In Year of Disasters, Experts Bring Order To Chaos of Relief

Tuesday, November 22nd, 2005

Logistics experts from the private sector are lending their expertise to non-profit relief organizations. From In Year of Disasters, Experts Bring Order To Chaos of Relief:

The first change was simple but crucial — halting the practice of unloading the planes directly into trucks. That’s a classic recipe for tarmac tie-ups: It blocks the landing strips so other planes can’t touch down. ‘They think it’s the most efficient way, but it’s actually the slowest,’ he says. He directed the planes to taxi off the runway to an area where they could be unloaded in a more orderly fashion — their contents transported into organized holding areas for later distribution. The other improvements amounted to the relatively prosaic inventory and warehouse management methods practiced by large shippers.

Why People Hate Economics

Tuesday, November 22nd, 2005

Arnold Kling explains Why People Hate Economics:

Paul Bloom’s essay ‘Is God an Accident?’ in the latest issue of The Atlantic, suggests that humans’ belief in God, Intelligent Design, and the afterlife is an artifact of brain structure. In this essay, I am going to suggest that the same artifact that explains why people are instinctively anti-Darwin explains why they are instinctively anti-economic.

Bloom says that we use one brain mechanism to analyze the physical world, as when we line up a shot on the billiard table. We use another brain mechanism to interact socially, as when we try to get a date for the prom.

[...]

The difference between analytical and social reasoning strikes me as similar to the difference that I once drew between Type C and Type M arguments. I wrote, ‘Type C arguments are about the consequences of policies. Type M arguments are about the alleged motives of individuals who advocate policies.’

[...]

Economics is an attempt to use a type C brain to understand market processes in impersonal terms.

Upscale Experience, Downscale Prices

Tuesday, November 22nd, 2005

Upscale Experience, Downscale Prices examines trends in retailing, including the emergence of lifestyle centers — which I’ve been naively calling outdoor malls:

Open-air pedestrian walkways, dozens of small merchants, no large anchor store. Developers are embracing this format, known as the lifestyle center, as the replacement for outdated enclosed malls.

‘There isn’t going to be this one super-regional mall model that everyone’ constructs, says Mr. Stanek. ‘Consumers have said that rather than going into a one-million-square-foot mall, they’re more interested in getting to specific stores.’

The International Council of Shopping Centers, a trade association, says there are currently 132 lifestyle centers in the U.S. that total nearly 50 million square feet. That’s still small next to the 951 million square feet of enclosed mall space in the U.S. Still, more than 60% of the lifestyle-center square footage has opened since 2000. And 52 more lifestyle centers — totaling 7.3 million square feet — are under construction, according to the council.

Developers often build lifestyle centers in upper-income communities where older, upscale shoppers will be drawn to typical lifestyle-center tenants: Williams-Sonoma, Barnes & Noble, Borders, Gap, Bath & Body Works, Pottery Barn and Victoria’s Secret.

Taking the trend a step further, some developers are building so-called retail districts — which combine office, retail, residential and open spaces — on the sites of demolished older malls. Continuum Partners’ Belmar development in the Denver suburb of Lakewood, Colo., proposes one million square feet of retail space in the lifestyle-center format, 900,000 square feet of office space, nine acres of parks and 1,300 homes. Belmar would sit on the 104-acre site of Lakewood’s former Villa Italia Mall.

‘Once the retailers learn they can survive without the department store,’ says Mark Falcone, Continuum’s CEO, ‘they move into more unconventional formats like these multilevel retail districts.’

What’s Behind the Boom

Tuesday, November 22nd, 2005

What’s Behind the Boom examines some of the longer-term forces that are reshaping the housing industry:

America still has lots of wide-open spaces, but many of them aren’t where people want to live. And builders are finding it more difficult to get permits to put up new houses in many of the more economically vibrant metropolitan areas, particularly along the East and West coasts.

‘The housing supply has been constrained by government regulation as opposed to fundamental geographic limitations,’ concludes a paper released in December 2004 by Edward L. Glaeser, an economics professor at Harvard University, and two colleagues.

Homeowners share the blame. Prof. Glaeser’s paper says they have grown savvier about organizing themselves to block proposals that would bring new and more densely packed housing to their neighborhoods — something that they fear could reduce the value of existing homes.

In the more crowded markets, home values no longer have much to do with the cost of building a home. In San Francisco, the paper estimates, the structure itself typically accounts for no more than 30% of a home’s value; the rest of the value reflects the costs of land and obtaining regulatory approvals to build. That’s why some people pay as much as $1 million for an old home, immediately tear it down and build a new one.

The Mayor of Ar Rutbah

Tuesday, November 22nd, 2005

In The Mayor of Ar Rutbah, James A. Gavrilis describes how his company of Special Forces soldiers established a functioning democracy in one Iraqi town:

As an alternative to Saddam’s regime, the particular form of democracy was not as important as the concept of a polity that provided for the individual. That was really what Iraqis missed under Saddam. Good governance had to precede the form or type of democracy. Because we were effective in providing services, were responsive to individual concerns, and improved their lives, the Iraqis gravitated toward us and the changes we introduced. However, we didn’t have to change much. Ar Rutbah already had a secular structure that worked. We just put good people in office and changed the character of governance, not the entire infrastructure.
[...]
In the end, I spent only about $3,000. This sum included the salaries of the police, the mayor, the army colonel, and a few soldiers and public officials. We paid for the crane and the flatbed trailers to move the generators to the city for electricity, and for fuel to run the generators. And we picked up the tab for other necessities, such as painting, tea, and copies of the renunciation form. But the change did not depend on the influx of funds; the Iraqis did a lot themselves. The real progress was the efficient and decent government and the environment we established. Without a lot of money to invest, we made assessments and established priorities, and talked with the Iraqis, exchanging ideas and visions of the future.

Hellboy Animated

Tuesday, November 22nd, 2005

Tad Stones describes his early efforts to get Hellboy Animated:

I first pitched Hellboy as an animated prime time show about ten years ago while I was still at Disney. (Hey, they claimed they wanted fresh ideas!) I even produced a little video reel on Adobe Premiere, complete with an animated Touchstone logo. No interest, of course. I was given several logical reasons why it wouldn’t really fit on prime time television, most of which can be summed up in the sentence, ‘It’s not The Simpsons.’ Ironically, I now work at Film Roman Studios where the entire first floor is taken up by artists working on The Simpsons.

[...]

Years later I got really close. [...] But as we worked on the show, it became obvious the executives wanted it safer, calmer and much more kid-friendly than the movie. My favorite exec quote: “Why do we need antagonists?” Finally, after the feature film disappointed at the box office, our production was shut down, fittingly, on Friday the 13th.

Now he’s finally getting his chance to do it right.

(Hat tip to Drawn.)

Bad for Business

Tuesday, November 22nd, 2005

In Bad for Business, Hans Labohm cites the opening lines of “Doing Business in 2006 — Creating Jobs”, a report cosponsored by the World Bank and the International Finance Corporation, the private sector arm of the World Bank Group:

If you were opening a new business in Lao PDR, the start-up procedures would take 198 days. If you were opening one in Syria, you would have to put up $61,000 in minimum capital — 51 times the average annual income. If you were building a warehouse in Bosnia and Herzegovina, the fees for utility hook-up and compliance with building regulations would amount to 87 times average income. And if you ran a business in Guatemala, it would take you 1,459 days to resolve a simple dispute in the courts. If you were paying all business taxes in Sierra Leone, they would take 164 percent of your company’s gross profit.

Outsourcing to the Heartland

Tuesday, November 22nd, 2005

Some American firms are outsourcing to the Heartland rather than India:

Rural Sourcing claims to provide information technology services at 30 percent to 50 percent below most U.S. consulting firms by tapping into the increasing number of IT professionals in rural America, where overhead and wages are lower than in metropolitan areas.”

If you need work done in grammatically correct English, should you send it to Bangalore or Greenville, NC? Wait, don’t answer that.

Trusting the teacher in the grey-flannel suit

Monday, November 21st, 2005

The Economist‘s Trusting the teacher in the grey-flannel suit calls Peter Drucker “The one management thinker every educated person should read”:

Along the way, he became increasingly convinced that the best hope for saving civilisation from barbarism lay in the humdrum science of management. He was too sensitive to the thinness of the crust of civilisation to share the classic liberal faith in the market, but too clear-sighted to embrace the growing fashion for big-government solutions. The man in the grey-flannel suit held out more hope for mankind than either the hidden hand or the gentleman in Whitehall.

Aspirin: Not Approvable

Monday, November 21st, 2005

Derek Lowe points out that there’s no way aspirin would be approved today if it were a new drug. In fact, it wouldn’t even make it out of the lab. From Aspirin: Not Approvable:

Aspirin causes gastric lesions in rats and dogs, which are the standard small and large animal models for drug toxicity. This side effect occurs at levels which would raise red flags for any new compound. What would a present-day research organization do about it? If we stipulate that they could determine that aspirin worked by inhibiting cyclooxegenase enzymes, they would surely try to break the vascular effects of the drug apart from its anti-inflammatory effects. They would try to find new compounds that selectively inhibited only one of the enzyme subtypes. They would, in other words, produce Vioxx, and Celebrex, and the other COX-2 inhibitors, and this is just why these drugs were developed.

(Hat tip to Alex Tabarrok.)

The Prodigy Puzzle

Monday, November 21st, 2005

Ann Hulbert’s The Prodigy Puzzle looks at the search for “genius” and how young prodigies have been discovered, researched, and trained over the years.

Now We Call It Marketing

Monday, November 21st, 2005

The Wall Street Journal‘s latest “Eyes on the Road” column, Surf Lessons, has a great line:

Polite Americans no longer indulge in stereotyping. Now, we call it marketing.

Where the Bets Are

Monday, November 21st, 2005

Where the Bets Are looks at the state of venture capital:

The technology world is revving up again as venture capitalists seek out a new batch of young start-ups they hope will become the next Yahoo or eBay.

Through the third quarter, venture capitalists have poured some $16.2 billion into 1,605 deals, according to VentureOne, an industry tracker owned by Dow Jones & Co., publisher of The Wall Street Journal. That’s a far cry from the $95 billion that flowed into start-ups at the height of the tech boom five years ago. But it’s on par with the $21.5 billion invested in 2004 and in keeping with the industry’s historical norms.

This time around, the VCs aren’t looking just to Internet start-ups or biotech firms for hot growth. Many are exploring new markets overseas, as well as underserved sectors such as alternative energy. Many also are placing their bets on more mature companies — start-ups that weathered the tech downturn and now boast a cool new product or, better yet, a profit.

Some trends playing out in VC:

  1. The China Strategy
  2. Clean Tech
  3. Digital Living Room
  4. New Kids on the Block
  5. Rock Stars
  6. Web 2.0
  7. Older and Wiser
  8. Adopting Orphans
  9. Telecom Comeback
  10. Late Exits

Where There Is No Doctor

Monday, November 21st, 2005

David Werner originally wrote Where There Is No Doctor as “a village health care handbook” for rural Mexicans without access to modern medical care.

It has since been translated into English — making it a hit with survivalists preparing for The End of the World as We Know It.

Now it’s available in its entirety on-line — but you’ll probably want a paper copy in case of total social collapse.

The Bakeoff

Monday, November 21st, 2005

In The Bakeoff, Malcolm Gladwell looks at a cookie-baking Dream Team and compares it to a nuclear power plant crew and an open-source software development team:

The strength of the Dream Team — the fact that it had so many smart people on it — was also its weakness: it had too many smart people on it. Size provides expertise. But it also creates friction, and one of the truths Project Delta exposed is that we tend to overestimate the importance of expertise and underestimate the problem of friction. Gary Klein, a decision-making consultant, once examined this issue in depth at a nuclear power plant in North Carolina. In the nineteen-nineties, the power supply used to keep the reactor cool malfunctioned. The plant had to shut down in a hurry, and the shutdown went badly. So the managers brought in Klein’s consulting group to observe as they ran through one of the crisis rehearsals mandated by federal regulators. ‘The drill lasted four hours,’ David Klinger, the lead consultant on the project, recalled. ‘It was in this big operations room, and there were between eighty and eighty-five people involved. We roamed around, and we set up a video camera, because we wanted to make sense of what was happening.’

When the consultants asked people what was going on, though, they couldn’t get any satisfactory answers. ‘Each person only knew a little piece of the puzzle, like the radiation person knew where the radiation was, or the maintenance person would say, ‘I’m trying to get this valve closed,’ ‘ Klinger said. ‘No one had the big picture. We started to ask questions. We said, ‘What is your mission?’ And if the person didn’t have one, we said, ‘Get out.’ There were just too many people. We ended up getting that team down from eighty-five to thirty-five people, and the first thing that happened was that the noise in the room was dramatically reduced.’ The room was quiet and calm enough so that people could easily find those they needed to talk to. ‘At the very end, they had a big drill that the N.R.C. was going to regulate. The regulators said it was one of their hardest drills. And you know what? They aced it.’ Was the plant’s management team smarter with thirty-five people on it than it was with eighty-five? Of course not, but the expertise of those additional fifty people was more than cancelled out by the extra confusion and noise they created.

The open-source movement has had the same problem. The number of people involved can result in enormous friction.