Silent EXPLOSION…More stroke notes

I’ve been hit hard–concussed–playing rugby; and I’ve been in serious car accidents.  I was in all cases aware that a major event was happening.  I braced for some pain, and it came.With stroke, I woke up, and it had happened.It was like an explosion went off in my head while I wasn’t looking, blowing away most of the furniture in the room, and blowing the windows out, but there was no noise,no big blast.  They say that denial is one of the typical symptoms of a right-side stroke, and I can see why. —Except for the damage, it’s hard to understand that something huge and devastating happened.Then, as you gradually learn what occurred, and you come to understand how serious and long-term a Traumatic Brain Injury (TBI) is, it floors you.  Goodbye, denial!

Most of the damage occurred for me while I was unconscious.  It started with a drfting off—the sensation of falling into an abyss–on the left side; and then I remember lying on the floor, flopping around like a fish on a dock, my left arm like a stubby flipper, unable to sit up.The effects are long-lasting, and they require ongoing work and therapy.  Progress, not perfection, is the goal each day.

 

 

The PROMOTION METRIC

Product companies produce things. Service companies produce people at the right place at the right time with the right skills and tools to provide an effective service for customers.  To evaluate a service organization, it is critical to assess the morale of the workforce.

IN an earlier post, “Organic v. Commodity Growth,” we mentioned how  organic growth creates jobs within the organiazation, while “growth ” by acquisition creates  horizontal pressure on jobs.  When genuine growth is created by new sales, the organization expands vertically.  Higher- level technical and management jobs are created.  This in turn creates promotional opportunities for current employees.

Promotions are a rare occurance in an individual’s career.  They are life-changing events, creating not only a nice salary increase, but also a whole new career ceiling.  Promotions create high levels of job satisfaction.  If we are achieving  significant real revenue growth–say,20%+–then we should be able to sustain a promotion rate of at least 10%.

An unfortunate tendency that has been around forever is that sometimes weaker managers will block promotion opportunities for a high-performing employee–because they selfishly do not want to lose the employee’s productivity.   Healthy organizations protect against this behavior.  Heathy organizations have consistently high promotion rates, created by effective HR management and genuine growth.

Promotion rate is a useful metric to measure the morale and motivation levels within a service organization.

 

 

 

 

 

MY LEFT HAND HAS NO EARS….. (but I talk to it anyway)

ON JULY 17th I had a major stroke on the   right side, mid-brain.I lost use of my left hand and leg, and my cognitive skills were scrambled quite a bit.

So,my left hand just lays there..It won’t respond to the thoughts or instructions that my brain sends to it…. I look at it, trying to will it to move, I talk to it, urging it to move, to grasp, to make a fist.I talk to it, even though it has no way o f hearing me.   And then it occurred to me–We talk to lots of things that have no ears.  We talk to the television, to cars on the highway,to golf balls,to cue balls,our computer, and all sorts of inanimate objects.My conclusion is that we are, of course, talking primarily to ourselves all this time–either affirmingwhat we believe and/or hope, or venting frustration to the world’s big ear. We’re trying to be brave and be heard.

 

Recovering from a stroke takes all the bravery that you AND your loved ones have.Softness in your brain where things used to be sharp causes gaps in communicating  and perception.I was fortunate to spend some time in a great rehab facility, the Healthsouth Rehabilitation Hospital in Reading,PA, a place with lots of caring folks who know how recovery works.(www. healthsouthreading.com.)

 

The upside–the benefit– of the stroke is that it provides a great opportnity to evaluate, and to understand what is truly important in your life.   When a good chunk of who you are is taken away, you see what you were with new clarity.  Typing one-handed is slow, and it slows the thought process in writing, but I just read back over some of the comments that you have bee kind enough to send, and i’mgoing to keep at it.  Thanks.

 

 

 

 

 

East Penn Energy Solutions and Blazing Systems LLC announce launch of: http://www.epenergysolutions.com

 

Boyertown, Pa – August 10th, 2011 –  Energy audits are a fast growing and vital portion of environmental and economic cost saving initiatives.  East Penn Energy Solutions serves homeowners and builders throughout the Delaware Valley.  The site offers information and answers questions surrounding Energy Audits and what homeowners and builders need to know.

 

“We are excited by the opportunity to spread information on how to save money on energy costs for our regions builders and home owners. Over the next months we will be adding even more material and information.” W. David Wallace President East Penn Energy Solutions LLC.

 

“Epenergysolutions.com utilizes the best in class wordpress back end software which makes it easy for content and information to be added quickly and as news breaks. “ Will Patch, Partner Blazing Systems LLC

 

 

East Penn Energy Solutions LLC is committed to energy conservation for the home owner.  We perform home energy audits to identify ways to improve your comfort in your house while reducing your monthly utility costs.  With our recommendations you can soon be on your way to cost savings and a comfortable house.  We look at your house as a “Whole House System” and can identify heat loss and gain and can recommend upgrades for increased performance, efficiency and savings.

 

Blazing Systems LLC is an Open Source developer, an Applications Services Provider (ASP), providing web-based software as a service (SaaS.)  Expertise & Tools: PHP, Python, Javascript, SQL, XML, HTML, Postgresql, MYSQL, Linux, Mac OSX, and Windows.  We are partnered with  Rackspace, who provides processing, storage, hosting, security, backup, availaibility, systems administration, and support services.

 

Blazing Systems is a family-owned and operated company, a partnership, with over 60 years experience in the technology industry among the partners.

 

Great Expectations

Expectations are powerful, and they affect our lives all day every day. High expectations are combinations of hope, optimism, and trust.

Negative expectations are based primarily on fears.

We set ourselves up for reality by expecting it to be either good or bad. When it happens and it’s better than our expectation, it’s a pleasant surprise.

Since the mid-’80s service companies have understood that customer satisfaction is tied directly to the customer’s expectation. If the service delivered meets or exceeds the customer’s expectation, then customer satisfaction has been achieved. The term ‘exceed expectations’ has become an idiom.

Negative expectations can also influence outcomes. Sociologist Robert K. Merton is credited with coining the term “self-fulfilling prophesy.”

In his book, Social Structure and Social Theory, Merton says, “The self-fulfilling prophecy is, in the beginning, a false definition of the situation evoking a new behaviour which makes the original false conception come ‘true’. This specious validity of the self-fulfilling prophecy perpetuates a reign of error. For the prophet will cite the actual course of events as proof that he was right from the very beginning.”

Examples of self-fulfilling prophesy happen many times in daily life. Every year it impacts grade school students, for example:

Little Johnny does ok in first grade, but he fidgets at his desk and talks a lot. At the end of the year, the first grade teacher notes these behaviors in Johnny’s record.

In August the second grade teacher is reviewing the students for the upcoming year, and Johnny’s behaviors in first grade are noted.

The second grade teacher decides to deal with Johnny right off the bat, and assigns him to the desk right in front of the teacher’s. His behavior is scrutinized by the teacher, more so than the other students’, and the first time Johnny fidgets or talks, the teacher comes down hard.

Pretty soon, Johnny starts forming his own expectations.

The Price is Right?

Pricing high-end technology services is a complex process, and it’s different from pricing a product.

When you price a program for services, all the costs have yet to be incurred.  With a product, the costs have been spent, and the margin can be more easily determined.

Sophisticated service organizations utilize complex algorithms and modeling to predict costs that will be incurred to deliver service.  There are lots of averages and metrics applied to the process:  The average time between failures, the average time to restore, the average cost of the labor component, the travel.  Unfortunately, some of these complex methodologies end up reducing the forest to the trees, and as a result services pricing is more art than science. We tend to me more inward-looking, and price according to our costs–rather than focusing on the market and what the customer will pay.

A true story from about 25 years ago illustrates this point, and a couple others:

The owner of a jewelry store in Santa Fe, NM, took a large inventory position in high-end turquoise and silver jewelry made by a leading local artisan.  Unlike the stuff sold on the roadside in the Southwest, this was very high-quality art jewelry.  She displayed it in one of the regular cases in her store, priced moderately.

For weeks the line did not move.  She moved it into the feature showcase in the center of the store, and featured some information about the artist.  The jewelry still didn’t move.

She was getting ready to go on a 3-week vacation, and she was reviewing the various items to be done around the store with her assistant.  Among the other items, she told the assistant to cut the price of the jewelry in half–she had decided to cut her losses and move out the inventory.

When she returned from her vacation, she noticed that virtually all the art jewelry had sold.  She mentioned to her assistant that it was a shame to have to lower the price to move it, but at least it was gone.

The assistant was surprised.  She informed the owner that she had misunderstood, and instead of cutting the price in half, she had doubled the price.

It is ingrained in each of us, “You get what you pay for.”

People expect to pay a reasonable price for quality services.

Nobody wants a “cheap” turquoise bracelet.

 

INDEPENDENT Service

As we celebrate our national independence, it’s a good time to reflect on benefits of Independent Service.  Today we take for granted the freedom to choose our service provider for computers and medical equipment.  It wasn’t always so…

In late 1969 Control Data (CDC) launched a venture called “Comma.”  At the same time MAI launched “Sorbus.”  Until that point the company who manufactured and sold the product also provided the post-sale support.  Period.

This obviously limited customer options for migration and change.  Service served as an effective account control tactic.  The early Independent Service Organizations (ISOs) broke that control by offering service on primarily IBM equipment.

The ISOs (or 3rd-Party Maintenance Companies, as they were first known) flourished through the 70s, and into the late-80s.  In 1987 IBM declared “The Year of the Customer.”  Major customers were signed to NDAs and given 5-year contracts with drastic price reductions.  About $1B went off the IBM service revenue for the year.  (Of course ISOs immediately countered with, ‘If this is the year of the customer, what’s next year going to be…The Empire Strikes Back?’)

IBM went on to suffer some tough years in the early 90s, but then recovered, partly because IBM developed an effective, win/win, business model for co-existing with independent service companies.

By the 90s every major IT manufacturer was engaged in a “multivendor” service strategy, competing directly with the independents, but the existence of an alternative for support helped fuel the growth of open systems, and the cat was out of the bag.

Today, ISOs provide unique advantages over manufactuers’ services:

The infrastructure/cost structure of an ISO is totally and solely devoted to direct customer service productivity…Service is the ONLY business.  In OEMs the service organization absorbs costs from the manufacturing and product sales side of the house.

ISOs can be selective about what products they maintain.  OEM service organizations have to service EVERY product the company produces, in EVERY town and hamlet they sell the product.

ISOs are customer-, not product-, driven.

The existence of an alternative helps customers get better deals and service from their OEM service providers.

By their nature, Independent Service Organizations produce benefits for clients of high-end technology products…So happy 42nd birthday!

 

Organic vs Commodity Growth

Growth by acquisition has been a viable strategy in the technology service industry for decades, and there are some large “roll-up” plays currently active in the industry.

Growth by internal sales is hard work.  Selling service is harder than it looks.  When you’re selling a product, you’re selling a thing.  It is +85 concrete, real, you can take a picture of it, you can demo it working.

When you’re selling a service, you’re selling a promise.  It’s intangible.  Like beauty, it is in the eye of the beholder.  This requires a much more sophisticated sales model, worked by highly-skilled folks.

A services acquisition involves people (customers & employees).  The retention rate of the revenue of the base acquired is directly proportional to how well the acquired business is integrated.  An acquisition brings in a new culture.  Acquired workforces create horizontal pressure in the organization.

Internal sales growth extends the structure and staffing incrementally, driven by revenue increases.  Internally-driven sales extends the current culture.  Internal growth stretches the workforce and provides promotional opportunities.

There are some interesting parallels in Search Engine Optimization (SEO) marketing.  Pay-per-click commodity programs can acquire immediate results, while organic programs create long-term equity.

Service organizations are best served with a strategy that blends organic and commodity growth.

 

 

 

Housing Headlines

Within the last two weeks we’ve heard from a variety of sources on the ongoing real estate/housing market saga.  The Federal Reserve, Harvard University, and Long & Foster, the largest privately-owned real estate company in the U.S., all weighed in on the current state of the market.

The Federal Reserve Beige Book, June 8th, for the Philadelphia District, says:

“Looking ahead, residential real estate agents expect sales for this year as a whole to be level with last year. An agent who remarked that “we are off the bottom, but it’s going to be a slow comeback” expressed a common opinion.” http://www.federalreserve.gov/fomc/beigebook/2011/20110608/3.htm

On June 10th, the Harvard University Joint Center for Housing Studies released their annual “State of the Nation’s Housing 2011” report.  The headings in the executive summary tell the story:  “The Rocky Road To Recovery,” “Uncertainty in the Homeowner Market,” “Rental Rebound,” and “Affordability Problems Creeping Up the Income Scale.”

The Harvard studies includes lots of demographics–all of which are negative indicators for the homeowner market, which has declined 2% in the last seven years.  Immigration is lower, family formation is lower, utility costs are eliminating some potential home buyers, income is lagging.  Cheerful stuff. http://www.jchs.harvard.edu/publications/markets/son2011/index.htm


And then there’s the news from Long & Foster.  The Philadelphia Region, headed by Vice President Art Herling, a Blazing Systems client, reported a 12% increase in unit sales in May compared to last year.

“Quite a few of our offices have experienced not only an increase in units this May, but also their sales volume jumped as compared to May 2010.” Herling went on to cite rises in prices in April and May, as a positive sign of recovery.

“Since the year 2000, the median price of a home in the Philadelphia metropolitan area has risen 70%, and has dropped only 7% from the peak year of 2007,” added Art.

Long & Foster attributed some of their success to the use of technology.  (Long & Foster news release, 06/10/11).  Art Herling’s website, http://www.phlfp.com/, designed, developed, and hosted by Blazing Systems, features the company’s leading map search IDX system for lead generation, and a quick search and rotating featured properties on the Home Page.

****What can we learn from all this?

Effective use of technology can provide competitive advantage, even in the most extreme of market conditions.

 

Privacy & Piracy

Pirates and Privates…It seems we are hearing more and viagr a pfizer more about these subjects lately.  From famous people taking & sending pictures of themselves, to teachers writing about how bad the students and parents are, to bullying campaigns on Facebook, to Wikileaks and actual bandit pirates on the high seas…

Texts are written, pictures are sent, videos go viral…The ability to publish is now firmly in the hands of anyone with a cell phone…

It’s not that it’s new…Even pre-Internet, content and images were being recorded and archived…Recent events reminded me of an incident that happened over 30 years ago…It seems that one employee, a male, had a “crush” on a female employee.  He left various anonymous notes in her desk over the course of 3 weeks, and then left a picture of himself, taken with a Xerox machine.  As it turns out, she was not so impressed by his picture, and the local sex crimes unit was able to match the handwriting on his job application to the notes.

What’s new is how easy it is.  That guy had to go to  a lot of trouble to get a good shot of himself on the Xerox machine.  Now, one click anywhere.  And it’s so easy to send…no making copies or addressing envelopes…just hit send and away it goes…Away it went…Sometimes not enough time spent thinking with the big head before hitting the send button…

So, by now everyone must understand that all of their texts, emails, photos, posts, contacts, google searches, and purchases, are recorded, and archived, forever.

We advise our clients to consider email as public, rather than private, communication.  If you wouldn’t want to see it on a billboard, then don’t send it.