You might be laying people off, but don’t be penny wise and pound foolish. There’s a reason your most expensive people are expensive. Going through a spreadsheet with names and salaries to make cuts is probably the worst way you can accomplish cost savings. After all, these are the people that provide you with your core-competency, right? You have to make sure that you’re keeping the cream of your crop.
If you don’t know who those people are, you have bigger issues going on than just the economy. Some management has no idea what its people do day-to-day. Find out what your people do – and not just their role or job title. In fact, find out as much as you can about your people’s skills beyond their work. One company, through several rounds of layoffs, let go of the last person who was familiar with the design of an electrical component still in production and being sold to customers. This is stupidity at its best. Your thought workers are the essence of your company.
Consider Wendy’s founder Dave Thomas. Prior to starting his hamburger chain, he was in the fried chicken business. Thomas turned around four failing Kentucky Fried Chicken restaurants, introduced the famous rotating bucket of chicken sign, reorganized the famous chain’s menu and sold the franchises back to the company for a cool $1.5 million (if that doesn’t sound like much, keep in mind that this was back in the 1960s). His departure to start his own place was a friendly one, but imagine what he could have done for KFC had they offered him incentive to stay.
Then there’s Michael Bloomberg. Before becoming mayor of New York City, Bloomberg and 61 other partners at investment bank Salomon Bros. were laid off as part of a corporate merger. Bloomberg turned the $10 million severance he received from the proceeds of the company’s sale into his own $20 billion business, financial information giant Bloomberg LP. Wouldn’t you like an entrepreneur like that in your idea department?
Of course, not all workers have the potential to make your company better. Removing truly weak links can only strengthen the structure. But accidentally do away with the best and the brightest, and be prepared to watch your competition grow stronger.
What!? Yes, grow your company now. It’s a buyers market for just about everything; real estate, employees, equipment, services, you name it. Buying low and selling high is not just a stock market axiom. Andrew Carnegie introduced the concept of counter-cyclical investing in the late 1800s. It was his secret sauce. During the slump between 1893 and 1897, he upgraded his entire operation to the latest equipment at rock bottom prices. In 1900 when the economy had turned around, the profits of his companies were $40 million for the year.
You should be looking at liquidation auctions for your industry, surfing Craigslist and eBay for equipment and generally bargain hunting constantly. In the meantime, don’t forget about human capital. Great employees are getting pink slips left and right simply because the companies they work for are going under. Your company is only as good as the people who run it – this is the time to make their losses your gain.
Of course, growth isn’t just about your assets; it’s about your product. But at the first signs of economic slowing, many firms seem to forget that, instinctively scaling back marketing to lower costs. That’s exactly what most companies did during the Great Depression – all except for Proctor & Gamble, that is. To the initial chagrin of its shareholders, P&G actually increased its advertising campaign and expanded into a brand new territory known as radio. Its creative ads, known as “soap operas” (sound familiar?), were such a smash hit that P&G doubled it’s radio budget every two years during the Depression and by 1939 sponsored 21 programs, essentially creating the modern radio industry. P&G bet that Americans would keep buying household goods during the Depression, and they figured branding was the only way to differentiate their products from other companies’. It paid off. When tough times ended and Americans wallets expanded again, consumers stayed loyal to P&G.
It might feel counter intuitive to push for growth when business is slow, but this is when the time is ripe to grab more market share. If you actively manage business while your competitors bury their heads in the sand, your company can shine.
If your costs are lower than all of your competitors, you’re in a much better position than they are to weather a financial storm. You’re also in a better position in the good times as well. An athlete processes food and oxygen and turns it into energy much more efficiently than I do. Money is the food and oxygen of a company and you need to process it as efficiently as possible. Some companies have done this to an uncanny science. Aldi Foods is a great example of a company that’s done this perfectly in grocery retail. Where a normal grocery store has 70,000 SKUs (different items), Aldi has 1,400. They eliminate any features that raise cost without providing substantial benefit. Southwest Airlines does the same thing. Their flight attendants clean up as the plane lands and reduce the airplane’s on-ground time. Flying planes make money, planes on the ground don’t.
You don’t have to be a low price leader to focus on efficiency. Apple Computers isn’t thought of as cheap in any sense of the term. But they’re very efficient at producing new, innovative, appealing products very quickly. They push products to market quickly, and then, as Guy Kawasaki says, they “churn, baby, churn”. Maybe even more important, they never stop. Just three weeks after Apple introduced its groundbreaking iPhone, it was back with a shuffle version.
So what around you is inefficient? You don’t have to be a CEO or manager to initiate process improvement.
It sounds obvious to say “focus on core competencies” but it’s really surprising the kinds of things companies will do in-house. They do it in the name of saving money, but in the long run it’s a distraction at best and a disaster at worst. What is a core competency? It’s anything that distinguishes your company from the competition.
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Groovy supports creating Domain Specific Languages. A DSL is simply a mini programming language tailored to a specific situation or domain. The idea is to hide the characteristics of the underlying programming language as much as possible (in this case, Groovy/Java), and let the vocabulary of the application domain shine through.
DSLs are nothing new. Just by encapsulating the concepts of a domain in classes (”domain objects”) and by defining the methods on those classes that act on them (”actions” and “messages”), you create a DSL of sorts. You see this a lot in unit testing. As a body of unit tests evolves, common SetUp and TearDown code is often extracted to avoid duplication. As the extracted classes and methods grow and evolve, a DSL emerges. For an excellent example of this, see Clean Code: A Handbook of Agile Software Craftsmanship
by Robert Martin.
Groovy accomplishes the creation of DSLs in a number of ways:
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For any programmer who wants to learn the particulars of Scrum (short of attending a Scrum training seminar, that is), if you are already somewhat familiar with agile practices like XP, then probably the best place to start is with Ken Schwaber’s second book, Agile Project Management with Scrum
.
Schwaber’s first book, Agile Software Development with Scrum
, is more of a reference book than a how-to. It describes what Scrum is, but not so much the nuances of how to use it.
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I’ve been reading “Clean Code: A Handbook of Agile Software Craftsmanship” by Robert Martin. This is no ordinary book on writing better software. It’s not just a rehash of “Code Complete” or “The Pragmatic Programmer.” Those are both fine books, but “Clean Code” is different. So, please don’t think that if you’ve read one, you’ve read them all.
In Clean Code, Martin doesn’t just name the best practices we should all be following. He explains the reasoning behind each one and gives names to the concepts. Just as the idea of software design patterns revolutionized the way we think and talk about software architecture, Martin’s exploration of day-to-day coding habits gives us a smarter way to think and talk about that.
Case in point: Clean Code kicks off with the practice of giving your objects meaningful names. One aspect of this is that good names do not require anyone who might read your code in the future to have to perform any “mental mappings.” Here’s an example of this that I came across just the other day.
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One of the major benefits of using Grails as a web platform is how almost everything can be written in a single language — Groovy. No more switching gears between language constructs. Everything’s Groovy.
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For any standard Grails app, the error log is called stacktrace.log by default. On some servers, it ends up in the config folder (rather than the logs folder) by default, so it’s hard to find. Also, with a fixed name, all apps running on the same server would share the same log. So, for any new Grails app, be sure to open Config.groovy and change
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First choice: JetBrains IDEA 7.0 (with 8.0 coming shortly). Possibly a good second choice: NetBeans 6.5 (new). Last resort remains: Eclipse.
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