Tag Archives: business thinking

March 11, 2013 · 10:00 am

The CW

You might have read this morning that the online betting site InTrade is shutting down.

Intrade $ predictions - Nov 3

(Photo credit: New England Secession)

Unlike many of the gambling sites with which you might be familiar, InTrade lets users place wagers on non-sports-related upcoming events.  It was a lot of fun to read the site during the election season because you could see the odds of various candidates’ success changing with each news cycle.  You can read about why the business is shutting down here or here.  We can debate if it’s for legitimate concerns or just because it seemed to be operating outside of the long arm of the law but that’s not really my topic this morning.

What interests me about this site is that it was sometimes criticized for “getting it wrong”, as if the odds it offered were some kind of prediction.  That’s as off-base as thinking that a Las Vegas betting line is a prediction of the outcome.  Neither of those things are true.  InTrade’s odds simply reflected the conventional wisdom – how people saw the outcome and were betting.  It was not any sort of analysis of polling and other data to make predictions.  The Vegas line is similar.  It’s not a prediction – it’s an inducement.  It reflects how the conventional wisdom perceives the event’s outcome and is there to induce an equal number of people to bet on either side.  That’s why the odds change and the line changes.

We do the same thing in business a lot of the time and it’s often to our detriment.  We don’t “bet” on the outcome because we often confuse it with the conventional wisdom.  It’s the old expression about no one ever getting fired for buying IBM or ATT back when those services were the “go to” providers.  We see it today in media plans – start with TV and see whats left.  Even in digital we see it with the “buy Facebook” thinking I run into all the time.  “Winning” in my mind means trying new things all the time, measuring them with data, and not worrying a whole lot if the outcomes defy the conventional wisdom.  After all, it’s easy to get lost in a herd (or to get trampled).

What do you think?

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March 8, 2013 · 11:39 am

Tips

The end of a snowy, wet week here in the Northeastern US and it makes me glad we can have a little Foodie Friday Fun.  We usually go out to eat on Friday nights and as we did so last week I got to thinking about how servers get paid.  That, in turn, lead to a broader thought about restaurants in general and how their business has changed with the growth of social.  Let me explain.

Servers work primarily for tips.  There’s usually some sort of minimum wage paid but their livelihood depends on the instant feedback a tip provides.  Bad service can mean a couple of hours working for not much money.  Doing a great job can mean extra cash.  Oh sure – in some places  tips are pooled and a good server gets shafted while the lazy ones and the owner take an equal share.  For the most part, however, how much you earn is tied to how well you do your job.  As an aside, that’s why I rarely leave a bad tip – unless there was no service or it was an absolute disaster the server did some work for me and they should be paid.

It’s an interesting dynamic.  The server can be perfectly competent but if the kitchen is badly run the service seems to be a mess as well.  The difference is the cooks are all on salary in most places while the servers can suffer the consequences.  Where the overall operation feels the pain is in the magnifying effect of social media.  A bad experience used to be a secret.  Today they’re aggregated, searched, and considered as people make their dining decisions.  It can kill a business or it can help everyone involved to do very well.  Why do I bring this up?

We should all operate as if we’re servers.  While for some of us compensation can be tied directly to how well or poorly we do our jobs, for most people in corporate life we make what we make – compensation is something we negotiate when we’re hired even if some of it might be tied to a bonus or to stock holdings.  We don’t go home most days with a paycheck that mirrors how well we performed.  Too bad – it might force a lot of people to consider the performance more often.

What would you earn if everyone with whom you came in contact had the option to tip you for the job you did?  What kind of tips would you give out to those with whom you’ve chosen to do business?   Something I’m thinking about as the week comes to an end.  You?

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March 7, 2013 · 12:20 pm

Why You Can’t Find A Great Person To Hire

One of my favorite Shakespeare quotes is from Julius Caesar and is spoken by Cassius. He’s trying to get Brutus to stop Caesar and reminds him that “The fault, dear Brutus, is not in our stars, but in ourselves, that we are underlings”. In other words, we control our own destinies, not fate.

 

Employment Exhibition

(Photo credit: Modern_Language_Center)

 

I thought of that this morning as I saw some research on recruiting from the folks at Bullhorn. It’s an annual survey of recruiting professionals and in it they asked about what those folks perceived to be the biggest challenge they would face this year.  As MediaPost reported:

 

Recruiting professionals listed their biggest challenge for 2013 as a lack of skilled candidates (33%). Additionally, in a separate question, 76.1% of respondents claimed to have a shortage of skilled candidates in their respective recruiting sectors.

 

What does this have to do with the Shakespeare quote?  We’re in the midst of a nasty employment cycle.  You’ll notice I said “employment” cycle, not economic.  The stock market is back to where it was in 2000 and  corporate earnings have doubled since then.  Even so, employment is soft.  Part of that has to do with how technology has made many processes way more efficient.  I think it’s had another effect which has to do with why qualified job candidates are so hard to find.

 

Many managers have come to think of employees as disposable.  They’re lucky to have jobs and if they’re not happy there are lots of people available.   Due to this, there’s less of an emphasis on training and development   The tech factor is at work here as well – think about how many people can’t write properly because the machine checks spelling and grammar (but not meaning or homophones or homonyms).   We don’t train so people are less skilled.  Because they’re less skilled, the recruiters have a small pool from which to draw.  The fault, dear hiring employer, is in ourselves.  You agree?

 

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