This has been a busy first quarter for the travelogue, although there is not one single interview to show for it. Several very good conversations, some well intentioned and informative emails, but not one formal, put on the suit, get out the lead face-to-face with anyone who had an actual position to peddle. So in the interest of keeping my skills sharp I've been working on several independent projects, and I'll let you know eventually if any of those turn out: remember, re-invent!

Nevertheless, I'm trying to keep an open mind about the state of the economy and the difficulties of 13.5 million Americans competing for survival. One series of incidents that I have found bitterly entertaining have been the attacks on CNBC aired by The Daily Show's John Stewart, the Daily Show, of course, being the only regular news show that is truly honest. If you haven't caught any of this, take a look at Stewart skewering Jim Cramer this week. You have to give Cramer credit for showing up, he knew what was coming, although I'm not sure he anticipated the public airing of a private interview he did in 2006, in which he describes the best methods of manipulating the short market. Pure felony. 

But the best (or worst) event that occurred recently was Citicorp Chairman Vikram Pandit's announcement that January and February were "profitable" months for the albatross, soon followed by BofA jumping on the two month profitability bandwagon. Renewed confidence in the financials caused the market to jump over 500 points this week as a direct result of this news. 

Well, it was bad enough that banks were stuck on a quarterly cycle of earning forecasts, but it appears that we will soon be announcing month to month. This should keep the day-traders and true manipulators happy (see: Stewart vs Cramer), but for the rest of us down 50%-70% in our retirement assets, which we were advised to keep "long", this is another blow below the sloar plexus. Pressure on banks to achieve quarterly forecasts kept them in questionable investments and dubious practices for many years, for which we now eat the rotten fruit. 

Me, I'm planning to stay away from CNBC until they start catching the bad guys rather than collaborating with them. I think maybe I'll move it all to cash and just go fishing...

Last week I attended an all-day workshop at the outplacement firm, on becoming an entrepreneur. I anticipated a large turnout, since the venue had been up-scaled from the original conference room, but I was surprised to see that attendance was around fifty or so. It didn't surprise me, however, to find that many of the professionals attending were folks like me, who were getting no reaction from a dead market (why expect a zombie to return your call?) and were looking to build a knowledge base in the event they will need to strike out on their own. The workshop was interactive, and the information presented was relevant and timely. Many of the attendees had already defined their personal approach to entrepreneurship, and some were already working on building the foundation for their business.

Here is what I found to be very intriguing. When the group broke up into four distinct categories (1. be a consultant; 2. start a business; 3. buy an existing business; 4. buy into a franchise), over 90% self-categorized #1 or #2. I believe the most obvious driver of these decisions (and perfectly legitimate) is that the initial capital investment required to accomplish #3 and #4 may not be a good economic decision at this time in history. But, I also think there may be a feeling that #1 and #2 are far easier to get started in the short-run, and I also believe that many of the budding entrepreneurs have themselves dealt with consultants or business owners in the past, and feel that they can do the job just as well or better.

Personally, I feel the same way. I wouldn't have attended the workshop if I didn't believe that. But here's an economic certainty: businesses will not begin spending again until consumers begin spending again. From a timing perspective, for new entrants in the "I'm my own boss" industry, does it make more sense to concentrate entrepreneurial focus on businesses or consumers? Or, perhaps, on that segment that represents both business and consumer: entrepreneurs? 

I recently had the pleasure of speaking with an entrepreneurial professional about the challenges and opportunities of stepping away from the structured corporate career ladder to an existence that is totally foreign to me.  One of the tactics she suggested is to completely re-do my curriculum vitae from one that is past-focused to one that shifts the point to "what-I-can-do-for-you-in-the-future". For those of you in the business, a functional rather than a chronological approach.

So I am going to do this (while still keeping the historic version in my back pocket), but I am also going to focus on anticipating the behavior-based thinking processes that dominate the middle market and large corporate approaches to hiring. For example, how do I craft a resume element that deals with this question: Tell me about the riskiest management decision you have made.   How long did it take you to gather the information to make the decision?  How long after that to make the decision?  What were the results?

It's almost as though I need to create a library of functional and behavioral components that I can draw on to fit the situation: one from column A, two from column B, etc. I'm going to work on this over the next several weeks and share my results as appropriate. 

I'm also taking up a new hobby which for me is really a rebirth of a very old one: fly-fishing. I've already recalled some techniques which apply to the travelogue: keep your hooks sharp, match your fly to what the fish are currently feeding on, practice your cast to make the best presentation possible, move from place to place to find likely targets, keep a hooked fish's head up, expect to spend a lot of time without a bite, talk to the locals to find the best spots, catch and release...the analogies continue....

I am deferring this week's blog to an essay in the Plain Dealer by Evelyn Theiss: 

http://www.cleveland.com/plaindealer/stories/index.ssf?/base/living-2/1234603883230130.xml&coll=2

A recent report from the Center for Human Resources at Wharton suggests that deep job cuts at corporations in the US and around the world are not the direct result of the tanking economy, but rather reflect operational and strategic issues that companies have effectively hidden over time. The onion-peeling effect of collapsed capital markets has brought these inefficiencies to light, and companies which reduce workforce in order to meet the next quarterly financial forecast may suffer more in the long run by not incorporating workforce planning into their recovery strategies. The report goes on to state that historically, corporate layoffs have a terrible track record, and contribute to future declines in overall performance. 

One insight from this report is that companies may assume that workers are a "just-in-time" resource that can be ramped up in a heartbeat. Let 'em go today, bring 'em back tomorrow. (Curiously, this was a fundamental plank of the UAW business model; amazingly, up until a few weeks ago, idled UAW workers were being paid by the industry for not working.) 

Wharton's supposition leads me to believe that those companies which accomodate this approach are actually increasing the chances for future operational issues and inefficiencies. Workers are not like engine parts, which can be manufactured to maintain a just-in-time inventory process. Here's a perfect example: the call center business.

In a call center, bodies-in-chairs is the fundamental objective. This has to be done within budget, while maintaining service levels and quality control. Since most call centers experience a turnover ratio in excess of 20%, managers, in effect, are re-tooling their resources at least 20% of the time. Assuming that new hires require a minimum number of hours (weeks) of product, service, systems, process, and customer management training, managers actually hire ahead of the attrition rate- if they wait for openings to occur, service levels and quality will tank, and both clients, the customer and the company, will lose out. The fact that somewhere around 20-30% of new hires wash out before they even get in the chair adds to the problem.

How do these managers get around this issue? They forecast: hourly call volume, workforce shrinkage, average call length, and a myriad of other factors which occur, including operations and system issues, new product releases, recalls--anything that will cause a customer to pick up the phone and call. 

This is an area where companies need to bring more discipline. Their strategic planning may not effectively forecast business conditions for the necessary re-tooling of the workforce. Just as they create a queue heading out the door, they should keep the incoming pipe open, particularly as it relates to quality. Now is the time to pick the market for the best and brightest. Essentially, re-tooling does not necessarily mean just layoffs, and companies which are not currently forecasting to incorporate workforce improvements into their recovery plans will again contribute to the next cycle of inefficiency and workforce reduction.

In my dubious career I've had a few different vocations. At one time I worked as a laborer doing rehab construction in Philadelphia, in the general vicinity of the Penn campus. A plumber I worked with once told me that there are only two things a plumber has to know, "shit flows downhill, and you get paid on Friday".

He was half-right. It's flowing downhill for sure, if you look at the daily announcements of layoffs by downstream companies in the economy, but nobody's getting paid on Friday except the banks, to whom we have given $350 billion to pad their balance sheets, with no accountability or urgency to track the money trail.

Financials, manufacturers, wholesalers, distributors, suppliers, retailers, services, and all their supply chains have caught the layoff flu, and it appears there is no end in sight. What's a no-job traveler to do? 

Yes, it's bad, but consider our numbers today compared to the past. John Campanelli in the Cleveland Plain Dealer points out a few of these in today's edition: 12 month inflation rate in 1980 was 14.6%, in 2008 1.1%; decline in the Dow 1930-1932 was 75%, from 2006 to 2008 18.1%. The one that grabbed me was the percentage of the economy's jobs that were lost: 1980's recession, 3%, this recession, 1.7%.

Now we all know that good statisticians can make the numbers dance, and here's the problem with that last number: what is the denominator of total jobs in the 80's versus today? How many real, living, breathing human beings are out of work? Here's a fact from the Bureau of Labor Statistics: In 2008, payroll employment fell by 2.6 million, the largest annual employment decrease, in absolute terms, since 1945. Remember what happened in 1945? The armed forces discharged a whole lot of employees, and the WWII military/industrial complex tooled down, eliminating jobs in that supply chain. In my opinion, those anomalies negatively skew the 1945 data, making our current situation that much more devastating. It's a different economy, folks, than we've ever encountered before. The house of cards has fallen.

I spoke with a headhunter last week who told me to stop reading the news, and focus on the fact that there is only one job out there: the one I am destined to find. I think I'll take his advice.

I just finished The Pursuit of Victory, a scholarly biography of Horatio Nelson, Admiral of the British Navy at the turn of the 18th century. By "scholarly" I mean that almost one-third of the book are footnotes and appendices, and just about every sentence is referenced (which I ignored while reading, since if you don't have the source at hand, why bother?).

Nelson won the four greatest sea-battles of his time, defeating the French, Spanish, Dutch, Danes, Russians, and their assorted allies: the battles of St. Vincent, The Nile, Copenhagen, and Trafalgar, where he was killed by French musket fire. He died in 1805. He was adored by the people, loved and honored by his crews, and disliked (sometimes despised) by his peers and superiors, until they actually had a chance to work directly with him. 

He was self-promoting, vain, sickly (he contracted malaria as a young lieutenant which plagued him all his life), he lost his arm and an eye in two different defeats, and he was generally vilified for his long affair with Emma Hamilton, the wife of a long-time friend. King George III hated him, and took every opportunity to snub him, yet Nelson was primarily responsible for keeping Napoleon bottled up at sea, despite being outmanned and outgunned. 

I'm not suggesting that you read the book unless this sort of history interests you, but there are some important things I took away:

• Nelson was a successful leader because he treated his sailors and officers with respect and discipline. He was obsessive about training, and drilled his crews to fire two shots for the enemy's one, more than making up for the enemy's superior numbers
• He maximized the resources at his disposal.
• He planned his tactics in consultation with his officers, and once the plan was agreed upon, they practiced the plan.
• He delegated authority to his captains, but maintained control.
• His plans were gamechanging and surprised the enemy. Rather than wasting time in maneuvers, he took the battle directly to them, cutting through their line of battle and engaging yardarm to yardarm.
• His courage was legendary; he led by example, and his was often the first ship to engage and board an enemy.
• He rewarded where appropriate, and censured when necessary.

He also failed in many ways:

• During peacetimes (there were several), he was a fish out of water. He was a terrible politician, often alienating friends and allies. 
• He was easily swayed by flattery, pomp and circumstance, and adorned himself with medals, ribbons, and sometimes ridiculous jewelry, which he displayed as much to irritate his peers as to boost his ego.
• He was arrogant enough to believe that whatever he did was righteous, and often ignored external factors that directly caused defeat or embarassment for the Crown. When he lost, it was always someone else's fault, or out of his control.
  
• He was compulsive about money. He once declined a peerage because he could not support the requisite lifestyle. He was never rich, nor lucky with money. This dogged him like the malaria.
• He never felt that the ruling parties or the Crown gave him enough credit for his accomplishments, and he was right; much of this was due to his vanity, and his habit of jumping over the chain of command with his demands.

He was absolutely the right man for most of the job, and absolutely the wrong man for the other parts. At sea, he was indomitable, on land he was inadequate. Politics and managing alliances were part of his job description; these required diplomacy and discretion, not Nelson's strong suits. Yet when the chips were down, he was the one called upon to plan and execute success, and he did. Nevertheless, I wonder how his performance review would have read? 

What Nelson really needed was an experienced politician in his retinue who could pilot him through the civilian components of his work. He could have used a chief of staff with talents in communications, project management, building consensus, and managing resources not directly under his jurisdiction. Nelson needed someone to remind him when he was over his head, and when to keep his mouth shut.

So, as I look at opportunity in this market, I will want to ask the questions: what will be required of me from both my strengths and shortcomings; will I have to provide leadership in the embassy as well as from the quarterdeck? Will I have the flexibility and authority to build a strong team with complementary skills and competencies? Will I get the help I need to work through difficult, unfamiliar situations? Will I be given the resources and training to "never mind maneuvers, go right at 'em"? Finally, will I receive adequate rewards and recognition for my efforts?