. It would be notarized in the office and then forwarded on to the attorney. Here is an obvious flaw in that procedure. The entire purpose of a notarized document is that the notary personally witnesses the signature on the document.

Of course, my past paragraph didn't really explain the urgency part. The fact is that this document wasn't urgent except that the lawyer said it was. I was going to have to re-sign the document personally when I returned, since my faxed copy wouldn't be valid anyway. So why the urgency I ask again? Because this was a genuine step 'n fetchit moment. The asshole said my signature was urgent so “the process can move forward.” Of course that was total bullshit. The process wasn't going anywhere without my legally notarized signature on the original document.

You ask, “Frank, how much do you hate this lawyer?” I hate him enough to build a time machine just to go back and push his parents off a cliff before his birth. If you know of someone with a working time machine, I will gladly empty my kids' college fund to buy it.

My office staff had a choice. Either they could tell the attorney I was out of town, and I would not be signing the document until I returned. Or – they could send me on a futile scavenger hunt for a business center in the Mirage to sign and return a document that was invalid anyway. They decided that I was the path of least resistance. I don't blame them for this decision. Dealing with the asshole isn't high on my list either. However, let me state this as a law of nature. The great Stephen Hawking discovered this law of physics when he was studying the behavior of black holes. I am never the path of least resistance. I am the male version of a stark raving mad pig-faced bitch. You shouldn't be the path of least resistance either. The key to getting your priorities accomplished is not being in the path of the big steamer.

I am not recommending that you become a total asshole. That is my method. Your path to enlightenment may be different, grasshopper. The real purpose of avoiding the big steamer is getting the tasks done that you believe are important. In a business sense, your top priorities should be serving your customers. You should avoid needless tasks that get in the way of that main priority.

I am going to introduce a technical management term, “manufactured drama.” If you took a management course in college, you won't find this term in your textbook. Of course, you probably sold the textbook within thirty seconds of taking the final exam. So I could lie to you, and tell you it is in there, but I am basically an honest guy. Manufactured drama is a situation of no real urgency that acquires urgency only because someone says it is urgent. If that someone is your boss, it is still manufactured urgency, but you probably have to treat it as urgent anyway. That comes under the “Do it because I said so” management principle. However, if the person manufacturing the urgency doesn't have authority over you, I grant you the permission to tell them to go directly to hell. Do not pass go. Do not collect $200.

Avoiding manufactured drama requires extensive training. Not of you, however. You have to train the manufacturers of the big steamers. They have to be trained to not just respect your time, but to respect your priorities as well. That means reasonable deadlines for tasks. You have probably run into people for whom everything is an emergency. They run from place to place endlessly checking their Blackberries and leaving urgent, must take care of now messages. They also never get anything of importance completed. When everything is urgent, nothing really is. The essence of setting priorities is making choices among tasks competing for your time. These choices should be yours. You own your priorities. Take possession of them. Respond to manufactured drama with the “N” word. That “N” word is “no”. My priority right now is another Blue Moon with a cute little slice of orange, of course.