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Wednesday, October 18, 2006

Business 101

I'm not in the advice business. I'm willing to talk about what I'm doing. That's different.

I have no formal business training. I'm not sure it matters much. It would be nice if they could train you to be able to run something effectively right out of the gate, but it seems unlikely. All the advice I got from business educated persons while running businesses wasn't just worthless, it was actively bad.

It may be because I've always been in the construction industry, more or less. It's different in many respects from other industries. When I went to college, there was no such thing as Construction Management. It was a blue collar profession right to the top.

I read Adam Smith and F. A. Hayek to get the big picture. I have no use for Keynesians or Marxists. Keynes says bang on the side of the TV to get a good picture. Marx says steal the TV, and then break it so no one can watch it. Then we'll all be happy. The world doesn't work that way. As far as getting the small picture, I just paid attention. I've learned some harsh lessons along the way, but never as bad as educated persons did alongside me. I've seen some colossal errors made due to hubris. I just plug away, generally. I've always made the most money doing things most everyone thought was crazy when I began. I could fit it on one page in pencil and all the numbers added up. That kind of crazy.

I have absolutely no use for show-biz management. Lee Iacocca and Donald Trump and all those guys with the laser pointers and the Rah Rah speech couldn't find their ass with a map and flashlight in the real world. They either build houses of cards and sell them before the wind blows, or allow you to point a camera at them while they run things into the ground for amusement. That's why they're telling you how to do it at $450.00 a ticket in a seminar. It beats working.

When I was working at a large commercial construction company, every once in a while, I'd be sitting in a meeting room with a fat sheath of figures of doubtful accuracy and utility, pressed into my hand by some inkstained wretch who had the BIG ANSWER. Move things from column A to column H, and all would be well. Institute Protocol F to counter Bad Behavior M and we'll lay in the clover. Make Target X and Bank C will give us a toaster.

"You do realize that something happens outside of this building, don't you?" I'd ask.

These gentlemen thought that the building of large and complicated things out in the landscape from Canada to Florida and Martha's Vineyard to Sausalito existed simply to give them figures to Rubik around on their desktop. They did not realize that they existed to support the actual operation. They thought they were the actual operation. Everyone in the government makes this same mistake, 25 hours a day, 11 days a week, by the way. A quarter of a billion dollars was going through that business a year. Very few of my colleagues had ever seen one bit of it generated.

They ran that place into the ground.

I was a middle manager. I helped make them a lot of money while everyone else lost it by the bushel. They hired consultants to restructure, and the consultants were instructed to ask me how I did it. I sat in front of them and got the same feeling an ugly puppy must get when the vivisectionist visits the dog pound. Some things are not amenable to being pulled apart for inspection. The components only work when they are working together.

I told them I didn't do anything. I let other people do it. I told them that when the customers called, we always answered the phone, and asked them what they wanted. I told the estimators to accurately determine what it would cost us to perform the required work. I submitted the bids on time and told the customer I wanted the job. If they said someone else was cheaper I instructed them to hire them, and to please keep us in mind for the future. I kept accurate track of how we were doing, and made sure we charged for all the work we performed. And I directed that we deliver the jobs on-time no matter what. When I ran out of one kind of work, I looked for work that was similar to the kind we already knew how to do. I hired good people and I trusted them, while expecting a lot from them.

That was it. They seemed disappointed. They were looking for a slogan of some sort, I think. They promoted me, and I left.

I'm trying every day to make the thing I made yesterday, only better. Or faster. Better and faster is even better. If I can't make money at it, I am disinterested in giving a congressman $1000 to get a set-aside for me, or a law passed against my competition. I'll do something else. The market is wise because the market is everybody's wisdom together. The market will tell me what to do. The customers tell me what to do. I listen imperfectly, because I am imperfect, but I get it eventually. I'm going too slow, and doing a poor job, but it's always getting better.

I show up every day, and work as hard and as smart as I can. I've been told that this pays off in the long run.

Who told me that? Why, everyone that has nothing to do with the government, a university, or a newspaper or television, that's who.

8 comments:

Pastor_Jeff said...

Ah, we are in agreement on Louis Jordan and catchy business slogans.

Reminds me of another favorite Demotivational poster.

And did you know KPMG has a theme song?

"KPMG,
We're strong as can be,
A team of power and energy;
We go for the gold,
Together we hold
Onto our vision of global strategy"

I cannot tell you how much I do not miss the corporate world.

Icepick said...

Jeff, as someone who worked in consulting, I take that poster as a compliment!

Walrus said...

Not just government and business. I can assure you from both personal and second-hand observations that college and university administrations are afflicted with precisely the same disease.

One college I worked at had an employee newsletter. New office personnel got an entire page devoted to them. New teachers, a brief paragraph. Students? There are students here?

In my primitive way of thinking, a school exists for the sake of the students. They are there to gain knowledge, or at least to learn the ways of acquiring it. The prime agents in this process are the teachers. Everybody else is there in a support role.

Not.

Oh, I love the use of "Rubik" as a verb. Sheer genius. I shall definitely plagiarize at the earliest opportunity.

Pastor_Jeff said...

Icepick --

I think the Andrews Sisters put it best: "Nice work if you can get it"

SippicanCottage said...

Walrus- You've caught me. I coined the term Rubik because I was trying to think of le mot juste to stick in there, and nothing did justice to the idea. By "caught", I am admitting that I got a little frisson when it came to me.

I've been told that you're supposed to find the thing in your writing that you are most proud of, and labored over to perfection, and strike it out.

I'm glad you liked it, and I left it.

In four long years at the job I mentioned, the only persons I enjoyed talking to were the the consultants that disemboweled the whole thing.

I am grateful for the thoughtful comments.

Icepick said...

All of this makes me want to blog about some of my past work experiences. Jeff, I would say that consulting is interesting work if you can get it, not necessarily good. (Unless, of course, you define 'good' as 'well-compensated'.)

Ron said...

The best remark I ever had from a boss for whom computer programming might as have been augery, was "I don't know what you do, but I know how to punish you."

Thanks again, Sippican, for another intelligent, beautifully expressed post.

Pastor_Jeff said...

Icepick -- I had friends, a couple actually, who both worked for Arthur Andersen. It's not easy work. There can be a useful role for outsiders to come in and help people see things about the business they can't see because they're too close to it.

But a lot of it seems like therapy -- telling you what you already know but aren't doing. Larded with catchy slogans.

I'd be interested to read your consulting blogging.