Published on: February 21, 2023
While the ChatGPT software being integrated into Microsoft's Bing search engine has been hailed as revolutionary, some of the early interactions have been troubling. One person who used it described it as a "narcissistic, passive-aggressive bot." I have a couple of thoughts about this … one reassuring, but the other, not so much.
Published on: February 21, 2023
The Wall Street Journal reports that Amazon's declining stock price has meant that corporate employees are taking a compensation hit - the company has a "stock-heavy compensation plan," and staffers are likely to see their pay in 2023 drop between 15 and 20 percent.
CEO Andy Jassy has responded to the situation by telling employees that effective May 1, they are expected to be in the office at least three days a week, ending a remote work policy that was created for the pandemic.
Some context from the Journal story:
"Amazon has historically given less base-pay compensation to employees than its big-tech peers but made up the difference with stock awards that vest over several years. Employees say the longer an Amazon employee stays with the company, the more their compensation can depend on stock awards, with stocks making up 50% or more of total income for some.
"Over the past year, Amazon’s shares have declined more than 35% amid a broader technology slowdown and slower growth on Amazon’s retail side of the business. When Amazon issues restricted stock units to employees, it is predicated on the longstanding assumption shared in compensation conversations that Amazon’s shares would appreciate at least 15% each year, the people said.
"Until recently, that had largely been true. Between 2017 and early 2022, the stock price increased on average about 30% each year. But Amazon’s stock is currently trading around $96 per share and some employee pay packages are structured under the assumption that Amazon’s shares would be around $170 per share, some of the people said."
The Journal quotes Jassy as telling employees at a recent all-hands meeting in Seattle that "'I know that this is and feels like a really difficult time. We have a very uncertain economy, we just had to say goodbye to 18,000 of our teammates, the market is in a funky spot,' he said, adding that Amazon and other companies have seen an impact on their stock prices. 'The result is compensations are impacted. And that is difficult. All of that is difficult. But I am quite optimistic that we have the chance to emerge from this challenging time in a relatively stronger position than we entered it'."
Bloomberg reports that Jassy informed employees of the in-office mandate via a memo posted on Amazon's corporate blog: "Teams tend to be better connected to one another when they see each other in person more frequently. There is something about being face-to-face with somebody, looking them in the eye and seeing they’re fully immersed in whatever you’re discussing that bonds people together.”
Bloomberg adds that "in asking employees to report to the office more frequently, Amazon, the second-largest private U.S. employer after Walmart, joins the ranks of companies that are rolling back some of the work-from-anywhere flexibility offered during the pandemic. Apple, Alphabet and Microsoft now all require employees to work in the office a minimum number of days."
First of all, I think that, if I were Jassy, I might've avoided the term "funky spot." If you're in the tech sector, it feels like a lot more than that - it seems like virtually every tech company out there is cutting personnel by six to 10 percent, and the ones who are left are facing lives of reduced expectations.
Now, I'm not saying that this isn't entirely appropriate - some would argue that compensation in the tech sector has been inflated in recent years and that a reality check was inevitable. But these employees are people, subject to the same concerns and insecurities as everyone else. "Funky spot" just seems a little cavalier to me.
There's an interesting analysis from Inc. that Jassy "does make a few good points. For example, having people together in person is better for some things, like professional development, mentoring, training, and spontaneous interactions.
"The thing is, what you're really saying is that you've fallen behind in things like collaboration, innovation, and invention. You're saying that your company has a problem and you're asking employees to be the ones to adapt in order to fix it.
"Basically, Amazon's top executives are asking their employees to change the way they work in order to make the executives' lives a little easier. Those executives are facing enormous pressure right now because Amazon isn't the growth machine it was in the past. That's not a thing they can fix right now. But, they have to do something … the problems Amazon is facing right now aren't going to be solved by forcing people to come back to the office. You can't just magically make the economy better or change people's shopping habits. You can't just magically go back to huge growth in a cloud business that depends on other companies--all of which are also having a rough time right now."
All good points. Amazon's problems are rooted in how customer behavior is behaving, and in its own - largely defensible - spending decisions during the pandemic. It may be that people being in the office together will help to solve these problems to some degree, but the rhetoric is lacking.
Amazon likes to say that it wants its employees to think and behave like owners, which is one of the reasons that compensation is linked to the company's share price. The irony, of course, is that for much of the company's first two decades of existence, founder-CEO Jeff Bezos downplayed the importance of the stock market, arguing that investment in strategic growth and constant Day One-style innovation were far more important … that if the company did all those other things right, the share price would take care of itself.
I love irony. I am reminded of the Raymond Chandler line from "The Long Goodbye:"
“There is no trap so deadly as the trap you set for yourself.”
Published on: February 21, 2023
From the Wall Street Journal:
"The U.S. food industry is tapping a new pool of workers to staff plants and grocery warehouses: their former employees.
"Kroger Co.the biggest U.S. supermarket operator by sales, is staying in touch with ex-employees and bringing some back. Cereal maker General Mills Inc. has persuaded some retirees to return to plant jobs, and other food-company recruiters have combed social media for former workers who might be open to coming back.
"Companies across the U.S. economy have faced a severe shortage of workers since the onset of the pandemic as people left the workforce in record numbers. Employees quit because they were worried about contracting Covid-19 or received government incentives, or they switched industries seeking better working conditions or pay.
"Cincinnati-based Kroger has been working harder since the pandemic to follow up with employees who leave, and maintaining contact with them, said Tim Massa, chief people officer at the grocer. Kroger is reaching out to some former employees via text and email, he said, helping return the company’s staffing to near its prepandemic level … Kroger has seen a significant increase in the number of former employees of various demographics returning to the company - so-called boomerangs - and people are typically coming back within six months of leaving, Mr. Massa said."
I wonder if there could be lessons learned from this situation about how existing employees are valued … how they are afforded new opportunities and challenges … and the degree to which employees are seen by any organization as investments, not costs.
Published on: February 21, 2023
From the Wall Street Journal this morning:
"Walmart Inc. reported strong quarterly sales Tuesday as cash-strapped shoppers gravitated to the discount retailer for food and other essentials and continued to pay higher prices on many items compared with last year.
"U.S. comparable sales, those from stores and digital channels operating for at least 12 months, rose 8.3% in the quarter ended Jan. 27, compared with the same period last year. That beat analyst expectations of 4.9% growth, according to estimates from FactSet … At Walmart, total revenue rose 7.3% to $164 billion for the quarter ended Jan. 31 compared with the same period last year. Overall net income rose 76% to $6.3 billion for the period."
According to the Journal, "The country’s largest retailer by revenue said it is gaining market share in grocery, including among higher-income households that are spending cautiously. December was the largest sales-volume month in the retailer’s history, the company said. Sales of nonfood items fell during the quarter, as shoppers prioritized spending on everyday needs.
"That ate into profits as it has in recent quarters, as food tends to be less profitable than items such as clothing and toys and Walmart discounted many items to offload inventory.
"The retailer gave a cautious outlook for the year, saying it expects U.S. comparable sales to increase by between 2% and 2.5%."
I'm sure the folks at Kroger and Albertsons will forward the Walmart results to the Federal Trade Commission (FTC) in an email, with a subject line that reads, "This is why you need to let us merge!"
Published on: February 21, 2023
The Des Moines Register reports that "following what it says was a surge in misuse, Hy-Vee has shut down its employee discount program so it can be retooled."
In a video last week, Hy-Vee EVP Georgia Van Gundy told employees "that the company was making 'necessary changes' to the discount program after uncovering increased 'fraud and abuse' by employees."
These abuses, Van Gundy said, included one employee's Fuel Saver account being "used in five states in one hour. Another employee made discount purchases that exceeded their paycheck, 'and we're fairly certain that employee is reselling the merchandise at a profit for themselves.' In addition, she said, some individual employees' discounts were being shared among several households in different states."
Some context from the Register:
"The reworking of the employee discount program is the latest corporate change in a tumultuous period for Hy-Vee.
"Last year, as Hy-Vee laid off more than 400 employees in marketing, communications and technology, CEO Randy Edeker said in a leaked internal video that the company's front office 'does nothing.'
"He bemoaned that some of those whose jobs were being eliminated had declined reassignment to store positions, saying 'some people just simply see it being beneath them to work at the retail stores. I think it's crazy, and I think that it's offensive.'
"The company in July announced Edeker was stepping down as CEO, while remaining board chair, and announced Aaron Wiese, then a vice chairman, would succeed him.
"Less than a month later, Jeremy Gosch, the company’s then-co-chief operating officer and chief marketing officer, was named co-CEO.
"The company said at the time that the announcements had been separated to give Wiese and Gosch 'their own moment of recognition.' But in December, it announced Gosch would be the sole CEO, while Wiese was named one of two company presidents under him."
I remember the days when Hy-Vee was a bastion of stability … Ric Jurgens was the CEO … and the company featured a decentralized business model, with store managers empowered with an enormous amount of autonomy, that seemed to foster a high level of collegiality.
Perhaps it is a changed reality that comes with growth.
Published on: February 21, 2023
From the Washington Post:
"One of the country’s largest food sanitation service providers has paid $1.5 million in penalties for illegally employing at least 102 children to clean 13 meatpacking plants on overnight shifts, the Labor Department announced Friday.
"The company, Packers Sanitation Services, allegedly employed minors as young as 13 to use caustic chemicals to clean 'razor-sharp saws,' head splitters and other dangerous equipment at meatpacking facilities in eight states, mostly in the Midwest and the South, in some cases for years. The plants are operated by some of the country’s most powerful meat and poultry producers, including JBS Foods, Tyson and Cargill. Those companies were not charged or fined.
"Investigators learned in recent months that at least three children suffered injuries, including a chemical burn to the face, while sanitizing kill floors and other areas of slaughterhouses in the middle of the night."
“The child labor violations in this case were systemic and reached across eight states, and clearly indicate a corporate-wide failure by Packers Sanitation Services at all levels,” said Jessica Looman, principal deputy administrator of the Labor Department’s wage and hour division, in a prepared statement. “These children should never have been employed in meat packing plants and this can only happen when employers do no take responsibility to prevent child labor violations from occurring in the first place.”
Gina Swenson, a Packers spokesperson, said in a statement, "We have been crystal clear from the start: Our company has a zero-tolerance policy against employing anyone under the age of 18 and fully shares the [Labor Department’s] objective of ensuring full compliance at all locations.”
The "zero tolerance" assertion lacks a little credibility, but let's move past that. (It is all well and good to launch an audit after the Labor Department starts an investigation, but where the hell were you beforehand?)
I always wonder in such cases - and the Post notes that "child labor violations have been on the rise in the United States since 2015," and that "the number of children found to be illegally employed in hazardous occupations, such as meatpacking and construction, spiked by 93 percent over the past seven years" - about the individuals who put children in these situations.
Don't they have kids? Is it just that other people's kids, especially the children of less financially prosperous people, have intrinsically less value than their own? Do they not feel shame? (I also look askance at the parents who allow their children to be put in such situations, but recognize that sometimes economic desperation creates choices bad and worse.)
Published on: February 21, 2023
From the Associated Press:
"The government agency responsible for tracking down contaminated peanut butter and defective pacemakers is taking on a new health hazard: online misinformation.
"It’s an unlikely role for the Food and Drug Administration, a sprawling, century-old bureaucracy that for decades directed most its communications toward doctors and corporations.
"But FDA Commissioner Dr. Robert Califf has spent the last year warning that growing 'distortions and half-truths' surrounding vaccines and other medical products are now 'a leading cause of death in America'."
Califf makes the point that "almost no one should be dying of COVID in the U.S. today … People who are denying themselves that opportunity are dying because they’re misinformed … We’re now in a 24/7 sea of information without a user guide for people out there in society. So this requires us to change the way we communicate."
The AP goes on:
"The FDA’s answer? Short YouTube videos, long Twitter threads and other online postings debunking medical misinformation, including bogus COVID-19 remedies like ivermectin, the anti-parasite drug intended for farm animals. 'Hold your horses y’all. Ivermectin may be trending, but it still isn’t authorized or approved to treat COVID-19' the FDA told its 500,000 Twitter followers in April.
"On Instagram, FDA memes referencing Scooby-Doo and SpongeBob urge Americans to get boosted and ignore misinformation, alongside staid agency postings about the arrival of National Handwashing Awareness Week."
A couple of things here.
First, regarding Covid. The Wall Street Journal this morning has a story about how, while "the US has dodged a major wintertime Covid-19 surge as the pandemic continues to recede into the background," the fact remains that "the death toll is still growing … the US averaged about 400 deaths a day in a three-month span covering November through January, based on weekly Centers for Disease Control and Prevention counts of death certificates listing Covid-19 as the underlying or contributing cause." That's a significant improvement - during the same period a year ago the number was 1,700 deaths a day, and the year before that it was 2,800. But, the Journal notes, Covid-19 remains "among the major causes of death in the U.S. The disease ranked at No. 3 in 2020 and 2021, behind heart disease and cancer, and might rank there again in 2022."
When I got Covid late last year and said so here on MNB, one of the first emails I got was from an MNB user who wondered if I was reconsidering my decision to be vaccinated and boosted. Which struck me as absurd - the reason my case (like that of so many other people) was relatively minor likely was because I'd been vaccinated and boosted. If it is recommended that I get another booster tomorrow, I'll get one, just like I get flu vaccines every year and got a shingles vaccines when the doctor suggested it.
There is no doubt in my mind that the majority of those 400 daily deaths are preventable, and can be ascribed to misinformation. So I think that the FDA has that right.
I'm not sure, however, that Twitter, YouTube and Instagram memes featuring Scooby-Doo and SpongeBob are going to be up to the task of remedying the problem. Misinformation seems to be a plague on our culture, whether it has to do with health, politics or virtually anything else.
I'd like to see the FDA come up with a vaccine for that.
Published on: February 21, 2023
Fast Company has a piece about Temu, ther Chinese-owned shopping app "with a very heavy emphasis on low prices across a truly bewildering array of product categories."
Temu, the story says, "launched in the U.S. less than six months ago. But by December, thanks to aggressive online marketing, it had become one of the most-downloaded free apps in both the Apple and Google Play app stores. By January, it had a reported 19 million installs. And that was before it paid for two ad slots at the Super Bowl."
Those two ads were bland and unremarkable, the story says, but the business model is unique - Temu allows Chinese manufacturers and merchants to sell directly to the world.
"Temu’s owner is Chinese mobile e-commerce giant PDD Holdings, valued at about $118 billion," the story says. "Operating mostly in China, it launched Temu in September as its first shot at a truly global shopping app. Temu is frequently compared to fellow Chinese e-retailer Shein, which is best known for its fast-fashion selection and popularity with Gen Z—as well as controversy over the environmental and labor impacts of its relentlessly price-focused, high-turnover business model."
You can read the entire story here.
The facile description of Temu is that it is "the TikTok of shopping," and while that may not be entirely fair, it also doesn't do the company any favors - I think we're on the path to TikTok, at least under current ownership, being banned in the US. The geopolitical tensions between the US and China do not seem to be lessening, and some would argue that TikTok is a much bigger threat to national security than any balloons that may be flying overhead.
Depending on how Temu's algorithms are set up, and how much data is being collected on Temu's users, I wonder if it may find itself subject to some of the same criticisms.
Speaking of criticisms, by the way … Forbes notes that "Temu has only a 1.8/5 star rating from 84 customer reviews on the Better Business Bureau website along with 120 complaints, many of which allege products never arrived, products were delivered with damages and customer service was slow or unhelpful."
Published on: February 21, 2023
• From Axios:
"As Amazon pushes further into live sports programming, the company has been investing resources to ensure that Alexa, its AI virtual assistant technology, is a sports expert.
"Why it matters: The strategy appears to be working. Alexa-enabled devices received hundreds of millions of sports queries in 2022, up 40% from the year before, per Amazon.
"The increased sports push means Alexa can provide more information than ever before, whether you have a simple question about a score or need to settle a historical debate with stats.
"Amazon wants Alexa to be the go-to technology for in-game updates, allowing fans to get real-time info without having to pull up a second screen and look away from the game."
Published on: February 21, 2023
• From the Wall Street Journal:
"Enriched pandemic-era food stamps made a big mark on supermarket sales in the past three years. Those extra benefits are soon coming to an end, possibly spoiling supermarkets’ outlook for the year.
"The federal government started beefing up households’ food budgets starting March 2020 to address food insecurity during the Covid-19 pandemic. Over the last three calendar years, that added up to about $98 billion of extra assistance—known as emergency allotments—on top of regular food stamps issued through the Supplemental Nutrition Assistance Program, or SNAP, according to HSA Consulting, a retail industry research firm. Those boosts made food stamps an important component of food sales. In 2022, SNAP benefits (including the emergency allotments) made up 12.3% of total at-home U.S. food and beverage retail sales, up from 7.1% in 2019, according to HSA Consulting."
The Journal notes that "Congress in late December put an end to that food-stamp boost, which will mean that SNAP-eligible households in 35 U.S. states and jurisdictions will lose at least $95 a month in benefits starting in March, according to the Center on Budget and Policy Priorities, a nonpartisan research and policy institute … Food stamps account for more than 10% of overall dollar-store revenues and can account for more than 20% of supermarket sales in lower-income areas, according to Howard Jackson, president of HSA Consulting. Ending those extra payments could have a noticeable impact on the stores’ sales."
• From the New York Times:
"A federal judge in Michigan issued an injunction on Friday banning Starbucks from firing U.S. workers because they seek to form a union or engage in other collective activities.
"The move is the first nationwide judicial mandate related to the labor campaign that has led to the unionization of more than 275 company-owned Starbucks stores in little more than a year. Starbucks said it would appeal the decision.
"Experts said the injunction would allow the National Labor Relations Board to come before the judge and seek more rapid reinstatement of workers who it believed had been terminated for union organizing. Normally, the process could take months or even years.
"The union organizing Starbucks stores, Workers United, has accused the company of firing more than 200 workers because of their involvement in the campaign. It is illegal for a company in the United States to fire workers for so-called protected concerted activity such as seeking to unionize."
Starbucks has argued that the affected workers for fired for other reasons, such as violations of company policies, and that "the extraordinary measure for injunctive relief prior to a full legal review of the matter is unwarranted and … actions taken were lawful and in alignment with established partner policies."
• Kroger announced that its Kroger Health division, its pharmacies, and health insurance company Medical Mutual have reached an agreement "to provide pharmacy services to Medical Mutual's Medicare Advantage members … This agreement, effective Jan. 1, 2023, allows Medical Mutual's MedMutual Advantage plan members to continue using Kroger as an in-network pharmacy. "
"We're excited to work with Medical Mutual as we continue to make healthcare more accessible for the communities we serve," said Colleen Lindholz, president of Kroger Health. "Our collaboration demonstrates a continued commitment to providing patients with quality, affordable healthcare services."
• From Fox 5:
"Approximately 200 employees at Lidl US headquarters in Arlington, VA have been laid off, according to a statement from the grocery story chain.
"The German-owned grocery store chain has been growing quickly in the D.C. area and throughout the East Coast. Lidl representative Chandler Spivey confirmed to FOX 5 that no store employees are impacted by the layoffs.
"'While we remain committed to the long-term success of Lidl US and look forward to continuing our expansion along the East Coast, we are continually evaluating our operations to ensure we are supporting our stores effectively,' said Spivey in a statement. 'We are grateful for the contributions of our team members, both those impacted and those remaining'."
• From Reuters:
"Britain's biggest retailer Tesco Plc is planning to review its presence in the UK banking sector in a move that could lead to a sale of its banking arm … The supermarket chain operator is lining up Goldman Sachs to advise on the future of Tesco Bank."
The report suggests that no deal is imminent, and that it is possible no deal - whether an outright sale or joint venture - will take place.
Published on: February 21, 2023
Got the following email from MNB reader Steven Ritchey:
The term "Rightsizing" implies that it's a good thing, a healthy thing, and in some cases, no doubt it is needed. But as George Carlin used to say, "We use jargon, buzzwords to cover up a lot of pain sometimes."
I'm not saying it's your fault, but, I think it behooves us to remember the human cost behind the jargon.
Fair point.
Regarding the antitrust scrutiny to which Apple is being subjected, one MNB reader wrote:
I guess I’m missing something here. Apple developed their phones and App Store, they charge third party to use/sell on the App Store and yet they are investigated because they favor their own products over third party? It’s their company, why wouldn’t they push their own products. Third party companies are free to utilize other app stores as they see fit. How is this different than a supermarket pushing their own brand over National brands.
Good point.
Last week, we took note of a Providence Journal report that a bill has been introduced in the Rhode Island legislature that would "limit the number of self-checkout lanes at any grocery store in Rhode Island to eight and mandate that grocers provide a 10% discount to customers who use self-checkout for 10 or more items."
Rep. Megan Cotter, who introduced the bill, explained it this way: “Self-checkout is a way grocery stores are avoiding paying employees by getting customers to do cashiers’ jobs for free. It seems only fair that if they are going to take on cashiers’ work, the customer should get something in return."
I commented:
This legislation is a crock. First of all, stores can't find enough employees. Second, customers like self-checkout because it gives them a sense of control and speed (though the latter can be illusory).
I have no problem with legitimate public policy, but this is protecting special interests in a way that is both obvious and misguided.
Like I said, a crock.
One MNB reader responded:
Ok. So how does this legislative attempt differ from forced minimum wage legislature?? One is attempting to legislate job protection, while the other is legislating wage protection. One you like, the other you don’t?
I see a double standard here. Both are governmental overreach. I have felt all along, the best way to regulate wages and jobs is let the business and competition guide these practices and keep the greedy fingers of government out of business.
I'm not sure that minimum wage legislation qualifies as "the greedy fingers of government." I do think that these two issues are entirely different, and government has the right, even the responsibility, to assure that workers are not exploited. Which, let's face it, some employers will do when given the chance.
MNB reader Steve Burbridge wrote:
As a Rhode Island resident, I agree with your assessment that this legislation is a crock. The representative knows nothing about business and the challenges with finding labor. She also ignores that there are Food stores - Dave's, a local chain - that have no self-checkouts that people can "vote with their dollars" to support.
Lastly, the legislation also calls for retailers to give a 10% discount if you use self-checkout more than 10 times. How is that going to be monitored?
PS - The representative was endorsed by the AFL/CIO and UAW...although most Democrats in Rhode Island are (she is a Progressive endorsed by Bernie Sanders).
From another reader:
I do like the discount idea. Should not be mandated by gov overreach, but rather an opportunity for the retailer to differentiate. This could easily be built into a rewards program. If I’m going to check myself out, bag my own groceries and (in NY) bring my own bag, hell yeah, give me discount!
We had a piece last week about how few kids are eating fresh fruits and vegetables, which prompted one MNB reader to write:
Kevin, I am dismayed at your blasé attitude about this study. It is shocking. It doesn’t say that kids don’t eat enough fruits and vegetables, it says they don’t eat any. No bananas on their cereal, no pasta with red sauce, not even canned pears or frozen peas, NOTHING.
I really don’t think you can blame this on the pandemic. Also, we all know kids do what their parents do (especially the under 5 crowd), so if the kids are not eating any fruits and vegetables, I suspect the parents aren’t either. This is tragic for their long term health and our taxpayer money going to healthcare. It should be treated as a national emergency, not a shrug and an “oh well”.
I know politics prevents it, but it is so unfortunate that people are not told the truth: that poor nutrition causes many of the so-called “diseases” they suffer from. They could alleviate or eliminate many of them by eating as many (canned, frozen, fresh or dried) fruits and vegetables as possible (especially beans), eating less cheese and meat (especially cured meats), and cutting back on sugar and salt. That’s the message – simple, but oh so difficult.
And finally, one more email regarding Michael Sansolo dismissing "Somebody Feed Phil" as "mediocre:"
We’ve been following this show since it began on PBS as “I’ll Have What Phil’s Having”. If you haven’t seen it, the show is produced by Phil’s brother Richard and the cinematography (is that an appropriate term for this show?) demonstrated in many of the travel shots is outstanding. Contrary to Michael’s comments, there actually have been episodes where Phil has refused to eat something and he has explained why he turned it down. His joie de vivre during his travels and interactions with others is absolutely wonderful-----and a great contrast to some of the darker food/travel fare produced by people like Anthony Bourdain.
“Somebody Feed Phil” appears to have been renewed for another season by Netflix, which justifies our subscription costs all by itself. If my wife and I were standing in for Siskel and Ebert, we would heartily give it “two thumbs up”!
Published on: February 21, 2023
Ricky Stenhouse Jr. last weekend won the Daytona 500 "in double overtime and under caution on Sunday in the longest running of 'The Great American Race,'" ESPN reports. "The two overtimes pushed the 65th running of the event to a record 212 laps -- a dozen laps beyond the scheduled distance and a whopping 530 miles."
