Monthly Archives: September 2010

Lessons From LeBron

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I’m going back a few months, but there’s a story here.  I’m talking about the departure of LeBron James from the Cleveland Cavaliers which left the ownership, and the city, in absolute shock.  Owner Dan Gilbert wrote an open letter to the fans, in which he stated, “You simply don’t deserve this kind of cowardly betrayal. You have given so much and deserve so much more.”

So, what’s the lesson here?  LeBron is a fink?  Dan Gilbert is a jerk?  Cleveland fans deserve what they get (did I say that out loud?).  Nope.  It’s about an employer taking an employee for granted.  Regardless of how much money James makes or that he plays a game that overpays all its players, he’s an employee.  And when the grass is greener (or it appears that way), employees move.

The economy is not as bad as it was a year ago, and in a year it will be better.  Thus, what better time to start thinking about making sure that your “stars” are treated that way.  Robert Half, the staffing firm, did a survey of employed workers and found that 40% are now more inclined to search for opportunities.  Per Heather Ainsworth, who was quoted in a recent online Dallas Business Journal blog, “For a lot of them [employees], they made it through the downturn, and through those times, they were short-staffed and had to take on a bigger workload.  In addition, Ainsworth said, employees have become frosty due to salary freezes and other cutbacks.  The concept of “they should be happy they have a job” is not a long term attitude a company can take.

What’s the solution?

Start by doing an internal review of your employee teams with your key managers .  Yes, at this point, they’re all keepers, but which ones do you really need to keep?  How does their compensation and benefits match up with their peers?  (MidAmerica’s Annual Wage & Benefit Survey can help).  Have you invested in their training and helping them grow their talents?  Also, it never hurts to find out what motivates them.  In some cases (especially now) it could mean more money, or possibly more time-off.  Determine which one works the best — and it’s not the same for everyone.

Regardless, don’t assume, as Mr. Gilbert did, that your star(s) is going to stay with you forever and take your basketball team to the NBA promised land.

USPS Proposed Rate Increase

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Unless you’ve been sleeping under a rock or with Rip Van Winkle, you are probably aware of the recent request by the USPS for a “emergency” rate increase .  There was a good Op-Ed piece written in today’s Wall Street Journal that summarizes many of the issues.   The Affordable Mail Alliance, a coalition of many firms and organizations who utilize the USPS delivery system, has taken a very proactive role in trying to derail this train.  If your business relies on the USPS — and whose business doesn’t — this is something you truly need to look into.  This “emergency” rate increase allows the USPS to ignore its fundamental problem, that it’s infrastructure is bloated and its labor costs are totally out of line.

If you are involved with direct mail, its creation or production, read the comments on the WSJ article, and you’ll see another issue print has to fight.  Relevancy.

Washington D.C. — UPDATE

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I was in Washington D.C. this past week, and the city’s mood had a unique feel.  It’s always about politics in this city which breaths and lives political intrigue and policy wonkiness, but there was a feeling that there were going to be significant changes in November.  The Republicans were starting to count the days until the elections and the potential for talking control of the House, with a slight possibility of controlling the Senate.  Democrats were jumping ship from President Obama’s tax proposals and rifts were occurring within the Republican Party as a variety of primaries were being heavily influenced by the Tea Party (Delaware’s  O’Donnell upset main-line Republican Mike Castle).

Why was I in Washington?  Every two years PIA hosts a legislative conference, which brings together PIA members and staff from across the U.S., so they can meet with legislators and voice our industry’s concerns.   Most of the meetings were with Republican congressional representatives with a smattering of Blue Dog democrats.  Why these groups?  It’s just a matter of interests.  Folks who sit on the Democratic side of the aisle normally don’t regard business issues as something that’s important to them and their constituents. That’s just a sad fact of life for the printing industry.  So, we meet with the folks who are willing to listen to our issues – which are small business ones.

Our industry targeted several areas, but there were two key ones – the postal exigency rate case and taxes.  As many know, the postal exigency rate case has created a massive response from publishers, printers and mailers.  Never before have we seen the kind of reaction from this community.  It is felt by the mailing/printing community this increase, which far exceeds the limits set by the 2006 postal reform legislation, could be a precedent setting situation.  In affect, allowing the USPS to increase rates on a regular basis without dealing with their fundamental structural issues– a structure that is not balanced with mail volume.  Granted Postmaster Potter has been able to reduce costs over the past few years – but he still has a long way to go with a system where 80% of its costs are labor.

Although not really a legislative issue, Congress can help the USPS reduce its costs.  One of the solutions lies in the way retirement benefits have been calculated and funded.   The other resolution is restructuring the infrastructure.  There are many postal centers and retail outlets that should be/must be shuttered, but the pressure congress will feel from labor and constituents to keep them open  will be tremendous.  Last week our industry’s message to over 80 members of Congress was that postal rate increases can not continue in this vein.  In the long term it is damaging to commerce, because it is business that really uses the mail system.  The days of Aunt Gracie sending letters to her nephews and nieces via mail has gone the way of the Betamax.

Taxes are another issue of concern. Much of what our industry voiced was nothing new to the Members of Congress.  With 50% of small business potentially impacted with the Administration’s proposal to exclude the “wealthy” from the Bush tax cuts, and the “death” tax rolling back to $1MM exclusion and a 55% tax rate, none of this is palatable to small businesses.  And the Members of Congress we spoke to understand these issues.

Another area of concern, which was voiced strongly by many of our PIA members, was in regards to the President’s proposed small business “relief.”  Almost every company owner in attendance stated that pumping federal money through the banks is not going to solve the problem.  The banks have the money; it’s the regulators who are leaning on them, or the specter of more regulations which doesn’t provide many banks the appropriate incentives.  As one printer said, “in today’s highly competitive marketplace, there’s no way I can come up with a 30-40% down payment to buy a major piece of equipment – and that’s limiting my ability to grow my business.”  As well as adding employees, which tends to be the magic words everyone in Congress wants to hear.

Did everyone hear the message?  Yes.  Did they all agree with our positions?  Not necessarily, but that’s the way our system works.  There are always two sides to the story – and it’s important to tell our industry’s.  Case in point was that most of the legislative staffers (occasionally you speak to an elected leader) we spoke to knew about the postal exigency rate case.  The reason being that the USPS had been talking to them as well as the USPS labor unions.  We were the first business group speaking to them who opposed the increase and the negative impact it would have to the users of the mail system — and that’s the way our legislative process works.  If you’re not at the table, you don’t get fed.

Fortunately, we have professionals like Lisbeth Lyons and Julie Riccio who represent our industry in Washington D.C. — but they can’t do it alone.   Become informed.  Ask questions.  And remember, Lisbeth, Julie, and the various PIA staffers can not do it alone — they need your help.  So, next time you are upset about issues, find a way to get to the table.  It might be picking up the phone and calling your legislator or  inviting him/her to visit your plant.  Maybe you can attend the next Legislative Conference, or  maybe it’s time to make a contribution to PrintPAC so we can ensure that our industry’s voice is heard.

Thoughts from 36,000 Feet

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Like many folks who are stuck in a metal tube traveling at 500 miles an hour, boredom begins to set in – so why not sit down and write errant thoughts, which will hopefully make sense at a later time.  Here it goes.

The industry lost an iconoclastic voice this past week with the death of Dick Gorelick, one of the industry’s true marketing consultants.  Dick wrote a bi-monthly newsletter which he shared with several of the affiliates – and we used his thoughts liberally.  Most of Dick’s writings weren’t very friendly to the industry associations or the post office (his favorite target – after the airlines). Sometimes it hurt to read what he was saying – but there was a lot of truth in those comments.  More importantly he challenged his clients to find ways to differentiate their business in other ways than buying more equipment.  His voice will be missed.

I’m headed to Washington D.C., as the Print Council’s Ben Cooper used to title “Fantasyland on the Potomac.”  For those of us who follow our nation’s politics, I’ve become somewhat jaded over the past decade as I’ve seen polarization set in, which is not good for this country regardless of what side of the aisle you sit.  Regardless, it’s important that our voices are heard – today more than ever before.  And I challenge anyone reading this column to become active in learning about the real issues – not just what the talking heads or bloggers opine about.  More importantly make sure that your legislators hear your voice.  As a business owner, or as an employee in a small business your voice needs to be heard.  So, stand up!

Once this trip ends, I’m headed to Los Angeles. My father passed away two weeks ago, and we are putting his ashes to rest this coming Friday.  My wife and are the black sheep of the family.  We packed up our belongings and my parents first grand child and moved to Texas 32 years ago.  Liz and I are now the only non-residents of California (both my kids now live in SoCal, as the locals refer to that part of the Left Coast).  My dad was a blue-collar guy and union member, which led to some interesting conversations over the years.  But he listened and attempted to understand his “errant” son’s pro business approach.  More importantly he understood that the unions had lost their way as they became more entrenched in being an organization rather than working on behalf of their constituency.  That’s where he and I saw eye-to-eye. I will miss those conversations, which ended years ago as Alzheimer’s ravaged his memory and eventually took his life.  Your voice will always be with me Dad.

On another note of interest, we are beginning to see a flurry of business consolidations.  And there’s more to come.  Many company owners are coming to the realization that things are not going to get “better” as in the past.  Thus, some are considering exiting the industry while others are looking for ways to “acquire” sales.  In our industry, one which has a tremendous amount of overcapacity and “old” technologies, acquiring a business really means finding a way to add sales – equipment has no value. The real challenge is for the owner of the “selling” company to understand that his/her business no longer has the same value as it might have 5-10 years ago,  It’s not an easy pill to swallow.

Swimming in the Potomac

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In my last blog, I wrote about the upcoming PIA Legislative Conference — which starts tomorrow.  Since I’ll be in D.C. for most of this week, I guess I’ll share various thoughts of a political nature over the next several days.  But first, I want to say that the industry lost an iconoclastic voice this past weekend.  Dick Gorelick passed away on Sunday.   Not everyone cared to hear what Dick had to say — sometimes because he was very outspoken and frequently took a very contrarian view.  And that’s what made Dick so interesting to read and/or speak with.  He will be missed.

Wonderful Day For a Swim

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North Texas is dealing with the remnants of hurricane Hermine, which translates into a lot of rain and traffic congestion.  I was slowly making my way into the office this morning listening to my usual updates re: political issues.  Of course, the talk was about the President’s upcoming proposal to help stimulate business and the contrarian perspectives from the Republicans.  As with the traffic patterns being brought to a halt by the rain, I see the same pattern with our economy.

Until the rain stops, traffic will not get better.  Until Washington stops messing with taxes and the economy, business will not improve.  It’s the unknown which slows business decisions.  And with all the proposals in the pipeline (tax changes, health care, cap & trade, more stimulus, etc.), business is not about to start spending – and the same goes for the consumer.  So, the question remains, how do we get our leaders in Washington to get it?

Next week many of our industry’s leaders will have that chance by participating in Printing Industries of America’s Print’s Voice 2010 in Washington D.C.   Yes, sometimes it seems futile talking to our Congressman and Senators – but the alternative is that they will never hear about our concerns, and that’s a scary thought.  So, come on in the water’s fine!

Regulations – Making Them Work

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Just finished meeting with our Clean Air Committee to discuss the upcoming regulations which impact our industry in Dallas/Fort Worth and Houston next year.  The industry if facing some significant changes next year and I’m always amazed how much willingness there is for the industry to try to do the right thing.  The challenge is trying to get the regulators to understand that documentation for documentation’s sake is not the solution.

Our biggest issue is not the requirements to use chemistry that helps reduce ozone — which has a dramatic impact on a company’s productivity/profitability.  It’s the regulatory hoops which must be jumped so the regulating community can “document” that the “rules” were followed.   It’s one of the major frustrations between the regulated community and the regulators.  If it’s not documented, it didn’t happen.  Yet, if one makes the rules so onerous — businesses are less willing to comply.  It’s a fine balancing act.  It’s also an argument at the heart of the recent litigation between Texas and the EPA.  Ah, such a tangled weave.