Hot Dog For IMTS!

By Lloyd Graff

The bi-annual IMTS gripefest will be upon us in half a year. An article in the February 5th Chicago Tribune documents why people hate McCormick Place. Stupid work rules, $66 per hour laborers, and overpriced food—that’s my town. Today’s dramatic cuts in the number of Chicago Transit Authority routes will also make the city even more alluring.

The Trib. article compares Chicago, Las Vegas and Orlando—the three biggies for huge conventions.

Orlando maybe cheap, Vegas has craps tables, but there’s no place like Chi-town for pizza and hot dogs.

Question: Will you be going to IMTS this year?

Is Toyota the Microsoft of Car Companies

By Noah Graff

My boss, one of my favorite free thinkers in the world, asked me the other day whether Toyota is today’s Microsoft of the car industry.

It felt like a ludicrous question. I hate Microsoft products (I’m a Mac guy all the way), and I’ve always enjoyed driving Toyotas. Well, at least my parents’ Avalons and my 1997 Lexus ES 300, which has 175,000 miles on it.

So what was the thinking behind this analogy? Toyota like Microsoft has become the largest seller of products in its sector in the U.S. market. It appears as though Toyotas have gained such a reputation as the benchmark for quality and reliability that the company has grown complacent in keeping up its highly touted standards. As the world has seen in the last week, the cars have their share of bugs, which has always been a trademark of the Windows operating system. Because Windows’ has minimal competition in software it has been able to get away with mediocrity year after year.

But is comparing cars to computers really “Apples to Apples”?

When I googled “Toyota and Microsoft” I found a brilliant blog written back in 2006, called none other than “Toyota Vs. Microsoft.” The following is an excerpt:

“At a recent computer expo (COMDEX), Bill Gates reportedly compared the computer industry with the auto industry and stated, “If Toyota had kept up with technology like the computer industry has, we would all be driving $25 cars that go 100 miles to the gallon.”

In response to Bill’s comments, TOYOTA issued a press release (perhaps fictional) stating:

If Toyota had developed technology like Microsoft, we would all be driving cars with the following characteristics:

1. For no reason whatsoever, your car would crash twice a day.
2. Every time they repainted the lines in the road, you would have to buy a new car.
3. Occasionally your car would die on the freeway for no reason. You would have to pull to the side of the road, close all of the windows, shut off the car, restart it, and reopen the windows before you could continue. For some reason you would simply accept this.”

There are several more on the blog but you get the picture.

It was a brilliant comeback for Toyota back in 2006. But these days Toyota isn’t doing much snickering.

Question: Is Toyota the Microsoft of cars, and are Ford and GM now Apples?

Software Malfunction. This photo has nothing to do with the story.

Is Overtime “Lean Manufacturing”?

By Lloyd Graff

Is paying overtime rather than bringing in new employees lean manufacturing practice?

For adherents to lean concepts, the question of how to handle a  “bullwhip” effect where companies need to rebuild inventories is a challenge for suppliers. (All this “bullwhip” talk is making me hum the theme song from “Rawhide.” See clip below.) People who were laid off may be unavailable for a call back or may be happily pruned. Overtime is expensive, and eventually core workers get burned out working six or seven days a week or 12 hour shifts.

Temps are often an imperfect answer because they require significant training and may be poorly integrated into a group of standoffish employees who are offended that old employees are not being rehired.

As contract shops reach the “bullwhip” phase of inventory rebuild, how do you think workforce additions should be handled?

Question: Would the Obama $5000 tax credit proposal for new employees be enough to tip you into hiring new people?

Theme Song from the TV Show “Rawhide”

Peace Corps: Who is it really helping?

By Emily Aniakou

I received a press release in my email Tuesday from the National Peace Corps Association (NPCA), advertising opportunities to interview NPCA president Kevin Quigley about how President Obama is recommending a government increase in Peace Corps funding to eventually double the size of the program.

Two years ago, I quit the Peace Corps halfway through my service in Benin, West Africa. My official reason was a nasty accident in my rural village, where a 12-year-old boy playing with the family’s motorcycle on the main road smashed into me from behind while I was riding my bicycle to the market. My unofficial reason is that it wasn’t a great program and I thought my time and energy could be better spent elsewhere.

I lived abroad in Bangladesh for a year before joining the Peace Corps. It was the most incredible experience of my life. I went alone to the sprawling city of Dhaka and stayed with a non-profit that maintained an orphanage. I was thrown into the culture headfirst and delved right in with zeal.

The Peace Corps tried to prepare everyone for the third world experience, so much so that for me, it ruined it. Involving the government and its policies and procedures in something as organic and unplannable as third world international travel was sadly amusing. For the sake of the volunteers, safety was touted, lectured about and then pounded into our heads. Lecture after lecture on topics like “how to deal with religious differences” and “what it means to be a woman in Africa” went on and on for weeks. Second year volunteers tainted the fresh-off-the-plane newbies with their jaded view of the culture and taught us how to get around the more annoying, unrealistic rules.

The hardest part of the experience for me was seeing the expectations of the locals soar upon our arrival and inevitably fall as soon as they heard us butcher their language. Peace Corps takes pride in their training, and although it is remarkable that I learned semi-fluent West African French in nine weeks, basic language skills does not a local make. The idea that the recent college grads the Peace Corps attracts have the experience, wisdom or street smarts to teach people twice their age with a lifetime of experience much of anything is a long shot.

Most volunteers I knew enjoyed their stay but felt a sense of disappointment at what they really accomplished during their two-plus years in-country.

Peace Corps is sensing this too, I believe, and that’s why I think they’re trying hard to attract older, more experienced retires and professionals. In my group of about 70 who headed to Benin, there was one woman over 50, and she lasted exactly two weeks before calling it quits and heading home. She told me that the program didn’t utilize her professional experience as a nurse and I could sense she didn’t fit in with the 21-year-olds.

In my opinion, Peace Corps is not a service organization, but a travel abroad, good will ambassador program for recent college grads not ready to settle into 9-5 jobs. Send young people abroad, it’s wonderful to see the world and let the world see them. But lets call a spade a spade and drop the pretense that the volunteers are giving up two years to save those sad, impoverished people. More often than not, volunteers will come back saying they were the ones who learned the most.

Question: Do you support the expansion of government programs like the Peace Corps?

Emily outside her house in Bassila, West Africa with some of the neighbor kids.

Is Lean Manufacturing to Blame for Toyota’s Woes?

Toyota's Faulty Floor Mat Retention System

By Lloyd Graff

Toyota, the icon of lean manufacturing, now has a big fat problem that could devalue the brands which vaulted it to the top selling car company in the world.

The sticky gas pedal that has prompted the recall of Toyotas and Lexus going back to 2005 has been traced back to a bad design in a component made by CTS, an Indiana auto parts supplier. Because Toyota was so committed to lean manufacturing, which translated into common components across platforms and models, the company has to callback the RAV4 SUV, Avalon, Corolla, the top of the line Lexus and the ubiquitous Camry.

Besides being a tort lawyer’s buffet, this debacle besmirches the reputation of Toyota, because the problem must have been recognized in the field years ago, yet was never fully acknowledged until now by the corporation.

This is a tremendous opportunity for Ford, GM and Honda to attack Toyota. Toyota is suffering because of the dark side of lean manufacturing which corrupted virtually every one of its major models from the last five years. Toyota’s reputation will also take a blow just for the fact that it refused to come clean about the problem for years in a marketplace that increasingly demands transparency.

Question: Do you think Toyota’s commitment to lean manufacturing was a significant contributor to its current crisis?

Imagine, this goof is from a company that can develop a thought-controlled wheelchair.

Toyota’s Thought-controlled Wheelchair

Stephan Marbury’s Full Court Press On China

By Noah Graff

One American is doing a full court press to balance the U.S. trade deficit with China.

Stephon Marbury, one of the NBA’s all time greatest bums and wastes of talent has gone to play in China. He’s not playing for a thriving cosmopolitan city such as Beijing or Shanghai, he’s playing for the Taiyuan Shanxi Zhongyu Professional Basketball Club, one of the worst teams in the league, in the podunk, coal mining city of Taiyuan. The entire city is covered by a thin layer of coal dust, including Zhongyu’s Binhe Sports Stadium, which holds around 4,500 people.

His new team, ranks fifteenth out of 17 teams and will have to win 14 of its next 16 games to make the playoffs. It is allotted $60,000 to pay two foreign players combined, one of whom will have to be cut to make room for Marbury. The team has mandatory 9:00 a.m. practices six days a week. The Chinese are known to emphasize unselfish, team basketball. Marbury is widely known as ball hog and first class jerk, to opponents, coaches and teammates. Not to mention, last year his skills diminished to the point where the Knicks bought out the 21 million dollars left on his contract. It’s addition by subtraction when you have a cancer on a team, who also stinks. Many doubt he will last a week with his new Chinese team. If history serves as an indicator the odds him lasting are poor, Bonzi Wells, another NBA player with a spotty past went to the same club back in 2008. He lasted 14 games.

So why Marbury there? He’s in a poor, remote, hick town in China that 99 percent of the western world has never heard of? Money of course. For a second I thought it was that he just fell off the deep end, which he may still have done. What else would motivate a guy like Marbury.

He’s going to China to promote his low cost signature Starbury line of shoes and apparel to the 300 million Chinese people who play basketball. His shoes, which cost as little as $15, haven’t been that popular here. I’ve never seen anybody wear them. He’s one of the worst athletes to aspire to be like, so it makes sense that no American who could afford better would buy his stuff.

But the Chinese don’t know that much about him. To them he’s just an NBA player who at one point was considered pretty high profile. If he can stick in Zhongyu the rest of the season, fool the Chinese into thinking he’s a great guy, his scheme may just be genius. And probably a screenplay will be written about it.

It’s a prototypical sports movie. Bad team brings in selfish, washed-up former star to play or to coach. Then they remember their love for the game and there’s magic and the team is victorious. Maybe throw in a Chinese love interest for Stephon. It would be perfect.

Question: Do you think he will last through the season? Do you hope he fails?

Source: Wall Street Journal

Industry Scuttlebutt

Brad and Jeff Ohlemacher with President Obama at EMC Precision Machining

For EMC Precision Machining in Elyria, Ohio, it was just another day at the office last Friday—except for President Obama stopping by for a walkthrough and photo op. For Jeff and Brad Ohlemacher, the owners, it was a chance to show off the plant to, who knows, maybe a big new customer. The video on their Web site shows the Ohlemacher brothers introducing the President to family members including Jack, Brad’s young son and several engineers in the plant.

Obama came to Elyria and Lorain, Ohio, to connect with small business people who are the key to new hiring in this country. He gave a brief talk at Lorain Community College and chose to go to EMC Precision, which was on a short list of desirable sites to visit. The Ohlemachers had six days from the first call to prepare for the Big Boss.

*************

While scrolling through Google, my brother Jim found a 644 Wickman 7-axis machine in use at a factory in Bournemouth, England. He visited the Web site and found a company called Hemp Technologies. Their product is “The Green Grinder” which according to the site is made of “high quality” HE30 aluminum and is then CNC turned and milled on a Wickman lathe. The site boasts, “The herb grinders are hand finished and feature our 31 spring steel pins.”

I wonder, is there enough demand in England for this product to justify buying a $250,000 CNC multi-spindle?

Question: If somebody contacted you to make a part used in cigarette manufacturing, would you take the contract?

The “Bullwhip Effect” on Caterpillar

Good article in the Wall Street Journal Wednesday on the “bullwhip effect” as it relates to Caterpillar. Caterpillar Inc. recently told its steel suppliers that it will more than double its purchases of the metal this year—even if the company’s own sales don’t rise at all. What does a company like Cat do when it is rebuilding inventories? It means big increases for suppliers. How does a supplier cope with a sudden surge in orders after a long dry spell in survival mode? How do you beef up ordering and production if you are a small firm whose credit lines are already overextended? Read the article.

Question: Have you seen the bullwhip effect yet in your business?

The Sports Illustrated Tablet from Wonder Factory

If you want to see what the future looks like with an Apple iPad tablet or comparable device, go to Michael Hyatt’s blog about the combination of Sports Illustrated and the Wonder factory device. Fascinating piece, and the future is almost here.

Question: Would you prefer reading on this device, or a traditional print magazine?

Story Time

By Lloyd Graff

I remember virtually nothing from my early childhood. I sometimes think I was born when I was five years old. My parents told me that I did not talk until I was three. They actually thought I was retarded.

But I do remember one thing quite vividly from my early years—my mother performing dramatic readings in dialect for my sister and I in the park. She would pack a picnic lunch, we would go outside, and she would read stories, doing several voices like it was a radio performance. Her favorite was about an immigrant mother taking children to an amusement park. I had never been to such a place but she made it come alive for me.

She didn’t read from a kid’s storybook. She had a green colored “elocution” folio of short plays, and I can still feel her joy and energy when she got into character and delivered the lines to me and my sister Susan sitting in rapt attention.

When I was an adult my mother told me that those readings were a highlight of her parenting, and she cherished the yellowing books of readings as mementos of a happy time for her.

I did not do dramatic readings for my children, but I did make up stories and recount events from my own childhood. I’m starting to do it now for my granddaughters.

Kids may say they want the newest toy or doll or video game, but I think it’s the stories and the joy that will make a lasting happy imprint.

Question: What stories do you remember from your childhood?

Peter Falk reads to Fred Savage in the film The Princess Bride

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