What will Congress do?

Now that the EPA has ruled that CO2 emissions are an official pollutant does this mean that we will have to never exhale again? If so, what about flatulence, or even belching?

The thought of never being able to exhale beguiles me. Are CO2 filtration masks (CFMs) going to be part of the new cap and trade scheme on which Congress is currently holding hearings? If we are to be forever confined by CFMs, they will have to enable us to speak, right? If not what is Congress to do?

I mean, think about it, talking is all that Congress does. They cannot balance a checkbook, even though they are in charge of the federal purse. It seems that they cannot even read.

Therefore, if they are also limited by their CFMs I see that they have only three choices. First, but most difficult, would be for them to learn English as a Second Language (ESL). This is a daunting task. However, there are many resources out there to help them achieve this goal. Second, and the route that I would expect cynical politicians to opt for, would be for Congress to change the law by which the EPA was forced, by the Supreme Court, to make this ruling. Lastly, and the option which I believe they will ultimately choose, is to exempt themselves from the rules.

Jim Coburn

Is Twitter a Social Ponzi Scheme?

I recently joined Twitter and soon came to wondering whether it is a social Ponzi scheme? Moreover, if it is a social Ponzi scheme, will it collapse?

 

A Ponzi scheme is one of the more widely known versions of a pyramid scheme. Pyramid schemes rely on an ever-expanding roster of new participants so that the original participants may receive the benefits promised them upon joining. This layering of larger bases of participants creates its defining name.

 

If you are not familiar with Twitter (but is not everyone by now), according to Wikipedia, it is a "free social networking and micro-blogging service that enables its users to send and read other users' updates known as tweets. Tweets are text-based posts of up to 140 characters in length which are displayed on the user's profile page and delivered to other users who have subscribed to them (known as followers)."

 

Yesterday I was selecting fellow twitterers to follow. I began to notice that as the number of twitterers that I began following increased so did the number of twitterers following me increase. The two groups, those twitterers I was following and my twitterer followers were nearly symmetrical in their growth patterns. My first thoughts were akin to having just bought a lottery ticket, if I were to win, what would I do with the winnings. Only as a twitterer, my thoughts went more, and more, towards whether I could achieve those lofty follower numbers of the great twitterers, such as aplusk, cnnbrk, or even britneyspears. Could I get hundreds of thousands, or even a million, followers? What would I have to do to join the ranks of the elite? Would I have to sell my soul?

 

As yesterday progressed into last night, my thoughts began to evolve. I learned quickly that when you gain a follower it is common courtesy on Twitter to return the favor, that you also follow your follower. Thus, I quickly surmised I could never achieve the mass of followers that those great twitterers have. They began their twittering before me and therefore there was an extra layer, or most probably layers, of a twittering pyramid between us. The only way for me to achieve those lofty heights were if I were somehow able to move up the pyramid. I sincerely doubt that I would be able to find a secret elevator inside the pyramid. Maybe, if I were to channel my Indiana Jones I could battle all the odds and find the Holy Grail.

 

Alas, I have resigned myself to the fact that I became a participant in this social Ponzi scheme to late to achieve Twitter greatness. My only hope now is that the pyramid does not collapse until I have had a bit more fun with it. I think I will go and search for Harrison Ford. Better yet, I will keep a vigilant eye out for the next hot social networking tool and get in on its' first layer.

 

Jim Coburn

My Favorite Stories of the Day

Phone taxes are cell hell        New York Post

This is but an example of the run-away money grabbing by our elected officials.

The Pirates and Us            The Daily Beast

This is a nice little bit of symmetry regarding the pirates and business.

Dead Aid Book Review            Real Clear World

This is not new, but it is finally becoming news.

Jon Stewart Goes to Washington    Real Clear Politics

    Is the tide starting to go against a pop icon?

Going Paperless

Going Paperless

The key to going paperless has all to do with process first. If you do not construct business processes that deal with 0-1 touch paper thoughts (0-1) (never having paper or an organization touching the paper once) all is irrelevant. Achievement of paperless goal is not cheap in the short term. However, the long-term savings can be strategic.

Paper inputs come from three main sources one internal, document production, and two external, customers and vendors. Implementing 0-1 requires the compliance from all sources. You can mitigate external sources by using digital technology, provided the source is technically capable. I have implemented technology that included EDI, web, ACH, and digital fax processing that have achieved 0-1. In my experience, a reduction by 95-99% of external is achievable.

Internal is a far greater barrier. It requires a greater focus on employee training especially curing the nasty habit of many people to print and view. An identification of the processes that create/handle paper must precede training. Once identified, process re-engineering, followed by training, can help achieve the 0-1 goal. User involvement in process re-engineering is mandatory. Employee buy-in is the most crucial element.

A scenario:

Freight forwarder uses multiple vendors (delivery agents/long haul carriers) to move client product.

Proof of delivery (POD) is required from the vendor, as a supporting document for the customer and government.

Using EDI and digital fax processing customer delivery orders are entered into the system. The system routes the orders, selecting the vendors, and posts the orders to the vendors (1-8 vendors per order) through EDI, or the web (website enables the vendors to eliminate manifest creation due to EDI).

Delivery is made and a POD is captured. It is faxed back to the company and through digital fax processing it is linked to the order and then available to the client on the web.

Would the last 25 years been as bountiful had this been the case?

Let's say that Ronald Reagan didn't lower taxes. What effect would that had on the innovation and productivity gains of the last 25 years? We may be about to find out. With the democrat party entrenched throughout all levels of government we are hearing a tremendous clamor for new taxes and fees. Not to mention increases in spending. Just have a look at my state, New York. We are about to get a new budget that actually increases both spending and taxes. This is at a time when the prime engine for taxable funds, Wall Street, is in need of not an oil change, but a re-build.

JustThinking        

GATES

Got Another Terminal Error S(darn)t

Mark-to-Market

I read an interesting post by Kevin Drum that I think is filled with inane language that solves nothing.

Why not instead require higher capital ratios in good times (which would reduce leverage and slow down credit expansion) and lower capital ratios in bad times (which would reduce fire sales and encourage banks to expand credit)?

He even states that banks themselves are "so good at lying about the quality and value of their assets, we're better off with a system that gives them as little leeway as possible when it comes to recognizing losses".

Why not be more specific.

How about, we let those financial institutions that are covered by the demands of capital ratios use another mechanism. If instead of immediate mark-to-market we instituted a counter liability on the balance sheet that is amortized (say for 10 years or the life of the asset) and made the liquidity adjustments correspond to the amortization. This would clearly announce that the market has a valuation that differs from that on the balance sheet, but mitigate the immediate impact on the income statement. IF these valuations were adjusted quarterly, then titanic adjustments would not be so devastating to the actual cash liquidity of the entity.

Jim Coburn

Why Process Engineering

The lack of process engineering is one of the main shortcomings of many small, to mid-size, companies today. It is the fact that these organizations have tended to grow their infrastructure around getting tasks done, as opposed to analyzing the business processes involved and resolving them.

To quote from "Beyond Reengineering", by Michael Hammer, "The problems that afflict modern organizations are not task problems. They are process problems. The reason we are slow to deliver results is not that our people are performing their individual tasks slowly and inefficiently ... because some of our people are performing tasks that need not be done at all to achieve the desired result and because we encounter agonizing delays in getting the work from the person who does one task to the person who does the next one."

Process engineering has been a cornerstone of modern management theory of late. Be it Total Quality Management (TQM), qualifying for International Standards Organization (ISO) certification, or adhering to Six Sigma. Today managers are ever eager to improve the functionality and fluidity of their organizations.

This has not been the case for the small, to mid-size, companies that are not littered with MBA's. These organizations tend to be either, extremely entrepreneurial, and, or, overly task structured. And, continually, they are faced with difficult decisions when it comes time to evaluate their organization, or to plan for new growth opportunities.

One of the core problems faced is how can such an organization grow, when it will cost them so much to do so. If they double sales how can they not double their infrastructure?

The answer will very often lie in process engineering. Quite simply a close examination of the tasks that the organization performs to get work done. Often during the examination it is found that such growth is not only feasible with existing personnel, but that sales growth rates could be potentially geometric when compared to infrastructure cost expenditures.

Jim Coburn