Isegoria

Fast Company writes about American Apparel's New Image — it went from emphasizing its “ethical” sweatshop-free production to “sexy T-shirts for young people” — but what interested me was its new internal emphasis on efficient operations:

The company’s — and Charney’s — image had gotten so much attention that nobody seemed to bother checking into how its actual business might have changed. So I met with Marty Bailey, the company’s vice president of operations. Quiet, serious, soft-spoken, and fully clothed, Bailey was an industry veteran who had begun his long education in manufacturing efficiency — and the hard realities of globalization — with Fruit of the Loom more than 20 years earlier. He had come to see offshore outsourcing as a mixed proposition. He believed that its promised labor savings had been diluted by the costs of moving materials to the cheap-labor haven and back, and by sacrificed quality. He believed that with the right plan, a U.S. manufacturer could still make money.

American Apparel’s factory was, he reckoned, the 41st manufacturing facility he had walked into with the mission of improving efficiency. The company was producing 32,000 pieces a day and struggling to keep up with orders. In months, Bailey’s system was churning out 90,000 pieces a day and would eventually reach 250,000. While the company was projecting an air of almost reckless decadence in its ads, it was quietly building a thriving made-in-America business model.

Bradford Plumer looks at The End Of Aviation, as envisioned by Anthony Perl and Richard Gilbert, two Canadian transportation experts, in their new book Transport Revolutions:

[They] envision a world in which rising oil prices have reduced domestic flying in the United States roughly 40 percent by 2025 — even assuming that airlines improve fuel efficiency by about 50 percent. In such a scenario, the United States could go from having nearly 400 primary airports down to 50 or so; instead of dozens of flights each day between New York and San Francisco carrying 200 people apiece, there might be only a handful carrying 800 or more in new extra-jumbo jets.

Joel Spolsky explains how he learned to love middle managers — but first, of course, he explains why he ever doubted their value, starting with his own first experience as a low-level manager at Juno:

I was proud to start getting those mass e-mails that were circulated among the managers.

Until I noticed about half the company was on that distribution list.

For a company of Juno’s size — it had about 150 employees at the time — there seemed to be a disproportional number of managers. I think most of them, like me, had only one or two people reporting to them. But it was hard to know for sure, because the org chart wasn’t circulated; apparently, Juno’s top brass were afraid it would fall into the hands of headhunters. So you knew your boss and your team, but unless you were a smoker, you didn’t know any of the people in the other parts of the company.

Unless you were a smoker. I love that bit.

Here’s what really bothered him though:

I noticed too many situations in which members of top management happily issued an executive fiat even though they were the least qualified to make a decision. I’m not saying that they were stupid, mind you. Most of the managers at Juno were quite smart. But they had hired even smarter people to work for them: people with advanced degrees, raw intellectual firepower, and years of experience. And these people would work on a problem for a long time, come up with a pretty good solution, and then watch in surprise as their bosses overruled them. Executives who did not have specific technical knowledge and who had not studied a problem in depth would swoop down and issue some random, uninformed decree, and it would be implemented — often with farcical results. I called it hit-and-run micromanagement, and I suspected that the managers at Juno acted this way only because many of them were young, and that’s how bosses seemed to behave on TV.

His experience at Microsoft was better:

A bit of Redmond lore: Two software designers got into a debate over how something should be implemented. The question was highly technical. They couldn’t reach agreement, so they went to their boss, a guy named Mike Maples, who was the vice president in charge of the applications division.

“What do I know about this?” he yelled at them. “Of the three people in this room, I’m the one who knows the least. You guys have been hashing this out for hours. I’m the last person who should be deciding. Work it out.”

And so they did.

Based on his personal experience, and based on an exciting article about a GE jet engine plant in North Carolina that had 170 employees and just one boss — an article I noted at the time too — he decided to have no middle managers at his new software company.

That worked for a while, but as the company grew the top managers (Joel and his partner) seemed more and more distant, even though they thought they were plugged in and very welcoming. Now everyone’s happy with a bit of middle management.

The lesson:

Don’t believe everything you read in a business magazine. Not even this one.

Inflation gets right down to the real nitty-gritty — soil prices:

Dirt and its upmarket cousins offer a glimpse of how rising energy prices have caused inflation in the grittier corners of the consumer culture. Products that are cheap, heavy and bulky, such as bags of soil, are particularly vulnerable to rising freight costs.

Moreover, thanks to technology, globalization and changes in consumer preference, a bag of potting mix is now a highly manufactured, meticulously designed product, often containing ingredients from all over the continent and from across the planet.
[...]
What does it have? Depends on the recipe, but any kind of topsoil or potting mix is likely to be crammed with composted organic material. Topsoils can be made from composted shellfish shells, for example. Potting mixes often contain sphagnum peat moss from bogs in Canada or Ireland. Bark fines might come from a sawmill in the Deep South. Coconut “coir,” a peat moss substitute, gets shipped all the way from Asia.

A common ingredient in potting mixes is perlite, which makes the soils airier while also retaining moisture. In its final form, small white pellets, it appears to be something synthesized in a factory. In fact, it comes from a volcanic sand mined on the Greek island of Milos. Shipped to the United States, the ore is heated to 1,400 degrees Fahrenheit, at which point it pops into kernels.

The Amish have expanded from barn raisings to home building:

About 600 Amish contractors or subcontractors work in at least a dozen states, a rapid increase over the past decade, says Donald B. Kraybill, who has written more than a dozen books on the conservative Christian sect. Not only do some of them specialize in the timber-frame construction method that doesn’t use nails, they often can erect a house faster and for less money than traditional contractors, customers say.

Yet working with an Amish builder brings special challenges. Imagine trying to keep in touch with a contractor who doesn’t own a phone — most are forbidden to have one at home. They also aren’t allowed to drive, so they need a driver or other means to get to the job site. Few use computers, have insurance or will sign a detailed construction contract.

Amish contractors find ways around the sect’s restrictions:

Many can’t own power tools — but they can rent or borrow them. They aren’t allowed to drive — but they can use a car with a hired driver. Use of phones is banned at home — but many are permitted to use cellphones for business or if someone else owns the phone, like the non-Amish driver.

“There’s no question it is harder to get in touch with me,” says Mr. Schwartz, the Amish builder who erected Mr. Heitland’s lake house. Though Mr. Schwartz works out of El Dorado Springs, Mo., he has built houses as far away as Colorado and Montana. He says he has a driver but has also used taxis and gets rides from clients. Though computers are taboo, he hires non-Amish to do three-dimensional pictures of his hand drawings. In his shop, his tools are driven by horsepower using a contraption that resembles a merry-go-round, allowing up to four horses to turn steel shafts that are geared to saws and planers. But in the field he uses a non-Amish person’s power tools.

Some Amish use non-Amish as conduits for their construction businesses. Cindy Shepherd, a real-estate agent at Mike Thomas Associates/ F.C.Tucker in Fort Wayne, Ind., agreed to develop a Web site and handle open houses and referrals for an Amish-owned builder of both spec and custom homes.

Deanna Vickery turned to Amish Timber Framers in Doylestown, Ohio, when she bought her grandparents’ farm in nearby Dover, Ohio, and wanted to put an addition on the 100-year-old barn. Although the Amish generally aren’t allowed to watch TV, if they happen to be in a room where the TV is on, they don’t have to leave. As a result, she would be asked to show up at lunchtime to turn on football games for the workers. Mrs. Vickery says she quickly became friends with the crew, inviting them and their families to her annual pig roast.

Why are the Amish diversifying outside of farming? It’s pretty simple, really:

About 20 years ago, the Amish started to diversify out of farming when it became clear that subdividing a farm among sons wasn’t sustainable as their population grew and land costs made buying new property prohibitive. The Amish population has about doubled since then to an estimated 231,000 nationwide, says Mr. Kraybill, the author, who also is a senior fellow at Elizabethtown College in Elizabethtown, Pa. Many became entrepreneurs, carpenters, factory hands and artisans. Now, more than 70% of Amish household heads pursue nonfarm lines of work, Mr. Kraybill says. Typical Amish thinking views work as an overwhelmingly positive and even formative element of life, says Erik Wesner, a scholar who studies the Amish and runs a blog about them.

Ben Casnocha says that Richard White’s The Entrepreneur’s Manual: Business Start-Ups, Spin-Offs, and Innovative Management is the best book on entrepreneurship that’s he read — despite the fact that it’s 30 years old and out of print. He shares some of White’s axioms:

Axiom One: In a free enterprise economy, there are always more dollars searching for viable and developed ideas than there are ideas searching for dollars.

Axiom Two: Your company must be the image of what your industry needs…the industry will not conform and be the image of what your company needs.

Axiom Three: Your sales price is totally a function of your product’s value as seen by your customers. In no way is your sales price a function of your costs to produce your product.

Axiom Four: Your company’s objectives must be in harmony with your inner self.

Axiom Five: If the financial communities feel that an industry is a growth industry, they will invest in it heavily enough in years to come to make it a growth industry.

Axiom Six: If the financial communities feel that an industry will plateau and become stagnant, they will withhold essential funds and stunt that industry’s growth so that it will indeed plateau and become stagnant.

Axiom Eight: First rate men hire first rate men, second rate men hire third rate men, these third rate men will then employ the bulk of your company’s employees who tend to be fourth rate people.

Axiom Nine: You need to attract talents, disciplines, and personalities which complement…not duplicate…each other.

Axiom Ten: Regardless of how large, how old, or how established your company becomes, there is room for only one management team. There should never be factions.

Axiom Eleven: You will realize as much from your people as you allow them to produce.

Axiom Twelve: If everyone is responsible for a task, then in truth no one is responsible, and the task will not be completed properly.

Axiom Fifteen: Sales training is a forever thing, an ongoing requirement as long as your company exists.

Axiom Seventeen: Nothing ever happens unless somebody sells something.

Axiom Nineteen: You’re not after all the business. You are after all of the profitable business that you can handle.