Jan 21, 2009

A better bailout

While we're dishing out cash to big companies, and thinking about insignificant sums to be returned to taxpayers, maybe we should think of one more thing. In Fareed Zachariah's new book, "The Post-American World," (which I plan to write more about) he offers an idea from one economist -- that our definition of savings is flawed. Cash, stock and property are dollars reserved instead of spent, it ignores another big class of deferred (monetary) gratification -- education.

Plenty of people sinking under loads of debt are those with big student loans. They followed conventional wisdom and invested in knowledge that will not only benefit them in the future, but will benefit all of us in their increased competence and ability to serve our needs (except for those studying to be stockbrokers, of course). Then they graduated into this economy and are waiting tables, if they're lucky.

So why don't we look at a student loan forgiveness program? We'd need some criteria for whose loans would qualify, maybe just those who are unemployed or making less than $20,000, or something. (It would probably be cheaper to just forgive student loans across the board rather than pay for a whole phalanx of examiners of applications.)

At the same time, let's find a way to beef up scholarship funds. As Toyota demonstrates, slack times are opportunities for training and improvement. As a society, couldn't we invest in that as well?

Jan 11, 2009

The immensity of the sea

My friend Josh sent me an email today with this message in his autosignature:

"If you want to build a ship, don't drum up people together to collect wood... but rather teach them to long for the endless immensity of the sea." --Antoine de Saint-Exupery

In a company that is really becoming lean, everyone is longing for the sea. They know they are making something that someone will use and value. They can see that person with their product in their hands, appreciating its design, workmanship, and function. Whether they are building a truck for Taylor Swift or a metal stamping to become part of a casket chosen by a family to honor a loved one in a final ceremony, they know everything they do is important. Whatever they find is not important, stands in the way of a smooth process, or wastes time or material, they figure out how to not do it.

They also see that it's up to them to keep the company afloat, driving ahead, on course for a distant port through stormy seas.

Jan 3, 2009

When customer experience comes first

Retailers were moaning about slow sales before the holidays, and I didn’t do much to help. It wasn’t until a few days before Christmas that I had the energy to think about what to get people. I bought quite a few gift cards, but there’s something crass about them. We made a toy run at Target, since Mike’s pretty good about knowing what the boys on our list would like – RC hovering helicopters went over big. Target’s usually neat and orderly with a lot of cross-trained employees who can keep the checkout lines short when volume bumps up.

That left me with my nearest and dearest. I called my mom and told her I had a gift, but not to expect it in time to put it under the tree. She was fine about it. For some others, I went online to Mercy Corps and, in their names, bought kits to help Congolese women make and sell clay ovens. Very easy process, well-designed website, and good stories to explain how your gift would help.

Then Zappos. They had a guarantee that if you ordered before 1pm Pacific time on December 23, you would get your item Christmas Eve. Free shipping, both ways. It wasn’t quick going through all the possibilities and guessing what my family would like, but I made my decisions and ordered. I knew that if they didn’t like what I got them, they could easily send it back. I set aside some quick access wrapping paper and ribbons and trusted in Zappos service

So there we were, exchanging gifts at about 5:30 pm Christmas Eve, and I was promising that more were on the way. Sure enough, the UPS man drove up just in time with our three big boxes with Zappos! emblazoned on them. We didn’t even bother to wrap them. The Zappos! boxes were exciting enough.

Crutchfield also gets online-shopping honors. Mike decided that I would get him an HD radio/music player for his 12-year-old Probe. When you order on the website, you first specify what kind of car you want to install it in, and it only shows you products that will fit it. Once you decide on a model that suits you and your car, you download a PDF document with instructions specifically for your vehicle and no others. You also get the “special tool” you need to install it in your car.

Would it be true? Yes, Mike says it went in like a charm. Other features he likes are the clock you can turn off, and the removable face of the radio/etc. He doesn’t drive his car a lot, and the battery was being drained by the clock in his old radio. The removable face immediately devalues your radio in the eyes of would-be thieves.

Let’s compare these two stores to a few others. Macy’s ranked high on Mike’s pre-Christmas list. He found good prices and service, and uncrowded stores. And a sweater, earrings, and a necklace for me. I went to the mall yesterday, however, and Macy’s was packed. Must have been all those gift cards being redeemed. Macy’s had a shoe sale – the most disorganized mess of a shoe sale I’ve ever seen. All the sizes were mixed together over racks and racks of shoes. There was only one shoe of a pair, so if you found something, you had to get a salesperson to get the other one. The lines at the registers were eight people deep, and there were a lot of impatient shoppers in chairs waiting for the other shoe to drop, so to speak. Not a few shoppers crowded with me in the sale racks said that it was just too much work, walking away with their credit cards. Macy’s – you went too far in your layoffs!

The other mall stores weren’t much different, except that the store personnel in Ann Taylor (or was it Talbots? No differentiation in this customer’s eyes) were preoccupied with trying to figure out where HQ wanted them to arrange their merchandise. Again, I walked off with my credit cards intact.

The exception—Nordstrom. It’s shoe department was crowded too, but a guy with a clipboard walked by me, stopped, and asked me if I was finding what I was looking for. No, but he walked me around trying to find the plain black pump I need for the occasional business meeting. We found a couple, and he said he would get me a salesperson—apparently he was a manager, at the gemba, who was able to step in where needed. The salesperson came back with a stack of boxes. They didn’t have my shoe in my size but she found some similar styles and sizes for me to try. They didn’t work out, but at least Nordstrom was willing to staff up and train in order to meet the needs of the shoppers.

The clothing departments were less crowded, but I started picking out things to try on, and soon a salesperson came along to take them to a dressing room until I was ready. This is why I love Nordstrom. I tried on about seven pairs of pants and didn’t like them. The girl brought more. She looked at the fit and brought me smaller sizes. I asked for a top to go with the pants. She brought several. I hate paying $89 for a pair of jeans. Usually I pay $5 at the resale shop. But I bought a pair she found for me because they fit really well and as she promised, looked cute. Nordstrom wouldn’t have made that sale, small as it was, without her. Their ROI, if they had a margin of $45 and paid her even as much as $15/hour, had about $40 left over after she spent as much as a half hour with me. But Nordstrom, take note. If you had had more selection in the petites department, you would have taken a lot more revenue.

I left my shopping trip with little more, except a resolution to turn to Zappos again that night. Now I have four pairs of shoes on their way to my house. Tony Hsieh absolved me from guilt about trying on and returning merchandise, adding the wish that I’d tell people about my good shopping experience. So that’s what I’ve done in this post.
Copyright @ 2005-2014 by Karen Wilhelm