SKUs

I used the term SKU in an email today to a client.

The response I got was "SKU?"

It was my mistake for using the seller's term. I should have simply said "item number." I got to thinking more about that. Maybe we should be more precise and always use the term SKU. "Item number" to a customer means that it is something the customer wants. Maybe the customer does not know what they want and so they do not know the item number.

I was at the annual Convention and Trade Show of a long running organization. There was an open Board meeting. It made sense as it was a non-profit organization. I could see a private company restricting attendance to stockholders.

At this Board meeting there was a presentation by two of the Executives that would depict the firm as having three distinct parts. One would be the annual Conference and Trade Show. Another would be the leading fee for service product group. The third would be everything else. There was even the suggestion that there be three separate legal entities. I watched the Board members. Zero interest. And both of those executives are now departed from the organization. Plain and simple the first two parts are the cash cows that keep the third one, and all of the bureaucracy, employed. The mission was buried.

What if each if us, individually and in our businesses, had defined SKUs for what we do?  We would not call them "item numbers" because our customers would not have to know them. An item number is something that provides us money. A SKU is something that we must define and give. Yeah I know. It's a fine line. It does not have to be a fine line.

That organization could see fantastic growth if it formed the three organizations. The surplus money from the first two parts would allow them to have some real growth. Everything in the third part would have to learn to perform. The second and third leading fee for service product groups have no reason for being. Under the present model they have no need to perform. They get their share of the total budget and can hide out. Top management does not care because their salary and bonuses are justified by having a large staff.

That organization is imploding. It is not just the decline of total revenue. Adjusted for the value of the dollar over time, it is rapidly going downhill. It stays alive with annual layoffs. The ones laid off are often the only real producers. Others are simply inventory that can later be dumped. They are like sand bags on a balloon. When there is a need to regain altitude they are cut loose. That organization has a ways to go yet like the buggy whip manufacturers it will eventually disappear.

A feature of Cowboy Safety is to make sure that the strategies are black and white. Strategy parts either achieve the mission or they do not. The operation model can reduce overheads by eliminating or outsourcing indirect functions. Initially it is done with tweaking the bookkeeping systems. Budgets are structured to the mission. Users begin to see what can be reduced and what needs to be increased.  Eventually the organization becomes known for its work and not for its bureaucracy.

David Sneed

Semi Crash on Black Ice

A good reason not to drive in the left lane. Watch this semi cross the median when it hits black ice.

Many states now have made it illegal to drive in the left lane on a high speed highway unless passing or making a left turn such as a left exit or on a high speed non limited access state highway where there are legal median access turn areas.

Wyoming does not yet have the law. Colorado defines it as any four-lane highway with a speed limit of 65 mph or higher unless passing or making a left turn. I have noticed many states now have signs about that law and also about moving over when approaching any emergency or maintenance vehicle on the shoulder.

Another reason not to drive in the lefty lane is that head-on crashes occur in the left lanes of divided highways. Someone driving the wrong way, impaired or disoriented elderly, may think they are driving to the right. They will in fact be in your left lane.

A good rule at night is not to drive in the left lane if you cannot see any taillights ahead of you. During the day time cresting a hill in the left lane can be bad on a divided highway.

On any highway looking ahead as far as possible is always a good idea.

David Sneed

Facebook is the Antithesis of Cowboy Safety

The value of Facebook has its origin in two fairly well-known quotes: 


"No one ever went broke underestimating the intelligence of the American public." H.L. Mencken. 


"If you want to get rich, you start a religion." L. Ron Hubbard.


Who would have ever thought that in 2012 it would be possible to get a billion people to devote large amounts of time to writing private details of oneself or to reading private details of others? Who would have thought that a billion people would openly allow themselves to become a product? 


Just today I was explaining to one of my daughters the effective function of "like" in Facebook. Yes it is to give assurance to someone who needs assurance. It is also a way to get data for the purpose of soliciting advertising. 


Facebook may not have set out to become a business, and certainly not one where the raw material has no cost, yet it has certainly become one. Not only is it a business it is now one where the stock is publicly traded. The only thing that could be better would be if it was a religion. And it has done that. 


Facebook has become not just a business but a religion. It is a religion that is the antithesis of Christianity, Judaism, Islam, Buddhism and possibly all others. Salvation comes from the sacrament of daily communion with self and with telling the world about oneself. All written in digital format in the eternal cloud, heaven if you will. No more meditating and seeking a Higher Power other than self. Not only does one not have to die to self, on Facebook there is honor in living to self.

Cowboy Safety is not a business or a religion. Yet Facebook is also the antithesis of Cowboy Safety. Cowboy Safety is a way to protect oneself. Ultimately Facebook is a way to destroy oneself.


Facebook is the newest form of the religion of Narcissism. And with an altar that is a far better one than a mirror. PsychCentral says that "at the core of extreme narcissism is egotistical preoccupation with self, personal preferences, aspirations, needs, success, and how he/she is perceived by others." Facebook exactly. Egotism is egoism with a "t," talking about self. 

Facebook, the religion, is only a threat to the religion of materialism. The other religions have embraced narcissism and many of their churches are on Facebook. As a threat to materialism, Facebook is a timely aid to a society that may have had too much growth. 


Who needs to make money and accumulate money when there is no longer a need to "keep up with the Joneses?" Facebook is a much better alternative. 

Facebook is a democratic religion. No longer does one have to be wealthy in money and make big donations, endow chairs at colleges, or to fund buildings named for oneself. The only wealth needed to build monuments to self in Facebook is time and that asset is more plentiful among those who lack money. In turn that time is converted to money for the stockholders of Facebook the company. 


I am not running down Facebook. Facebook does not create narcissists. Facebook provides the place for worship of self.  It has done a great job of that and will do it even better in the future. Maybe it is good that we know how many narcissists there are.


David Sneed

Cowboy Safety Idea from Mark Zuckerberg

Startups today are not like in the past. Here is a comment from Mark Zuckerberg of FaceBook:

"An idea today can be implemented right away. There is a fundamental protocol for a business that is for the most part standardized."

New development today is in the arena of how to plan for a business to self-finance with only a small amount of seed capital or maybe none. Flow-through taxation is a disadvantage with the new type of businesses.


David Sneed

Salvation Army Thrift Store Cheyenne Wyoming

The Salvation Army Thrift Store in Cheyenne Wyoming closed about two years ago. I don't have the details but I believe that the labor cost was greater than the revenue. Most o=if not all of th staff was paid. There may also have been some other reasons but a net loss is a good enough reason.

The store is back in business with a different operations model.

The two buildings are owned free and clear of debt. Possibly the only fixed cost is insurance on the buildings.

The items sold are all donated. The staff is all volunteer. The only variable cost might be the utilities.

For all practical purposes the net profit is equal to the revenue.

Because of limited inventory the store is now open one day a month. As donations pick up, rather than have "percent off sales" the store can add days that it is open. This part is only my speculation. It is true that the operation is more sustainable.

That store now is similar to an internet experience or information business. Once the website is set up the incremental cost of a sale is zero.

The lesson to be learned is that if the economy has a no growth recovery, competitive advantage will come from new operations models like the Salvation Army Thrift Store.

In the late 60s when supermarkets went to Sunday opening and then 24/7 the others had to do the same for competitive reasons. What if for competitive reasons shortening of hours was necessary for survival?

Sustainability may stem from reduced revenues rather than from growth. Minimization of fixed costs will be necessary. There will be reduced risk of all kinds and related reduction of expenses.

Shortening hours is only one way to reduce revenue and costs. There are some other options. We are dealing with them on a case by case basis. The American way of work is unfortunately being forced to change.

David Sneed

Cowboy Safety Design Process by Richard Rodgers

Cowboy Safety Design Process by Richard Rodgers? Do you mean the Richard Rodgers of Rodgers and Hammerstein? Yep!

Here it is.

"Our first meeting on the project that eventually became known as OKLAHOMA! took place at my home in Connecticut. We sat under the huge oak tree and tossed ideas around. What kind of songs were we going to write? Where would they go? Who would sing them? What special texture and mood should the show have?

We had many such sessions until we became thoroughly familiar
not only with every aspect of the play but with each other's outlook and approach as well. Fortunately we were in agreement on all major issues, so that when we finally did begin putting words and notes on paper - which didn't occur until we'd gone through weeks of discussions - we each were able to move ahead at a steady pace.

The first problem was, appropriately, how to open the show. We didn't want to begin with anything obvious, such as a barn dance with everyone a-whoopin and a-hollerin'. After much thought and talk, we simply went to the way Lynn Riggs had opened his play, with a woman seated alone on the stage churning butter. For the lyric of the first song, Oscar developed his theme from the description that Riggs had written as an introduction to the scene.

This was all Oscar's poetic imagination needed to produce his lines about cattle standing like statues, the corn as high as an elephant's eye, and the bright golden haze on the meadow. When I read them for the first time I could see those cattle and that corn and bright golden haze vividly. How prophetic were Oscar's words I've got a beautiful feelin'/Everything's goin' my way.

By opening the show with the woman alone onstage and the cowboy beginning his song offstage, we did more than set a mood, we were in fact, warning the audience, 'Watch out! This is a different kind of musical.'"

I cannot imagine what the play would have been like if Rodgers and Hammerstein had used the technical approach used by most safety plan designers.

David Sneed

How to Build a 30 Story Hotel in Two Weeks

This hotel in China was built in 2 weeks