Tim Harford on the Logic of Life

This book can be found at Amazon.com. Tim Harford is an English economist and journalist, residing in London. He is the author of two economics books, presenter of BBC television series Trust Me, I’m an Economist, and writer of a humorous weekly column called “Dear Economist” for The Financial Times, in which he uses economic theory to attempt to solve readers’ personal problems. His other FT column, “The Undercover Economist”, is syndicated in Slate magazine.

Harford studied at the University of Oxford, gaining a BA and then an MPhil in Economics in 1998. He joined the Financial Times in 2003 on a fellowship in commemoration of the business columnist Peter Martin. He continued to write his column after joining the International Finance Corporation in 2004, and re-joined the Financial Times as economics leader writer in April 2006. He is also a member of the newspaper’s editorial board.¹

Here’s the 7-part discussion…

1. http://en.wikipedia.org/wiki/Tim_Harford [↩]

Would You Quit for $1000?

Harvard Business Press has a great article on the new retention strategy being practiced by shoe manufacturer Zappos. It seems that after initial training, the company offers the new employees $1000.00 to quit.

Why? Because if you’re willing to take the company up on the offer, you obviously don’t have the sense of commitment they are looking for. It’s hard to describe the level of energy in the Zappos culture—which means, by definition, it’s not for everybody. Zappos wants to learn if there’s a bad fit between what makes the organization tick and what makes individual employees tick—and it’s willing to pay to learn sooner rather than later. (About ten percent of new call-center employees take the money and run.)

First, if the numbers in the article are true, Zappos can afford to do this. With revenues of $1B a year or more, this provides an opportunity to some creative things in terms of recruiting and retention. Creativity is one thing that is definitely lacking when it comes to luring qualified people into the company.

Second, let’s look at the people this offer is made to. These are call center workers. This is a position that has requirements which can vary widely depending on the industry they serve. You might have some very educated, experienced people on the phone at Cisco or other high-tech companies. These are considered moderately to highly skilled positions. At other times, you might have less skilled people on the phones at a shoe company, for instance. (Really … how much support can you provide for a shoe?)

The less-skilled people can find a similar job with little effort most of the time. Many of them are job-hoppers looking for a “what can you do for me now” position. Occasionally they are people who have flunked out of similar low-skill positions at other companies. If the $1000 offer to quit helps to weed these people out, then I am all for it.

What kind of people take the offer? There are some people in this world who are just looking for a position that pays something so they can get by between jobs. They are the ones who live for the here and now and have no forward-thinking possibilities. If offered the $1000 to quit, a small percentage will take it and run. They don’t want to work anyway. It’s free money to them. That will make a car payment, pay rent for a month, or help stock the refrigerator with alcoholic beverages while they are looking for their next gig. Mission accomplished.

So what makes people reject the offer to quit? As someone who is intimately familiar with the call center environment, I can tell you that there are two primary factors that keep people around for an extended period of time. First, there are some with a strong work ethic who really care about the customer, enjoy solving problems, and simply thrive in that kind of environment. These are the true geeks of the world and will be there as long as the company will have them.

The other people may not be as hip to solving problems or working in a call center, but like the culture and benefits. If a cable company (just as an example) can provide $13.00 an hour, an opportunity to increase that wage through optional sales/upgrades to the customer, and provide FREE cable TV, high speed Internet, and deeply discounted home telephone service, they have a powerful retention tool. This is also an incentive for some to hang around longer than they would have normally.

Something else that needs to be looked at is the interviewing/recruiting strategy of Zappos. Could this whole idea of paying people $1000 to quit be unnecessary if people with an adequate level of enthusiasm and skill were attracted to the company in the first place? I know that a very small percentage of the new hires are actually taking the offer to quit, but what’s the possibility that they’re scaring off someone who would make a fine employee but simply had a momentary lapse of reason when cash was waived in front of them?

At the same time, there are 1000 other factors that we’re not looking at. Geographical location in comparison to the supply of workers who can do this job is a factor for any call center operation. If it works for Zappos, so be it.

One Colorful Bird

Sun Conures are loving, easy to train little birds, about twelve inches in length, including the tail, and live an average of 25 to 30 years. As juveniles their coloring is a muted olive green, which serves as a defense mechanism in the wild. When they mature, at approximately one year old, their coloring is a brilliant rainbow of yellow, red, orange, blue and green and are often considered the most beautiful of the Conures.

Sun Conures were originally imported from South America to the United States in the late 1800s. Virtually all Conures offered for sale as pets now are the result of captive breeding programs which have produced healthier birds that are hand raised from birth and better suited as pets.

Sun Conures love attention and can develop some destructive behavior if they do not get the socialization they need. They have a piercing shriek which they will use to draw attention to themselves. They like to be held and cuddled and talked to and they do enjoy the company of other birds.�

Sun Conures can learn to talk, although they are limited and their voices are birdlike and squeaky. They amuse themselves by imitating unusual sounds, like the sounds of a doorbell, a telephone ring or an alarm clock ring. [Source: http://www.pet-parrots.com/Conures/sun-conures.html]

Declining by Degrees

In what little spare time I have, I try to see a documentary of some kind. The latest one was Declining by Degrees. I was pleasantly surprised. When I hear about a documentary about higher education, I immediately suspect a translucent, deeply rooted political bias that clouds any originality or usefulness the production may have had otherwise. Not this one.

Some of the topics the program covers are the inability for some people to make the cut in college, how it is increasingly difficult for professors to concentrate on teaching due to research requirements, the marketing and retention efforts of colleges and more.

Also discussed is the trade-offs in having instructors that work part-time vs. full-time faculty. More importantly, they talk about how people need a 4-year degree just to remain viable in our new society and global economy. There is a great divide that has been created over the years. There are many reasons for it, but education seems to be the bridge that connects the two. This documentary is dedicated to how that bridge is still very much broken.

One of the topics that caught my ear was how college has become a marketing juggernaut and has potentially cheapened the prestige that came with a degree some years ago.

The marketization of the admissions process has intensified at both ends of the process. High school guidance counselors report that they are under ceaseless pressure to produce by getting students into exclusive colleges. This pressure is greatest at the most elite private schools, where parents feel they are paying extra for results. A sense that high school counselors are not doing enough has also led to booming business for private admissions consultants, most of them hired by relatively affluent families. ¹

And ..

Evidence for the increasing marketization of the college scene is ubiquitous and indisputable. Responding to the ever-rising costs of an education and the never-ending desire for expansion, the development offices of both private and public colleges have increased dramatically in size and budget. Mirroring this growth, far greater efforts are expended in attracting prospective students to learn more about the school, recruiting them to apply, furnish pleasurable visits to the college before and after admission, providing ample rewards for those athletes, artists, academic stars whose attendance promises to reflect glory on the institution. ²

Somewhat related: I found an article the other day that discusses some of that being based on IQ and how the “working class” should not expect access to the best colleges. Take a look and parse it for yourself. The article and the DVD have some correlation, although not directly related.

There were some parts of this movie that showed what I already believe. College is not for everybody. A quarter of the people who start college don’t complete it. At the same time, the material has been so watered down that it seems that the whole educational system is grading and presenting the coursework on a curve. I will let you decide for yourself if that’s the case.

At the end of the day, this is a great documentary. You can get it from Netflix.

1. http://www.decliningbydegrees.org/book-excerpt-fallows.html [↩]
2. http://www.decliningbydegrees.org/book-excerpt-gardner.html [↩]

The Economics of Being Traded

There’s always a really bad trade in baseball that we can talk about. Babe Ruth was traded to the Yankees for cash. Others include the 1991 trade where the Baltimore Orioles sent pitchers Curt Schilling, Pete Harnisch and outfielder Steve Finley to the Houston Astros for First Baseman Glenn Davis.

In 1990, the Boston Red Sox traded first baseman Jeff Bagwell to the Houston Astros for pitcher Larry Andersen. We all know how that worked out. One is on the way to the Hall of Fame. In 1997, he Seattle Mariners trade pitcher Derek Lowe and catcher Jason Varitek to the Boston Red Sox for closer Heathcliff Slocumb. A few World Series wins later, Boston is laughing all the way to the bank.

How would you feel if you were traded for 10 baseball bats?

For now, Odom is headed to the Laredo Broncos of the United League. They got him Tuesday from the Calgary Vipers of the Golden Baseball League for a most unlikely price: 10 Prairie Sticks Maple Bats, double-dipped black, 34-inch, C243 style.

History (as well as the difficulty of getting from the minor leagues to the big show) will probably tell us that neither team will suffer from this deal. But if this guy ends up playing at the caliber of a Bagwell, Schilling, or any of the aforementioned players in the lopsided trades mentioned above, this will be the trade of the century.

This is to the Point

Found this at the bottom of a job posting for a very high level VP position. These guys are not playing around.

We only hire the world class employees. If you have the intellect, experience, talent, and passion to deliver world class results, then we look forward to meeting you. Otherwise, please apply for a position with our competitor. Thanks.

This may sound very crude to some. Not to me! I wish I could put this kind of “warning” in the job adverts my company posts to all the job sites.

HP 2133 Mini-Note vs ASUS eeePC

This is my first post with my new HP 2133 Mini-Note Model KX870AT) and what a pleasure it is to write with this thing! Instead of simply writing a review on the 2133, I want to compare it with the Asus eeePC 701 (both of which I have). Suffice to say that the eeePC will soon be sold on eBay or Craig’s List sometime soon.

If you want the short version of this blurb, comparing the HP 2133 mini-note with the Asus eeePC 701 is like comparing apples and rocks.

I had originally bought the eeePC because it was new. It was cool. What a great concept. But like most gadgets I buy, it’s usefulness wore out quickly and it has lived in my floor or on my desk, unused for several weeks. I had upgraded it to Windows XP and 2G of RAM. It didn’t make much difference.

I didn’t like the keyboard and it was slower than I had hoped. Multitasking was a rough proposition, and without running the browser at full screen, it wasn’t very functional. Furthermore, the resolution and screen size didn’t mesh well. Yet people are still buying these things like crack. More power to them!

HP has now taken that concept and made the eeePC look and feel like something you would buy at Toys R’ Us. For a device that takes up about the same physical space and costs a couple hundred bucks more, I have a “real” computer! There is so much to compare and I have yet to see one thing that makes the eeePC stand out against the HP 2133.

When the mini-note was first released, I placed an order directly with HP. When my lead time grew from 2 weeks to almost 4 weeks, I canceled it. I couldn’t justify spending the cash at the time, and I wanted to see if I could convince myself that the eeePC 701 was more functional than I thought. Not long after I canceled my order, they showed up on Amazon.com. Not having an ounce of restraint in my body, I paid for overnight shipping and had it the next day.

Here are some of the highlights of the 2133 Mini-Note vs. the eeePC 701

Keyboard: This is the primary reason I don’t like the eeePC. I have big hands and the keys on the eeePC are small. I ended up attaching a small USB keyboard to it, which defeats the purpose of having a small computer. The keyboard on the 2133 is almost full size and is a delight to use. Hands down, this is one of the most significant differences.

Screen: Far superior. Glossy mini wide screen with a resolution that is out of this world! The eeePC 701 doesn’t touch this. I can run Firefox and still have plenty of real estate on the screen. With the eeePC, you nearly have to run everything at full screen just to be semi-functional.

Speed: The eeePC is only 800mHz. The 2133 is 1.6gHz. At almost double the speed, you can certainly (and obviously) tell the difference. I’ve heard some complaints about not being able to multi-task. I am not sure what those people were doing, but I am not having an issue.

Storage: The 2133 has a 120G hard drive. I understand the attraction of the 8G solid state drive in the eeePC, but after XP and Office 2003, there was hardly any room left for applications. I had to use a 16G SD card just to be able to install my programs.

Touch pad: The touch pad on the 2133 is great.

Heat: The 2133 does get a little warm, but it’s certainly tolerable. It’s a real computer, after all.

The bottom line is that the mini-note costs a couple hundred more than the best eeePC, but it is worth every penny! If you have a chance to get one, do!

It Ain’t Easy Being Green

I haven’t seen a tree frog in ages.  I grabbed this shot at night.  The flash came in handy.