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    Published on: March 6, 2015

    by Kevin Coupe

    The Washington Post has a piece about a speech Facebook CEO Mark Zuckerberg gave at the Mobile World Congress in Barcelona, in which he offered "a nugget of management wisdom" during a follow-up Q&A session when he was queried about how he hires people.

    "I've developed over time a simple rule," he said. "I will only hire someone to work directly for me if I would work for that person. And it's a pretty good test ... It doesn't necessarily mean that I'm rushing to give up my job of running the company and put other people in the role. But what it does mean is that in an alternate universe - if things were different and I didn't start the company - I would be happy to work for that person."

    Zuckerberg added: "If you're building a big organization, then it also works many layers down. If each person is only hiring people to work directly for them who they would work for, then you're probably going to get a pretty strong organization."

    I think that's a pretty smart rule and the kind of approach that can lead to actual teamwork. It also means that maybe - just maybe - the person at the top has his or her ego in check, and understands in a fundamental way the importance of people as you travel down the corporate ladder. After all, if the bottom of the ladder isn't stable, the person on top of the ladder is a lot more likely to fall.

    It is an Eye-Opener.
    KC's View:

    Published on: March 6, 2015

    Bloomberg has a piece saying that when Walmart announced increased wages for some 500,000 employees last month, it was less altruism and more a response to a specific economic trend.

    "Yesterday's Beige Book (an anecdotal roundup of economic trends across the various Federal Reserve districts) gave us a clue about what's really going on," the story says. "The report notes that contacts in several regions of the country noted that employers are starting to have trouble attracting and keeping workers, and have been forced to raise their wages as a result."

    The piece goes on: "Wage pressures were moderate across most Districts, but some contacts reported increased wages to attract skilled workers for difficult-to-fill positions. In particular, service sector firms in the New York District noted increasingly widespread reports of wage hikes. Contacts in the Cleveland, Richmond, and Kansas City Districts noted increased wage pressure due to the difficulty in attracting and retaining truck drivers. A staffing firm in the Chicago District reported some companies were also willing to raise rates for unskilled workers to reduce turnover, and contacts in the Atlanta District noted increasing entry-level wages."

    The bottom line, Bloomberg says, is that "as the economy gathers steam, workers have more options and that's forcing employers to pay more."
    KC's View:
    Talk about déjà vu all over again...

    It was just last week that MarketWatch had a similar story, and MNB dutifully reported on the trend.

    I mention it again here because after the first story ran, I got an email from an MNB user who seemed to view the MarketWatch story as political propaganda, writing, in part:

    MarketWatch needs to wake up and the Federal government needs to publish a realistic truthful number. The official unemployment numbers are extremely misleading.

    Anyone who thinks that the unemployment rate is around 5.6% also needs to wake up. I hate to burst MarketWatch’s bubble but the real reason(s) driving the economy are low interest rates and stock market gains.

    The truth is that about 100 Million Americans are not working.

    I actually don't know anyone who thinks the actual unemployment rate is 5.6 percent. But I'm not sure that the ideas that actual unemployment is higher and that wages are going up because of a tightening labor market are mutually exclusive.

    A lot of it depends on where you live. North Dakota has a 2.8 percent unemployment rate, Nebraska is at 2.9 percent. South Dakota is at 3.3 percent. I've talked to retailers in such places who say that, in fact, good help is hard to find.

    The economy can and should be a lot better than it is. But it is getting better, and we're moving - slowly, to be sure - to the point where it is going to be a seller's market, not a buyer's market.

    Published on: March 6, 2015

    The Organic Trade Association (OTA) is out with a new study suggesting that "nearly half of U.S. families (47 percent) are 'very familiar' with the organic seal, representing a steady and significant increase of awareness from just 27 percent six years ago. Nearly seven in ten parents say they are extremely well informed or at least know 'quite a bit' about organic."

    The study mains that this is translating to sales: "Over eight in ten (83 percent) U.S. families say they buy organic, up a full 10 points from the first year of the survey in 2009 and the highest level in the survey's lifetime. " In other words, "empowered with that knowledge, more parents are deciding to purchase organic than ever before."
    KC's View:
    Two observations here.

    One is that the economy is working in the organic industry's favor. A lot more people have money today than had it back in 2009, which makes it more likely for them to spend it on organics. They might have resisted the compulsion back in the early days of the Great Recession.

    Second, there would be something seriously amiss if greater knowledge didn't translate into higher sales for a category like organics. So this should not come as even a mild surprise to anyone.

    Published on: March 6, 2015

    The Associated Press reports that Kroger yesterday reported Q4 earnings that were up from $422 million during the period a year ago to $518 million during the most recent quarter, on revenue that was up to $25.21 billion from $23.2 billion. The company was expected to earn 90 cents a share on sales of $25.18 billion, on same-store sales, excluding fuel, that were up six percent.

    For the just-completed fiscal year, Kroger reported a $1.7 billion profit, up 13.8 percent from the previous year, on sales of $108.5 billion that were up 10,3 percent. same store sales for the year were up 5.2 percent.

    The story notes that the results "mark the 45th straight quarter of identical stores growth – more than 11 years of increasing sales at stores open at least 15 months."
    KC's View:
    For the three or four MNB readers who think that the site ought to be about stock price, I want to note here for the record that these results propelled Kroger's stock to an all-time high, and its share price has almost doubled in the past year.

    Published on: March 6, 2015

    Fortune is out with its annual top 100 places to work list, and one retailer has made the top 10 - Wegmans, which came in at seven. Google sits atop the list at number one.

    Other notables on the list: Nugget Market (#26), The Container Store (#27), Quik Trip (#54), Whole Foods (#55), LL Bean (#56), General Mills (#80), Publix (#81), Zappos (#86), and Nordstrom (#93).
    KC's View:
    I always try to keep lists like this one in perspective. The companies that made it are to be congratulated, but they also are the ones that invested time and energy in making the applications. Also ... does the fact that Wegmans and The Container Store have dropped down the list from number one at various times really mean that they've lost a step? Not really ... I think it actually means that Fortune needs to keep rotating the leaders so that there's some suspense.

    Published on: March 6, 2015

    The New York Times reports on a study done by the Rudd Center for Food Policy and Obesity at the University of Connecticut concluding that "changes made to government-subsidized meals by the Obama administration to get schoolchildren to eat more fruits are having their intended effect ... from the time the changes went into effect in 2012 through last year, the percentage of students choosing fruit on a cafeteria line increased to 66 percent from 54 percent."

    In addition, the story says, "the study found that children were throwing away less food now than they were before the new guidelines were put in place. Students ate 84 percent of their entrees, not including fruit, up from 71 percent before the rules were in place, thus decreasing the amount of food waste, the researchers found."

    The Times notes that "many critics of the new nutritional guidelines had claimed that children were throwing food in the trash because they were being forced to eat more nutritious but less desirable meals."
    KC's View:

    Published on: March 6, 2015

    ...with brief, occasional, italicized and sometimes gratuitous commentary… reports that Home Depot "is testing the use of Samsung customer kiosks within its appliance departments. The 85-inch interactive kiosks are non-transactional, providing product information only."

    The story says that the test - currently in three Home Depot locations - is similar to one being run by the retailer's major DIY rival, Lowe's.

    I love it when technology serves this kind of function ... creating a sense that the retailer is a resource for information, not just a source of product. These days, I think that's what smart retailers have to do ... make their customers smarter.

    MarketWatch reports that Fresh Market plans to "close its remaining stores in California as part of a broader plan to focus on its operations in the eastern half of the US ... The company said that despite improving results at the California stores - which include locations in Palo Alto, Santa Barbara and Laguna Hills - the company concluded the pace of organic store growth was going to be slower than anticipated and that focusing on markets closer to its other operations had more potential."
    KC's View:

    Published on: March 6, 2015

    Remember ... for most of us in the US, this weekend marks the end of Standard Time and a return to Daylight Savings Time. On Sunday, March 8, at 2 am, it will be time to turn your clocks forward an hour. (Assuming, of course, you actually have clocks that require manual changing. This will be a foreign concept to anyone younger than a certain age...)

    This seems to be more important to mention this year than ever, since the cold and snow have beaten down the spirits of many of us; I've casually mentioned the time change to a number of people over the past week, and almost nobody realized it was about to happen.

    Let's hope that the weather gets the message, too...
    KC's View:

    Published on: March 6, 2015

    ...will return next week.
    KC's View:

    Published on: March 6, 2015

    One of the challenges of writing about "House of Cards" just a week after all 13 episodes of its third season were made available for streaming by Netflix is that most people have not had the time to watch them all. But I'm not most people ... I considered it my duty as Content Guy to watch all 13 episodes as quickly as possible (and dragged Mrs. Content Guy along for the ride) so I could offer some thoughts and business lessons here.

    Which I will do, while assiduously avoiding spoilers to the best of my ability.

    With the first two seasons now well in our collective rear view mirror, I think it is fair to say that they mostly focused on the pursuit of power by Frank and Claire Underwood, Washington, DC's version of the Macbeths. For two seasons - a total of 26 episodes - we watched Frank move from the leadership in the House of Representatives to the Vice Presidency, and by the end of the second season, he'd maneuvered himself right into the Oval Office. We've learned that Frank seems to have few compunctions about anything, and that Claire is just about as cold-blooded ... for them, power is its own reward, and public policy and public service are afterthoughts ... almost an inconvenience to be dealt with as a consequence of increased power.

    It has been great fun, I must admit, to watch their singled minded pursuit of power - the bridges burned, the people seduced and cast aside,and the human atrocities committed. And while they have distinct personalities, it has at times seemed like they were two parts of a single-celled organism, albeit one that is frequently toxic and capable of inflicting great damage.

    Now we come to season three, which almost by definition has to be different in tone and scope than the first two. After all, Frank Underwood is the dog who actually has caught the car ... it is hard to yearn for more power when you occupy the most powerful office on earth. And yet, in many ways, I think the third season of "House of Cards" is about powerlessness, and how difficult it is to lead when one has little in the way of a moral center, and when one has managed to disenfranchise almost all constituencies in the pursuit of a goal for its own sake.

    I don't want to give much away here, but one of the thing that becomes evident almost from the beginning of the first episode of the new series is how little Frank listens. For him, listening is the bridge that sits between his making up his mind and giving orders ... he has to do it to show any sort of leadership, but he's not really invested in it. And because he has not gotten to the White House through normal means - he is an unelected President, having replaced the Vice President and then the President through parliamentary procedures - there is little foundation for the power structure he is attempting to build. And while one would think sitting behind the desk in the Oval Office would make him more powerful, there are times in the series that he seems almost diminished by it, that he misses the back room dealings and political maneuverings of the legislative branch, and finds state craft - and the requisite stage craft - almost frustratingly limiting.

    Of course, this is how I view the series. Others may view it differently, and draw different conclusions. Perhaps because I was an enormous fan of "The West Wing," I see allusions to that series here ... it is almost the anti-"West Wing," spitting in the eye of a series that fervently believed in the noble exercise of power and servant leadership. And I must admit that I would like to think that government and politics are more like"The West Wing," I fear that "House of Cards" may be closer to the truth than any of us would like.

    The business lessons? Without giving too much away, I think "House of Cards" shows the importance of building coalitions and teamwork, of appropriate delegation, and of servant leadership. Mostly, it is because these are things that Frank Underwood is not very good at; "House of Cards" ultimately asks if hollow victories are actually victories at all.

    The third season, as much as the two that preceded it, is really well acted, written and directed with what seems to be an insider's knowledge of Washington ... and above all deeply cynical about the nature of power. It is upsetting to watch, sometimes. And I can't wait for season four.

    One piece of excellent news ... Tom Selleck will return as Robert B. Parker's Jesse Stone in a new TV movie, "Jesse Stone: Lost In Paradise," that will air this fall on the Hallmark Channel.

    Thanks to MNB reader Michael Schillo for alerting me to the new movie, part of a deal that will result in at least two new Jesse Stone movies.


    That's it for this week. Have a great weekend, and I'll see you Monday.

    KC's View: