Start-up Nation: The Story of Israel’s Economic Miracle

By Jerry Levine.

How can Israel — a country of only 7 million, with no natural resources, enemies on every border, and in a constant state of war, produce more start up companies then Japan, India, Korea, Canada, and the UK? In Start-up Nation Dan Senor and Saul Singer describe how Israel’s adversity-driven culture does it — how they foster their unique combination of innovation and entrepreneurial spirit.

The short, partial answer is: Israelis put chutzpah first! But more in-depth: their policies on immigration, R&D, and military service have spurred the country’s rise. For the US and others there has never been a better time to look at this remarkable and resilient country for some impressive and surprising lessons.

Israel is most noted for its high-tech developments, and ties to the likes of Google, Intel, Microsoft, and Cisco; but their real start began 80-100 years ago in the low tech battle against the desert. In 1869 the “tourist,” Mark Twain, described the area as a desolate land — infertile and lacking water. But this infertile land eventually yielded to invention and technology, and more and more is now covered with agricultural fields and forests. Over two hundred and fifty million trees have been planted.

The IDE seawater desalination plant in Ashkelon produces 120 million cubic meters of water annually.

It started with smart water management. The first great innovation was trickle irrigation combined with water recycle and desalination. These techniques have now grown worldwide. On a recent trip to Ecuador, I was impressed to visit a huge rose farm with big signs out front indicating that it was operating on Israeli irrigation technology. Israel also leads the world in recycling of waste water; over 70% is recycled which is three times the percentage recycled in Spain, the second leading country.

When water wells were drilled in the desert, the water came up warm and salty — bad for irrigation, but ideal for fish farming! That technology has spread to the US Midwest, home to several huge talapia farms. In Israel they are called St. Peters fish. Here they are called talapia — different names for different markets, but the same technology and the same fish.

Not only was the environment hostile, so were their so-called friends and neighbors. Facetiously, the two real fathers of Israeli high-tech were the Arab Boycott and Charles DeGaulle. They forced the need for secure home-grown industry. Israel’s industry developed out of Israeli traits of tenacity, constant  questioning of authority, determined informality, and unique attitudes toward failure, teamwork, mission, and cross-disciplinary creativity.

Many Israeli start-ups fail, but their attitude is to bring failed entrepreneurs back into the system, use their experience and try again. By contrast, in the Far East, loss of face inhibits risk taking. This is not an Israeli characteristic.

Israelis, in addition to their unique attitude toward failure, constantly question authority. Their focus is on the mission, and their stress is on teamwork and cross disciplinary creativity. The authors relate a story at Intel where there was a great internal debate about the future of chip design. The Israeli workers argued for a different direction from their US supervisors. The Israelis persevered, and moved the company in a totally new, but winning direction. To the Israelis the fight wasn’t about winning the battle inside Intel, rather it was about winning the war outside, against the competition. This story epitomizes so many US union/management fights, where the union’s adversary is their management. Obviously, the focus for both sides ought to be uniting to win the war over the competition. But this doesn’t always happen.

Collaborative behavior comes from the military training, which essentially all Israelis — male and female alike — undertake. The Israeli Defense Force (IDF) stresses a downward delegation of authority. The army has very few colonels and an abundance of lieutenants. The ratio of senior officers to combat troops in the IDF is 1 to 9. In the US army, it is 1 to 5. This culture generates more maturity and better judgement at lower levels of the organization. The authors doubt there is any other country in the world where the creative types all have done (and continue to do) national service. When hiring, Israeli businesses still look for private sector experience, but the crucial metric is the applicant’s military service — what unit was he or she with.

The authors draw an analogy to the 1967 Six Day War where the combined militaries of Egypt, Jordan and Syria (probably 10 times the size of Israel) boasted they were about to destroy Israel and drive all the Jews into the sea. At that time Israel did not have strong world-wide support. President Johnson counselled against a preemptive strike. He suggested they wait to be attacked first, and suffer some losses to garner world sympathy. Israel told the President “no,” struck first, destroyed the Egyptian air force on the ground, and won the war.

So, what is the answer? What makes Israel so innovative and entrepreneurial? The conclusion is a set of contradictions: 1) aggressiveness yet team orientation, 2) isolation yet connectedness, and 3) being small yet aiming big. Also, it’s OK to try and fail. Success is better, but failure is not a stigma.

Many worry that Silicon Valley may be losing its creative mojo. I don’t know if that’s true, but I suspect managements worldwide are studying the Israeli model for guidance.

Question: Do you have faith that Obama can make a good deal with Iran on nuclear weapons?

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Not an American Sniper

By Lloyd Graff.

Lloyd Graff at Basic Training, 1968

My wife and I went to see Clint Eastwood’s film, American Sniper. We thought it was a well made movie, Bradley Cooper was superb as Chris Kyle, but we walked out halfway through. Two tours in Iraq were all we cared to watch.

For me, it brought back sad memories of my youth – the Vietnam War – the war I was supposed to fight in, but managed to avoid.

I did go into the Armed Services. I left for Fort Jackson in South Carolina for Basic Training on New Year’s Day 1968, but I went as a member of the Illinois National Guard.

I figured I had a better than 50-50 chance I would not go to Nam. I expected to come home in five months and go back to college, writing papers and taking exams, not shooting at Viet Cong in black “pajamas” waiting to ambush me in the rice paddies.

At Fort Jackson I was one of two Guardsmen amongst my training company of 300 guys. The war was at its peak and the Tet Offensive was starting. In my bunk there was a sense of fear and anger in the older drafted guys. For the young kids there was excitement in some, bewilderment in others. For the Hispanic kids there was a feeling of displacement. They may have been saying, “This isn’t my war, but I’m here, so I better learn how to be a soldier.”

I was a journalist by training so I tried to assume a bit of detachment. I wanted to record the details in my head to recount later. I also wanted to believe I wasn’t going to Vietnam to keep from freaking out.

In my bunk one third of the guys were older and had experience in college. They were all trying to figure out a way not to go to Vietnam. They knew I was Guard, but they showed no resentment toward me, which I found surprising. Were it the other way around, I think I would have been jealous.

The training sergeants were generally professional and fair, except for a newly minted one who had never gone to war. He hated me and devoted himself to torturing me when he could. He used crude psychological warfare, telling me that all the Guardsmen were going to be activated and sent to Nam. He was a really shrimpy guy, a foot shorter than me, from New York. He always wore his Smokey the Bear hat to make himself look taller, but I think he hated me even more vehemently because of a sense of inferiority over his height.

It was winter at Fort Jackson and everybody got sick. Some people wanted to end up in the infirmary, but that ended when one of my bunkmates went to the infirmary and never returned. It was announced that he died of meningitis. We got our first passes right after that announcement. I went immediately to the biggest hospital in Columbia, South Carolina, and marched into the Emergency Room. The doctor looked at my throat and gave me a shot of penicillin. He assured me I did not have meningitis, and I felt like a new man. I went to the Union of the University of South Carolina and luxuriated in the company of college students. I watched basketball on TV, I even called a sorority and told them I was available. Amazingly, some young women came to meet me and one ended up inviting me to a big dance.

Then it was back to Fort Jackson. I learned how to shoot a rifle, take it apart and put it back together. It was an old M-1, not the M-16, because the Army was short on rifles in early 1968. We got into good physical condition if we could stay healthy in the raw weather. We learned how to march and slither on our bellies. The highlight of Basic was the obstacle course with live ammunition being fired over our heads as we burrowed under barbed wire and traversed a 300-yard course that seemed like it was three miles.

I graduated from Basic in eight weeks and stayed at Fort Jackson for specialty training in “Communications.” I had thought maybe I could use my writing background, but “Communications” was stringing wire on telephone poles.

I became adept at climbing 35-foot poles using metal spikes on the insides of my legs. Got a lot of splinters, but it was easier than Basic and the weather was improving.

Things went fairly smoothly and it was looking like I was going to survive Fort Jackson, but on April 4, 1968, Martin Luther King was assassinated. There were riots in Los Angeles, Chicago and elsewhere. The National Guard was mobilized around the country. It was a terrible time in America but it also meant Guardsmen in big cities were needed to back up the police. I realized I probably was not going to end up in Nam like most of the guys I had spent four months with in South Carolina.

Selfishly, I just wanted to get home. I felt bad for everybody headed to Saigon, but I just wanted to not think about the killing. When I got home I hugged my parents and quickly left for college. It was a wonderful place to try to forget about the war and all the good guys who were sent to that awful place.

Question:  Where were you during Vietnam?

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I’ve Been Waiting So Long

By Lloyd Graff.

Chicago Cubs pitcher Jake Arrieta. 2014

Major League Baseball Spring Training officially begins this week. This is a signal event for me stating that the teeth of winter will lift out of my groin in a few weeks.

To me the beauty of baseball endures. It isn’t just the game and the stars, it’s the talking about the game with friends. It’s the memories of seasons past and the opportunity to watch my grandchildren swing a bat and toss a ball around. It’s memories of Ernie Banks and Harry Caray and a thousand semi-forgotten Chicago Cubs. And now it is hope for a better season with better players and a new manager and pitchers who throw smoke.

I find parallels between business and baseball. The game is timeless in its simplicity, just like the tenets of business are simple but very hard to execute in the moment.

With performance enhancing drugs now apparently reduced significantly in the game, the home run has become an unreliable weapon. Few teams are built around sluggers when 38 homers is good enough to lead the league. Pitchers are more dominant with 96-mile per hour fastballs common and split finger pitches at 88 and unhittable. But this kind of velocity quickly kills pitchers’ arms. Today a starting pitcher hopes to pitch a strong six innings and then give way to a bullpen of flame throwers and trick pitch specialists to finish the game.

With starters usually happy to just pitch into the 7th inning you might expect the starting pitcher to have a reduced economic value, but the contrary is true. A reliable starter who can start 35 times a season and pitch 200 innings is one of the rarest and most valuable commodities in the game. A 10 game winner who can keep a team ahead or within one run most of the time makes $10 million a year of he has staying power in the game and can reach free agency status with an intact arm.

Every team in Major League Baseball is attempting to develop a dominant bullpen with high quality role players to fill the seventh, eighth and ninth inning slots. The Kansas City Royals showed us in the playoffs of 2014 that a shutdown bullpen and decent starting pitching can take a mediocre team to the World Series.

This brings us to the value of a manager in baseball. In a very long season with highly paid young people of very different backgrounds (often half the players are from the Dominican Republic, Venezuela, and increasingly Cuba) it is very hard to develop cohesion on the field and in the clubhouse. Teams that have a great manager and a Latin leader on the field like the San Francisco Giants did in the now departed Pablo Sandoval (signed with Boston) can play better than their players’ stats.

In the machining world, with the large number of Latinos on the shop floor, developing leadership amongst the Spanish speaking employees is crucial to the success of many firms I encounter.

Another change in baseball that has an analog in the business world is the emphasis on data analysis. Good managers in baseball have an a­nalysis of hitter success off various pitchers and where they are likely to hit the ball if they make contact. We see much more movement of defenses today than a few years ago. Good pitchers can dictate play by pitching to spots that match the defense. This makes bullpens even more invincible today because pitchers are fresh, relying usually on one pitch on which they have great control, with defenses set up specifically to combat players’ tendencies. I think many businesses follow the path of least resistance continuing to pursue products and customers who are low margin and high maintenance rather than focusing on new, juicier opportunities. Successful sports teams make changes quickly.  After Green Bay Packers’ coach Mike McCarthy’s terrible play calling against Seattle in the NFL Championship game he gave up his play calling responsibility to the Offensive Coordinator.  The Packers also have already cut the player who dropped the pivotal onside kick by Seattle. (I think the onside kick is a play that is under utilized. Teams should try it once a game and develop expertise).

With pitching so dominant today I am surprised that the super speedy running specialist is still rare on teams’ 25 man rosters. As single runs become super valuable in tight low scoring games against overpowering bullpens an unsettling base runner can tilt an inning. An analogous player in football might be a specialist in onside kicks. It would catch on.

Baseball 2015 is finally here. In the snows of January you think it will never come. When business stinks and you can’t seem to close a deal it feels like a winning streak will never come, too. Spring training means hope. It feels like I’ve been waiting a long time for this one.

Question: Have you been missing baseball this winter?

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The Smart Rat

By Noah Graff.

I recently heard a story on an NPR podcast called “Invisibilia,” which discussed the effects expectations can have on human abilities.

The story begins by describing a scientific test conducted on rats.

Researchers took several rats and put them in cages, arbitrarily labeling half the cages with “smart rat,” and the other half with “dumb rat.” Lab technicians who did not know that the rat cages were labeled arbitrarily, took the rats out and tested their abilities to finish a maze.

My inference, as I assume most people’s would be, is that the rats from cages labeled “smart” would do no better on average than the rats from cages labeled “dumb.” After all, the rats’ cages were labeled arbitrarily. But rat after rat, the ones labeled “smart” finished considerably better than those labeled “dumb.” So how did this happen?

Scientists theorized that the lab technicians, without thinking about it, treated the “smart” rats differently from the “dumb” rats, which led to the differing results. The technicians handled the supposedly smart rats with more care than those that were supposedly dumb, which led to their superior performance in the maze. Thus, the higher the expectations the technicians had for the rats, the better the rats would perform.

The NPR story centers around Daniel Kish, a blind man who from the time he was young was allowed by his mom to do everything seeing children could do. He was allowed to play outside on his own. He’d climb trees, cross streets, fight with other kids and even taught himself to ride a bike as a very young child. On his own, Kish trained himself to use a tongue clicking method called human echolocation which enables him to know where he is in space, much the same way bats navigate. By sensing echoes from nearby objects, people trained in echolocation can orient themselves by interpreting the sound waves reflected.

In elementary school, Kish met another blind kid who had previously gone to a school for the blind. This kid had been used to people constantly helping him function. People always had led him where to go and brought him whatever he needed, but when he was left on his own he became helpless. Schools for the blind are no longer in vogue today, as people have realized that not letting blind people struggle to function on their own is debilitating. Today Kish devotes his life to working with blind kids to teach them to be independent. He teaches kids do the type of activities on their own that he had taught himself when he was young, such as climbing trees, hiking, crossing the street and even riding a bike.

Kish says that the main obstacle he runs into in his quest to make kids independent is love. Parents understandably have considerable trouble allowing their disabled kids to become frustrated or perhaps even harmed by letting them struggle on their own.

I grew up with a learning disability which made me a slow reader and slow writer. I had to receive extra time on exams and go to special tutors, but my parents always expected me to get good grades and produce great work. They never said, “Maybe he’s just not good at school, so we shouldn’t put pressure on him to do better.” Instead, my parents gave me a ton of help, but they always treated me like a “smart rat,” making me believe that I was gifted and would do well, no matter how impossible the work seemed. I also think that by seeing their examples of academic achievement, along with those of my older siblings, I simply accepted that excelling in school was what I was supposed to do. If they excelled, why shouldn’t I?

Question: Did your parents’ expectations help you or hurt you?

Daniel Kish rides bicycle blind using echolocation

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American Pipe Dream

By Lloyd Graff.

Yesterday, I received a one hour crash course from a client deep in the plumbing business on what it takes to be successful making faucets and bathroom components in America.

He works for a company that sells to big box retailers. They have made their stuff in China, but five years ago, they took on the challenge of showing the CEO and accountants of a publicly traded company that they were not only relevant, but could make good brass components in America for less money and with way less aggravation than using subsidiaries in Shanghai. In four years they reduced their hourly burden rate by one third. The employees who made the cut are making more money through production bonuses, and the shop’s old National Acmes are cranking out perfect parts on time to satisfy the numbers people at Home Depot who require a 98% inventory fill rate or they charge the companies penalties.

By reorganizing the shop floor into product cells they were able to change the standard of one operator running two machines to an average of three machines. They hooked up sophisticated monitoring equipment with predictive software that told the operators (and management) how many holes each drill made in real time, so they could change drills before they broke or made inferior parts. This dramatically increased productivity by eliminating most of the tooling wipeout that can kill a setup. The drills and taps now come out of a “vending machine” on the shop floor, not from an inefficient tooling czar, thus saving a lot of space and kibitzing time.

The tooling sales people became allies in the project, with Iscar, Kennametal and Allied reps visiting the plant every week to share best practices. They also started buying tooling from MSC, which is phenomenally efficient in getting tooling to a client quickly.

The company bought a new Fanuc wire EDM to augment their old Agie machine and improved output by 70%. It was a fast payback on a $150,000 investment, so now they are making all of their form tools in-house.

They have become great experimenters in the arcane world of coating. They love the mad scientists at Balzers who keep coming up with slightly different variations for their drills. This willingness to continually tinker with processes enables them to keep shaving costs.

The virtually complete changeover to lead-free brass in the water cooling industry has been a boon to them. Rather than complaining about lead-free, they embraced the change and figured out how to make the cranky material an ally while competitors fight with lead-free brass.

Brass prices have dropped by a dollar a pound over the last 18 months. The retailers are certainly aware of the raw material changes, but prices have held fairly solidly, which is one reason the company is prospering.

The firm does not make everything in house. They have two trusted outside suppliers who are highly skilled on lead-free brass and they have found it useful to job out about 10% of their work to reduce overtime costs and simplify their in-house operation. The outside sourcing is a safety valve and insurance against unforeseen disruptions. Price per piece is slightly higher, but it is deemed to be well worth it.

I had heard about American companies beating foreign competition, but it had never been clear to me how management in the ancient art of screw machining in the high wage market of the United States had managed the task. Wage cuts really have nothing to do with it. It’s all about the organization, tooling technology and the COMMITMENT.

Question:  Is manufacturing prospering in the United States?

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Hail a Robot

By Lloyd Graff.

I am fascinated by changes coming in staid old automotive land.

The battery operated car business is moving rapidly. Tesla may be surpassed by BMW or GM in the next few years, but Tesla may still be the big winner with its mega battery factory in Nevada, which will push the price down significantly on this platform. Never underestimate Elon Musk. Batteries are the game changer in the electric car business. The car is secondary for making money.

Other truly interesting developments include the advancement of self-driving car technology and the rise of Uber, the automated car service that is quickly replacing taxis and changing many people’s driving habits, particularly those of younger urban folk.

Several companies are predicting a viable self-driving car in three years. Certainly there will be regulatory issues to navigate and lawyers to neutralize, but the trend is clear. In some places in this country or elsewhere the autonomous car will likely be driving people around in five years or less.

Now word comes out that Google, which is at the forefront of development of the self-driving car and also a major backer of Uber, is considering competing with Uber. The Uber founders are furious and scared.

While Uber has a big first mover advantage in the automated car service business, Google could cut the wheels out from under it with its autonomous car. Google already comes into the race with elite searching and mapping software. Imagine the price advantage Google could have over Uber with a driverless fleet hailed by a Google App. This may sound like it’s out of the Jetsons, but it is likely within reach soon. It could revolutionize travel, particularly in cities where Uber is growing phenomenally at the moment.

Google currently has $64 billion in cash on its books, but it knows the search business which provides most of its profit can’t last forever. Some people see that business as threatened by the growing number of mobile apps that take away opportunities for search ads on mobile devices. So Google keeps buying companies and developing new products like Google Glass, looking for a home run to augment search. It looks like urban transportation has the potential to be a game changing business of major magnitude. Uber is now starting its own research into driverless cars by backing a team at Carnegie Mellon in Pittsburgh, but they are 10 laps behind Google. And, Google, an early investor in Uber, with its own person on the Uber board of directors, knows a tremendous amount about Uber’s operation.

From the viewpoint of the people in the machining world, the driverless car could be a net plus. A lot of old cars will be scrapped. The urban market for vehicles will expand. Rail traffic may be reduced. The pickup truck and SUV market will probably not be disrupted in the short run. I can easily imagine a driverless garbage truck with computer chips in garbage cans and dumpsters.

One reason why car sales are running at close to 17 million a year in the U.S. is the appeal of new technology. Honda’s clever Super Bowl ad with synchronized cars with rear cameras backing into parking spaces highlighted the appeal of new stuff for auto buyers. Scrap rates right now are relatively low as people are making their cars last longer than in the past, but high-tech cars are prompting increased sales despite that.

I believe the autonomous car will give car sales a big shot in the arm. I know I will be an early adopter.

Question: Do you want a driverless car?

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Ernie Banks

By Lloyd Graff.

Photo of Banks taken by Jim Graff 60 years ago.

The news of the past week was dominated by the brilliant scoundrel, Bill Belichick, coach of the New England Patriots, and the death of beloved Mr. Cub, Ernie Banks. Could there be two men at the top of their professions more different?

Today I’ll focus on Ernie because I feel like he’s almost been a member of the family. When I was a kid I learned early that I was a member of various tribes that helped define my identity. I learned I was Jewish, white, and Cub. I was a member of an offshoot of the main Tribe, because I was in the South Side sect that rooted for the Cubs, a small minority among millions of Chicago White Sox fans. We did not face pogroms like my brethren in Russia, but we felt like a beleaguered minority in my neighborhood.

In 1953 the Chicago Cubs bought Ernie Bank’s contract for $20,000 from the Kansas City Monarchs of the Negro Leagues. Soon after, they picked up Gene Baker a black Triple A player from the Pacific Coast League who definitely should have been playing in the Majors five years earlier, but teams were slow to break the color barrier even though Jackie Robinson had been in the Big Leagues for six years. Players had roommates on the road and the Cubs felt white players would resent bunking with black players, so they had to have a pair of Negroes on the team.

Ernie Banks was an immediate success at shortstop, as was Baker at second. Everybody got a nickname then and Banks got “Bingle,” and Baker got “Bangle.” The Cubs had a fat first baseman named Steve Bilko, so the new Cubs double play combination was the euphonious, Bingle to Bangle to Bilko. The Cubs were almost always a lousy team, but with Banks and Baker and home run hitter Hank Sauer in left, they were fun to watch on early TV and listen to on radio with the great play by play announcer, Jack Quinlan.

I read the sports pages religiously, even The Sporting News, the Baseball Bible, to keep up with my team. And I studied Ernie Banks assiduously. Ernie had a batting stance like nobody else in the game. He cocked his right elbow awkwardly so his bat was sticking straight up. As he eyed the pitcher his hands were moving constantly on the bat handle, like he was massaging it. I copied Ernie’s stance meticulously and practiced my swing for hours trying to build my bat speed. If it was working for Ernie I figured it would work for me. Banks won back to back Most Valuable Player Awards in 1958 and 1959.

Ernie Banks weighed only 170 pounds but he generated terrific bat speed with his great timing and powerful hands and wrists, which had developed from picking cotton as a kid in Dallas. Banks was one of 12 children. His father had a third grade education, but Ernie had a gift for baseball, an outgoing personality and endless curiosity, which set him apart from his baseball peers. Banks was always smiling and expressing his love for the game. He became synonymous with the phrase, “Let’s play two.” I loved the game like Ernie loved the game. I just couldn’t play it anywhere close to how he did.

I kept following the Cubs through bad times and worse times, dying with them in 1969 when they looked like they were going to win the pennant and then collapsed in September. Ernie was old then, 38 and playing first base, but still a dangerous hitter.

For me baseball wasn’t just a sport. It was a language and a link to talk to people, especially my grandfather and mother. Grandpa Kassel, my mom’s dad, was a taciturn lawyer for a railroad. We really had nothing to talk about except baseball, specifically the Chicago Cubs. We both loved it. He told me about “Jolly Charlie” Grimm and Mordecai “Three Finger” Brown. He went back to the days of “Tinkers to Evers to Chance,” the double play combo of the last Cubs World Series winner in 1908. He actually knew those players because they stopped at his family’s little grocery.

My mom used to excuse me form school and take me to Ladies Day games. I remember seeing Jackie Robinson and Roy Campanella play in one. It may have been the most special thing we ever did together just me and her at Wrigley Field in the grandstand talking baseball.

When she got older and sadder we still had the Cubs to talk about and that special bond baseball fans cherish when they are sharing knowledge.

So when I got the news Saturday morning that Ernie Banks, Mr. Cub, had died, I shed many tears. Ernie was family. Ernie was what I shared with my Mom and passed on to Noah. All three of my kids adopted the Banks batting stance. It’s part of my legacy – and his.

Thank you, Ernie. You’ve been a part of my life for over 60 years. I keep your picture hanging up in my house and look it almost every day. And I’m not stopping now.

Question: Who will win the Super Bowl? Do you care?

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The Title Shot

By Noah Graff.

Rocky’s Title Shot with Apollo Creed

Many Super Bowl watchers are familiar with the Doritos Brand Global Crash the Super Bowl Ad Contest, a competition Frito-Lay has been running since the 2006-07 football season. This year, Doritos received 4,900 videos submitted from 29 countries made by independent filmmakers — not ad agencies — to compete to have their ad played during the Super Bowl and receive $1 million. A panel of judges consisting of Doritos executives, advertising experts, and actress Elizabeth Banks picked 10 finalists. Those finalists’ videos are online currently and will be voted on by Web viewers. Two videos will be shown during the Super Bowl, one the winner of the Web audience vote, whose creator will receive $1 million, and one other video chosen by the panel, whose creator will win $50,000.

I see this contest as a symbol of America’s romance with democratic opportunity, the idea that everyone should have their chance to reach their dream. The Doritos contest is like the World Heavy Weight Title shot that Apollo Creed gave Rocky Balboa. It’s the chance, to be broadcast on the most watched event of the year, win $1 million, and possibly break into an advertising career. It is the same theme as the barage of talent contest reality shows that saturate our TV schedule, such as Top Chef, American Idol, Americas’s Got Talent, and my favorite, So You Think You Can Dance. Their message is that if you have the talent and drive you should be given your dream title shot, regardless of where you were born, how much money you have, or who you know.

I’ve written before about my various YouTube series, such as Jew Complete Me, a reality dating show about my search to find the Jewish woman of my dreams, and my recent documentary, Saving Ferris, a film about the Chicago locations of Ferris Bueller’s Day Off. When it first debuted, I saw Jew Complete Me as my longshot chance to be discovered by a Hollywood executive who could give me a way into the professional mainstream TV industry. It wasn’t exactly a direct title shot, but it was my way of throwing my hat into the ring. Despite my videos receiving hundreds of thousands of views, I never became famous beyond the YouTube screen. So I chose to embrace the quality career options in front of me, journalism and the used machinery business. They weren’t my romantic dream jobs that I had fantasized about when I was 15 — at that age I had envisioned myself following in the footsteps of Quentin Tarantino. But it turned out that I liked both jobs and they grow on me every day. Nowadays, I fulfill my passion for filmmaking with projects like Saving Ferris. What’s nice is that I don’t have to make videos to eat. I get to make videos, and I only produce ones I feel like making. Do I ask myself what if I went a different route and tried harder to be a full-time filmmaker? Once in a while, but not that often like I used to. My main filmmaking ambition now is for my work to be seen and enjoyed by a lot of people.

My dad Lloyd Graff took his title shot when he tried out for the Chicago Cubs as a sidearm pitcher. He wrote a letter to the team and somehow convinced the Cubs to invite him to tryouts at Wrigley Field. As his story goes, he didn’t have his control that day.

Later, Lloyd was confronted with the choice of going into the relative security of the family machinery business or using his journalism master’s degree to take a shot at becoming the next Mike Royko. He chose the family business, and I’ve never once heard him say, “I wonder what would have happened if I had tried to get a job at the New York Times,” despite the fact that some of his fellow journalism classmates at University of Michigan did eventually become famous writers. But obviously, he never did give up his dream job of reaching thousands of people with his writing.

Question: What was your dream job when you were younger?

Noah Graff writes for Today’s Machining World and sells machines for Graff-Pinkert & Co.

Watch a clip of Apollo giving Rocky his shot

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Fittings Together Over 60 Years

By Lloyd Graff.

Company Owners left to right: Tricia Morris, Perry Wiltsie, Jeff Wiltsie, Jim Wiltsie Jr.

The latest statistics show confidence building steadily for small businesses while Wall Street staggers over plunging oil and copper prices. The oily bankers and hedge funds bet big on the frackers in West Texas and North Dakota, and some of those leveraged loans look as solid as Venezuelan bonds today.

But for most of the folks we deal with on a daily basis, business looks rosy. The Detroit Auto Show has its mojo back. Cobo Hall has the pizzazz of the Las Vegas Consumer Electronics Show held last week. It’s amazing what 17 million cars can do for American machining.

A family business we’ve known for four decades, Vanamatic Company of Delphos, Ohio, is celebrating 60 years in business. The Wiltsie family has figured out a way to manage 70 people, including nine family members, into a prospering continuing company. Through turbulent times, the challenges of changing technology and an evolution in attitudes about work, Vanamatic has made it work. Four siblings share the authority of leadership with three brothers holding the title of President. To an outsider it may seem like a model for managerial chaos, but when family members respect each other’s talents, it can work.

A family business that works is a beautiful thing. As we watch the daily malfunction of government amidst the contentiousness of hardball politics, a functional family business seems almost magical.

The funny thing is that in the competitive machining world it really does work surprisingly often.

In the small microcosm of Graff-Pinkert & Co. my brother Jim and I worked with our father Leonard for 25 years. We argued frequently about the direction and tactics of the business, but the relationships were respectful. After our father died, leaving me with a slightly larger ownership in the business, it became harder to maintain balance and satisfaction. Ultimately my brother and I could not maintain the joy and momentum, and I bought out his interest in the company. But we still stay in touch and sometimes we do deals together.

Now my son Noah and I work at the art of balancing family and business while keeping the father-son relationship a happy one. Noah’s buoyant attitude sops up my incipient pessimism, making the situation generally viable and fun. I thought I understood the ethos of a successful family business when my Dad, Jim and I worked together, but there is no magic to it. It takes enduring respect and a daily subjugation of ego.

At Vanamatic four members of the third generation currently work in the firm. They are preparing for long careers. Employees average 17 years with the company.

Congratulations to the Wiltsie family and Vanamatic for 60 years of success, finessing ornery 8-spindle Conomatic screw machines and modern CNC equipment to produce beautiful fittings, along with automotive and aerospace components. Mastering screw machining is no easy task, but integrating nine family members into the fabric of Vanamatic over three generations is truly the art of the family business.

Vanamatic launches their new Website today.

Question: Should a spouse or in-law work in a family business?

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Review of Henry Kissinger’s “World Order”

By Jerry Levine.

Henry Kissinger’s recently published World Order, is an extremely thoughtful meditation on international harmony and disorder. He validates the truism that wisdom comes with age. (He’s currently 91.) I doubt that he could have written this book at age 50.

Kissinger relies on his great knowledge of history and his years of foreign service experience. The book is peppered with subtle, yet diplomatic digs at Obama’s foreign policy. He faults Obama’s inconsistency towards both allies (such as Saudi Arabia and Israel) and enemies (Putin, Assad and Iran), as well as the U.S.’s recent alternating engagements and withdrawals (Libya, Iraq/Syria).

Kissinger notes that there never has been a true world order. Previous empires at their height of power defined the world in their own image — be it China, Rome, Europe or Islam, but they were not necessarily inclusive or collaborating with those they ruled.

In defining America’s view of itself as a world power, he begins by quoting Harry Truman on what made him most proud. “We totally defeated our enemies, then brought them back to the community of nations.” Truman wanted to be remembered not so much for America’s victories, but for its conciliations. All of Truman’s successors have followed some version of this narrative. We see ourselves as a “benevolent superpower,” even if we don’t always live up to our ideals.

Kissinger then discusses varieties of world orders, specifically the European Westphalian arrangement: a multiplicity of political units (some with contradictory politics) where none was powerful enough to defeat all the others. They checked each other’s ambitions through a general equilibrium of power. Later, as the U.S. entered this system, there was a shift from a strict balance of power to the “achievement of peace through the spread of democratic principles.” This system now encompasses many regions and cultures.

Yet there are challenges on all sides. The European Union itself is shifting from independent states to a pooled sovereignty, and not without some significant inter-state conflict. In the Middle East, jihadists from both sides of the Sunni-Shiite divide are dismantling states in quest of a “global revolution” based on their own fundamentalist versions of their religion. In Asia, conflicts are arising, reflecting historical claims and borders of individual countries

Meanwhile, America struggles to define its relationship between its power and principles. We have a strong urge to withdraw from a confusing world. Yet in business and economics, right now the world is coming together. Globalization is complex and messy, but progressing. However, in politics, the progress is slower. Forces of anarchy have grown with potential to do great harm. Today, much of the Islamic world (defined as the Middle East, Pakistan and Afghanistan) struggles between joining the world community and fighting against it.

Historically, Islam grew by conquest, beginning in 622 A.D. and continuing until about 1700 A.D. As Islam grew, the faithful believed that the religion, the government and the land were all to be Islamic forever. The joining of state and religion is the official doctrine of Iran and other Islamic states, and is the rallying cry of armed militias throughout the Middle East from Palestine to Afghanistan. Western states, on the other hand, have maintained a separation between “things that were Caesar’s and things that are God’s.”

Kissinger discusses the general failure of the Arab Spring and the Syrian Cataclysm as the inability to develop pluralistic institutions and leaders. Syria, in particular, has become a battleground between rival regional players manipulating militias. It is not about democratic government, but merely about prevailing or just surviving.

Most Moslem Palestinians see the doctrinal commitment never to give up territory to non-Moslems as a tenet of their faith. This makes a two-state solution with a Jewish entity an intractable proposition, and is why every time that firm proposals such as Clinton’s Camp David negotiations or Olmert’s 2008 offer become formalized, the Palestinians reject them. It’s worse than politics, it’s religion.

In his conclusion Kissinger warns that, “In an era of suicide terrorism and proliferating weapons of mass destruction, pan-regional sectarian wars must be deemed a threat to world stability, warranting cooperative effort by all responsible powers.” “The affirmation of America’s exceptional nature must be sustained. America, the modern world’s articulation of the human quest for freedom, and the geopolitical force for the vindication of humane values, must retain its sense of direction.” It is obvious that Kissinger worries about our future.

Question: Do you agree with Obama’s withdrawal from Iraq and Afghanistan?


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