I know I’m showing my age, but I distinctly remember growing up with the belief that American workers of my generation (yes, I’m a baby boomer) would be working only four eight-hour days per week by the time we joined the workforce. My father was a senior design engineer in the R&D division of a Fortune 500 company, and he worked 36 hours per week. (He retired at age 58 in 1981 after spending most of his career with one company.) He also had a huge amount of vacation time–something like eight weeks a year. Now, 20 years later, I’m working as an IS executive. I don’t enjoy the short workweek or ample vacation time that my father had, or that I grew up anticipating. On the contrary, I often spend 45 to 50 hours at work and at least another 10 hours per week in bumper-to-bumper traffic getting to and from my office.
The Myth Of Productivity
As I remember, new technologies and better business methods were supposed to make us more productive. The expectation was that the increased productivity gained by computerization, new process methodologies and better corporate organizational models would allow us shorter workweeks. Well, it didn’t happen! I recently discussed this unfulfilled promise with a fellow executive, and he mentioned that the shorter workweek didn’t happen for our generation because we now have PCs. He may be right.
PCs have raised the bar on the type, amount and quality of the output we can manage. Executives used to need administrative assistants to produce letters or memorandums. Today, we create and distribute our own correspondence without any support. We work with our own spreadsheets with little help from the accountants. We develop our own presentation materials, and we handle our own messaging via e-mail. Curiously, the colorful, capable PC has actually added to our individual workloads and made us forget what the promise of a better life meant.
On a larger scale, what else has happened to kill the golden lifestyle those in my generation were planning to enjoy? Having endured 26 years so far in IT, four years in the Navy and five years in college getting my degree in aerospace engineering, I have the right to know why I’m not worthy of having more free time without diminished fortune. I suspect that others of my generation want to know too. We’ve been told various plausible theories to explain why we’ve been deprived. The list includes the emergence of the world economy, loss of our manufacturing base, our own personal greed, the legacy of driven immigrants, the post-depression era and the focus on quality.
As I see it, the most powerful reason for this changing circumstance is our collective work culture in America as enforced by the corporate institutions. As the generation that is nearly in control of the Fortune 500 corporations today, we are all held captive by what we believe corporations expect of us. If we don’t log 50-hour workweeks, we risk showing that we aren’t really interested in the company or its success. Working anything less than 40 hours per week is something we should feel guilty about. We also feel compelled to mandate that our employees share this same work ethic.
I have an alternate theory. We can have the 32-hour workweek if we all decide to change at the same time. Our companies would sell the same amount of products and services as they do today, and profits would remain constant.
A New Work Ethic
I propose that starting on May Day 2001, we celebrate our collective American success. The managers of Fortune 500 corporations should announce to their permanent workers that the standard workweek will be cut to four eight-hour days. Employees will receive no change in the compensation they receive.
If we have the vision to take this collective step toward a revolution of more free time, we can change our culture in a way that’s fitting for the true start of the new millennium. The promise to my generation will be fulfilled for the remainder of our lives and for the lives our children. What a gift this would be to America.
David L. Russell is the director of IS for EIS, a distributor of electronic materials based in Atlanta.
Raising The Dead
By John Fontana
These are dark days for B2Cs–the label itself is almost a mark of doom. Many B2C companies have repositioned themselves–some becoming B2Bs, others transitioning to ASP models and still others associating themselves with infrastructure plays and enabling technologies.
Some companies have moved through four or five models, all without finding an enduring value proposition, paying customers or growing profits. These are the lucky ones. Many more B2Cs did not have the cash or the talent to reinvent themselves, and now are locked on a dead-end course. They’re stuck with a stale, first generation website, they rely on cutting prices to attract customers and advertising to drive profit margins, and they are usually lost in a sea of undifferentiated competitors. As such, they have almost no hope of reengaging increasingly sophisticated customers and newly skeptical VCs. Before the brick-and-mortar companies get too smug, their situation is the same in many regards: How many CIOs and VPs of e-business have to troop into the CEO’s office to explain where the money went and when “this Net thing” will pay off?
And yet, is everything really that bad? Or is this situation largely a self-inflicted wound, begot by a failure to innovate fast enough to keep pace with the market and compounded by demoralized–and in many cases inexperienced and naive–leadership? The fundamental opportunity that led VCs and brick-and-mortar companies to fund so many pet, women’s golf, furniture and other B2C sites still exists, and should lead to real businesses in the future, even if many of the current participants don’t live to see tomorrow.
Widely dispersed groups of customers with money and specific interests still exist, and they have increasing access to the Internet. Suppliers can still profit by connecting with these customers and fulfilling their needs.
The basic reasons for Web-based commerce still apply. Convenience and time savings are still major issues for most families, far outweighing a few dollars in shipping fees. Information still adds value to even commoditized products. Web costs can still be substantially lower than brick-and-mortar costs for appropriate services and products. Bundling, cross-selling and other methods based on superior knowledge of customer behavior are still easier on the Web than they are offline.
Back To Basics
For the management of B2C businesses and their investors, the keys to survival and prosperity are returning to sound strategic basics, smart customer targeting, a solid value proposition, great execution and wise capital investment. Not surprisingly, the first step on the road to profitability and survival is a rapid, objective evaluation of the fundamentals of cost position, customer needs, competitors, capabilities to execute and management expertise. Driven by experienced e-business strategists and operating executives, this evaluation must uncover worthwhile customers, a clear path to profitability, nonadvantaged competitors and the capability to change in an effort to exploit an opening in the market. Most important, the evaluation must identify potential investors who care enough, or believe enough, to provide funding. This applies equally to brick-and-click operations where many boards are skeptical of management’s “e-promises.”
The second step is standard VC/new economy fare: a business plan that can stand up to the greater degree of scrutiny a company gets the second time around whether from a board, a first-round investor or a vulture. A beleaguered dotcom needs a rock-solid implementation plan, bankable financials and a management team that has learned in the market or been bolstered by turnaround managers.
The final step–funding and relaunch–should be almost anticlimactic. Hiring new members of the management team, specifying and acquiring new technologies, and executing the plan within the marketplace must become part of normal, ongoing dotcom operations.
The beneficiaries of the potential that exists within these businesses–whether current participants or vulture investors–will depend on the skills of management and the willingness of earlier round investors to step forward with new funds to protect their positions.
We have already seen the first wave of bargain basement transactions. Some have been by strategic buyers, some by vulture or turnaround investment funds and some by the increasing numbers of VC funds participating in “down rounds.” Expect to see dedicated pools of private equity focused on the purchase and rehabilitation of dead and stalled dotcoms and brick-and-click operations. Acquisition, followed by a bust up, merger, restructuring or turnaround will likely be the norm for these groups, just as the LBO funds worked on brick-and-mortar companies in the 1970s and 1980s.
For the management of dotcoms and brick-and-clicks, the challenge is similar to what it was at the beginning of the dotcom boom: Who can innovate to recapture customers’ business, and who can execute to capitalize on the real business opportunities that exist? The hype has been shaken out of the capital markets with a vengeance. Now the rewards will go to the management teams that can deliver sustained results.
John Fontana is president and COO of eRunway, a Westborough, Mass.-based software developer.