Conventional wisdom says that it's difficult, if not impossible, for small businesses to compete directly with big retailers. When Wal-Mart comes to town, mom-and-pop shops go out of business. When...
TRENDBIRD: Edopter is a unique concept that attempts to combine crowd-sourcing with internet buzz to predict new trends. It’s called “social trendcasting.”
The way it works, is by allowing users to generate “trends” according to what they think will catch on. Some trends are “cewebrities” (pictured below), “Batman: The Dark Knight,” and “tap water.” The user who makes the trend writes a “pitch” - the reason they think it will catch on. Then the Edopter system scans the web to measure current internet “buzz.” Users can join a trend, and give their pitch, upload photos and videos related to the trend, and discuss the trend with the other users in that trend. The more discussion and content you add, the more likely more people will join, thus increasing the value of the trend.
My Internet connection is down again today. It is now day 10.
On the first morning after the heavy rain storm when my connection wouldn’t, well, you know, connect, I didn’t think anything of it. I had a meeting out of town, packed my computer and my notes and headed to the car.
On day 3 of no connection, I called the cable company. Via my phone I toured many departments, visited India and back — and still no connection.
“We’ll have to send someone out, Ms. Brown. How is next Saturday between 2-4pm?” Seeing as Saturday is three days hence, it wasn’t my first choice but the show must go on.
I packed up and headed to the local library for their wireless. Connected. Ah, that sense of no longer being marooned. I retrieved email, wrote a blog post, did some research and responded to my email.
Gads – my email wouldn’t send!
I packed up and headed to the local coffee shop for their wireless connection. Comfortable seats, a connection that works both ways — receiving AND sending. Yet there was something not so right about taking without giving, so I bought a coffee. $4.25 later (because you can’t go into a coffee shop and just buy ordinary coffee — shouldn’t you experience something different?) I send my email. Then I smell the scones. Another $2.00 later I’ve gotten caught up and yet – no I haven’t because more email has come through and another blog comment to respond to and a request for a proposal and an hour turns into many hours and it’s dinner time.
I pack up to feed my family only to realize that I have a project due to a customer by morning and they are expecting it by email. Which I don’t have in my home office at the moment. So after dinner it’s back to the coffee house again.
This frustrating dance continues for three more days, packing up my office, starting at the free library, ending up at the coffee shop, wasting gas and drinking and eating into my profits.
Finally Saturday arrives. (more…)
This is a post from: Small Business Trends
Running My Business from the Caribou Coffee Parking Lot at 10 PM
Dog psychologist Cesar Milan is nothing short of amazing when it comes to taming grumpy dogs. Before you shudder at the New Age implications of dog psychology, know this: I moonlight as a dogsitter. And believe me, this stuff works.
While browsing Milan’s website, I chanced upon 8 dog handling tips that humans in business could use, too. The tips were broad, so I applied them to business communication in general: Talking to clients, hiring and firing people, networking, pitching your service, asking for a raise, or anything else you can think of. Here they are:
1. Stay Calm and Assertive
Dogs: Dogs sense fear and uncertainty. Since both emotions indicate submissiveness, dogs often misbehave when you’re feeling insecure. Imagining yourself as calm and assertive helps the dog understand who’s in charge.
Humans: Calm and assertive behavior marks you as a steadfast character. Staying calm builds trust; being assertive stops employees from misbehaving.
2. Be the Pack Leader
Dogs: A few simple tricks, such as entering and exiting building before a dog, let it know that you’re the pack leader. Seeing a leader doesn’t threaten the dog, according to Milan. It simply knows where it belongs in the pack.
Humans: People need to use more discretion when deciding to position themselves as the pack leader. The human-friendly statement would be “find the right pack to lead.” Leaders get ahead in business, whether they’re CEOs or admins. Find out what and who needs your leadership, then start leading.
3. Reward Good Behavior
Dogs: According to Milan, some people give their dogs indiscriminate affection when they should be reserving it as a reward. Dogs need affection—after they’ve been given rules and boundaries.
Humans: People love to be acknowledged, especially if they’re working hard. Saying thank you, sending thank you cards, complimenting someone’s work, and even offering tangible rewards for good work are all tricks that endear you to other human beings. If you’re not careful, they’ll make you feel good, too.
4. See the World Through Your Dog’s Eyes
Dogs: Milan not only trains dogs, but helps their owners see the world through their pets’ eyes. This helps dogs and owners build a more functional, enjoyable relationship.
Humans: Seeing the world through your client’s eyes is fundamental for any business owner. What does your client want? How can you know that without stepping into their flip-flops (or cowboy boots, or high heels, or loafers)? It’s not a bad idea for people in the corporate world, either.
5. Take Your Pet Seriously
Dogs: Paris Hilton might not agree with this, but a dog isn’t a fashion accessory. It’s a sentient creature, and should be treated with great care and attention. Take your dog—and your decision to get one—seriously.
Humans: Seeing your colleagues, boss, clients, suppliers, contractors, and others as humans, rather than “the HR lady” or “the IT guy,” will make you treat them with more respect. Everyone appreciates respect, so a good reputation isn’t far behind. That, in turn, could be your oyster.
6. Select the Right Dog
Dogs: Milan says that it’s vital to find a dog with energy that harmonizes your own. From his website:
The most important step is to take some time for self-reflection and to identify what your own energy levels are. Do you wake up early every morning, pound a power bar and a health shake, and go for a run in the mountains? Or do you take life at a more leisurely pace? When energy levels conflict, resulting frustrations on the part of both human and dog can create tensions and issues with dramatic repercussions, so take into account how your energy will affect your decision.
Humans: Synchronicity is essential in partner, supplier, and consultant relationships. Unlike with dogs, humans with opposite energy levels sometimes work well together. Finding out what you need is a crucial first step.
7. Play
Dogs: Milan says dogs get pent-up energy after being at home alone for a while. Play and exercise drain this tension and keep dogs sane.
Humans: In this case, we are exactly the same as dogs.
8. Gain Trust Through Consistency
Dogs: Taking your dog on a walk at the same time every day lets her know you’re in charge. She builds trust with you through your consistency.
Humans: Consistency is the basis of human trust. Doing what you say you’ll do, showing up at an agreed-upon time, performing your tasks as requested—or better—makes you a trustworthy person. And when people trust you, they do business with you.
*
I didn’t include Milan’s tip on short leashes, which make dogs obey but often drive people to madness…
(Image: SethHughes.com)
This BusinessWeek article claims that China and India are facing off to see who will become the next superpower.
The author claims that China won’t be the next new superpower because it has an authoritarian regime. India, despite its shoddy infrastructure, still hosts a chaotic democracy, so it should succeed. Here’s an excerpt:
Authoritarian regimes often yield impressive short-term economic results, as seen in Germany in the 1930s, the Soviet Union in the 1950s, Brazil in the 1960s, and China in the 1990s. Unencumbered by such things as property rights, legal recourse, and public debate, the
authoritarian regime can harness significant economic and political resources to create impressive industrial and economic feats.
Conversely, democratic regimes tend to be sloppy affairs with loud public discourse, a vocal press, stubborn land owners, and a myriad of civil liberties. Far from being able to harness economic resources, the government often must act more as a regulator. The result is that there are very few grandiose government-sponsored projects. Instead, there are countless private-sector initiatives driven by the invisible hand of the market. While the authoritarian regime is envied by some, the fact is that longer term, this type of socioeconomic model has typically led to economic and social distortions.
The author goes on to cite threats such as inflation, lack of property rights, and lack of rule of law as major stunting factors for China’s eventual dominance.
It’s true that India has an active democracy. It’s also notoriously corrupt. (”Rule of law” is an exaggeration in some places.) Half the population doesn’t have access to clean water. You can’t mobilize a sick, starving population without the infrastructure to give them their basic needs. You can, however, argue about their rights in a parliament without actually building them a well.
China, on the other hand, has infrastructure. It’s a communist-capitalist society, whatever that means. As far as I know, more than half its population has enough to eat. China has been showing a few signs of opening up to increased public discourse, at least internationally (Olympics, anyone?).
If China’s trend towards openness continues, it will win hands-down. Infrastructure is key to building a middle class, which is key to being a stable superpower. India needs to get its act together and figure out a way to get more than 50% of its population into livable conditions.
I think the only thing standing in China’s way at this point is itself. Inflation and a bad reputation are cheaper to fix than a major demographic problem. If innovation is an issue now, it shouldn’t be for long, with the millions of university graduates pouring out of Chinese tech institutes. A few tweaks to the economic model, and we’ll all be learning Mandarin in a few years.
Thoughts, anyone?
Women are dropping out of the workforce at the highest rate since the 1970s, says a New York Times article:
After moving into virtually every occupation, women are being afflicted on a large scale by the same troubles as men: downturns, layoffs, outsourcing, stagnant wages or the discouraging prospect of an outright pay cut. And they are responding as men have, by dropping out or disappearing for awhile.
The proportion of women holding jobs in their prime working years, 25 to 54, peaked at 74.9 percent in early 2000 as the technology investment bubble was about to burst. Eight years later, in June, it was 72.7 percent, a seemingly small decline, but those 2.2 percentage points erase more than 12 years of gains for women. Four million more in their prime years would be employed today if the old pattern had prevailed through the expansion now ending.
Journalist Louis Uchitelle cites the example of a 48-year-old woman named Ms. Samson, who never returned to the workforce after being laid off from a factory job that paid around $20 per hour:
She could be working. Jobs that pay $8 or $9 an hour are easy enough to land, she says. But she resists going back to work at less than half her old wage. Ms. Samson knows she will have to get another job at some point. So Ms. Samson, now receiving unemployment benefits, is going to college full time — leaving the work force for more than two years — hoping that a bachelor’s degree will enable her to earn at least her old wage of $20 an hour.
This struck me as one of those articles that doesn’t intrinsically contain much new information, but sparks discussion on the topic of women and the economy. Therein lies its value.
Crucial points to add:
Going on leave isn’t always voluntary for women.
–If childcare costs eat up a woman’s entire salary, there’s no ROI for her job. She might as well quit.
–Commuting is a big consideration for mothers. What’s the point of working if you’re gone 12 hours a day, barely see your kid, and barely make money because of skyrocketing gas costs?
–Few jobs these days seem to offer benefits. Benefits are a big job consideration for many women.
–Quite a few older women (55+) find it hard, if not impossible, to get rehired after dropping out of the workforce or changing jobs.
This is a systemic problem for Americans of both genders.
–Outsourcing, skyrocketing health care costs, and wage stagnation do not a good career make.
–The economy is changing rapidly, requiring workers to adapt. They primarily do this through education. Learning new skills, then, is a necessity rather than a luxury.
And, finally–the article fails to cover the plight of single women, who often have no choice but to work.
That said, I have no idea what this means for equality, if anything. It merely appears to be another sad economic fact…
Cutting back on driving and lattes is one thing, but now Americans are letting things get out of control. Plastic surgery, gym memberships, and diet product sales are all down according to this article by Laura Petrecca. Is this really such a good idea? Aren’t we depressed enough? Let’s not get ugly.
Put Down Your Scalpel
According to a recent survey by the American Society for Aesthetic Plastic Surgery, more than 50% of plastic surgeons are experiencing a slow down. Liposuction and breast augmentation -staple of the industry were down 30% percent in the first quarter San Diego’s Scripps Mercy Surgery Pavilion. People are reluctant to spend the money on procedures, and they also watching those personal days. Few can afford extra days off at work to recover from a major facial overhaul.
Does this mean my local medi-spa will soon run a special on Botox?
As reported in the LA Times, cheaper procedures like Botox and Juvederm increased by 7% in 2007. I’ve always read that lipstick sales held steady during the great depression. Women needed that inexpensive pick-me-up. If 60 is the new 40, then Botox and the other [relatively] inexpensive injectable enhancements are the new lipstick.
Wide Economic Impact
Cosmetic surgery, which used to be the exclusive territory of the rich and famous, has gone the way of designer clothes and high end cars. Everybody does it. The desperate housewife next door has only to watch an extreme makeover on TV to get the idea that plastic surgery is not quite a luxury, but a necessity.
Cosmetic surgery doctors pulled in over $12 billion in fees last year. That doesn’t include nurses, anesthetists, operating rooms, materials and other costs, which nearly doubles the figure.
“No one can have a practice built on the ultra-wealthy, because there aren’t enough of those people to go around,” said Dr. Robert Kotler, a Beverly Hills surgeon who specializes in the face. “The reality is that cosmetic surgery became popular when the middle class became enamored of it: flight attendants, professional people, businesswomen – people whose appearance is important to them.”
The good news about this weak economy is that our weak dollar makes our plastic surgeons more attractive to the international crowd. Outside of LA, doctors are looking to diversity into reconstructive surgery, which is often is covered by insurance.
As for me, I’ll be sticking to lipstick for now. And no, that’s not a euphemism for Botox. Not yet.
While there is no shortage of simulators for individual sports, the E Ball stands apart because it simulates a whole range. It comes in both outdoor and indoor varieties and comes in a range of sporting flavors including: golf, soccer and Australian Rules football.
An indoor version of the E Ball is available, but there is no substitute for the bouncy castle outdoor version. Presumably there is some setup involved in changing between the sports, as the ball sensors are all appropriately shaped, but that is a small price to pay for enjoying sports out of the sun.
E Ball’s Sports Simulator Brings All of Your Sporting Needs Indoors [Uber-Review]
The Iraq war is many things to different people. It is called a strategic blunder and a monstrous injustice and sometimes even a patriotic mission, much to the chagrin of rational human beings. For many big companies, however, the war is something far different: a lucrative cash-cow. The years-long, ongoing military effort has resurrected fears of the so-called “military-industrial complex.” Media pundits are outraged at private companies scooping up huge, no-questions-asked contracts to manufacture weapons, rebuild infrastructure, or anything else the government deems necessary to win (or plant its flag in Iraq). No matter what your stance on the war, it pays to know where your tax dollars are being spent.
Following is a detailed rundown of the 25 companies squeezing the most profit from this controversial conflict.
The first name that comes to everyone’s mind here is Halliburton. According to MSN Money, Halliburton’s KBR, Inc. division bilked government agencies to the tune of $17.2 billion in Iraq war-related revenue from 2003-2006 alone. This is estimated to comprise a whopping one-fifth of KBR’s total revenue for the 2006 fiscal year. The massive payoff is said to have financed the construction and maintenance of military bases, oil field repairs, and various infrastructure rebuilding projects across the war-torn nation. This is just the latest in a long string of military/KBR wartime partnerships, thanks in no small part to Dick Cheney’s former role with the parent company.
At first blush, a private equity fund (and not, say, Exxon-Mobil) being the number 2 profiteer in the Iraq war might sound strange. However, the cleverly run fund has raked in $1.44 billion through its DynCorp subsidiary. The primary service DynCorp has provided to the war efforts is the training of new Iraqi police forces. Often described as a ‘state within a state‘, the sizable company is headed by Dwight M. Williams, former Chief Security Officer of the upstart U.S. Department of Homeland Security. With this and other close ties to defense agencies, Veritas Capital Fund and DynCorp are well-positioned to capitalize on Iraq even more.
The Washington Group International has parlayed its expertise the repair, restore, and maintenance of high-output oil fields into $931 million in Iraq-related revenue from 2003-2006. The publicly traded 25,000 employee company’s other specialties include the building and maintenance of schools, military bases, and municipal utilities, such as watering systems. Some have complained that Washington Group’s hefty government payoffs have served primarily to raise its trading price on the New York Stock Exchange. One thing is for sure - with oil prices continuing to rise, there will be no shortage of demand for the oil protection services Washington Group International brings to bear.
All war zones eventually becomes cluttered with spent ammunition and broken/abandoned weapons, creating a lucrative niche for any company willing to clean it all up. In Iraq, this duty has fallen into the hands of Environmental Chemical. The privately held Burlingame, California company has stockpiled $878 million by the end of fiscal 2006 for munitions disposal, calling upon its “decade of experience planning and conducting UXO removal, investigation, and certification activities.” The company has close ties to several defense agencies and is staffed by graduates of the U.S. Navy’s Explosive Ordinance Schools, as well as the U.S. Army’s Chemical Schools at Anniston.
Aegis has done the United Kingdom proud after reeling in a contract to coordinate all of Iraq’s private security operations. The Pentagon contract is good for $430 million (incredibly lucrative by any standard) but it has landed Aegis in some hot public relations water. The company’s decision to contribute to Iraq war efforts has lead to a rejected membership application from the International Peace Operations Association. According to The Independent, the influential trade organization does not consider Aegis worthy of inclusion in the “peace and stability industry.” It remains to be seen whether Aegis will continue to be ostracized for participating in the training of Iraqi security forces.
Even with all of the blinding innovation and trailblazing advances in military technology, none of it would be very useful without electricity. Running electrical wiring in hostile war zones is dicey business, but International American Products has stuck their neck out and collected a cool $759 million in just 3 years for its efforts. While avoiding enemy fire, their work has become increasingly dangerous - and yet, critically necessary - as Coalition forces struggle rebuild cities, put down warring forces, and stabilize the chaotic nation. Schools, oils wells, and other public infrastructure have relied on IAP for the electricity needed to operate. With Iraq slowly beginning to stabilize, International American Products is holding out hope that its job will eventually become less treacherous.
London-based Erinys has so far scored $136 million for its effort in securing Iraq’s precious oil reserves. Riding the coattails of its considerable mining, petroleum, and construction expertise, the company has already made considerable headway toward this critically important goal. In the space of just 16 months, Erinys successfully trained, equipped, and mobilized an all-Iraqi guard force of nearly 20,000 to protect the nation’s oil pipeline from terrorist attack or sabotage. With crude oil prices skyrocketing and no end in sight, Erinys looks to have its hands full for years to come.
Fluor scored a monster $1.1 billion contract in 2004 to build, service, and manage water/sewage systems in Iraq. The deal is actually a joint venture between Fluor (a 44,800 employee company based on Aliso Viejo) and London’s AMEC, PLC and actually encompasses two separate contracts. The first - worth $600 million - obligates Fluor to build a water distribution infrastructure and cleaning system for Iraq’s major cities. A second $500 million deal will have the lucrative joint venture performing similar tasks in other, less hostile regions of the country.
Perini (controlled by financier Richard Blum) is one of the more controversial companies to have scored big-time Iraq war money. That’s because Blum’s wife, Senator Dianne Feinstein, appears to have used her seat on the Military Construction Appropriations subcomittee to steer the $650 million environmental cleanup deal in his favor. This has lead to outrage and cries for conflict of interest investigations among those in the media, as well as Feinstein’s peers in Congress. Feinstein has also neglected to comment on this potential conflict of interest. This has lead to what Metroactive.com calls an “omission [that] has called her ethical standards into question.”
Another widely disparaged, Blum-controlled company that has profited from Iraq is URS Corporation. Long known as one of the nation’s major defense contractors, San Francisco-based URS has collected $792 million in environmental cleanup fees in Iraq war zones. As with Perini, both Blum and Feinstein have come under intense scrutiny to answer questions about the apparent conflict of interest inherent in Feinstein helping to secure such an exorbitant government contract for her investment banker husband. Both Blum and Feinstein have refused to produce copies of the ethics commitee’s rulings on Perini and URS, leading to considerable suspicion.
Few Iraq contractors have come under fire as much as Parsons, who reportedly mismanaged the construction a police academy so poorly that human waste dripped from its ceilings. Far from being an isolated incident, reports from federal government auditors revealed lackluster work on 13 of the 14 Iraq projects entrusted to Parsons. Unfortunately, that hasn’t stopped the Pasedena-based firm from making off with $540 million in U.S. government funds for the poorly executed reconstruction projects at Iraq’s healthcare centers and fire stations. For obvious resaons, Parsons’ work in Iraq has generally been considered an embarassment.
“This is the lens through which Iraqis will now see America,” lamented Rep. Henry Waxman (D-Calif.) said. “Incompetence. Profiteering. Arrogance. And human waste oozing out of ceilings as a result.”
First Kuwaiti General Trading & Contracting is another example of the apparent cronyism that has gone into the process of awarding Iraq war contracts. It now seems that the company has succeeded on the strength of its ties to Bush Administration officials than its business merits. Rival companies have been extremely vocal in their displeasure at First Kuwaiti being awarded $500 million to build a United States Embassy in Baghdad.
“First Kuwaiti was not the lowest bidder”, complained Framco senior vice-president Gilles Kacha.
Armor Holdings (now a subsidiary of publicly traded BAE Systems) is one company whose opinion of the Iraq war can’t be all that negative. Since combat commenced in 2001, the company’s revenue has skyrocketed by a mind-blowing 2,247%, up to $634 million. Armor Holdings’ specialty is providing state-of-the-art armor for military vehicles and important personell as they traverse dangerous Iraqi war zones. The civil war between opposing Sunni and Shia and general unrest throughout the country have greatly increased the demand for the company’s products.
L3 Communications has carved out a neat $359 million slice of Iraq’s security screening needs as of fiscal 2006. The New York-based company has been charged with overseeing the screening and training of law enforcement personell for the growing all-Iraqi security force, as well as replacing equipment in the field. Linguistics is another one of L3’s specialties, one that is heavily relied upon to interface with native speaking Sunni and Shia forces.
L3 Communications has also purchased Titan, a corporate intelligence company with a $1 billion Iraq contract. Prior to being acquired by L3, Titan plead guilty to international bribery charges (a felony) and paid a record-breaking $28.5 million under the Foreign Corrupt Practices Act.
AM General (a subsidiary of Renco) is another company that has seen its revenue sail toward the heavens since the beginning of combat in Iraq. The renowned maker of extra-wide all terrain vehicles (shown below) has seen its Pentagon revenues soar by 92%, a phenomenal leap for any business. This placed Renco sixth in a 2005 analysis of the fastest growing contractors by dollar amount, and sixth in an analysis of fastest growing contractors by percentage. Growing hostilities prior to the Bush Administration’s “surge” strategy in 2007 helped fuel the sudden demand for AM’s heavy duty combat vehicles.
Already the third largest financial institution on the planet, HSBC has seen its fortunes brighten beyond its wildest dreams since the start of combat. It has purchased a controlling stake (70%) of the newly created Iraqi national bank, Dar es Salaam Investment Bank, which, though small, has already amassed assets of $91 million. HSBC’s chief executive of Middle East operations, David Hodgkinson, was quoted as saying HSBC intends to “develop the bank’s services by investing in computerised payment systems and cash machines.’
HSBC’s stake in the fledgling Iraqi bank could turn out to be a significant strategic foothold in the developing country. According to a BBC report, the bank already has 14 operating branches across Iraq and a modest but growing staff of 450. It is also the first private bank in Iraq since the toppling of Saddam Hussein, as the late dictator did not allow them during his rule.
Cummins has staked its claim to $45 million in Iraq war-related revenue with its robust line of diesel engines and power stations. According to a press release, United Kingdom-based Cummins”signed a distribution agreement with HMBS in Iraq for all Cummins brand products and equipment.” Antonio Leitao, Cummins’ General Manager of the commercial power generation business in Europe, spoke approvingly of the deal.
“Cummins Power Generation is proud to be the first generator set manufacturer to establish a distributorship in Iraq that covers the whole country.”
Cummins and power-generating companies like them will be instrumental over the coming years, as the world learns whether Iraq truly has a future as a rebuilt, independent nation.
MerchantBridge got its “in” to the growing money pot of Iraq’s fledgling financial sector by casting a wide net. The investment banking group has ambitiously targeted marketshare in Iraq’s developing construction, telecommunications, financial services, real estate, hotels, and information technology industries, all of which have been made easier by being the “lead advisor” to Iraq’s Ministry of Industry. The inside partnership has paved the way for MerchantBridge’s factory lease program, the opening of Mansour Bank, and an overall capitalization of $61 million.
Furthermore, 90% of MerchantBridge’s initial operating capital in Iraq has been supplied by Iraqi investors.
Risk management is a lucrative business the world over, and the stakes are nowhere higher than the high-pressure war zones of a foreign nation. GlobalRisk Strategies has capitalized on the bewildering uncertainty to the tune of $24.5 million, which it has primarily earned by advising U.S. and Coalition forces on the risks of various counter-terrorism strategies. Some of the more noteable risks the company’s 2,000 employees have managed include distributing fresh currency to the locals and guarding the heavily fortified Baghdad airport during 2004.
Alternatively, GlobalRisk has also assisted with reconstruction and delivering humanitarian aid in the banking, aviation, oil and infrastructure sectors throughout Iraq.
ControlRisks is another risk management company that has successfully hopped on the Iraq bandwagon. The UK-based firm has extracted roughly $37 million in war-related profits by providing discreet armed security and logistics support to troops on the ground and in the air. With a presence of 250 employees in Iraq, ControlRisks has provided security for the disastrous Parsons Usaid buildings (prior to the revelation of the embarassing shoddy work scandal) and has also been tasked with protecting Iraq’s active duty UK forces. While Iraq has recently begun to cool down in terms of insurgent violence and infighting, the region should provide opportunities for companies like ControlRisks to profit for years or even decades to come.
CACI was called upon by the U.S. government to provide 36 interrogators to Iraq, 10 of which were assigned to Abu Grhraib. While all the details have not yet come to light, it looks like CACI profited from Iraq in the worst possible way. One website notes that a leaked Army investigation implicated CACI employee Stephen Stefanowicz in the abuse of prisoners.” Furthermore, the allegations have led the Center for Constitutional Rights to agitate for trying CACI and its affiliates in U.S. courts.
Susan Burke, an attorney working on the case on CCR’s behalf, was quoted as saying “We believe that CACI and Titan engaged in a conspiracy to torture and abuse detainees, and did so to make more money.”
Bechtel is yet another Iraq contractor who seems to have benefited from close ties to the Bush Admistration. How else would a company recommended by the man who oversaw the Big Dig disaster possibly be awarded a $2.4 billion, no-bid reconstruction contract for Iraq’s infrastructure? Journalists and competitors are scratching their heads at why the Bush Administration trusted the choice of USAID chief Andrew Natsios after his woefully ineffective tenure at the head of the Massachussetts Turnpike Authority. While in that capacity, the Big Dig’s operating costs ballooned from an initial $2.6 billion to $14.6 billion, and the job still took years to complete!
In line with Natsios’ track record of recommendations, this one turned out to be a flop. Bechtel proceeded to lose its contract for the Basra Children’s Hospital Project after falling a year and a half behind schedule and $70-$90 million over budget.
Custer Battles has the dubious distinction of being the first Iraq war contractor to be found guilty of fraud. In March 2006, a jury ordered Custer to pay damages in excess of $10 million for 37 counts of fraud, including what the judge called “false and fraudulently inflated invoices.” While Custer wriggled out of serious penalties on a technicality (the Coalition Provisional Authority is not part of the U.S. Government and therefore crimes against it cannot be tried under U.S. law), the whole ordeal has muddied the company’s reputation greatly, possibly beyond repair. It also seems to have opened the floodgates for similar cases of contractor fraud. As of fall 2006, a backlog of 70 fraud cases were pending against Iraq contractors doing all manner of work.
During the trial, a retired Army general testified that the inflated invoice scandal stood out to him as “probably the worst I’ve ever seen in my 30 years in the Army.”
Of all the companies on this list, Nour USA might be the only one who actually did not exist until the Iraq war got underway. Since its opportunistic opening, the company has recieved $400 million in Iraq-related contracts, including a gigantic $80 million deal to secure the nation’s oil pipelines. Some critics allege the contract was pushed through by Ahmed Chalabi (whom one website calls “Iraq’s No. 1 Opportunist.”) While Chalabi has denied this allegation, several other bidders on the pipeline contract point out how awfully strange it is for a company with no prior experience to be awarded such a large contract.
Of course, it probably didn’t hurt Nour to have William Cohen (former Defense Secretary under Bill Clinton) on board as a company consultant, but that’s another story.
According to a Washington Post report in July of 2006, General Dynamics is one of the big-name defense contractors that has gotten the biggest monetary boost from the Iraq war. The key to General’s war profiteering strategy has been a broad focus on virtually everything the government needs to wage war, including tank shells, bullets for small arms, and even Stryker vehicles, which were first put to use during the initial 2003 invasion to remove Saddam.
All of this has lifted the company to tripled profitability since 9/11, and critics are speculating that ties to top Defense Agencies helped grease the wheels. According to the Project on Government Oversight, Genearl Dynamics formally announced that it was hiring a former top aide to the Army Chief of Staff in November 1999 - conveniently, just a month after the aid announced a grand new vision to introduce wheeled, light armored vehicles like the Stryker into regular use.
We’re in a water crisis.
Before I talked to economist and creator of Aguanomics David Zetland, those two words–water + crisis—made me scratch my head.
I’ve visited developing countries with water problems in the past. In many of those places, water trucks refill tanks located on the tops of buildings, and consumers have to haul their daily dihydrogen monoxide home in buckets. Here in the States, however, there’s plenty of water flowing from our taps. All the time.
According to Zetland, that illusion of plenty–endless water flowing from our taps–is part of the problem.
Business Pundit interviewed Zetland, who was recently been featured in Forbes and on Fox Business News, to get a primer on the water crisis—and how to solve it. Below are notes from the interview.
(Ed.: I organized these by category rather by Q&A. This is basically a transcription)
WHAT’S THE PROBLEM?
Our demand for water often exceeds supply. When that happens (as in Las Vegas and Atlanta now), a small imbalance can inflate into a crisis.
What do we mean by crisis? If a watershed is storing less than a year’s worth of water, groundwater is falling fast, and rain isn’t coming, it’s a crisis.
In situations like that, people MUST change their consumption behavior if they want to be able to live there in 2-3 years.
Las Vegas has been on the edge of crisis for years. Although the city is one of the most efficient water users in the country, its major water source is close to depletion. Vegas is trying to get more water by building an aqueduct to bring groundwater from rural Nevada, but that solution is neither sustainable (Vegas will be mining the water) nor ecological (the exporting area will lose its water supply).
Demand from metropolitan Atlanta is also causing trouble for neighboring states in the Southeast that claim Atlanta is taking more water than it should.
Southern California gets its water from the Colorado River and northern California. The region is in a bad drought. If it doesn’t rain this winter, red lights are going to be flashing even brighter.
Most of the Colorado River Basin is in a drought, and it’s not getting better. Colorado’s Front Range, where Denver is located, doesn’t have much water. Denver and other areas import water from the other side of the Continental Divide using a tunnel bored through the Rockies. Water exporting areas are worried that their future is flowing into that tunnel.
In all of these areas, it’s necessary to make changes in the way water is managed. If we don’t make changes, people and businesses will suffer from less-reliable water supplies (rationing!), farmers’ water will be seized (emergency!), and the environment will be screwed (dry riverbeds!).
HOW DID THIS HAPPEN?
Back in the old days, there was enough water for everyone. Cheap water was (and is still) used as a development tool. Landowners love cheap water: It makes worthless land valuable. Governments love it because development brings tax revenues and power.
The first programs gave water to farmers who settled on the frontier. As frontier areas developed, the demand for water grew, but there wasn’t enough. The government got more ambitious – developing water for agriculture through megalomaniacal engineering projects. People wanted to reshape the West, make flowers bloom in the desert. (ED: For example, the Central Valley Project (CVP) delivers water to California’s Central Valley, a semi-arid desert. It provides half the water for the agricultural industry there, which accounts for about 2-3% of gross state product. It’s also heavily subsidized.)
Urban demand grew at the same time around this “enough water for everyone mentality.” For example, the Southwest is now home to millions of people who depend on imported water (and air conditioning!). You can find similar examples of unsustainable living in the Middle East, tourist resorts on islands, and, most recently, in China.
These crises result when too many people and farms exist in areas not naturally capable of supporting them. After many decades of “hydro-growth,” people are unprepared to change their lifestyles. Meanwhile, supply becomes increasingly stretched–until it snaps.
WHO OWNS WATER?
Although “The People” own the water, farmers own most of the rights to use that water. In the US, agriculture consumes about 75% of the developed water supply, with the rest going to urban areas.
Farmers’ water rights are strong, but they can be of limited use. Although some farmers might prefer to “farm water” (sell water to cities), they are often prevented from doing so.
Some laws state, for example, that a farmer who does not use his water will lose his rights. It’s in situations like this that we see farmers flooding the desert to grow grass while municipal water providers are fighting to get water for their customers.
Even worse, farmers with vague rights may face shortages or rationing. Shortages can result when too many farmers tap the same aquifer (too many straws in the glass); rationing may result when imported supplies are cut. Farmers who can’t get water at any price may have to cut down an avocado orchard to keep remaining trees from dying of drought.
THE SOLUTION: MORE MARKETS AND HIGHER PRICES
Although agricultural and urban water supplies are managed in different ways, they come from the same sources. When these sources are under stress, water supplies need to be managed in different, but interdependent ways.
Zetland proposes that wholesale auctions be used to allocate water among urban, agricultural and environmental uses. After that allocation, he proposes that urban areas use “conservation pricing” to limit demand to available supply. Agricultural users, on the other hand, have the capacity to allocate their water supplies through a second set of auctions. (Environmental water presently just flows down the river…)
Auctions
Note that wholesale auctions would only sell sustainable quantities of water, so that (minimal) environmental flows and aquifers are maintained. (Environmental interests may want to buy more water for “restoration” or “augmentation” at auction.)
By a sustainable yield, we mean that there’s no water shortage if what goes out equals what comes in. If you sink a well and take water out at the same rate it comes back to surface, that’s sustainable. If you take water out faster than that, you’re mining water, which means that your renewable resource disappears and the land is uninhabitable.
For more on wholesale auctions, see Zetland’s site.
Why auctions? Because they are the easiest way to ensure that water reaches its highest and best use. Consider these facts:
Farmers pay $20 per acre/foot of water (that’s an acre of land covered a foot deep in water).
A single person consumes 1/8 of an acre/foot per year.
A single person pays $1000 per acre/foot of water.
Farmers own 75% of the nation’s water supply.
Moving water from agriculture would increase water supplies for urban dwellers, at a market-appropriate price. Some farmers, for example, can make more money selling water than farming low-value crops like alfalfa, hay, or cotton. The water they own would be put on the market, and consumers, other farmers, industries, businesses, etc. would compete for that water in an auction. Of course, a bidding war for water is likely to increase prices – and higher prices will signal that water should be treated as a precious resource.
Conservation Pricing
From Zetland’s Forbes editorial:
I propose a system where every person gets the first 75 gallons, or 1.5 bathtubs, per day for free but pays $5.60 for each 75 gallons after that. Under my system, the monthly bill for the average household of three would come to $95.
Most families will respond to higher prices by using less, so their bill will not be three times today’s low price. (Those who use less than their “lifeline” allocation will pay nothing at all.) As higher prices reduce the quantity demanded (a la $4/gallon gas), water supplies will stretch farther.
Overall
If we had a reasonable price on water, we could have a sustainable water supply everywhere, forever.
People will have 100% reliability IF they are willing to pay. If businesses want reliable water, they pay. If poor people want to use water for more than drinking and sanitation, they pay. If a guy wants to irrigate his golf course, he pays A LOT.
The food supply would shift to higher value crops (less alfalfa and more broccoli). Food prices would go up, but they would reflect the true cost of growing food, not the subsidized cost from unsustainable practices.
CONCLUSION
Zetland is working with farmers to test auctions for reallocation of water within irrigation districts. He is also pushing for urban price reform (he says the tide is going in that direction). One driver for urban price reform is political necessity: Cities won’t be able to approach farmers until they are efficiently managing their own supplies.
The general population has mixed reactions to his proposals. Although some think that water should be subjected to even stronger market forces, the majority find it hard to put a price on water.
“Water is a very emotional subject for people,” he says. “They don’t want to use markets for allocating water, but if they don’t there won’t be any.”
David Zetland, PhD, is a S.V. Ciriacy Wantrup Postdoctoral Fellow in Natural Resource Economics and Political Economy at UC Berkeley. His blog is located at Aguanomics.com.
(Image: Bilaterals.org)
Have you read about corporate raider (”activist investor”) Carl Icahn’s antics at Yahoo? Icahn’s up to his old tricks, buying up enough company shares to make it into the boardroom, then lobbying his cause–in this case, that Yahoo be sold to Microsoft–until other board members either agree or get Cahnned.
The business with Icahn got me thinking about the business of negotiation. Icahn, 72, still has enough fire in his belly to negotiate with the best of them. He’s proven time and again that it’s not about who’s right or wrong, but who drives a harder bargain.
People have studied the art of negotiation to a fault. However, many aspects can be simplified. Sun Tzu, his seminal “The Art of War” stated “Know thy self, know thy enemy.” In the language of negotiation, those two tips are fundamental.
Familiarizing yourself with a few other tenets–thy topic, thy allies, and thy laws–will get you on the road to successful bargaining, with anyone, anywhere.
Witness these five essential things to know before bargaining hard:
1. Know thy Topic
In the language of negotiations, he who plans, wins. Know everything you can about the circumstances of the negotiation. What are the characteristics of the market you’re dealing with? What is the extent of the opportunity you may have? For example, if you’re negotiating a salary for a new position, research what others in that position make. Do you have any additional skill sets that could up your salary range? Who are you competing against? What is your market in general doing? Where are your growth opportunities? With solid backup, you’ll be able to tackle most issues that arise during the negotiation process.
2. Know Thyself
If you have a thin skin and are prone to temper tantrums, bear this in mind as you enter the negotiation. Taking things personally takes away from objectivity. Irrational behavior, in turn, may lead you to agree to something you’ll regret later.
Once again, preparation will help you stay objective. Write down all the objections you can imagine your counterpart to make. Then, write down a reply for each. Ideally, in the process of negotiating, this kind of preparation will help your memory overrule your urge to throw something.
3. Know thy Enemy
What are the other party’s objectives? What does she want from you? What are her priorities? What’s her reputation like? Take 30 minutes to list everything you know about the other party, her company, her professional history, her needs, and her wants. When things come up, you’ll be equipped to respond with a level head.
4. Know thy Laws
Trying to sell something? It would behoove you to be part of a trade association, Chamber of Commerce, or another organization that represent industrial authority. If you’re a buyer, know in advance the regulations, standard procedures, and review agencies associated with the product being sold. Invisible authorities are hard to argue with during negotiations.
5. Know thy Allies
Who’s your posse? If you’re a buyer, they may be your suppliers. If you’re a seller, they’re your customers. If you’re a job-seeker, they’re your achievements and references. Know your best allies off the top of your head. If you have many, memorize an impressive-sounding number. If you have few, make the ones you do have sound special.
Long after Sun Tzu’s time, Sir Francis Bacon stated that “Knowledge is power.” When it comes to bargaining and negotiating, this couldn’t be more true. With these five tips, you’ll have both power and knowledge at your side.
Last week I read The Black Swan: The Impact of the Highly Improbable by Nicholas Taleb. If you are starting a high potential venture or are investing in one, this book has a lot of useful information.
The main thesis of the book is that prediction is very difficult and the statistical tools used to manage risk are flawed because they don’t deal well with “Black Swans” — really rare events with outsized effects, like September 11.
The book makes several useful points for entrepreneurs and investors that come from the existence of Black Swans.
The one recommendation I would make to entrepreneurs interested in the information in this book is to get a book summary. The author is long-winded and spends a lot of time trying to impress readers with his knowledge of philosophy and superiority over other experts. I found that tiresome; and it detracts from the message. A good summary would just avoid the problem.
Editor’s note: In keeping with Professor Shane’s suggestion of reading a book summary, I found a free summary of The Black Swan over at BookJive. BookJive looks to be a helpful service that will even email new book summaries to you. There’s also a short YouTube video excerpt describing the Black Swan theory, delivered by Nicholas Taleb himself. — Anita Campbell, Editor
* * * * *
About the Author: Scott Shane is A. Malachi Mixon III, Professor of Entrepreneurial Studies at Case Western Reserve University. He is the author of eight books, including Illusions of Entrepreneurship: The Costly Myths that Entrepreneurs, Investors, and Policy Makers Live By; Finding Fertile Ground: Identifying Extraordinary Opportunities for New Ventures; Technology Strategy for Managers and Entrepreneurs; and From Ice Cream to the Internet: Using Franchising to Drive the Growth and Profits of Your Company.
This is a post from: Small Business Trends
The Black Swan for Entrepreneurs
Suicide is a big problem in South Korea. According to the Financial Times, the compact peninsula has the highest rate of suicide in the developed world: 24.7 deaths per 100,000 people.
It’s become such a problem that employers are sending workers to “well-dying” courses to prevent suicides. During the courses, employees go through the arduous process of faking their own deaths.
Fake funeral training has become so popular that major companies like Samsung have built their own funeral training centers. Hyundai, another large employer, regularly sends employees to “well-dying” training.
Via the Financial Times:
South Korean companies are sending employees on ‘fake funeral’ courses to help prevent suicide. Participants sit at candlelit desks and are told to write their last will and testament. Attendees are prompted by questions such as: “If you died today, what would you tell your family”? Many of those in the room become emotional as they read out their wills.
Before they are “buried”, participants are asked to pose for their funeral portrait. Participants (then) enter a “death experience room” where they choose a coffin and put on a “death robe.” Course members get into their coffins and a flower is laid on each person’s chest. Funeral attendants place a lid on the coffin and dirt is thrown on the casket. Participants are left in the closed casket for five minutes and some start to cry in the darkness. Once the lids are opened the resurrected trainees are asked how they felt.
As someone who’s 99% ignorant of Korean culture, this strikes me as harsh. Is giving someone a reason not to die the same as giving them reason to live? Then again, it does seem to be working: Why else would Samsung have built a permanent funeral training center?
Thoughts?
No matter what kind of office you work in, hold this truth to be self-evident: You’re stuck in the same micro-environment most hours of the week. For some of us, that means a gray-walled cubicle; for others, a window office. For telecommuters, it often means a desk located next to the refrigerator.
Thanks in part to tech companies like Google, office environments are becoming less pristine and more like playgrounds. Plastic action dolls and disarming signs complement–and sometimes replace–mahogany and philodendrons.
Business Pundit researched ten items that straddle the gap between professional and fun. Some items, such as the digital picture frame, are adaptable enough even for the Department of Motor Vehicles. Others, like the Omni bean bag, might require a more relaxed environment.
One thing’s for certain. Housing one or more of these office items in your cube will bring you back from the dead, even on the slowest of summer afternoons. Here they are, in order of necessity:
10
ROCK GARDEN
Life-giving element: Oxygen. Plants recycle carbon dioxide into breathable oxygen, making them essential for life.
Cube use: Recycle the stale air in your work-box with only a minimal commitment by cultivating a rock garden like the one above. Unlike some indoor plants, this little garden will survive weekends and holidays.
Life-giving element: Memories. Rotating pictures of your friends and loved ones remind you that you have a life outside of your cubicle and department meeting room.
Cube use: Load your digital frame with pictures of family, vacations, wild nights, and other memories that make you feel good. Best-case scenario: Motivation to work hard in the name of weekends and vacations. Worst-case scenario: Minutes of wistful pining.
Life-giving element: Hygiene. Keeping your hands clean helps you stay healthy. Keeping crumbs off your desk helps you feel like less of a slob.
Cube use: Hands, coffee rings on desk, crumbs on keyboard, finger grease on mouse–Handy Wipes are good for just about everything. Except for your face.
7
CHOCOLATE-COVERED ESPRESSO BEANS
Life-giving element: Energy. Instant, tasty energy that doesn’t come in brown liquid form. Satisfying crunching sound when chewing. Candy with benefits.
Cube use: Good for hijacking afternoon slumps and getting buzzed before meetings.
Life-giving element: Pets. When people think of low-maintenance aquatic creatures, they think of goldfish. Dwarf frogs are infinitely more interesting, but require almost as little care as the standard goldfish.
Cube use: All these fascinating little critters require is a small, filtered tank like this one, an aquatic plant or two, and food. They like to hang out upside down and stare into space, creating an ideal distraction for long days in front of the computer.
Life-giving element: Uniqueness. Teddy bears are so played out–why not get a stuffed E. Coli to mix things up?
Cube use: Hang or place your favorite microbe (the deadlier, the better) in a peripheral place, such as the entrance of your cube. it will catch you by surprise and invoke a giggle when you least expect it.
Life-giving element: Rest. Of course, you don’t ever do that at work. Right?
Cube use: Lean this rectangular bean bag against your wall or under your desk. Its shape-shifting qualities allow you to stash it in a variety of places. Then, at an acceptable time, use the Sumo as a chair, a sleeping mat, a pony, or any other shape that comes to mind. (Ed.: Sumo sent Business Pundit an Omni to try out. We loved it, both as a cube toy and a cure for the common, circular bean bag.)
Life-giving element: Relief. Climber’s putty is another form of the common office squeezy toy, an ideal way to reduce tension.
Cube use: The stuff stores in a large plastic fist, making it an interesting decoration with utility. Bust out the putty when your clients, direct reports, boss, and/or colleagues have you ready to beat down your cube wall.
2
REARVIEW MIRROR
Life-giving element: Safety. Nobody–no employee, no client, no boss–can sneak up on you when you have the advantage of a mini-mirror.
Cube use: Clamp your little friend on a flat-screen monitor, desk, or any other jutting corner. If your back faces the entry to your cube, this mirror will be invaluable.
Teamwork: There’s No “I” in Drunk
Life-giving element: Satire. If you can’t make fun of your surroundings, what can you make fun of?
Cube use: Decorate your walls with one of these de-spiring posters. Here are just a couple of the many messages waiting to be tacked onto the padded walls of your cube (via ThinkGeek):
–Customer Disservice Because we’re not satisfied until you’re not satisfied.
–Consulting. If you’re not a part of the solution, there’s good money to be made in prolonging the problem.
–Give Up. At some point, hanging in there just makes you look like an even bigger loser.
*
Once you secure all the items on the list, add a couple of employee recognition awards and a really complicated project chart. You’ll be set for success–and quality distraction–in no time.
From MSNBC:
Beverly Hills is one of the most fertile oil fields in Los Angeles, producing nearly a million barrels a year. Many wells are camouflaged or hidden inside buildings. Not far from here, in Wilmington, they churn out far more oil — in fact, the Department of Energy calls Wilmington the third largest oil field in the 48 contiguous states.
With oil prices so high, all over Los Angeles people are digging, or restarting, wells — even ones that only turn out 10 barrels a day. Conservative estimates are that California is sitting on three billion barrels of accessible oil. In Los Angeles, there are three challenges: The fields are old, there’s too much urban sprawl to drill easily, and there’s a lack of rigs and crews. Also, the oil here is much heavier than the stuff they pull out of west Texas, meaning it’s less profitable.
Perhaps most pleasantly surprised all by this are the thousands of individuals who own the mineral rights to the land where drilling is happening, moms and pops whose families have owned those rights for years.
I would like to see oil derricks in the following celebrities’ backyards*:
–Pamela Anderson
–Michael Jackson
–Tori Spelling
–Steven Segal
–OJ Simpson
–David Hasselhoff
Seriously, I wonder where else smaller mom-and-pop operations will become lucrative in coming years…
*because I do not like said celebrities.
I present seminars on franchising several times a year, and always try to leave a half hour at the end of my presentation for questions about the franchise model from the audience.
One very common question relates to what I call “The learn while you earn” model.
This model was a personal favorite of mine when I was in my late teens and early 20s. I would apply at 2 or 3 really different companies for positions that interested me in a general way, and in my mind, I had very little risk, because I would be learning about these totally different types of businesses, while getting a paycheck. Wow! If it turned out that I didn’t like the business, or at least my role in it, I could resign, and try something else. I did this a lot.
People looking at franchising ask me this common question:
“Joel, are there any franchise companies out there that will let me work with a local franchisee, to see if I like the business?”
My answer (being the laid-back, totally politically correct person that I am not) is No.
That is as long winded as my answer will ever be.
“But why not, Joel???”
There may be a few franchise companies out there that will let that take place, but I would not advise it. It comes down to the major difference between employment and small business ownership.
This is a post from: Small Business Trends
Does This Franchise Company Get It?
With the current state of the economy, the need to make extra money online has spawned some really successful businesses. Ryan, one of the authors on Business Pundit, lists some very creative businesses in the blog article “15 Crazy Ways People Make Money In Today’s Economy“.
What if you had a business idea but you thought no one else would be interested? Would you take the risk and try anyway? Whateverlife was started by a teenage girl to assist others with MySpace layouts. According to Ryan’s article, she now receives around 7 million visitors to the site each month and has received generous offers to buy her site. Does this list inspire you to start an unusual business online?
I was all set to write what I considered to be a non-controversial post about the Better Business Bureau.
I didn’t expect ANYONE to find fault with the Better Business Bureau. The Better Business Bureau is like motherhood and apple pie. Who could say anything bad about them?
But then I put out a quick note on Twitter about becoming accredited by the Better Business Bureau. And to my surprise I got back several messages from someone I know stating essentially that the Better Business Bureau was a waste o
