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Friday, June 13, 2008

Covington Car Show

If you're a close friend or associate, you've probably heard me rave about the car shows in Covington. It is sponsored by The Maple Valley Street Rats, and happens every Friday night during the summer.

I took a gaggle of pictures this time around, hit the link to see them.

If you'd like to attend one of these Friday night events, here are the details:

When: Every Friday, May through September, 4PM to 8PM
Where: The (parking lot of) Wal-Mart in Covington, WA

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Friday, June 6, 2008

Death by spreadsheet

I have watched many companies tank based on the power of the spreadsheet. See, the spreadsheet is a clever device that allows you to lie to yourself in completely factual fashion.

Here are a couple of examples:

Starbucks has been making big waves about its attempts to "get its mojo back". This is great, since the new Pike Place Blend is actually a half decent cup of coffee (I'm a coffee bigot, and I'd rather drink McDonald's coffee than the old, burnt, stale stuff that they used to serve).

But the mistake that they made was in following the spreadsheet--not really understanding the gestalt of faddish drinks (that you can only drink a certain sugary drink for a while, and then you get sick of it, and change to e.g. Jamba Juice)--just looking at top line growth, expansion of stores, same store sales year over year, etc. Those all looked good, while not pointing out the inherent fragility and fickleness of the market (and if you've ever been to a Starbucks in Southern California, you realize that the customer base can be extremely fickle).

Maybe they really understand the need to keep turning things over, but they have to manage to the spreadsheet, since Wall Street demands that.

The other case I'd mention is Guitar Center.

See, they've taken the new policy of not negotiating prices. This is certainly a "management by spreadsheet decision". Let me give you an example:

I currently own 3 basses, which are all "boutique" instruments. I have a bass amplification system that can homogenize your internal organs. I also run the sound at our church, and consulted on the purchase of our current sound system.

In other words, I spend a lot on, and I recommend the purchase of a substantial amount of gear.

Guitar Center just lost all of my business-- except for nick-nacky stuff that I won't wait for (cables, music stands, etc.). Because they no longer make deals.

I will buy online, because I'm not going to spend thousands at a place that won't cut me a deal. Imagine shopping at Wal-Mart when their prices were actually higher than the Mom-n-Pop.

If anyone is paying attention, now is the time to strike: Guitar Center, formerly unassailable, destroyer of the local music store, is now vulnerable. There is an opening for a new business model to usurp the hegemon (and it doesn't have to be "the Internets" & long tail FTW!).


Wednesday, June 4, 2008

FERC Order 2004 Compliance

If you are in the Natural Gas Industry, you are aware of The Federal Energy Regulatory Committee (FERC) Order 2004. This requires natural gas companies to control communication between Transmission Function Employees and Energy and Marketing Affiliates. FERC has the power to fine companies that violate this order. Even if the communication was unintentional. Even if the company self-reports to FERC.

However, FERC has hinted at what can prevent those fines:

In April 2006, a FERC webcast was held, discussing what constituted compliance, and which companies were fined (and not fined), and what behavior would cause an organization to be in the former or latter category.

Boiling the discussion down, the essential bit is this: The companies that did not get fined demonstrated a Culture of Compliance. Now, the $65,536 question: what can a company do to demonstrate said culture?

I'd like to suggest that there are three things:

  1. Fostering a culture of training towards compliance (teach the employees about compliance, what the regulations are, acceptable behavior, etc.)

  2. Measure compliance (know where employees sit in the organizational hierarchy, who is communicating to whom, what constitutes a shared employee)

  3. Implement technology to assist (implement ethical walls, especially incorporating automated group/department detection (e.g. looking in Active Directory for groups) and keyword detection, paying attention also to shared employees)

Granted, I've given these three the briefest of coverage, but also note that these can be generally applied to any compliance effort (even if it is just compliance with a corporate Acceptable Use Policy (AUP)).

What are you doing to foster a Culture of Compliance?