Experience

It is now a week into school and I suspect there are a lot of freshman students who are a bit sleep deprived as they adjust to the new experience. Regarding experience, I have been most intrigued the last few days concerning our presidential candidates, which makes me wonder how important experience really is to performance.


In some cases, experience is actually a negative. The population of world class gymnasts is typically made up of teenagers – often very young ones. The two best two female gymnasts in the just completed Olympic Games were 16 and 18. Once the skills are learned, experience can be a negative because what you learn from experience is how easy it is to make mistakes (not to mention the body is less nimble).


In some cases, experience can predispose people to be blind to new ways of thinking about things. Entrepreneurs are good at thinking outside the box—where current knowledge is of little use. Some entrepreneurs are very good at doing this over and over. I suppose their experience is helpful, but there have been many successful entrepreneurs who were inexperienced (e.g., Michael Dell).


In some cases, the advantage of experience is short-lived. Consider three restaurant servers: one with six days experience, one with 6 months, and one with 6 years. Certainly, the one with 6 days is going to be at a disadvantage, but is the one with 6 years necessarily that much better than the one with 6 months (all other things being equal)? Sharp people can easily pick up the skills needed to be a good server – though some maturation and life experience will certainly give someone better tools to take on unusual situations.


How about CEOs? Well, it would seem that experience is crucial as many of them are recycled into new jobs as struggling companies attempt turnarounds. But it is undetermined how well these experienced executives have fared – often they seem to steer the ship right over the edge based on the scores of bonehead moves made by these experienced leaders.

Presidents are equally hard to figure. Are Barack Obama and now Sarah Palin qualified to be president of the United States? It seems that there are a number of things that might be considered appropriate qualifications.





First, knowledge. Many people want their president to be intelligent and have broad knowledge. Ronald Reagan, arguably one of the better presidents, was dubbed an “amiable dunce.” As this article in 2004 notes, there have been plenty of supposedly brilliant presidents (Hoover, Carter, Wilson) who have been failures as presidents and “dumb” ones (Reagan and Truman) who were not.


Second, accomplishments. Often people are promoted based on their accomplishments in any number of specialist fields (a great salesperson or a legislator) but this does not easily translate to executive work. Perhaps the biggest accomplishments of the Presidential and V.P. candidates are that they have gotten themselves elected; getting nominated as Obama and McCain have done is an even bigger accomplishment.

Finally, experience. An objective expert on presidents, Richard Reeves, recently noted that there is no way to prepare to be president because the issues that they will face are mostly unknowable or at least uncertain. Although some decisions are strategic, others are reactive. I suspect that while experience is not unimportant it is also overrated (as William Kristol from the NY Times asserts). Says Clive Crook for Financial Times, "No training or experience can prepare you for the presidency. On any given issue, the president is surrounded by specialists who know infinitely more about the subject than he [or she] does. The ability to weigh the quality of that advice, and then act on it, is what matters." In other words, experience can easily be trumped by effort and talent.


So freshmen: don’t bewail your lack of experience as it offers you some advantages . . . but don’t substitute it for hubris, which your professors can detect easily.

The Job Search

On Tuesday, a representative from H&R Block visited my class to give students tips on internships and job searches. Our business faculty thought it important enough to target several junior level courses for this topic on Tuesday morning. Of course this topic should be of some importance to most college juniors as they think beyond college. The prospect of choosing careers and finding jobs seems like it would be a daunting task, but it is something many people in this country, especially those with a college degree, take for granted.

I can only imagine how those many people in the Great Depression felt when jobs were hard to come by, or any number of eras and regions where jobs were neither plentiful nor chosen. Yet, with so many Americans able to get college degrees we do have the great privilege to have at least some choices in our careers and jobs.

When I graduated in 1980 with a degree in Accounting I did not think that much about my career -- I just thought I would get a job, which I did. Since then I have changed careers (not jobs) twice. Lucky for me I was able to do this (at some financial sacrifice). My father, on the other hand, stayed in the same job for 45 years -- he grew up in the depression and jobs were a thing to be cherished.

Anyway, there are probably two points in this ramble: 1) students should be thoughtful about their careers and college is a good place to do that and 2) although there is some whining about the ups and downs of the economy, be thankful for the abundant opportunities even in a "down" economy . . . college students like I once did can easily take this opportunity for granted.

Getting that Feeling

On the eve of a new school year, I have been hard at work preparing for classes by . . . watching the Olympic gymnastics. Well, it is the one sport my girls will sit down and watch with me.

Tonight Shawn Johnson won the gold and in a subsequent interview, I heard her answer to the question of whether she would train for the next 2012 Olympics. Here response is telling and should be understood by everyone, including coaches and managers. She said that while she had bet this would be the end (afterall, 8-10 years of guelling training is quite a commitment for a 16-year old!), she now was having a change of heart, "But after being here, I would give anything to feel this way again." Achieving excellence is what gives people this feeling and it is understandable that people will sacrifice lots to have it again.

It is why so few athletes quit while they are on top -- what is going to give them that feeling ourtside their competitive excellence? Michael Jordan couldn't get it being a mediocre baseball player. It is why CEO's come out of retirement to save another sinking ship. Playing golf does not give them that feeling. It is why successful people in about any field, will "retire" only to go back to work doing something very similar so that they can get that feeling.

So my daughters and I are already planning for the London 2012 Olympics to watch Johnson and probably her equally successful teammate, Nastia Luiken compete even though they are "older" women by gymnastics standards and have already given more than young girls should.

And I come back to start two new courses, two new sets of students, the pressure of providing them productive learning experiences . . . why? Of course, it is so I can "get that feeling."

The Good, the Bad, and the . . .

The last three days might be a microcosm for my immediate future. Saturday was the good. As much as students feel relief and satisfaction of finishing that last semester paper, faculty feel the same when they complete grading the last paper. Friday and Saturday I "crammed" to finish grading papers for my two summer courses. And the nice thing was that I learned some interesting things in many of these papers on topics related to corporate responsiblity and strategy. Now onto other projects.

Sunday was also okay, but nonetheless different as my oldest daughter and I attended a reception for new Freshman here at Rockhurst. Yes, my oldest is now off to college, a rite of passage I guess. Being a college professor I should be rejoicing in such rite and I am. Still, life will be different as she shifts more time to things outside of our home. Perhaps, I am just being selfish -- she will have less time to assist me in things like shopping at the grocery store and mowing the lawn for me. Fortunately, however, I will know where to find her!

Tonight, well it was the . . . eerie. My wife and I attended a get aquainted session for parents of new students to the private school my youngest daughter will be attending. Nearly 20 years of marriage and 4 kids, I have managed to avoid all such things as parent-teacher meetings, school get to know your child sessions, etc. (more on why I have avoided them later). That is, except when I was teaching sixth grade in the early 1990s. The people at the school were very nice and we are "cautiously optimistic" that this will work well for our daughter. Still, this is a new era for our family, not quite an empty nest, but different just same.

The public good

Today two things caught my eye (and ear) that relate to what I think of as the public good. First, I read an editorial on the potential sale of the Pittsburg Steelers, a football franchise owned by the Rooney family since 1933. Secondly, I heard an ad on the radio by T Boone Pickens calling for an aggressive move towards wind and solar energy -- he has a website promoting his plan.

The Rooney family is looking to sell because of the looming whammy of the estate tax. With the value of their franchise now nearly 3/4 a billion dollars, the elderly family members who own most of the franchise could be hit with a large tax bill. Even though they own a valuable asset, it doesn't mean they have liquid assets to cover a big bill. As the article notes, the coming election may influence the impact of the tax on the current ownership--whether Congress decides to increase the estate tax or not.

I don't know much about Mr. Pickens except that he has a LOT of money from oil and has given a lot back to things like his alma mater, Oklahoma State. In this current gambit he makes an appeal to wind and solar energy, touting its cleanness along with the economic imperative that we come out of the clutches of foreign oil. Here is the thing--a major plank of his plan is to get Congress to act: "On January 20, 2009, a new President gets sworn in. If we're organized, we can convince Congress to make major changes towards cleaner, cheaper and domestic energy resources." Certainly looking for favorable conditions is the right of any company--including getting favorable laws and subsidies.

The question is whether Congress will make things better. While income redistrution is a popular tactic, it also has unintended consequences. The Steelers are being pursued by a hedge fund, private equity concern, making a family built business vulnerable. In the case of T Boone, he is coming off as a conscientious public citizen looking for help from Congress. The question is should Congress let the market work to determine the viability of wind and solar (in other words, Pickens should convince consumers more than Congress) or does it assist businessmen like Pickens who have now staked themselves to this strategy? While an unfettered market is problematic, I also doubt Congressional wisdom to determine ultimate public goods.

$400 Million

It is free agent season for the National Basketball Association and another star player signs a big contract -- $111 million for Gilbert Arenas. This is guaranteed money. Yet, this pales in comparison to another big contract announced today: talk radio's Rush Limbaugh signed with Clear Channel for $400 million over 8 years. While the topic of Limbaugh and his impact on the political environment could lead to a lively debate, I am interested in this question: Has he earned the windfall?



First, some comparisons. With the new contract, which includes a $100 million signing bonus, Limbaugh's annual salary ($50 million not counting ancillary income from merchandise, etc.) now surpasses celebrities like Leno, Letterman, and Dr. Phil but is still well behind Spielberg, Oprah, and J.K. Rowling.



Like many of these celebrities, Limbaugh is a businessperson. Unlike many of them, he created a new market, so he is in some ways a entrepreneur who hit it big. In the mid-1980's am radio was a dying medium. The radio played mostly to local audiences. In 1988, Limbaugh took the chance of taking his show national--identifying a market need for a point of view (and style) not found in other media venues. So he is much like the many entrepreneurs who identified a new market and were able to exploit it. This NY Times Magazine article, which also came out today, tells part of the story.



Not only did he create a new market, he built a strong buisness model. He saw his customers as not only his listeners but the advertisers promoting their products on his show. He built a loyal audience (customer loyalty is what every product or company seeks) that not only listened--creating the largest radio audience--but bought the products of the companies sponsoring his show.



And he has made this work for 20 years; a proven talent and formula convinced Clear Channel to pony up for $400 million for 8 more years. It was a business deal based on market results . . .

Corn

Last Friday I spent all day driving to northwestern Iowa and back to bring one of my daughter's home from a camp. Besides just missing a storm that blew through Omaha, we noticed many of the crop fields in high water. It is not news that Iowa has been hit hard by flooding--though the most severe problems are east of where we drove. One thing that I thought of looking at those corn fields was the rising price of corn.

Well it turns out that the dire reports of corn shortages may have been vastly overstated. Today's Wall Street Journal reports that while there has been signficant crop damage, estimates did not account for increased planting this year from last. An innocent mistake. Yet, that misinformation caused the price of corn to skyrocket (and plummet again based on this news).

No doubt in the market there will be winners and losers because of this -- I sure would like to have sold corn short! Still, this kind of news has business people pulling their hair, especially if they insist they can make data certain decisions.