Rethink the Basic Bargain

Posted on | May 17, 2012 | No Comments

Robert Reich calls it the basic bargain.

The basic bargain is what we’re fed in high school. It’s the promise that a good day’s labor will produce a day’s worth of livable wage.

Work hard and you’ll succeed.

Devote yourself to the ambitions of the company (and the profitability of its owners) and you’ll be taken care of.

It’s a promise … or, well, sorta.

Maybe it’s more of an implied agreement that can be terminated at will by the people who’re offering it.

Anyway, the basic bargain is how we’ve structured our education system. It’s also how most of us have structured our lives.

Our system makes really good employees for our labor market. We teach people how to be efficient, devoted, and dependent cogs in exchange for the basic bargain.

Pretty suckish if you ask me.

Inasmuch, we make really piss-poor entrepreneurs. After all, we’re shown that truly inspired individuals abandon formal education. That’s because entrepreneurialism, philanthropy, or values-based employment for a non-profit or religious institution, have nothing to do with the basic bargain. Instead of trading time for money and and money for security, you’re working for a purpose; an ideal.  Well, inspired souls working for a higher purpose doesn’t make them highly dependent.

Reich and others call for a return to the basic bargain … to balance income inequality and restore the American economy.

I’d suggest that – in unfettered Capitalism – the basic bargain is a sham. 2011′s record-high corporate profits should underscore my point. At no time will the welfare of employees ever be as important as profit to the Capitalist. In fact, Capitalists will undo labor for greater profitability at any time.

So instead of a return, we should rethink the basic bargain.

We should encourage students to pursue their principles, their ideals – every one of their dreams and ambitions – even if they’ve nothing to do with greed.

We should teach them to survive on their own without making them dependent on banks, supermarkets, or corporations.

We should forget the basic bargain. We should build a nation of independent thinkers,  dreamers, and inspiring visionaries instead of a nation of uninspired cogs.

R

Expert Systems and Filters

Posted on | April 3, 2012 | No Comments

Expert Systems are a form of artificial intelligence.

These are computer systems that are designed to answer questions on  specific topic through collecting data using a set of cascaded questions, or, analyzing a predictable set of data.

Take an expert system for a doctor as an example. Collecting basic biometric data from a cell phone, along with basic Q&A on symptoms, may yield enough information for the software to draw conclusions for a diagnosis.

You can also imagine an expert system for a lawyer. Basic Q&A or data collection could yield a preliminary opinion on a certain circumstance or situation.

Now, the state of memory and processing capabilities on cell phones – combined with bandwidth – are rising to the level necessary to support AI like Expert Systems. We’ve seen it in SIRI on the iPhone4s.

Now imagine an AI/ES that asks basic questions about your health and can answer basic questions in a similar format to SIRI; or, using an app, it collects biometric data and captures that data in a telemedicine format. It can then be analyzed by a server somewhere in the clouds and the AI/ES can inform the patient of a preliminary diagnosis. Therein, the AI/ES can notify appropriate health and medical professionals if the patient’s condition becomes dire; it can even recommend or prescribe base medications, an appointment, or schedule a referral to a specialist.  Imagine what an AI/ES could be in terms of a filter – allowing the doc to be freed up from routine diagnosis an prescription activity in favor of automation that screens for suspicious or dire cases? It would help target medicine, reduce costs, and contribute to the electronic profile of a patient without opening up a new clinic . It may even allow for early diagnosis and treatment.

If you can see that any professional service can be front-ended by an AI/ES (lawyers and attorneys, psychologists, architects, IT professionals, accountants, business coaches and consultants, nutritionists, mechanics) – all of these are expert professions that could benefit from a similar structure. Meanwhile, consumers would have a channel to reach out to these experts through channels manned by the AI/ES. Imagine notices and alerts coming in to a marketplace of providers who’re needed to answer questions that the AI/ES can’t field, connecting consumer to provider?

It’s easy to see where the AI/ES could become the gateway filter for channeling consumers to professionals for any need.

Two things here:

1. If you’re a professional that could easily be displaced by AI/ES technologies, what will you do to provide more value than a cell phone?

2. If you’re a professional, how could you use AI/ES to extend value to your customers, save time and money, and extend your reach using automation?

R

The Future of Work is In Your Pocket

Posted on | March 13, 2012 | No Comments

In the future, work won’t need you to get up at 5am, commute through 8am, and report to your desk by 8:30am. Instead, your work will be in your pocket.

It’ll be on a cell phone, tablet, or other mobile device.

Work will be everywhere you are.

You’ll access your work instantly and make decisions, provide advice, attend conferences, read and watch updated materials, approve and disapprove of daily activities, research product details, interact with customers, and – yes, make work-related phone calls – all from your cell.

You won’t need a desk. You won’t need an office. Your business won’t require a building.

It won’t need heat, electricity, water, sewage, or maintenance either. You won’t pay taxes on something you don’t own. You won’t pay for more space just to expand your capacity.

You won’t need a commute, a car, a parking space, or oil.

You’ll just grab your cell phone and solve a problem.

Of course, this very utopian picture of future of work relates to knowledge workers - people who exchange their knowledge, skills, talents, and ability for money.

If you’re not a knowledge worker then you’re trading your time for money, or, your physical labor for money.

Think about the competitive disadvantages as compared to the knowledge worker – what the laborer will have to spend as compared to the knowledge worker to keep working. Even working and owning a job will create expenses that are not born by a section of society: the knowledge class.

And if you’re a business owner … if you haven’t moved most of your business processes to mobile applications and platforms … and your competitor does, then you’re slower, unresponsive, and have all of those fixed cost structures your competitor got rid of. Your competitor can even attract and retain talent better than you can because, let’s face it, the employee is going to want to be unteathered from the office.

If you’re a worker, are you trading your time and labor for money? Or are you a knowledge worker?

If you’re a producer, are you ready to compete against virtual organizations with nearly zero fixed costs?

R

The Numbers Won’t Make Us Feel Better

Posted on | February 14, 2012 | No Comments

The media enjoys talking about the rosy 8.3% U3 unemployment number. Unemployment has fallen considerably over the last eight months with modest job growth putting more Americans back to work.

More work is good. Employment shouldn’t be argued with. But the definition of “employment” bothers me. More good work is good … work that pays well and offers a high quality of life. Inasmuch, the U3 unemployment number doesn’t make me feel better.

Under U3, those who’re employed are:

• People who’ve traditionally earned a middle-class wage have taken whatever job they can, perhaps earning much less than they did previously (ie, the underemployed);
• People who be counted as part-time workers and contract labor;
• People who have been actively looking for work over the last four weeks.

What the U3 number doesn’t incorporate are the “marginally attached” workforce, discouraged workers, or, the quality of the jobs offered by the economy.

A recent report from the Federal Reserve of New York shows is a widening disparity in real wages and the restructuring of the American economy from high-paying, technical, and specialist jobs, to low-paying, service-sector jobs. The report shows “wage polarization” where something has been happening in the economy that we all can intuitively sense: more of us are employed in lower-waged jobs working more hours and earning less, and there are fewer and fewer middle-class opportunities.

Maybe when most economists look at the U3 numbers, they’re optimistic because of historical precedence:

Increased US job growth = increase median income = increased consumer spending = increased disposable income = consumption/demand = increased GDP

But I’d suggest that if we factor-in wage polarization as noted by the NY Fed, you get a different outcome:

Increased US job growth = flat or diminished median income = flat or diminished consumer spending = flat or decreased disposable income = diminished consumption/demand = decreased GDP

And unlike the 2000′s, where consumers borrowed from the equity in their home or loose credit to make up for their losses in real wages, consumers can’t continue spending. There’s no equity to draw on and most consumers will be fighting tooth-and-nail to preserve what assets they do have. They might even save more (yikes!). They might be hesitant to acquire credit or incapable of it with tighter banking restrictions. They won’t have liquid assets and they can’t borrow or access credit … and some 90 million will be retiring within 20 years and losing their disposable incomes.

So none of this should look positive for federal, state, or local governments in the long term:

Increased wage polarization/retirement = lower net incomes = lower taxable wages = diminished tax revenues = increased borrowing = increased debt 

But it also means a heavier burden on government to provide transfer payments to those who’re just getting by:

Increase waged polarization = lower net incomes = increase demand on social safety nets = growth safety net spending = increased borrowing = increased debt

So these numbers don’t make me feel better.

In fact, they make me feel more worried because we’re distracted by the simplicity of the number. Instead of focusing on the root problems (wealth inequity, wage polarization, the loss of the middle class) we’re assuming that greater employment means better times ahead.

On the contrary: greater employment – with low-paying service jobs that don’t offer medical insurance, livable wages, disposable incomes, or retirement savings or pension plans or education benefits – will only make our circumstances more challenging in the years ahead. It’s a Red Herring; a man behind the curtain.

Millions upon millions of people barely getting by with no discretionary spending ability, no health care or access to preventative maintenance, no retirement, no education, no equity, no credit, no savings – won’t make a future Americans can be proud of in 25 years.

So don’t be comforted by the number. It masks the real systemic strains that will continue to undermine American standards of living.

R

15 Skills For The New Economy

Posted on | December 15, 2011 | 2 Comments

1. Bargain Shopping Instinct. You use technology to find the best deals on products and services that you can. In the jungle of Capitalism, you’re an aggressive and clever competitor that will use all of the tools at your disposal to save time and money. You balk at the people decrying Amazon for arming consumers with tools to find things cheaper online. This is Capitalism, for crying out loud! Why not?

2. Synchronized Everything. There isn’t time to wait on information. It’d be terribly inconvenient to update data from a single place, like a PC. Decisions will need to be made increasingly faster. Everything must be online, interconnected, and synchronized.

3. Mobile Me. Everything of value must travel with you. You’re nimble. Technology enables your lifestyle. You can work and play anywhere. You’re everywhere you need to be and not hindered at all by geography.

4. No Fear. New technology doesn’t scare you. You embrace it. You emerse yourself in it. You learn quickly how it can be adapted to serve you and make you stronger, faster, and better.

5. Special Snowflake. You use social networks to showcase your abilities and talents. You demonstrate capabilities to all in your social circle who – in turn – will remember your competencies and promote you within their own network.

6. Connected. Connectedness breeds opportunity. More connection means more jobs, gigs, money. Being connected offers hope. Being disconnected will drive you bonkers. Being disconnected makes you unavailable, and there’s plenty of people who’ll take your place.

7. Available. Everyone will want something from you and they’re looking to get a hold of you in a reasonable timeframe (fifteen minutes). It could be voice, tweet, Facebook status, instant message, text, voicemail, or contact form. Those who’re available and connected will satisfy customers and meet expectations. Those who’re unavailable and disconnected won’t be selected, relied upon, or trusted.

8. Efficient. You will constantly seek new ways of doing your business and routine tasks. You will aspire to greater efficiency and less friction. More friction equals more cost. You will constantly be off-setting rising costs of living with greater efficiency.

9. Relentless. There will be many people crushed by the weight of the future. All of these skills demand discipline and perseverance. Many won’t have the chops to keep up. Many won’t want to change. Many won’t want to learn anything new. Many won’t care. The world will be negative. Your friends and family will be less fortunate than you. You will need to be relentless to survive. It is a more competitive existence.

10. Econo-master. Every aspect of living introduces new opportunities to economize. You’ll track your expenses. You’ll experiment with ways to reduce costs over time, or, share expenses with others. The more you can economize, the lower your living expenses, the greater your competitive edge.

11. Energy Efficient. The cost of energy will continue to rise whereas you will lower your consumption to maintain fixed expenses to the greatest extent possible. Your home will become smart. Your thermostat, appliances, even your doors will have intelligence. You will be surrounded by smart things capable of taking independent actions to reduce aggregate consumption.

12. Thrifty. Second-hand will become your first choice for clothing and furniture. Why have a new car when the old one works just as well? Why live in 3,300 square feet with 2,200 will be reasonably comfortable?

13. Multiply The Value of Information. A $400 purse won’t make you competitive. A $400 investment in a smart phone, on the other hand, will. The smart phone is an asset. It’s a machine. A tool. It can automate, make you efficient, synchronize, make you mobile and connected – it will enable your digital lifestyle. A purse will bring you meaningless cosmetic function. You will learn to see the multiplier effects in information and devices that exploit it.

14. Healthy. Obesity, drugs, alcohol, smoking. Any one of these things will force you to incur more expenses; prevent you from responding to a client; make you prone to illness and disease. The future will offer us a form of Darwinism. Only the fittest will survive. The less-fit will be in greater debt and poverty, and be unavailable for satisfying customers or solving problems.

15. Educated. And not from college but from the school of hard knocks. Experimentation and experience will help guide your decision-making. Further, you’ll leverage the wealth of information available to you to make better decisions. You will be self-directed. You’ll learn from the abundance of self-education materials available to you online.

And bonus skills:

16. Flexible. You can adapt. Any career. In any State. Any neighborhood. With any group of people. In any career. Instead of being stymied by excuses and missed expectations, you will redefine your expectations constantly.

17. Self-Reliant. You’re not a dependent; you’re self-reliant. You aren’t an employee; you’re an owner. You’re not handed opportunity; you make opportunity. You’re not waiting; you’re shipping, launching, starting.

Of course, you might disagree with me.

You might believe that the next twenty years won’t demand this much out of you, and that you can sit back, wait and see what happens, maybe work hard at all of this stuff later.

All the while, others who understand this will be passing you in the fast lane, moving at exponential speeds, eventually to a point where catching-up competitively becomes impossible.

You ignore these skills at the risk of your own obsolescence.

R

How to Find What You’re Looking for Online

Posted on | December 11, 2011 | 1 Comment

You might be looking for things online.

A job. A client. A new venue for an upcoming gig. More volunteers. Customers. Fans.

How do you get what you’re looking for? Be generous.

Being social is sharing.

Share yourself, your time, your ideas, your opportunities, and your failures.

Recommend others when you can. Support others often. Even if you disagree with their ideas, remind them that you respect who they are. Help other people be successful. Be known for being generous.

IRL (In Real Life), we live in a world of scarcity. Scarcity demands sacrifice. Sacrifice dissuades us from being generous.

Online, we live in a world of abundance. Bits are abundant; they’re infinite. It costs nothing to spread them, store then, and nothing to share them. We can pipe bits around the world instantly. It takes seconds to share an idea from a cell phone; seconds in a Tweet, a status update, or an uploaded photo. Sharing is how we appreciate others online.

Success will come to you when you share and help others online.

So what will you give away today? What will you share?

R

10 Things Smart Businesses Will Do Next Year

Posted on | December 8, 2011 | No Comments

If you haven’t noticed already, businesses are learning how to operate leaner and more profitably by leveraging technology.

Yeah, imagine that.

Record levels of profitability coupled with record levels of unemployment. And yes, there is a correlation. They’re smart. They’re learning from the economic downturn that they have to think differently about common expenses. They’re learning how to automate and leverage technology for competitive advantages.

And they’re adapting because they have to. 

Over the next year, smart businesses:

1. Will pay for just one telecommunications circuit – their Internet connection. No extra expenses needed for TV or dedicated phone circuits.

2. Will turn their phones into an appliance. They’ll even use their smart phones to make VOIP calls across wifi, coming off of their carrier’s plans. It’s about free or fixed-costs for unlimited calls and unlimited minutes.

3. Will off-load email, contacts, calendars, files, databases, and other crap to other vendors. Why manage that themselves? Too risky and costly.

4. Will get rid of fax machines. That stuff should arrive via email: where you are, not where the fax is.

5. Will get rid of paper storage. That stuff should be electronic for ease-of-access. It’s slow and inaccessible.

6. Will reduce the need to print. Anything. It takes too long, consumes toner, paper, electricity, and other resources … because they’re designed to cost you money and make recurring revenue for the manufacturer. Duh – kill that printer!

7. Will reduce their dependency upon the US Postal Service. Their costs will go up and their services will go down. Yes, it’s time to cut that cord before it hangs you.

8. Will transform their payment systems into electronic systems. Those who wait for paper receipts will be waiting a very long time. Make receipts move as fast as electrons.

9. Will move away from merchant accounts that lock businesses into three years of transaction processing. Instead, companies that don’t use credit cards all the time will find a better deal with companies like Square and PayPal who charge by transaction. Just say no to contracts.

10. Will explore alternative payment systems with consumers (Popmoney, for instance – text receipts and transfers – or NFC … Near Field Communication devices through cell phones) to make it easier to do business. They’ll make it as easy as possible to do business with them.

And here’s a final thought.

Next year, smart businesses will decouple work from a geographic location. You’ve got to be able to work from anywhere and everywhere. Otherwise, you’ll be slower than the competition, and, paying for leases and rents and taxes and energy expenses your competitors don’t have to pay.

R

Ignoring The News Won’t Help You

Posted on | November 30, 2011 | No Comments

A friend of mine was speaking the other day to an audience of business people.

I like my friend. He’s good-peoples. Smart, charming, a good uplifting personality.

Yet he encouraged everyone to ignore the news.

The news, he argued, is pessimistic.

Yeah, social, economic, and political collapse is a real downer, sure, I could get on board with that.

But he also suggested that people who make the news have an ax to grind. Okay, it’s not like CNN or The Economist or the Wall Street Journal is trying to relay truth or anything. Errr?

And finally he implied that those who listen to the news are influenced by negativity and propaganda, and it affects their ability to be positive and cheerful – and sell more – which was the crux of his discussion.

Then I started to lose it. I felt his advice was akin to encouraging the audience to close their eyes and hum a jaunty tune whilst they dance unaware in front of an oncoming train.

If you ignore the train, he says, you’ll be happy. You won’t be bothered by the rather pessimistic perspective that you’ll likely be splattered to bits. And you’ll be able to sell more. Cool!

Myself, I don’t think this is rational. I think it’s downright terrible advice.

Blissfully ignoring the train won’t make it go away.

Optimistically hoping the train will pass you is pretty much wishful thinking.

Believing the train isn’t real is akin to believing in other magical universe stuff like fairies, unicorns, and vampires.

I think ignoring the train is a bad idea.

I feel if you’re cognizant of the train then you can do something strategic to avoid it, like, say, get off the track.

That’ll allow you to live another day, and sell more … if that is what’s really important to you.

Ignoring the news – and the circumstances surrounding the current economic malaise that influences unemployment in America and is destroying the middle class - isn’t a viable solution. It’s actually a disadvantage.

Ignoring the conditions that create unemployment or hoping that those conditions won’t affect you won’t make it go away.

It’ll be the ones who aren’t paying attention to the world – as it is, in its very ugly and complicated details – who’ll be the most decimated by its passing.

R

You Can’t Be Sick

Posted on | November 14, 2011 | No Comments

Sick is a liability in the new economy.

If you’re sick, you can’t work. You won’t get paid.

Sick creates a system of distrust.

An employer is expecting you to show up and do the work. If the work isn’t getting done – if the laborer is sick, or, has a chronic illness – there’s no incentive for the producer to keep the laborer. Many of the laws that protect employees in this area aren’t applicable to contractors and freelancers.

Oh, yeah, sympathy … empathy. The projection of really caring for employees. Well, they won’t have to pretend anymore. The employer: they don’t care, so take the whole issue of sympathy and empathy out of the equation. This is about profitability. This is about business.

Today, some employees abuse sick time. They’ll call in, say they’re sick, and won’t work. It’s a fun game, one that’s been going on for a long time. The employer shells out money so that somebody can get a day off.

Besides, you deserve it, right?

Wrongamundo. That’ll cease. In the new world of employment, that kind of behavior won’t be tolerated, especially when there’s so many ways to find out if you’re really sick: digital health readings from your cell phone, your social media announcements, GPS … these things will be conditions of employment, just as mandatory drug screening is. Our world (for good or ill) is transparent. You can’t lie if everything is transparent.

Also, there’s no switching cost for the producer: tomorrow, it’s easy enough to replace the sick worker with a healthy one.

That used to be a problem. It’d cost a lot more to replace somebody than to buy a new one. In the future, there’ll be a surplus of healthy workers ready and waiting for the job. All it’ll take is an Internet search or a job posting from a cell phone. And telecommuting/electronic means of production means that the new person could start tomorrow with limited training.

It used to be that you could count on “sick-leave” from a company or PTO (Paid Time Off). When you’re a contractor, you’re not afforded this luxury. You still need to put bread on the table and feed the family. Sick is a liability.

Even if healthcare reform passes, health insurance will still be expensive and coverage will constantly be restricted. Remember, our real wages are declining yet these costs increase by 30-percent per year! Baseline health insurance will likely be what most of us can afford, and baseline won’t cover extensive health problems.

The State won’t help you in this area, either. They’re running out of money, too. Taxes are diminishing and the social services offered through Medicare and Medicaid must be targeted for significant reduction. They have to be. Just watch Greece and Italy over the next year. That’s what we’ll be doing in the United States soon.

In an economic environment of intense and almost pure labor competition, with immediate access to labor markets around the world, when production can be performed anywhere and by anyone, and with little regulatory controls over how employers can “switch” from one unit of production to another (labor), sick is a competitive disadvantage. Obesity, cancer, smoking, carpel tunnel, diabetes, dental work, even eye care … your health and ability to work clear into your 70′s will be a fundamental, principle asset, that makes you financially viable.

If you can’t, there will be few social nets to catch you, or to help you climb out of the hole.

R

Don’t Have A Boss

Posted on | November 12, 2011 | No Comments

Why a boss?

Bosses were created to look after Labor – the premise being:

Labor is untrustworthy and undisciplined;
Labor is always requiring attention, direction, and leadership;
Labor is unfocused and easily prone to distraction;
Labor is exploitative of the owner’s scarce resources;
Labor is bumbling and incompetent, incapable of making hard choices when real decisions are on the line;
Labor is incapable of rational judgment;
Labor lacks creativity and problem solving skills;
Labor isn’t educated;
Labor isn’t a partner, not an owner, not in charge of anything, but is a unit of production.

Does this describe you? No? Okay, why do you need a boss?

R