Posts Tagged ‘business’


How Alaska Airlines stays on top: watching the fundamentals

March 3rd, 2013 at 12:43 pm ET

Jad Mouawad’s extensive business feature on Alaska Airlines in the NYT tells the stirring story of how Alaska Airlines, America’s most reliable airline and one of America’s financially steadiest airlines, has pulled it off. It’s a great read, full of detail (and it made me want to visit Alaska, which I can honestly say is something I’d never taken seriously before).

The most interesting thing about Alaska’s story is how much the company has relied on fundamentals to keep its business strong: technology, people, metrics. It invested early and substantially in satellite navigation technology, in response to the treacherous approaches and difficult weather that Alaska’s pilots have to deal with routinely. It is deeply committed to staff training, with an Arctic certification that takes its pilots six years to complete. And it takes data seriously:

The airline has established 50,000 points of data to improve its on-time performance, from the time bags are loaded and passengers board to when the pilot pushes back from the gate. It also figured out that if it could shave just a minute of taxi time from each flight, it could save 500 minutes, or over eight hours, a day — the equivalent of flying an extra plane daily, said Ben Minicucci, the chief operating officer. If such small efforts allowed the carrier to free up a plane, it could generate $25 million to $30 million in revenue a year.

$30 million isn’t a fortune — that’s less than 1% of the company’s total revenue. But successful businesses with strong margins are built by steady attention to all the levers that are within the company’s control. That’s a lesson that’s worth the attention of any management team, whether they’re building a neighborhood restaurant or a global technology company.

Sky Captain and the Technology of Tomorrow (Gogo Inflight edition)

March 19th, 2012 at 10:14 am ET

With Gogo inflight wireless, Delta Air Lines has done something remarkable: made a miraculous technology (Internet service at 29,000 feet) easy and fun to use without charging an arm and a leg.

The service works well, provides more than adequate speed, and it feels very fairly priced. Different plans seem to be available on different flights, but $1.95 for 15 minutes, $4.95 for an entire short flight, or $12.95 for 24 hours all seem reasonable. Once you have an account, signing in is simple and your payment info has already been saved for you (no taking off your seat belt and fumbling for a credit card). You can even hop from one device to another during your flight.

The beginning of the end of the 9-to-5 workday?

January 6th, 2012 at 9:32 pm ET

Gregor Poynton tweeted this article by Dan Schawbel from the Time website. Its main contention is that “employees in the Gen Y, or millennial, demographic — those born between roughly 1982 and 1993 — are overturning the traditional workday,” through flexible hours, job-sharing, freelancing, and so forth.

I understand what Schawbel is saying — certainly things have changed since the Gen Yers’ parents’ generation (which is, roughly, the generation midway between my parents and me — I graduated from high school in 1983). But the analysis of why, and how pervasively, seems a bit facile to me.

I mean, this is certainly true, and a good thing, for a relatively narrow stratum of highly empowered and self-actualized white-collar workers — people with good educations, marketable skills, and strong personal brands (Schwabel’s specialty), which includes me and Schwabel and almost everyone who works at Time.com, and most people we deal with professionally. So, yay us!

But the day-to-day world is operated not by people who blog and work for marketing agencies (like me and Schwabel), but by people who make donuts and build bridges and clean up after our grandparents in nursing homes — and almost none of those people (or, for that matter, their managers) are being released from the constraints of routine. It’s very nice to say “Gen Y workers won’t accept jobs where they can’t access Facebook,” but a lot of the people in those age groups — the majority? — don’t get to be so fussy. That was true at the height of the last economic boom, and it’s much truer now than it was then.

I thought Matt Yglesias’ take on the economic policy debate as just another culture war issue was right on the money. The sorts of people who live empowered Gen-X and Gen-Y lives (and I certainly include myself), especially the childless and well-paid, don’t ever have to make the choices that many middle-class people (nevermind working-class people) have to make, and it’s harder for us to empathize with those choices than we would like to think.

Female entrepreneurship: the game-changer?

January 2nd, 2012 at 12:15 pm ET

I found Ariel Levy’s profile of Kiran Mazumdar-Shaw, Indian biotech CEO, refreshing on multiple levels.

In her free time, around the edges of running a gigantic biotech company, Mazumdar-Shaw devotes her surplus entrepreneurial energy to changing the Indian health delivery system, and the approach to health prevention and health insurance, at the level of the Indian village.

For one thing, it’s always interesting to hear about an energetic, thoughtful, successful businessperson, who’s not afraid to think capitalistically but who applies her surplus entrepreneurial creativity to social challenges. I never heard of Mazumdar-Shaw, the billionaire founder of Biocon, and in fact I’m not sure I’ve ever taken notice of Biocon, which gives you a sense of just how insular we Americans are, even the thinking stratum of us.

For another, I enjoy reading a story about a strong professional woman who was underappreciated in her early career — indeed, who worked in a country where women are systematically underappreciated — who maintained her good humor and indefatigability, and kept pushing forward in the direction indicated by her own personal compass, and ended up being successful. Her Scottish husband John Shaw is a successful businessman in his own right, but it’s clear from this story that in their household her career is privileged over his, and he’s comfortable with that.

It’s a classic entrepreneurial story (nobody believed in me, but I believed, and kept going until I succeeded), but not all entrepreneurs do keep their good humor. Some end up embittered and paranoid, resentful of those who didn’t believe in them, unable to share credit or mentor others, and unwilling to credit the large share of luck that played a role in their successes.

Mazumdar-Shaw doesn’t seem that way, at least in this telling. She hasn’t lost her good nature or her optimism, doesn’t seem to have an outsized opinion of her own talents, and is clearly generous both financially and emotionally to her professional staff, who speak highly of her. What’s more, she’s held onto her sense of social vision, which is what separates a great entrepreneur from a good one. She wants nothing less than to transform the healthcare experience of the Indian villager.

Historically entrepreneurialism has been seen as a men’s game, but I’m glad that’s changing. Human society needs all the social creativity it can muster, and that’s doubly true in places like India where a quarter of the population lives in stark deprivation. Just imagine a world where everyone was encouraged to contribute according to his or her full talents and interests, to reach his or her full flowering, in an environment that fully respected differences of approach and inclination — how much richer would life be!

Groceries in London

May 30th, 2011 at 6:24 pm ET

Is it that the national market is incrementally smaller and tighter? Or that the population is incrementally smarter? Or a bit less cowed by corporatism? Or just a bit more demanding, in environmental and quality-of-life terms? Is it the cultural affection for London’s grand food halls? I don’t know what it is driving it exactly (although I have some thoughts below), but it’s clear that the quality of groceries is higher in London than in the United States.

I’m not necessarily talking about the quality of provisions at the high end. Certainly the produce and meat at Fairway, or Whole Foods — or, for that matter, a large, well-stocked Publix or Ralphs — rivals anything commonly available in London.  What I’m talking about is the quality available to the great middle market across the country, from the four or five national mass-market purveyors.  It seems that the average Briton has access to far better (fresher, more wholesome, better-tasting) food, and especially prepared food, than the average American.

In the United States, once in three months I might come across a store-brand prepared (i.e., perishable) dish from Kroger or Safeway or A&P that I found worth mention, and maybe once a month a boxed or canned (dry-goods) product that’s interesting.  And specialty grocers like Trader Joe’s score better.  But everything I ate this month from Waitrose, Sainsbury’s, and even Tesco was excellent: good-tasting, well-labeled, made from wholesome ingredients, free of artificial preservatives, sustainably sourced and proud of it. The prepared Indian food and fresh pasta sauce I bought from Sainsbury’s (and from a limited-stock city centre store, mind you) were both restaurant-quality, and Waitrose’s baked goods were on a par with their artisanal equivalents costing three times as much.  (And don’t get me started about Waitrose, the only mass-market supermarket I’ve ever seen to rival Harris Teeter for quality and visual experience.)

This isn’t the Harrods food hall, or even Marks & Spencer’s, that I’m discussing; it’s the ordinary supermarket chains that feed the overwhelming majority of the British public day in and day out.

What makes the difference?  Here are some thoughts:

  • Because there’s a single national market — and everywhere on the island of Britain is within delivery distance — it becomes cost-effective to offer the full range of products to every community in the country.  It’s also less necessary to use preservatives, which means (on the downside) that fresh prepared food in the UK lasts only three or four days rather than the week or more that’s common in the US.
  • It’s clear that the culture is more accepting of sustainability and authenticity as a value worth paying for — although to be honest, the prices of the sorts of food I tend to buy (i.e., excluding the heavily processed grain-based items such as sugar breakfast cereals that are subsidized in the US) did not seem significantly different here.
  • This may be my urban bias talking, but most people here, even in the cities, seem to be culturally closer to the land than the average American is; certainly there is a larger share of the population in the UK than in the US that is a generation or less removed from rural or village life, and even in the cities, the health of the countryside seems to be treated as a community value to be respected.

Whatever it is, I’m sorry to be going back home. I eat very well indeed in New York, but I do have to shop carefully (I almost never set foot in any of New York’s four largest grocery chains) and it costs me.

Starbucks is finding its way

March 13th, 2011 at 4:55 pm ET

Claire Cain Miller’s long profile of Starbucks’ CEO Howard Schultz is business journalism at its very best: engaging and readable, telling a story, packed with snippets of intelligence I hadn’t known despite my having kept an eye on the Starbucks story.

(My favorite bit of color from Miller’s story: apparently all the CEOs in America are friends. Schultz is pals with Michael Dell, and it was on a long bike ride with him in Hawaii that Schultz began developing the rebound plan. The CEO of J. Crew emailed Schultz with a store complaint, and Schultz answered personally.)

For all the things I don’t much like about Starbucks, they’ve brought a level of consistency (in the best sense) to both their coffee and their atmosphere that is easy for urbanites to sniff at, but extremely valuable in places where there wasn’t an indigenous coffee-oriented “third place” culture before Starbucks arrived. And that describes much of America.

I’m happy to see Schultz taking the company’s problems seriously. Although I rarely visit Starbucks for the coffee or food, I do buy my daily newspaper in one down the block, so I have occasion to watch the company’s transformation. I generally like the company’s recent improvements and innovations, starting with the vast improvement in food offerings (including both snack and mealtime options) that has swept the chain in the past two years. Time was (and not long ago) that most baked goods at Starbucks were nearly inedible, and overpriced at that. But in the recent revamp, quality, price, variety, and freshness have all improved. A year ago, I would have said that British chains like Caffè Nero and Costa Coffee offered consistently better baked goods and snacky foods than Starbucks, but Starbucks is catching up.

I don’t much like the over-roasted coffee or the mainstream drinks (sugary and artificial, they are). But they’re paying attention to this, too, and in most stores there’s a bean blend in one of their brewed-coffee urns that I can tolerate — and it’s always, always hot and fresh, even in their licensed locations in airport terminals. Given the swill that is often called coffee in America, even here in New York, that’s not nothing.

On the value of self-reflection, in business and in life

August 14th, 2010 at 4:17 pm ET

I’ve often been surprised at the degree of honest self-awareness I see in the voices of the interview subjects at Adam Bryant’s “Corner Office” in the Sunday NYT. Almost every week, there’s at least one nugget of quotability that helps me see something more clearly in my own life path. And so, this week, this nugget from Sheila Lirio Marcelo, founder and CEO of Care.com:

“The first thing [the executive coach] gave me advice on, and I give it to everybody, is to journal. Write things down. When you come out of a meeting, or you come out of an interview, or you just finished running a session, what’s on your mind? How did it make you feel? How did you make people feel? What’s going on? Again, it was raising my self-awareness around my management style.”

Amen! During every American business boom cycle (and I’m old enough that I can say “every,” thank you very much), there are always entrepreneurs who are lionized in the press for just charging forward, trying not to stop to think, just indulging their animal business instincts or riding the wave or making the wave or what have you. This (let’s call him the “Nose for Success” Guy, or “Nose Guy” for short, and 95% of the time it is a guy) is just one of the American business types that we all recognize and are taught to admire. (One of these guys shows up as a character in Allegra Goodman’s new book The Cookbook Collector, which I just finished.)

The problem with this is that “be more like Nose Guy” is a difficult business strategy to put into practice, if by “strategy” you mean “principles or approach which, if you adopt it, will lead you to your goals.” The Nose Guy story is tautological. If you have the nose for success (and, really, we can argue about whether such a thing even exists, but grant for the moment that it does), and you find yourself in a lucky position, then, boy, will you do well. But if you don’t have it, saying “be more like that guy” — like the tedious urgings of George Costanza’s parents about Lloyd Braun (video), and indeed of anxious parents throughout history to emulate boring, conformist siblings and cousins — gives you nothing actionable to work with. To be more like, say, Warren Buffett or Mike Bloomberg — for you, [Your Name Here], to make your actual successes more resemble those of these people, what exactly are you supposed to do today?

Well, one of the very few levers you have, as an ordinary person with an ordinary nose, is self-awareness. If you’re lucky enough to be Nose Guy, you can just charge forward after the scent — you don’t have to be able to explain how you know which way to go, just go. But if you’re like the rest of us, you need to be more deliberate. And in the realm of normally successful business people, most of us get there — if we ever do — by being exceptionally deliberate. And (again, in the absence of The Nose) the way to successful deliberateness is awareness of the world, and of yourself, and how the two interact — knowing which of your instincts to trust, and which to second-guess, being able to predict how you will affect people, being able to motivate them to work with you rather than against you, and so forth. And this awareness, in turn, can be developed only by study of oneself and the world and the points at which they interact. And this study, in turn, is vastly aided by a self-reflective attitude.

It goes without saying that nowadays we all move too fast. But writing — especially coherent, thoughtful, synthetic writing — cannot be rushed. Writing up one’s impressions of a meeting or encounter — or, really, anything — is a superb opportunity to take stock of what went well, what didn’t, how you feel about it, and what to do next. Taking time to think and write about a failure is the right way to learn from it and turn the next opportunity into a success. And, more broadly, stopping periodically to take stock, to collect your thoughts, and to set them down is the best way to make sure that your life path, taken broadly, is leading to a place you will be happy to find yourself in a year’s or five years’ or ten years’ time.

This blog, rambling and random as it sometimes may seem to you, has been immensely useful to me in understanding who I am, what I’m good at, and what direction I should point myself in, in both the short and long terms. And, within the context of my job, the things I take time to reflect on are the things I handle best, and the areas in which I produce the best value for our clients, for my employer, and for myself. Marcelo’s advice rings true.

Triumphs of marketing: FreshDirect

August 10th, 2010 at 11:55 am ET

Brilliant, just brilliant! FreshDirect, the Queens-based gourmet-ish grocery delivery operation, packages a “Fruit Ripening Bag” with its fresh fruit. Otherwise known as a “bag,” it is printed with instructions for using it to ripen your fruit. (Said instructions more or less reduce to: “Place fruit in bag. When ripe, remove.”)

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And thus FreshDirect turns something that costs them 2.4 cents apiece into a valuable customer-retention amenity!

Average Monthly Profit: $11,706.27

August 9th, 2010 at 8:00 pm ET

As someone who struggled desperately for two years to get his bookstore to break even, and didn’t succeed in doing it even for a single month — not even December — I find that this just makes me really, really sad. More on this subject after I make peace with the cold injustice of the universe.

In which I agree to pay for something I can get for free

August 7th, 2010 at 4:03 pm ET

photo.PNGOK, I’ve done it: I’ve subscribed to Sirius XM satellite radio. This despite owning hundreds of CDs and gigabytes of ripped and downloaded music, having streaming music available at my command bundled with Time Warner and Roku products and services I’ve already paid for, having a Pandora account that I basically like, and, you know, having access to the Internet, which contains for free (for those willing to dig) every single musical note ever played in the history of man, multiplied a zillion times over.

So here’s the deal. In the course of my one-week free trial, I discovered that despite all that music I already had access to, I actually listen to a lot more music via this Sirius XM/iPhone/docking station three-way marriage than I’ve listened to since I gave up my XM subscription. A lot more, like five times as much. And that music involves a broader variety of genres, and a broader variety of songs, including both songs that awaken my nostalgia and songs I’ve never heard of before. And about half of the background music I’m adding to my media diet is directly crowding out background episodes of reality TV. Good stuff, right?

One of the business facts I’m reminded by all this is that people don’t just pay a premium for innovation in product, they pay a premium for innovation in delivery experience, too, and in packaging of that experience, and especially in the consistency and reliability thereof. It’s worth money just not to have to think — to be able to take for granted that something will just work. Netflix figured that out with DVDs-by-mail, and then figured it out again with streaming, and Apple of course figured it out ages ago and has put it into practice half a dozen times, in a range of sectors that are gradually converging. FedEx figured it out, by taking something (overnight delivery via USPS) that was perceived, rightfully or not, as a dicey proposition and making it 100% trustworthy.

So now, wherever I plop myself down, I dock my phone, I hit the Sirius XM button, I fiddle with the display for just a moment, and within 10 seconds I’m listening to an interesting stream of music. I don’t even think; I just do it. Now that’s the kind of reliability I’d happily pay $12 a month for.