Monthly Archives: March 2006

Annals of globalization

The Bay Area’s tiffin wallas, according to The New York Times:

In Mumbai, formerly Bombay, the tiffin, or lunch, is prepared by the wife, mother or servant of the intended. In the United States, because of little time (and a lack of a domestic staff), many of these lunches are prepared by outsiders, but the underlying principle is the same.

With the spread of these services, Punjabis can have their saag paneer and meat curries; Gujaratis can have their dal, bhat (rice), shak (vegetables) and rotis (flatbreads); and south Indians their rasam (tomato-based curry). And as demand for home-cooked food on the job has increased, so has the number of outlets providing tiffins.

Annadaata, which began as a homespun operation in 2002, has morphed into a business with several delivery people distributing meals each weekday across San Francisco. Kavita Srivathsan, 29, the chief executive of Annadaata, got her start by cooking meals for her new husband and his friends.

I checked Annadaata‘s site and, sadly, they don’t deliver to the East Bay. (We do, however, have Vic’s Chaat House around the corner.)

Countering Silicon Valley triumphalism

Thomas Otter, who works for SAP in Germany, provides some reflections on the value of the company’s “Germanness”, at a time when siren voices are urging it become more “American”. His post was provoked by the coverage of possible unionization of SAP’s workers, but I think the import of his remarks goes far beyond the side issue of trade unions.

As SAP continues to globalise though, I think it is worthwhile to pause and think back to what has made SAP the success it is. A big part of that success comes from that very “Germanness” that is now perceived by some as unfashionable and irrelevant. Discipline, debate, deliberation, diligence, a focus on detail, a healthy skepticism of “marketing blah-blah”, consensus, thorough execution, and a strong ability to self-criticise are key to SAP’s success to date.

Many of the world’s greatest industries were founded within 30 minutes drive of SAP. The first car drove from Mannheim to Pforzheim, or there abouts. Soon after that Benz built the first car garage in Ladenburg. Friedrich Engelhorn’s BASF, the world’s biggest chemical firm, is just across the river. Many of the world’s great philosophers and mathematicians were German: Gauss, Reimann, Hilbert, Jacobi, Kant, Runge, Hegel, Marx and so on. More recently, MP3 is a German invention. SAP is part of a long line of German innovation.

SAP’s german roots are part of its success and its long term competitive advantage. We should not ignore them. As we grow as a global company, we shouldn’t forget that innovation and engineering are at the core of SAP’s success. At the same time, we need to be open to new ideas from abroad and from people from other companies, and adapt to those new ideas and ways of working. Other great German brands, although global, leverage their German heritage. Vorsprung Durch Technik, for example. But Max Weber, another famous Heidelberger , wrote of “The passion for bureaucratisation drives us to despair” and the “the iron cage of bureaucracy”.

I know which Germany I prefer. The SAP and the Germany that attracts people like me is the Germany of innovators, not of stagnators. Those that fear globalisation will not find safety in further bureaucratisation. To compete, innovate and grow we need less rules, not more.

Particularly at a time when Silicon Valley triumphalism is on the rise again, I hope SAP stays true to the Germanness that Otter describes. The notion that there is only one way to spur innovation, that there is only one corporate culture that works in the 21st century, is madness. That’s equally not to say that Rhineland capitalism has a unique claim. We need all the different flavors of enterprise and history shows that innovation and creativity can, given the right circumstances, thrive in each.

I find debates about the superiority of one model of capitalist enterprise over another sterile. In the late ’90s I had modest success travelling to conferences and giving my stump speech: most of the world doesn’t want to be Silicon Valley (and, by the way, even if they want it, they can’t do it). I was equally baffled at Will Hutton’s The State We’re In climbing the bestseller lists. His book pressed for British enterprise to become more Rhenish and less Anglo-Saxon at precisely the time when the German economy was heading south and the US economy was in the middle of one of history’s great upswings.

Let a thousand flowers bloom.

Beware the ides of March

My wife and I occasionally lament that we’ve swapped The Guardian for The New York Times. It’s not that we’re missing much news, it’s that we’re losing bursts of humor and wry cleverness that the serious Times either can’t do or doesn’t deign to do.

If it’s seriousness that you’re looking for, the German papers trump even the Grey Lady (is the Times still called that, now that it has color pictures?). My German is imperfect at best, but I used to goggle at the erudition of sections like the FAZ’s Feuilleton.

Yesterday’s Süddeutsche Zeitung managed nicely to combine great erudition with a sense of humor. For the classically inclined, there’s an Ides of March interview with Wilfried Stroh about Julius Caesar — in Latin (via Adrian Murdoch).

What Clinton had to say

Fon entrepreneur Martin Varsavsky reports on a three-hour dinner conversation with Bill Clinton. He has a lot of interesting material, but here’s a snippet:

President Clinton said that unfortunately the Republicans have the upper hand in using psychology in their campaigning. He offered many examples but one that stuck to mind is the current trend among Republicans to tag Hillary as an “angry woman.” Personally, I met Hillary a few times and would hardly say that she is an “angry” woman; if anything I would say that she is a “concerned” woman. But Clinton went on to explain how the American electorate expect men to be angry but not women and how this label is part of the psychological warfare (my words) that the Republicans are good at. Another very vivid point he made is that this psychological machinery sometimes is used among Republicans against each other. He illustrated this with the attacks made on John McCain, a man as brave as they come, portraying him to be a person not brave enough when it came to pursuing aggressive American Foreign Policy.

"The profound importance of the blogosphere…"

Glenn Greenwald:

The profound importance of the blogosphere is grounded in the fact that the other institutions and safeguards which are supposed to exist as a check on abuses and excesses by the government are rotted and broken. Congress is co-opted, corrupt, and under the control of the Bush Administration; the national Democratic Party is paralyzed by fear, indecision, and a suffocated, or missing, soul; and the role which the media plays is so far removed from what it is intended to be — and from what it has to be in order for us to maintain a healthy and functioning democracy — that one can literally spend every day documenting its gross failures and abuses.

To me, the blogosphere is, at its core, an instrument that is being used by citizens to congregate and figure out ways to create new weapons and competing systems to rectify those failures. For that reason, most people who read and participate in blogs believe that blogs now play an irreplaceably important role in trying to force some measure of change. I certainly believe that.

Brad DeLong, optimist

Somehow, Brad DeLong remains an optimist about the economic outlook. In a talk in Washington, he enumerates the numerous policy failings of the Bush administration, but reckons: “As my grandfather used to say, the Lord protects dogs, children, fools, and the United States of America. We all mourn at the opportunities that have been wasted by the George W. Bush administration, but — so far at least–they are opportunities wasted, nothing much worse.”

Still, Brad has valuable advice for what a government should be doing:

  1. We’re in the up-phase of the business cycle, so we should be running a budget surplus in any event, considerations only reinforced by the unsustainable current-account deficit.
  2. We should be making it very clear that as a deficit country we value foreigners who want to invest in us–that we are grateful rather than xenophobic when we think about foreign capital.
  3. The Federal Reserve should be making it clear that it is more interested in stabilizing measures of domestic prices than of measures that have a high weight on import prices.
  4. International consensus on what to do should market prices move, and should demand for the products of 40 million Asian workers in export industries and 10 million American workers in construction and consumer service industries disappear.

Are any of these things happening?

Still, we’re probably going to be OK. Opportunities, not crises.

The unaligned interests

Mark Cuban writes about how the interests of CEOs and shareholders are very much not in alignment:

There are two types of CEOs, those who are the founders or co-founders of their companies, and those who were hired to do the job. The difference is important because those involved with the founding of their companies not only have a different personal connection with the company and its employees, but more importantly, since they founded the company, they most likely already own a lot of stock.  The motivation of a founding CEO will be money, but there will be other considerations. Sometimes.

Then there are those hired to be CEOs.  What are the goals of hired CEOs ?. Plain and simple, its to get paid. To make as big a chunk of money as they possibly can in the shortest amount of time.  No one in their right mind is going to take on a job with the amount of pressure, stress and away from family time that comes with being the CEO of a public company without getting paid incredible sums of money.

There is an interesting kinship between hired CEOs and professional athletes. Both realize that there are limited opportunities to make the big financial score, and if they dont make it this time through, they may never get the opportunity again.

There isnt a CEO in America with the opportunity to take  the helm of a public corporation that didnt run the numbers in their head and play “what if”. What if the stock went to this price ? What if the stock went to that price?  Then based on the total number they needed to get to the networth they always dreamed of, and  using the CEO pay totals of men or women who had already  done the same  thing to get their current jobs as comps, they  negotiated their deal from there.  Any CEO in this position who tells you otherwise is lying.

Which is why the concept of CEO and shareholders interest being in alignment because they both own stock is a big lie.  The CEO wants to hit the homerun of their career when they take the job, the shareholder just doesnt want to strike out with their life savings.

I’ve written before that I don’t buy the argument that CEOs need to be paid vast sums of money because that’s the market price for great talent. I think a lot of the CEOs I’ve met like the power as much as the money (I’m assuming they’ll get paid what to any normal person is boatloads of money, just not obscene amounts of money). Cuban seems to think the obscene amounts are a necessary enducement for the tsouris of the job. I’m curious to see what he proposes to do about it in the subsequent post he promises.

Disconnect me, please

Bond investor Bill Gross interviewed in Fortune about his work habits: “For a portfolio manager, eliminating the noise is critical. You have to cut the information flow to a minimum level. You could spend your whole day reading different opinions. For me, that means I don’t answer or look at any e-mails I don’t want to. Other than for my wife, I’ll only pick up the phone three or four times a day. I don’t have a cellphone, I don’t have a Black-Berry. My motto is, I don’t want to be connected — I want to be disconnected.” (Usability warning: horrible pop-up frameset needs to be negotiated to get to the individual profiles.)

We certainly all need a way to recover space for uninterrupted thought in our lives. I love connection, but there are chunks of my day — and certainly my week — when I need disconnection. Next time someone asks for your instant judgment, respond, “I’ll sleep on it.” Chances are it’s an expression they haven’t heard in at least a decade.

Lasers:lightbulbs, hedgehogs:foxes

I recently had an email exchange with a well-known, polymathic academic. He regretfully turned down collaborating on a project with me because, he wrote, “I used to be a lightbulb and now I’m a laser.” He’s found a worthy obsession, and that’s where his energies are devoted.

We certainly need lasers, but let’s not neglect the value of lightbulbs. The world, it seems, increasingly favors the hedgehog. I have a soft spot for foxes.