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    Published on: July 13, 2021

    by Michael Sansolo

    Something instructive apparently happened recently in the National Basketball Association (NBA) finals. I doubt it was meant as a business lesson, but it certainly provides a great one.

    According to a report I read about the second game in the championship series (I didn’t watch any of it), the Milwaukee Bucks changed their defensive strategy after losing the first game. The only problem was that their opponent, the Phoenix Suns, adjusted to the adjustment and grabbed another victory.

    Honestly, I’m not a big pro basketball fan and I don’t really have anything insightful to say about either team, the game or anything else except for that notion of the Suns adjusting to the Bucks’ adjustment and beating them again. I would argue there’s a powerful lesson in that for all of us.

    We’ve talked here before about the importance of flexibility. We’ve used the famed Mike Tyson quote about how all his boxing opponents always had a pretty good strategy to beat him, at least until Tyson punched them in the mouth. Likewise, we’ve quoted a prominent former US Army general who talked about how every battle plan is perfect…until that plan meets the enemy.

    The lesson is pretty straightforward; plans are great, but only if the individual, team, company, Army or whomever realizes that the plan needs to be flexible to change with the changing realities of the competition, consumers or whatever. In other words, just like the Phoenix Suns you need to adjust to the adjustments.

    And frankly, the time to think about that is right now. No doubt there are countless readers out there who got to this spring delighted to have simply survived the year of covid lockdowns. You might have even had plans to capitalize on how shopping habits had changed by examining everything from omni-channel operations to pent up consumer desire to return to normalcy.

    But once again, the situation changed. Now internal discussions are likely focusing on how to cope with a sudden inflationary spiral in pricing and a seemingly universal inability to find enough workers for anything. Like it or not, you’ve got to adjust to the adjustments.

    The ugly truth is this: stuff is going to change again and maybe quickly. We have no idea if the inflationary jolt is lasting or if it will fade quickly, just as we can’t know what reality is going to sting the job market and either extend this period of worker scarcity or end it quickly.

    Likewise, you can’t know exactly how consumers are going to respond to the seeming end of covid, just as we don’t really know if covid is defeated or simply regrouping into new variants. (The virus is adjusting to our adjustments because that’s what nature does.) 

    Inflation has been so incredibly low for decades now that many companies and consumers may have forgotten how to cope with rapidly rising prices. It may be worth looking back to the 70s and early 80s to get a sense of what did and did not work. (Let’s hope plain label and spotty quality generics aren’t due for a moment in the retro spotlight.)

    Let’s also consider how to cope with employee scarcity by studying why jobs in your company may be unattractive (an overdue exercise) and also studying areas where labor is wasted.

    As you do all this, remember the one rock solid lesson from history and the Phoenix Suns. Whatever plans you make will likely have to evolve quickly as the situation changes for you. Adjust to the adjustment - make it a mantra!

    Michael Sansolo can be reached via email at

    His book, “THE BIG PICTURE:  Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available here.

    And, his book "Business Rules!" is available from Amazon here.

    Published on: July 13, 2021

    We all know that Americans are quitting their jobs at a record pace.  But, apparently, not at Target.  KC suggests that this is because Target has made a choice, one that is available to every employer.

    Published on: July 13, 2021

    From the Washington Post this morning:

    "Prices rose 5.4 percent in June compared with one year ago, reflecting upward-creeping inflation throughout the economy, as more consumers open their wallets and supply chains struggle to bounce back from pandemic pressures.

    "Still, policymakers at the Federal Reserve and White House continue to predict that as the economy has time to heal, inflation will settle back down.

    "Data released by the Bureau of Labor Statistics on Tuesday showed that prices rose 0.9 percent in the past month. The latest figures aren’t likely to rattle officials who have long maintained that the price increases are a temporary feature of a bumpy economic recovery. Their expectation is that inflation will simmer down closer to the Fed’s 2 percent annual target next year and in 2023.

    "There are a few reasons inflation is on the rise. For starters, prices in 2021 are being compared to those from 2020, when the pandemic caused the economy to shut down and prices fell … Also, as vaccinations become more widespread and consumers unleash their pent-up savings, demand is rebounding much faster than supply can catch up. Many Americans are newly eager to book airline tickets, rental cars and hotel rooms, while the travel industry is still climbing back from the depths of the pandemic. Backlogged supply chains are also clashing with demand for products like furniture, bicycles and auto parts."

    Published on: July 13, 2021

    CNBC reports that Walmart-owned Sam's Club is testing a new digital tool that will allow customers, as they walk the store, to choose and pay for a variety of items using their smartphones, with products they cannot or would rather not take home being shipped to their homes or offices.

    “We want to have great items. We want to have disruptive prices. And we want to make sure that we’re providing convenience to our members,” says Sam’s Club CEO Kath McLay.  “What we really learned through the pandemic was that we need to stay true to that strategy.”

    Some context from the CNBC story:  "During the health crisis, Sam’s Club rolled out curbside pickup to all its stores, as customers sought fast, contactless ways to pick up online purchases. The Scan & Ship service, announced Tuesday, is the latest way that Sam’s Club is using digital options to stand out from competitors. It will become a feature of Scan & Go, which allows customers to ring up purchases with a smartphone as they add items to their shopping carts."

    KC's View:

    It is all about reducing friction, wherever and whenever possible.  This has to be a core priority for every retailer these days, because it will be the difference between viability and obsolescence.

    Published on: July 13, 2021

    The Wall Street Journal  reports that McDonald's franchisees "are adding emergency child care and other benefits, as many U.S. restaurants are struggling to hire enough workers to run their businesses."

    The plan is to "boost hourly pay, give workers paid time off and help cover tuition costs to draw enough workers and improve the Golden Arches’ image as an employer. McDonald’s corporate parent said it is making a multimillion-dollar investment to back the franchisee efforts."  A new employee program "aims to “fundamentally change what it means to work at a McDonald’s restaurant."

    The story notes that "labor has emerged as one of the biggest challenges to the U.S. economy’s post-pandemic rebound, particularly in service-heavy businesses that depend on large numbers of workers to prepare meals or make beds … A number of restaurant companies are trying to understand what it will take to lure back workers. Chipotle Mexican Grill Inc. conducted a weeks-long survey of market wages before announcing last month it would boost starting pay to an average of $15 an hour, chain executives said. Shake Shack Inc. executives said they raised hourly wages at more than half of their U.S. restaurants this year and are reviewing compensation frequently to keep it competitive."

    KC's View:

    It isn't just restaurants and fast food joints, of course - there are all sort of businesses competing for workers.  As I pointed out in my FaceTime this morning, retailers have a choice - they can create worker-centric businesses, knowing that prioritized workers then will make customers their priority.  Or, they can do things the old way, which I'm not sure is up to the task of being relevant in 2021 and beyond.

    Published on: July 13, 2021

    •  Investors Business Daily reports that Walmart-controlled Flipkart, the India-based e-commerce business, "soared in value to nearly $38 billion after its latest fundraising round, as the Indian e-commerce startup looks to IPO."

    It was just a year ago that the company was valued at about $27 billion, and the company had been aiming for as current valuation of about $35 billion.

    The higher valuation "reflects global investor confidence in digital commerce in India, which has continued to accelerate over the last year," Flipkart said in a statement.

    •  Amazon said yesterday that it "plans to hire over 100,000 U.S. veterans and military spouses by 2024. Amazon currently employs over 40,000 veterans and military spouses across multiple businesses - from Operations to Alexa to Sustainability to Amazon Web Services (AWS) - and they all receive a starting wage of at least $15 per hour and have access to comprehensive benefits.

    “Amazon is focused on recruiting and developing military talent with training programs specifically designed to help veterans transition into roles in the private sector,” said John Quintas, Amazon’s director of global military affairs. “We value the unique skills and experience that the military community brings—and our new hiring commitment will expand the impact that military members currently have on every single business across the company.”

    Published on: July 13, 2021

    •  Kroger said that the United Food and Commercial Workers Union Local 1996 in Atlanta and Savannah ratified new labor agreements with its Atlanta division, which it said is "investing over $300 million­­­­ in wage increases across four years in these agreements."

    "These new agreements provide significant pay increases, affordable and comprehensive health care, and continued investment in our associates' pension fund," said Tim Brown, president of the Kroger Atlanta division.

    Published on: July 13, 2021

    •  Hy-Vee announced that it has hired Dr. Daniel Fick to be its new Chief Medical Officer, responsible for overseeing the retailer's existing health and medical programs and developing new initiatives for both customers and employees.

    According to the company, "Fick comes to Hy-Vee from the University of Iowa Carver College of Medicine, where he is a clinical professor of family medicine and part of the provider group for the Executive Health Program at the University of Iowa Hospitals and Clinics, positions he will continue to hold alongside his new role at Hy-Vee."

    Published on: July 13, 2021

    Random and illustrative stories about the global pandemic and how businesses and various business sectors are trying to recover from it, with brief, occasional, italicized and sometimes gratuitous commentary…

    •  In the United States, we've now had 34,766,404 total Covid-19 coronavirus cases, resulting in 623,029 deaths and 29,274349 reported recoveries.

    Globally, there have been 188,134,301 total coronavirus cases, with 4,057,017 resultant deaths, and 172,060,692 reported recoveries. (Source.)

    •  The Centers for Disease Control and Prevention (CDC) says that 67.7 percent of the Us population age 18 and older has received at least one dose of vaccine, with 58.9 percent being fully vaccinated.

    •  From the Washington Post:

    "The Food and Drug Administration announced a new warning for the Johnson & Johnson coronavirus vaccine on Monday, saying the shot has been linked to a serious but rare side effect called Guillain-Barré syndrome, in which the immune system attacks the nerves.

    "About 100 preliminary reports of Guillain-Barré have been detected in vaccine recipients after the administration of 12.8 million doses of the Johnson & Johnson vaccine in the United States, according to a companion statement from the Centers for Disease Control and Prevention, which monitors vaccine safety systems with the FDA. Of these reports, 95 were serious and required hospitalization, the FDA statement said. There was one death … The cases have largely been reported about two weeks after vaccination and mostly in men, many aged 50 and older, according to the CDC. Most people fully recover from Guillain-Barré."

    Published on: July 13, 2021

    Yesterday, we took note of a Yahoo Finance report that "The Back Space, a newly launched retail spine and neck care subsidiary of IMAC Holdings, Inc., has partnered with Walmart.   The unique partnership will make it possible for the Company to provide spinal health and wellness services through its own branded locations directly within select Walmart locations."

    I commented:

    This strikes me as a baby step on Walmart's part toward the model that I talked about here a few weeks ago when I interviewed Bhavdeep Singh about his new HealthQuarters concept in New York City, which actually offers the promise of accessible preventative care with a strikingly retail component.

    One MNB reader wrote:

    Although I agree this is indeed a baby step for Walmart, it points to two important indicators: 1) Walmart (and other retailers) must look for uncommon partnerships to provide unique and differentiated value to its shoppers; and 2) retailing is no longer just about “products,” but rather it is about “products AND services.” These may be two of the most important ways brick-and-mortar can remain relevant with consumers.

    Totally agree.  As someone once said (here, I think), it is important to be more than just a source of product - retailers now have to be a resource for consumers.

    From another reader:

    This direction could be a very positive way to provide accessible healthcare to outlying communities.  As long as it is quality care, it could dramatically change the consolidation landscape that doctors and hospitals have been moving to over the years.  I personally like the idea.

    We wrote about a Bloomberg report last week that "some high-ranking Black managers at Walmart say career advancement is difficult at the retail chain and they wouldn’t recommend working there, a recent internal survey commissioned by the company found … A majority of those surveyed gave mediocre rankings for career satisfaction," with the overwhelming sense that they did not have the same support systems that non-Black executives do.

    One MNB reader reacted:

    It must be comforting for those who don't make it up the corporate ladder to have a convenient excuse to fall back on.  Failure is so much more-acceptable when it's not really your fault.

    And from another reader:

    You have to perform at an exceptional level to maintain your position.  That is bad?   Heavier emphasis on recruiting from the outside vs developing internal talent.  Isn’t the job opportunity process one that seeks “best qualified” for the position.  HR has traditionally had to open job postings to the outside for that reason, less they become a target for not sourcing from a broad enough pool.  So that too is bad?  Unequal access to career growth opportunities?  Sounds to me like if this was the case, the NAACP would be all over this.  And finally,   conform to unspoken social norms.  I see this as a whine.  What is wrong with having to conform to presenting yourself in a professional manner?  If you need to show your individuality, do it on your own time.  If you work for me, I have expectations.  Present yourself well.  Do your job, well.  AND take the initiative to better yourself.  Don’t wait around for it to be given to you.  I know a lot of diverse people that have done exactly that, and they didn’t stand around and wait to become successful.  Stop the victim mentality and acquire the personal drive to succeed. 

    I think you miss the point that the study seems to be making - that the expectations may be unequal, as well as the support systems in place, for Black folks.

    The story made the point that the study was of a limited sample, and that Walmart seems to be open to having the conversation and rectifying inequities.

    These folks didn't sound like they were whining to me.  Sounded like they were giving honest answers to questions they were being asked.  

    Maybe some companies wouldn't ask the questions because they wouldn't like the answers.  But I actually give Walmart credit for considering the possibility that its culture may be imperfect, and initiating the research necessary to find out how.  How Walmart proceeds from here will say much.

    Yesterday, CNBC reported that Dollar General, following a pattern set by retailers that include Amazon, Walmart and CVS, is signaling a major health care play by looking to recruit a chief medical officer and expanding its HBC offerings in-store.

    I commented:

    There would seem to be little question that if Dollar General wants to have an impact on how people in the US consume health care, it has the footprint and muscle to do so.   And the idea that it could connect food and HBC products in a compelling way makes a lot of sense to me.

    On another subject, from an MNB reader:

    Subway needs to upgrade their entire image.  It is great that they are upgrading their ingredient line up. (I think the bar was pretty low to begin with.)  Wouldn’t it be a great idea to use their size to source local and become “better for you” option rather then the belly filler option they currently are.

    The Federal Trade Commission (FTC), according to a government posting, has "finalized a new rule that will crack down on marketers who make false, unqualified claims that their products are Made in the USA. Under the rule, marketers making unqualified Made in USA claims on labels should be able to prove that their products are “all or virtually all” made in the United States."

    I wrote:

    Good.  I am sick and tired of companies making false claims with impunity, thinking that they won't get caught, and certainly won't get penalized.

    This is one of those scenarios in which marketers largely know what they're doing, but figure that they can get away with it because nobody has been paying attention.

    Lie to the consumer, and you ought to get nailed.

    Hang 'em high.

    One MNB reader wrote:

    The rules have to be specific so that manufacturers know what will be considered made in the USA.  Will foreign components assembled into the final product in the US be allowed?  Will US made formulas or products packaged in components from foreign sources be OK,  or will the package have to say assembled in the USA but may contain foreign components?  I once saw a huge recall due to a small packaging component from a foreign source on a US made product that was assembled and packaged in the US because it said it was made in the USA.   There are hundreds of products that are assembled in the US with some component that may come from Mexico, Canada, China or components that come from China that are included in parts or ingredients that come from Mexico and Canada for instance.  It is a real Pandora’s box that need to be clarified if the FDA is planning to issue heavy fines.

    Another MNB reader wrote:

    Totally agree.  I wonder if this to will affect the car industry.  How much of your car was “Made in America”? 

    MNB reader Bob Thomas wrote:

    “All or virtually all” made in the United States" is a very difficult bar to have.  With supply chains that run around the world, components (or chips) can knock a product out of the ability to use the Made in the USA sticker.  What if you buy a Chinese component from a US distributor?  I once did a test in South Africa.  A retail store had the same exact product available for sale.  One had a US flag on it.  The product with the flag vastly outsold the product without one.  In my experience in international sales the Made in the USA sticker is a major selling point.  It gives products instant credibility.  “Made in China” does the opposite.  Some companies are using “designed in the USA” but that sends consumers to look for where it was made.  Maybe the FTC should look at content and then say if it has XX% US content it can use the Made in the USA label.

    Yesterday we noted that "public health officials are saying that the vast majority of all new Covid-19 coronavirus cases - more than 99 percent - are affecting people who have not been vaccinated."  Which led me to make this observation:

    What if insurance companies established a policy - no pun intended - that if you had access to a vaccine and refused to get it (as opposed to being unable to get it because of age or geography or a health condition), then they will not cover expenses incurred during treatment for the coronavirus?  (According to HealthCare Finance, the "average cost of hospital care for COVID-19 ranges from $51,000 to $78,000, based on age.")   If you don't follow public healthy experts' recommendations, then you have to cover the expenses yourself … and could, if you don't have that kind of cash lying around, lose your house, savings and other assets.

    And here's an ever bigger question.  If an insurance company that is publicly traded made that announcement, do you think its stock would go up or down in the immediate aftermath?  I think its stock would go up.

    One MNB reader reacted:

    Just wanted to give you another idea on how to get more people vaccinated.  Just put a deadline for getting it and then take it off the market.  Actually, this is my husband’s idea.  But think about it- how many times has there been a run on items when it is in short supply or off the market???  I’m thinking Cabbage Patch Dolls, marijuana before it became legal in many places, gasoline, etc.  People go crazy trying to get things that aren’t easily and readily available.  There could become a covid vaccine black market!

    And from another:

    The stock question is a good one.  I think a better one is, will our premiums go down?  I don’t think so.

    And finally, MNB reader Chuck Loyd offered a timely lesson:

    I just wanted to offer a little Soccer scoring lesson for you...For the record, the correct result of the Euro 2020 goes in the book as a tie - Italy 1 - England 1 with Italy advancing and declared the Champion as a result of a 3-2 advantage on PK's in a penalty kick shootout.  Although it doesn't change the result, Italy did not win 2-1. 

    While it's certainly not yet on a level as our national pastime Baseball, Soccer continues to grow exponentially as more folks learn the rules, play, and follow the game internationally through events like the World Cup, Euro Championship and Soccer leagues home and abroad.  This is especially in light of the way MLB continues to lose a younger audience and alter its traditional rules.  Baseball is timeless and should remain that way - only move the post-season game start times up for our younger viewers.