Sunday, October 31, 2010

Individual Prices

How many times have you sat next to someone on the plane and compared fares? Invariably you could never see the logic of why your fare was different from someone else. Accenture was part of the cause of this optimal pricing when various complicated pricing algorithms were programmed for industries (hotels, airlines etc.) with fixed capacity that is wasted when time expires (e.g. flight takes off, hotel room goes unused).

The software industry prices their product on the "ability to pay" (the bigger the company - the more you pay). After all the incremental (marginal cost) cost of an additional copy of computer code is nominal compared to the development and maintenance costs. Consequently pricing can be highly subjective and variable.

Consumers get very irritated when they find out someone else got a better price. We don't think that what we have paid - when we paid it - was a consious price/benefit evaluation. What we paid must have been fair at that time or else we would not have purchased the item. Somehow the value changes once we know what someone else paid.

Time Warner in their last billing indicated a price increase effective 11/2010 - but it only applied to those individuals who have are not on a 2 year contracted price program. In January 2010 I switched my cable to digital (long story that requires a different blog). In the space of 10 months the price had changed 4 times - $62.99;$54.95;$44.95 and now $72.99. Each time the price changed with a phone call or new information I obtained.

The lessons - everything is negotiable; prices are individual; value is related to what someone else paid; keep asking - keep calling - keep evaluating value.

Saturday, October 30, 2010

Obama Care - Generation Warfare

I've blogged before about the Landmark Healthcare Legislation. It only hits home when you see exactly how it impacts you personally. So here is the summary:

Jenna has a high deductible HSA plan and the premium increased this year 29%.
Susan, Ellen and I have a high deductible HSA plan and the premium increased this year 8.6%
Because of the high deductible there have been no costs to Anthem in the last year - yet the premiums go up and up.

My uninformed conclusion is that the younger generation is paying for the Healthcare changes. The young healthy people are paying for the older generation - setting up a generation warfare. This will just be incentive for the younger generation to pay the penalty to avoid health insurance.

Another wrong incentive is to encourage the younger generation to stay on their parents plan until age 28 - ridiculous. We should be encouraging the kids to become self-sufficient adults - physically, emotionally, financially, and spiritually.

There is little choice but to renew the policy and find a way to cover the increase in the personal financial budget.

PS - My family policy increased $23/mth. Check out the blog on Jan 6, 2010 ---- Based on the extra $23/mth I must weigh 200 lbs :)

Chainsaw Massacre

I played lumberjack in the backyard today. The heavy storm winds on Tuesday knocked down some significant limbs (12 inch in diameter). So out came my Eager Beaver chainsaw to clean up the mess. The first frost today made it feel crisp and enjoyable to be outside working.

There is something manly about using a chainsaw. The roar of circling steel, the blue smoke of exhaust and the spitting drips of oil flipping off the chain all add to the excitement of trying to control nature.

Plenty of firewood for the outdoor firepit - now just in time for Smores season.

Friday, October 29, 2010

Lifetime Membership

The October letter from Miami announced the giving club changes. "Your dedication to Miami is reflected in your status as a lifetime member of the Presidents Club". But the Presidents Club will be reclassified as an annual giving club.

I always kicked myself for not "buying in" to the lifetime membership of the Delta Crown Room back in the 90's. What exactly does lifetime memberships get you - and how much does it cost?

I remember an Accenture consulting assignment with Rex Electronics in Dayton. Visiting the Louisville store a sign stated - Guaranteed lowest price - for life. I questioned the store manager about the advertising (did it violate corporate guidelines of 30 days). He quickly rebutted - "Who really cares" - it is a rare person who comes back to the store with the proper documentation and the value of "for life" vs 30 days was worth the risk.

Lifetime membership is an attempt to get the highest value (benefit) for life at the lowest possible cost. Do we really want a membership in anything that creates a club where "I win and you lose"?

So a lifetime membership is just a bet with other members - who outlives you and who pays more. So I either hope for you to die (less future costs); or for you to pay more than me (you subsidize me). Sounds like a club I don't want to be in.

Thursday, October 28, 2010

Abandoned Data

I'm not a hoarder - but I do have the bad habit of not throwing stuff away. It includes data and PCs. I have PC's in the basement, 5 1/4 floppies in shelves, old software, IOmega Zip Drives, Maxtor hard drive, Seagate, the list goes on and on.

I feel sorry for all that abandoned data. There is no visability into what data is out there. The only difference between this abandoned data and the physical stacks of manila folders and financial statements in my attic is that I can't physcially open this data up. It is carefully hidden from access in virtual folders with index names that I could never recall on media that is almost impossible to open.

Today started a new version of Outlook on the "hand me down" HP PC from Jenna. A clean slate - nothing in folders - I have abandoned my 25760 emails from the Acer. Yes - almost twenty six thousand emails (from 3/16/2006 to 10/27/2010). That is about 16 emails a day for 1661 days (igorning the spam that gets scanned and deleted).

Well - I haven't completely abandonded them. They still sit on the Yahoo server in a backup folder :)

And what about all those pre- 3/16/2006 emails? Those are hidden away in Lotus notes files, old floppies, and backup diskettes.

Tuesday, October 26, 2010

Who is that behind the Mask?

Several Sunday's ago, Lee Tyson asked everyone to introduce themselves and describe their most memorable Halloween costume. Mine was Zorro - when my mom made caps, hats and swords for D'Lane and I. We both had the small black eye mask for anonymity. After all - Zorro was the key Disney show on black and white TV at the time.

Interesting that we can become whatever or whoever we want at a Halloween party. But who is that really behind the mask? Trouble is there is still a mask even after we reveal our non-Halloween identity. It is our own personal mask we wear everyday for most people we know.

How often does that mask come off?

Age has helped me peel the mask off. It doesn't make me look better :)

But it sure makes me smile more often - and smiling makes you look younger.

Sunday, October 24, 2010

Home again

"Hey - it's good to be back home again .... It's the little things that make a house a home, like fire softly burning, suppers on the stove .... its the light in your eyes that make him warm". John Denver had it right in his 1974 song. Even if you're not a country pop fan this song has to hit the spot for you.

There is something special about walking back into the house after at trip. The smiles of loved ones who missed you.... the comforts of familiar things..... the routine begins...... and before long........

"I just can't wait to get on the road again... making music with my friends" (Willie Nelson)

Now if I was really technology proficient - I could embed the Youtube songs for comparison.

Airport Waves

I have spent thousands of hours in airports in nearly every city in the USA and many foreign cities. Naturally the airport I spent the most time in was luckily Cincinnati which for a time was voted the 2nd best airport in the world.

Later in my career at Accenture, I happened upon one of the most valuable "lower stress" lessons when I began to arrive early - very early to airports. When I was flying back an forth to Canada - my flight would be at 9:50am - but I would get up at normal time 6am and drive to the airport and "set up shop".

Airport activity goes in waves. During the hubbing years with Comair the volume of traffic would peak and die suddenly. During those valleys the airport morphed into a different animal. The personnel would relax, early non stressful flyers would leisurely walk the corridors, the sound would become almost library like. It was these times I grew to like airports.

Travel doesn't need to be stressful.

Saturday, October 23, 2010


Philanthropy - an "aloneness game" Matthew Bishop said at the SVPI (Social Venture Partners International) conference. The words constantly batted about at this conference were collaboration, co-funding and community. The SVP model attempts to remove the aloneness from Philanthropy by connecting a diverse group of partners together into a common giving group.

SVPCincinnati has touched 24 Partner units (our $ counting metric) and about 36-40 people - call them all acquaintances over the last 4 years. We have lost 7 Partner units leaving 17 units (24 people). Most of those 24 have turned from acquaintances to friends and for many of us the philanthropy we do together has eliminated the "aloneness".

Multiplying the joy in the network.

Acquaintances vs Friends

The keynote speaker at the SVPI (Social Venture Partners International) conference referenced the Malcolm Gladwell article from 10/4/2010 New Yorker "Small Change":

"Our acquaintances—not our friends—are our greatest source of new ideas and information. High-risk activism is a “strong-tie” [e.g. friends] phenomenon."

So what's the difference between friends and acquaintances? I've blogged about this before (Oct 8, 2009 - Faithful Friend) and it was interesting to see how social networks and the "friends" of Facebook are perceived in Gladwell's article.

In the SVP network, I have acquaintances and friends. The power of SVP combines the many acquaintances (innovation of new ideas and information) with my SVP friends (high-risk activism). It is a philanthropy network model with both powerful components.

Thursday, October 21, 2010

Get a Life Card

I pulled out my "Get a Life Card" from my wallet and blew the cobwebs off of it. Delta wouldn't like that reference to the million miler medallion customer they honor.

I've been in an airport no more than 10 times in the last 9 years. The Accenture routine felt familiar - like riding a bicycle - long term parking, self check-in, upgrade status, boarding, Hertz Gold, Hyatt Check-in, room prep, and locate dinner.

Now I studied the faces of those like me 10 years ago - what are their stories? Where are their smiles?

My past travel routine was a blur - I paid no attention to anyone throughout the routine - I doubt I was smiling that much either. How different to be an observer vs the road warrior.

On the Hertz bus everyone had their 3G data phone out checking messages and here I was with my old LG and lugging a laptop. Clearly I was the technology dinosaur "outlier" in a sea of road warriors.

Wednesday, October 20, 2010


B.W. said "Things left unattended, decay". Wow - that principal applies to many things, vacant houses, human body, food, money, spirituality .......

While I am a procrastinator, at least I attend to the task - only in a "just in time" basis. Attention really means recognizing the relationship between time and decay for the object in question. The rapidity of decay as a function of time means greater attention earlier is required.

There is a "decay theory" for memory - that time will fade a memory. Attending to the memory must therefore slow down the decay.

Hence a side advantage of blogging :)

Tuesday, October 19, 2010

Foolish Fear

Another person's fears look so foolish at times. But that is what fools us - the fear is real - the reality for the person experiencing it. I helped Ellen practice the 6th grade presentation to the class on Daylight Savings Time. I could see the pressure building inside her and the fear taking control of her both physically and emotionally.

Fear relates to future events which is why time makes our fears look foolish. That is also why practice (for this particular fear) can lower the level of uncertainty about the particular event.

I learned in my training at Accenture the value of video taping presentations. Seeing yourself as the audience would and projecting your presentation into the future can be invaluable. So I have a complete library of videos of both Ellen and Jenna in various classroom practice presentations. These memories will create laughter as they will both see the "foolish" fear they overcame.

Monday, October 18, 2010

Living the Dream

It reminded me of youth and energy at Accenture - eight fraternity brothers at KC's daughter's wedding on Saturday evening. In fact Hank had joined Accenture for a year and a half but now was doing marketing in D.C.

Wade was the first fraternity brother to get married and these guys were like the "The Diner" movie at their college buddy's wedding. Out on the patio smoking "stogies" talking about "living the dream".

Investment Bankers, Real Estate Mogal, Marketing Rep all aspiring to the top - Manhatten, D.C., Michigan, all with their button down shirts or tuxedos with no clip on tie. These guys had flown in and were "doing the town".

They were even willing to talk to a FIP (Formerly Important Person). Who knows - maybe he knows someone important :)

Friday, October 15, 2010

Housing Crisis

In our Bible study about Revelations it mentions the size of New Jerusalem - Rev. 21:16

16The city was laid out like a square, as long as it was wide. He measured the city with the rod and found it to be 12,000 stadiaa]">[a]in length, and as wide and high as it is long. (a stadia is about 1400 miles)

So the "numbers guys" (and I include myself in this elite group) start playing with the data. One internet site estimates that with a 2800 sq ft apartment 12 feet high you could get 1,500,000,000,000,000 apartments in this space (I was too lazy to audit this number). By the way that is 1.5 Quadrillion or 1.5*10^15.

On June 18, 2010 I blogged about the 106 Billion souls (as of 2002) looking for eternal space.

Still plenty of space available :)

Thursday, October 14, 2010

Cigarette Habit

One of my many Accenture stories popped into my head today.

It was around 1980 and I was doing an EDP review (Electronic Data Processing) at Southern Ohio Bank. I had my checklist of questions and entered the office of Vice President Joe Falsetti. Looking back, I can smile as they loved to poke at the "green beans" (the term for the consultants/auditors).

As I asked my questions, Joe pulled a cigarette from a pack and began to manipulate it with his fingers putting it in back and forth in his mouth ( smoking was allowed in offices in 1980). This went on for the entire interview.

Finally I got the courage to ask Joe - "Are you even going to light that cigarette?"

No, he replied, I gave up smoking two years ago. He waited for my reaction.

Why - then do you have a pack of cigarettes? I questioned.

"Oh, I like the smell, feel and taste of the tobacco." Joe quipped.

And how long does a pack of cigarettes last? - the statistician in me wondered.

Joe said, "I consume about a pack a week."

I wonder if he has kicked the habit :) - Cigarettes or "toying with the green beans"

Tuesday, October 12, 2010


Gas - On and Hot; Undercarriage - down and fixed; Mixture - full and rich; Pitch and Safety Belt. This verbal checklist on landing a plane is permanently fixed into my memory.

Final approach on landing was always a time of excitement - a sense of anticipation (not necessarily fear - just a nervous anticipation).

I remember one landing in particular - it was a hot summer day and I was wearing contacts. It was early in my flying lessons and I was sweating - big time. As we approached the final, I tried to wipe my brow and somehow the right contact popped out of my eye. There was no time to say anything to my instructor - I just closed my right eye for focus and landed the plane.

I was too embarrassed to mention anything to my instructor and felt it was a good test of what could happen sometime. I would add a reminder.

GUMPS + glasses.

Monday, October 11, 2010

Prevent Offense

If it hasn't been invented - you heard it here (or hear) first. The Bengals have what is know as the "Prevent Offense". The ability to prevent a win by trying to play safe offense vs trying to win the game.

I think both the prevent defense and the prevent offense - prevent the team from winning.

Playing safe may also not be a real satisfying win. In games where the opponents are both playing their hearts out it is just more exciting. Maybe there is a message in life about this also.

Prevent living is offensive :)

Sunday, October 10, 2010

Seeing is Believing

The statistician (me) was talking to the nuclear physicist (Rich M.) on a recent rendezvous in the farmland of Granville Ohio.

I mentioned the book "Evidence of the Afterlife" by Jeffery Long M.D. (the book is intriguing but not well written) and the fact that statistically if two lines of evidence (mutually exclusive) of Near Death Experiences (NDE) are 90% convincing that together we would be 99% confident of an after life.

Rich M. responded that evidence in science is based on what can be replicated and observed. He then updated me on the current theory of scientific unknowns - we live in 11 dimensions. Why eleven? - because the mathematics seems to most elegantly work in the various equations.

Naturally thinking time was the 4th dimension, I asked about the other seven. Rich responded that the 4th dimension is not time - it would be better explained by rotating your left shoe in a way that it becomes identical to your right shoe. WOW - ponder that one.

I remember the book "Flatlands" that described what it would be like for a two dimensional inhabitant to describe activities of things popping in and out of the third dimension (almost like magical disappearing acts or teleporting).

Those individuals talking about NDE's are believers - maybe three dimensional inhabitants describing some other dimensions. For them - seeing is believing.

Wednesday, October 6, 2010

What's your Number?

I continue to see that financial firm's (ING I think) commercial with the guy walking around with "his number". The next door neighbor say's his number is a Gazillion - clearly a SWAG and without a thought of "how much is enough".

Back in 2001 my financial advisor (T.A.) helped pull together a financial forecast and we discussed "my number". Next I had the challenge of figuring out - was it enough (and endless question)?

We spend a lifetime thinking implicitly about "the number" - trying to earn it, save it, invest it, and give it away. K.C. and I talked about this yesterday. What if suddenly (like winning the lottery) the number changed significantly (we only talked about the number going up not down).

Do you calibrate "up" your number - basically saying "enough earlier was not enough"? Or do you say the surprise excess can be given away? Giving away "a big number" can be stressful. I know, I know - you are saying please let me have that problem.

Everyone has that problem today regardless of the relative certainty of your number (in actual terms or forecasted). In his book "Wealthy and Wise", Claude Rosenberg plays around with "the number" with the premise that we can give more than we think.

Remember - it's only a number.

Tuesday, October 5, 2010

Efficient Recession

The business cycle is essential for proper balance - it's like yin and yang. So what is the optimal recession - the most efficient recession? It takes at least two quarters of lower GDP to be even considered a recession. Since recessions are considered "bad", then we should only want two quarters -- right? I don't think so.

Attempting to define the most efficient recession assumes something can be done to "control the timing and depth" of a recession. Hence the attempt with government stimulus and Federal Reserve actions. So implicitly we are defining what we view as the most efficient recession - meaning short and thin.

However this is like "squeezing a balloon". The shorter we want it, the deeper it becomes; the thinner we want it, the longer it becomes.

An efficient recession - is exactly what it takes to eliminate the bad habits of inefficient growth during the growth phase. Habits are hard to break.