Project Management with Niel Robertson

Friday, July 11th, 2008

The folks at the Devver Blog have posted a piece, called Project Management with Niel Robertson, summarizing Robertson‘s recent presentation on product management for start-ups:

In fact, he went as far as saying the number one thing that goes wrong at startups might be PM. Niel described PM as a process for delivering Kstrong>the right features at the right time. He went on to discuss why PM can become stale, be ignored, and is often hated because it is associated with excessive documentation, which it shouldn’t be. Mentioning more than once that the best feature requests, requirements, and specs are often just one sentence.
[...]
His basic points about why every project can benefit from PM are:
  • It takes 30 secs to write a requirement
  • 2 minutes to clarify in discussion
  • 5 min to for an engineer to spec
  • Hours or days to prototype, write code, integrate, or deploy it

[...]
As my notes are often just a list of key points that caught my attention, I will do as I often do and share some favorites.

  • How to write a good requirement… “The user should be able to…”
  • How to respond with a good spec… “The user can do that by… doing X… List the exceptions”
  • A spec is well written when QA can figure out how to test a feature based on the spec.
  • Doesn’t encourage people to shotgun tons of things to market. “When I make spaghetti, I try not to throw all of it against the wall.”
  • On gathering data, go out and talk to people getting more data points about the problem you are solving until you start hearing the same things and can’t learn more from talking. Then go work on it, knowing all this data.
  • Niel doesn’t recommend a developer also taking on the role of PM, as there needs to be a tension between who represents the user and who implements the product.
  • “The PM should be the most empowered employee in your company… Yes, even more than the CEO”

I’ve uploaded the actual presentation to Google Docs:

Extravagant Pensions Are Killing General Motors

Friday, July 11th, 2008

Roger Lowenstein, writing in the New York Times, argues that extravagant pensions are killing General Motors — which is fairly uncontentious — before veering into brazenly political and self-contradictory territory:

The sorry decline of General Motors has proved Reuther right: the government is the better provider of social insurance. Let industry worry about selling products.

Unhappily, however, the fate of many public-sector pension plans is even worse than G.M.’s. Responding to the same temptation to offload expenses into the future, public employers have committed to trillions of dollars in future liabilities. In New Jersey, a huge pension liability has created a budgetary nightmare for the state. The city of Vallejo, Calif., burdened by police pensions, recently filed for bankruptcy.

Just as G.M.’s shareholders bore the burdens of its pensions, states and cities will have to force taxpayers to sacrifice in the form of service cuts, tax increases or both.

(Emphasis mine.)

Amazon Kindle Sales on the Rise?

Friday, July 11th, 2008

Are Amazon Kindle sales on the rise?

According to a source at Amazon, “on a title-by-title basis, of the 130,000 titles available on Kindle and in physical form, Kindle sales now make up over 12% of sales for those titles.” Amazon is notoriously tight lipped about sales data, and the new line of business that the Kindle represents for the online retail powerhouse has been especially frustrating for analysts and media to parse. At a technology trade conference in May, CEO Jeff Bezos said that Kindle sales accounted for 6% of book titles sold for the Kindle and in print. So Amazon appears to be selling more e-books.
[...]
A couple of things could explain the uptick. The Kindle quickly sold out shortly after it was unveiled on Amazon at the end of 2007. However, the company recently cranked up supply to meet demand, and cut the price at the end of May from $399 to $359. Some analysts estimate Kindle sales at around 55,000 a month.

UFC 86 fighter paydays and salaries

Tuesday, July 8th, 2008

I found the UFC 86 fighter paydays and salaries interesting:

Forrest Griffin — $250,000 ($100,000 to show, $150,000 to win)
Quinton “Rampage” Jackson — $225,000
Griffin defeated Jackson via unanimous decision

Patrick Cote — $32,000 ($16,000 to show, $16,000 to win)
Ricardo Almeida — $23,000
Cote defeated Almeida via split decision

Joe Stevenson — $60,000 ($30,000 to show, $30,000 to win)
Gleison Tibau — $11,000
Stevenson defeated Tibau via submission (guillotine choke) in round two

Josh Koscheck — $70,000 ($35,000 to show, $35,000 to win)
Chris Lytle — $14,000
Koscheck defeated Lytle via unanimous decision

Melvin Guillard — $20,000 ($10,000 to show, $10,000 to win)
Dennis Siver — $7,000
Guillard defeated Siver via technical knockout (strikes) in round one

Tyson Griffin — $40,000 ($20,000 to show, $20,000 to win)
Marcus Aurelio — $40,000
Griffin defeated Aurelio via unanimous decision

Cole Miller — $20,000 ($10,000 to show, $10,000 to win)
Jorge Gurgel — $10,000
Miller defeated Gurgel via submission (triangle choke) in round three

Justin Buchholz — $8,000 ($4,000 to show, $4,000 to win)
Corey Hill — $8,000
Buchholz defeated Hill via submission (rear naked choke) in round two

Gabriel Gonzaga — $100,000 ($50,000 to show, $50,000 to win)
Justin McCully — $5,000
Gonzaga defeated McCully via submission (kimura) in round one

Those numbers don’t include bonuses:

Fight of the Night: Forrest Griffin vs. Rampage Jackson
Submission of the Night: Cole Miller
Knockout of the Night: Melvin Guillard

Each fighter received $60,000 for their efforts in addition to their respective base salaries.

Brilliant or a sham? Questions asked over Ingrid Betancourt rescue

Saturday, July 5th, 2008

Kidnapping is big business and has been for some time, but no one wants to admit that they pay off — and thus encourage — kidnappers.

It didn’t take long for some to wonder, Was the Ingrid Betancourt rescue brilliant or a sham?

Swiss public radio cited an unidentified source “close to the events, reliable and tested many times in recent years” as saying the operation had in fact been staged to cover up the fact that the US and Colombians had paid $20 million for their freedom. [...]
French media have also raised questions about Ms Betancourt’s relatively healthy appearance after her release, compared with the gaunt and haggard look of her last video from captivity. French state radio suggested the hostages may have been given food and medicine to return them to health before their release. There was no suggestion that the hostages knew they were to be released.

Dominique Moisi, one of France’s leading foreign policy experts, said that it was “probable” that the Farc had been paid money as part of the “infiltration” of their command. “They were bought in order to turn them around, like Mafia chiefs,” he said on French state television, as Ms Betancourt’s plane was taxiing up to the terminal in Paris.

This wouldn’t be the first time a Latin American regime faked a rescue operation.

Can a freight train really move a ton of freight 436 miles on a gallon of fuel?

Saturday, July 5th, 2008

American freight trains move a ton of freight 436 miles on a gallon of fuel:

According to our calculations, which match the [Association of American Railroads]‘s tally exactly, the nation’s seven major railroad companies reported the following for 2007:
  • Moving 1,770,545,245,000 ton-miles of freight
  • Consuming 4,062,025,082 gallons of diesel fuel (including freight trains and trains in switching yards, but excluding passenger trains)

The average works out to be 435.88 ton-miles per gallon of fuel.
[...]
The rail industry says its fuel efficiency has increased by 85 percent since 1980. It attributes that to factors that include using new and more efficient locomotives, training engineers to conserve fuel, using computers to assemble trains more efficiently in the yard and to plan trips more efficiently to avoid congestion, and reducing the amount of time engines are idling.

BrandWeek on TapouT

Friday, July 4th, 2008

I’ve been astonished over the past few years by just how mainstream MMA has become. I can remember seeing the TapouT crew in their buffoonish costumes years ago, at small King of the Cage fighting events on Indian reservations in California. They seemed like a joke. They still do, but BrandWeek looks at their amazing growth:

Sales
2005: $3 million
2006: $12 million
2007: $22.5 million
2008: $100 million (projected)
2009: $225 million (projected)

Oh, and they have negligible competition.

Like I said, I can remember the early days:

By 1997, the pair had quit their jobs to start TapouT, the first such apparel company for the MMA world. A Web-only business, its sales grew from a meager $29,000 to $3 million by 2005. In those days, before the sport had really taken off, the brand made a name for itself by sponsoring athletes with amazing ease. Caldwell remembers being able to outfit some early fighters in head-to-toe TapouT looks for a mere $500. But as the sport grew, so did TapouT, and it was time for the next phase.

Then they brought in marketer Marc Kreiner and got funding from PemGroup.

They now have an almost unwatchable reality show, which, of course, serves as one long commercial for their brand. It’s not unwatchable to everybody though; 100 fans have sent in photos of their TapouT tattoos.

(Hat tip to Robert Joyner at MMAPayout.)

Rules to Keep Your Skin in a Wall Street Massacre

Thursday, July 3rd, 2008

Michael Lewis (Liar’s Poker, Moneyball) has written some amusing rules to keep your skin in Wall Street massacre:

The first thing you need to know about recessions is that they don’t signal the end of anything on Wall Street.

They’re more like a red flag during a Formula One race: The cars coast gently around the track until the wreckage is cleared whereupon they all roar off as if the accident never happened. The difference is that, on Wall Street, it’s possible to make the disaster work for you.

You can inch your car quietly forward so, when the race recommences, you’re its surprise leader.

Rule No. 1: Betray your employer before your employer betrays you.

Chances are, if you work on Wall Street, you work for some giant corporation. Citigroup Inc., say, or Merrill Lynch & Co. The sheer size of these firms may convince you that they are, essentially, secure, that there is no better place to ride out a storm than among the tens of thousands of fellow employees.

This is a mistake.

No Safety in Numbers

There’s seldom any safety in numbers, and the more parlous the situation, the more dangerous it is to be in it with a lot of other people. London during an outbreak of the bubonic plague, the Superdome during Hurricane Katrina, the New Jersey suburbs: People are always clustering together precisely where and when they should not.

In World War I, hordes of men charged directly into machine- gun fire, no doubt reassured that they weren’t alone.

The hole you should crawl into, he says, is a hedge fund.

Rule No. 2: Remember what you are selling.

No matter what you’ve told yourself in good times, to justify the huge paychecks you have received, you aren’t selling actual money-making expertise. For decades, brokers and money managers as a group have underperformed the market. Yet ordinary investors continue to solicit their advice and pay them for their services. Why?

Greed, contrary to popular belief, isn’t what keeps this strange wheel spinning. Greed eventually gropes its way to self- interest. In good times, the dominant psychological impulse can be mistaken for greed but what’s really going on is that a lot of people are worried everyone else is getting rich and they aren’t.

At the bottom of the Wall Street money machine isn’t greed but anxiety. [...] A calm investor is one who might think twice before investing in your hedge fund.

You need to learn to talk to investors in new ways. To frighten them so terribly that they feel compelled to pay someone to hold their sweaty hands.

Rule No. 3: Hide your motives.

Or, specifically, minimize the appearance of financial interest.

Don’t tell anyone how well you’re doing for yourself, for example, not even women you have just met. Recessions blow in with them a general backlash against worldly pleasures and material obsessions.

You must reckon with this shift in public values, for it will occur even on Wall Street, and threaten to expose your ambition as freakish. A lot of people you thought you knew are about to rediscover what’s important in life: wife, kids, the love of one’s fellow man. But you are not.

Don’t worry: it’s temporary. This is still America.

The End-of-the-World Trade

Wednesday, July 2nd, 2008

Donald MacKenzie looks at the End-of-the-World Trade — which only really pays off if the economy totally collapses — and explains why it would become popular:

All this activity [in CDOs and credit indices] explains the attractiveness of the end-of-the-world trade. The trade is the buying and selling of protection on the safest, super-senior tranches of the investment-grade indices. No one buys protection on these tranches because they are looking for a big pay-out if capitalism crumbles: if nothing else, they have no reason to expect that the institution that sold them protection would survive the carnage and be able to make the pay-out. Instead, they are looking to hedge their exposure to movements in the credit market, especially in correlation. Traders need to demonstrate they’ve done this before they’re allowed to book the profits on their deals, so from their viewpoint it’s worth buying protection, for example from ‘monolines’ (bond insurers), even if the latter would almost certainly be insolvent well before any pay-out on the protection was due.

So many financial decisions are made for less-than-obvious reasons:

Processes of this kind [e.g., unwinding highly levered positions to avoid catastrophic losses] — changes internal to the world of credit derivatives, not in the level of the risks being insured against — have meant that investment-grade indices sometimes move by up to 20 per cent in a single day. At times, the price of end-of-the-world insurance has corresponded to utterly implausible correlation levels in excess of 90 per cent: meaning, in effect, that if one investment-grade corporation were to default, almost all of them would.

Why aren’t such mispricings being corrected by savvy investors, eager to seize the opportunities for profit they create? Why, for example, have people not been selling end-of-the-world insurance when the returns from doing so have jumped ten-fold while the risk of having to pay out remains small? A crucial part of the answer is that, paradoxically, a fact-generating mechanism is blocking the restoration of fact. The mechanism is ‘marking-to-market’, the compulsory revaluation of portfolios as market prices fluctuate. Its motivation is entirely sensible: for example, when regulators insist that banks mark-to-market, it should force them to disclose losses to their investors and creditors.

Unfortunately, however, marking-to-market makes market participants extremely sensitive to short-term price fluctuations. To sell end-of-the-world insurance, for example, is almost certainly an excellent long-term bet, but traders don’t do it because of the fear that in the short run its price may increase even further, causing a mark-to-market loss. Although it would be a paper loss, it would have real consequences, damaging your bank’s balance sheet and profits, threatening your bonus, and typically forcing you to transfer valuable collateral to the custody of the buyer of the insurance.

Devo is suing McDonald’s

Monday, June 30th, 2008

Post-punk pioneer band Devo is suing McDonald’s over its New Wave Nigel Happy Meal doll, which sports the band’s signature red flower pot hat:

In April the fast food chain released a series of American Idol Happy Meal toys in the US based on a range of music genres, including Disco Dave, Country Clay, Rockin’ Riley and Soulful Selma.

Devo’s complaint relates to New Wave Nigel, a toy kitted out in an orange jumpsuit, pink shades, and Devo’s “energy dome” hat.
[...]
“This New Wave Nigel doll that they’ve created is just a complete Devo rip-off and the red hat is exactly the red hat that I designed, and it’s copyrighted and trademarked.

“They didn’t ask us anything. Plus, we don’t like McDonald’s, and we don’t like American Idol, so we’re doubly offended.”

(Hat tip to BoingBoing.)

Go Home, Bill

Monday, June 30th, 2008

Cringely says, Go Home, Bill:

The last two executive actions on the part of Bill Gates that had singular effects on the future of Microsoft were: 1) his 1995 Think Week that resulted in Microsoft shifting course to flow with the “Internet Tidal Wave,” ultimately destroying Netscape, and; 2) his 1988 decision to back Jeff Raikes’ proposal to bundle most of Microsoft’s productivity applications into what they called Microsoft Office, which effectively destroyed all Microsoft’s competitors for shrink-wrapped applications. The first action was that of a strong chief executive operating at the very top of his game while the second was that of a major shareholder who was willing to accept lower earnings in the short term for the long-term success of his investment.

These were radical and dynamic positions to take that resulted in creating thousands of millionaires in the greatest peacetime transfer of wealth since OPEC. But they were also 13 and 20 years ago, respectively. If Gates took another Think Week and determined Microsoft’s future lay in baked goods or virtualization, could he turn the entire company toward one or both of those product directions today? I don’t think so.

No one person can control Microsoft today, which has been obvious to Gates for at least eight years, since that’s how long ago he put Steve Ballmer in the CEO job. For at least eight years, then, these guys have known that their jobs are not so much to steer the Microsoft ship as to try and keep it from drifting onto the rocks. That’s the way it is with huge and successful companies. At best you can trim the sails, because to come about (to significantly shift direction) is just too dangerous for the money machine.

Glory Days

Thursday, June 26th, 2008

Joel Spolsky looks back at his time at Microsoft, during its glory days in the early 90s, when Bill Gates himself would read a spec and grill the designer:

He was flipping through my spec! (Calm down; what are you, a teenager?) And there were notes in all the margins! On every page! He had read the Whole Darn Thing!

As the conversation went on, Bill’s questions got harder and more detailed. And they seemed a little bit random. But I didn’t care. By now I was used to thinking of Bill as my buddy — a nice guy who had read my spec. In my head, I was already thinking of how I would address his comments, pronto.

Finally, the killer question. “I don’t know, you guys,” Bill said. “Is anyone really looking into all the details of how to do this? Like, all those date and time functions. Excel has so many date and time functions. Is BASIC going to have the same functions? Will they all work the same way?”

This was exactly the question I had spent the previous day investigating. And as I had discovered, there was a discrepancy. In both Excel and BASIC, each date was assigned a numeric code. The code for any day in 1992 that I looked up was the same in both. But when I looked up a date around the turn of the last century, Excel and BASIC were one digit apart. Huh?

When I went to find someone who might be able to help, I was directed to Ed Fries, a longtime Excel programmer famous for inventing those screen savers with the swimming fish. I hadn’t had much contact with Ed, but I used to see him every Friday afternoon as he played miniature golf in the hallways outside my office.

“Check out February 28, 1900,” he told me.

Its number in the Excel code was 59.

“Now try March 1.”

Its number was 61.

“What happened to 60?” Ed asked.

“It’s February 29!” I said proudly. “1900 was a leap year!”

“Nope,” Ed said, and left me pondering the problem for a little while longer. I eventually figured out, with some more guidance from Ed, that a group of programmers at Lotus had skipped a day in 1900 because it created a mathematical shortcut for them, and they probably figured that nobody would care about a mistake buried in the software’s internal calendar more than 90 years in the past. The people who made Excel hadn’t cared at all and built the bug into the code that the spreadsheets ran on. But the people who had written the code for BASIC had apparently been offended by the shortcut, so they set the start of their internal calendar a day earlier. That way, it would accurately reflect the actual calendar, but the solution was also practical. Because BASIC started its count a day earlier, the number that BASIC assigned to March 1, 1900, was also 61, and from that point on its date and time functions were aligned with Excel’s.

So were the date and time functions compatible?

“Yes,” I told Bill. “The dates are exactly the same, except for January and February 1900.”

Silence. The F Counter and my boss exchanged astonished glances. How did I know that?

“OK. Well, good work,” said Bill. He took his marked-up copy of the spec…wait! I wanted that…and left.

“Four,” announced the F Counter, and someone said, “Wow, that’s the lowest I can remember. Bill is getting mellow in his old age.” He was, at the time, 36. Later, I had it all explained to me. “Bill doesn’t really want to review your spec,” a colleague told me. “He just wants to make sure you’ve got it under control. His standard MO is to ask harder and harder questions until you admit that you don’t know, and then he can yell at you for being unprepared. Nobody was really sure what happens if you answer the hardest question he can come up with, because it’s never happened before.”

What did I take from all this? Bill Gates was amazingly technical, and he knew more about the details of his company’s software than most of the people who worked on those details day in and day out. He understood Variants and COM objects and IDispatch and why Automation is different than vtables — and why this might lead to dual interfaces. He worried about date and time functions. He didn’t meddle in software if he trusted the people who were working on it, but you couldn’t bullshit him for a minute because he was a programmer. A real, actual programmer.

Watching nonprogrammers trying to run software companies is like watching someone who doesn’t know how to surf trying to surf. Even if he has great advisers standing on the shore telling him what to do, he still falls off the board again and again. The cult of the M.B.A. likes to believe that you can run organizations that do things that you don’t understand. But often, you can’t.

Bulking Up: Japan’s Drugmakers

Wednesday, June 25th, 2008

When I saw the headline — Bulking Up: Japan’s Drugmakers — I was expecting a story linking performance-enhancing drugs to Japan, but the story is about M&A:

On June 11 midsize Japanese drugmaker Daiichi Sankyo announced it would pay $4.6 billion for control of Ranbaxy Laboratories, India’s largest maker of generic drugs. In doing so, Daiichi seems to have beat Pfizer and GlaxoSmithKline to the punch, gaining instant access to double-digit growth in India, China, Russia, Brazil, and Mexico. If the deal goes forward, it will be a coup for the little-known Japanese company. “All the big pharmaceutical companies are talking about emerging markets as the next growth opportunities,” says Stewart Adkins, head of London-based consultancy Stewart Adkins Advisors.

It looks like they’ll have to get used to a more competitive field. The Ranbaxy deal is the third multibillion-dollar overseas acquisition by a Japanese drugmaker in the past seven months. Eisai paid $3.9 billion in December for MGI Pharma of Bloomington, Minn. And Takeda shelled out a hefty $8.8 billion for Cambridge (Mass.)-based biotech Millennium Pharmaceuticals in early April.

The regulatory environment is shifting in Japan, and that is prompting the change in behavior:

Coming regulatory changes in Japan’s universal health-care system may further fuel the trend. For years, policymakers have protected the domestic drug industry. By setting medication prices relatively high and erecting clinical trial hurdles for foreign drug products, the government set the stage for one of the world’s most crowded, least international markets. At last count, there were 1,200 drugmakers.

The government also has failed to encourage patients to enroll in clinical trials or to increase its number of drug reviewers. Getting a new drug approved often takes up to 22 months, vs. an average of 10 months in the U.S.

Regulatory reforms would allow more low-cost generic drugs into the market and make it easier for foreign drugmakers to get their products cleared. But that means Japan’s domestic companies will have to work a lot harder—and for that, they will need some bulk. Takeda, the biggest in the group, ranked 17th in global sales last year, according to researcher IMS Health. Each of the world’s Big Three—Pfizer, Glaxo, and Novartis—posted revenues that were more than double Takeda’s. And all the Japanese drug companies combined account for just 10% of the $700 billion global industry. Ranbaxy won’t level the field. But it won’t be the last deal.

Technology: It’s Where the Jobs Are

Wednesday, June 25th, 2008

The technology sector is where the jobs are:

The highest concentration of technology workers — 286 for every 1,000 workers — was in, no surprise, Silicon Valley. Boulder, Colo., came in second, with 230, and Huntsville, Ala.; Durham, N.C.; and Washington rounded out the top five in density.

Now for the answer to the question on everyone’s mind: Where are the highest salaries? That would be Silicon Valley, where the average tech worker is paid $144,000 a year. That’s nearly double the $80,000 national average for tech jobs. Runners up included San Francisco and Oakland, Calif. Austin, Tex., home of Dell came in fourth, and Seattle was fifth. San Juan, Puerto Rico, had the lowest salaries, with an average of $38,000 a year, but living expenses there are also considerably lower.

Hustle & Flow

Friday, June 20th, 2008

Every time I travel, I think to myself, Please let me redesign this system! Hustle & Flow looks at Alaska Airlines’ Airport of the Future:

The carrier has spent more than a decade designing a better way to get customers through airport check-in, debuting the first iteration in its Anchorage terminal in 2004. Last October, the $3.3 billion carrier began rolling out its redesign in Seattle, where Alaska and its sister airline, Horizon, have almost 50% market share. The project, to be completed in May, has already reduced wait times and increased agent productivity. “People come to the airport expecting to stand in line,” says Ed White, Alaska’s VP of corporate real estate, who ran the project. “It’s an indictment of our industry.”

Alaska’s embrace of the future came out of necessity. By the mid-1990s, it was running out of space to handle its Seattle passengers. “If you came here on a busy day, it was jammed,” White says. A new terminal, though, would have cost around $500 million. Alaska tried self-serve kiosks, but technology alone wasn’t the answer. Kiosks were pushed against the ticket counter, which only further stagnated the flow of passengers.

White assembled a team of employees from across the company to design a better system. It visited theme parks, hospitals, and retailers to see what it could learn. It found less confusion and shorter waits at places where employees were available to direct customers. “Disneyland is great at this,” says Jeff Anderson, a member of White’s skunk works. “They have their people in all the right places.”

The team began brainstorming lobby ideas. At a Seattle warehouse, it built mock-ups, using cardboard boxes for podiums, kiosks, and belts. It tested a curved design, one resembling a fishbone, and one with counters placed at 90-degree angles to each other. It built a small prototype in Anchorage to test systems with real passengers and Alaska employees. The resulting minor changes, such as moving the button that sends a bag down the conveyor belt, “increased agents’ efficiency and prevented them from straining themselves,” says Gordon Edberg, a principal at ECH Architecture who helped implement the adjustments.

The Seattle design begins with a deep lobby where 50 kiosks are pushed to the front and concentrated in banks. “You need to cluster kiosks in the ‘decision zones’ where passengers decide what to do within 15 seconds,” says airline technology expert Kevin Peterson. Alaska placed “lobby coordinators” out front, à la Disneyland, to help educate travelers. The 56 bag-drop stations are further back and arranged so that passengers can see security.

The results? During my two hours of observation in Seattle, an Alaska agent processed 46 passengers, while her counterpart at United managed just 22. United’s agents lose precious time hauling bags and walking the length of the ticket counter to reach customers. Alaska agents stand at a station with belts on each side, assisting one passenger while a second traveler places luggage on the free belt. With just a slight turn, the agent can assist the next customer. “We considered having three belts,” White says. “But then the agent has to take a step. That’s wasted time.”

The new design will create significant cost savings. Seventy-three percent of Alaska’s Anchorage passengers now check in using kiosks or the Web, compared with just 50% across the airline industry. Forrester Research estimates that it costs airlines $3.02 to process a passenger using an agent but only between 14 and 32 cents for self-service. Alaska, then, is likely to save almost $8 million a year on the Seattle terminal if it converts customers the way it has in Anchorage. And the makeover cost just $28 million. “This design will take us to 2017, at least,” White says.

It cost just $28 million to make over the Seattle terminal versus $500 million to build a new one.

The question is, Why does it take so long to bring in a bit of operations expertise when the problem is so glaring?