Extremely poor form, but not surprising

Rather than focus on the obvious concerns about the timing and reasons given for the firing of FBI Directior James Comey, I want to focus on the absence of common decency exhibited by our President. Firing someone should be hard, but one thing you must do is let the person know before you tell others not involved in the process. Apparently, Comey found out while making a speech across the country after someone saw it on a TV news report.

That is extremely poor form, but not a surprise given our President’s history of taking advantage of people. It should be noted that a White House source said the President kept the firing close to the vest, so the roll out was chaotic, even beyond their normal chaos level.

As a former manager, I have had the misfortune of having to let someone go. Even after vetting the issue to make sure this action was ultimately needed, it still bothered me to have to ask someone to leave and it showed when I did it. The process must be handled with as much grace as possibly can be mustered.

Yet, our President did not take the time to make sure Comey knew beforehand. Comey served our country for many years and deserved better. When a senior person was being let go in my office by the bold line matrix management, I asked if I could sit in to honor the man’s thirty five years of service. We owed him that.

To me, it is very obvious this President is hiding something. The fact he wanted to get the firing announced in time for the evening news is telling. The fact he wanted to do something to respond to Sally Yates saying he knew well before Flynn’s firing that Flynn is trouble is telling. The fact Comey was fired after he wanted to expand the scope of the Russian investigation per several Senators is telling.

But, let’s set that aside. The fact our President fired someone and announced it before the employee acknowledged it is telling. It tells me exactly what kind of leader our President is.

A windy day at sea

On Monday, I read an article written by Bloomberg called “Costs for generating wind power at sea drop.”  The gist of the article written by Jessica Shankleman and Brian Parkin is the cost of building a wind facility offshore is now less than building a new nuclear power plant and getting closer to the cost of building a coal power plant.

It should be noted this is the cost of building and does not factor in the present value costs of retrieval, transportation, environmental degradation, distribution, maintenance, litigation and health-related costs, which make coal energy less palatable than wind energy. Just maintaining coal ash many years during and after the life of a coal-fired plant is something utilities would love to avoid, as it is the gift that keeps on giving, in a negative way.

Per the article, “Across Europe, the price of building an offshore wind farm has fallen 46% in the last five years – 22% last year alone.” The average building cost is $126 per MWH versus $155 for nuclear and $88 for coal. Yet, Henrik Poulsen, the CEO of a Danish utility, noted “If you have a sufficiently large site with the right wind speeds, then I do believe you can build offshore wind at least the same price as new build coal in many places around the world.”

Heretofore, the significant growth in wind energy has been in our plains states, with Texas leading the way. Iowa gets a third of its energy from wind energy. Yet, the US is expected to build offshore wind in a significant way in the future. Our goal is “install 86 GW of turbines at sea by 2050. That’s six times the 14 GW of capacity now in place worldwide, according to the Global Wind Energy Council.”

Wind energy has overtaken hydro-energy as the leading renewable source in the US. Like solar, it is taking off in installation and job growth. And, with the significant efforts from folks like Tesla owner Elon Musk on large-scale battery storage, it will grow even more. As we speak, Musk is helping out Australia with a power outage problem with a goal of setting up a battery storage facility in 100 days or it is free.

This is the progress that needs to be discussed as it is exciting, environmentally needed and job-creating. Investing in an increasingly obsolete energy is throwing money away.

 

 

Rewarding inefficiency

As a former consultant, I have witnessed too often how some are rewarded for their inefficiency. For those who have never worked for a consulting firm, the management goal is to bill all time to a client. So, pressure is applied to record all time spent working on that client, then pressure is placed on the account manager to bill the time charges in the system.

The dilemma begins when you are working on a set  budget for a project and the agreed upon maximum amount cannot be billed, unless you speak with the client first about why additional work is needed. With those further removed from the budgeting/ billing process, they are told to record time, whether they are inefficient or not. As they are measured on billable hours, people who are inefficient are actually rewarded for their inefficiency.

So, Joe is inefficient on his work and has 1,800 billable hours for a year. Susan is efficient and works well within budgets and has 1,500 hours. Joe will get more rewards for his work, even though the company had to write off 300 of his hours that exceeded budgets with clients. I should note this is not an uncommon dilemma. What Joe fails to realize is future project managers may say we cannot use Joe as we always have a write off. So, this may right itself long term, but in a matrix managed world, Joe does not report to the account and project managers, so he will be judged by his supervisors.

Why am I thinking of this? Our President is getting kudos from his followers for doing what he said he would do. The problem is much of what he said he would do may not be the best course of action. While I applaud looking at infrastructure and looking strategically at how we can increase domestic jobs, measures like building a wall or introducing a travel ban will do very little to accomplish making us safer and dealing strategically with immigration. Neither will ignoring the far greater terrorist threat in our country of anti-government and other domestic hate groups that are already here.

I have written earlier these tactics are more like a gorilla beating on his chest than they are about solving real problems. Data centric analysis should drive what we should do, rather than the campaign rhetoric of a man who is not known for his desire to perform due diligence. So, let’s not reward inefficiency. Let’s focus on doing smart things that can help our country. Building a wall and banning travel are inefficient.

 

 

 

The wind is at our backs now, with red states leading the way

While our President is not a fan of wind energy (having unsuccessfully sued the Scottish government to stop an offshore development) and has made some climate change is a hoax comments, rather quietly, renewable energy continues to move up the charts. Solar energy is going like gangbusters with double-digit growth in production and jobs, but wind energy has surpassed hydro energy as the largest form of renewable energy in the US. What is interesting, most of the growth in wind energy is occurring rather quietly in mostly red states.

From an American Energy News article last week:

Texas has more than 20 MW of installed wind capacity, or nearly a quarter of the market. Iowa is the second-biggest wind state, and Oklahoma overtook California for third place at the end of 2016.

 The first offshore wind project in the United States also came online in the fourth quarter, the 30 MW Block Island wind farm off the coast of Rhode Island.

More than 10,000 MW of wind is under construction in the United States, about half of which is in Texas. New Mexico’s wind industry is growing rapidly, with 1,300 MW under construction. Once completed, those projects will double the size of New Mexico’s installed wind capacity.”

Per Reuters from an article this week, in 2016, Texas has 12.8% of its energy produced by wind energy, something our new energy secretary and former Texas governor has been fairly silent about. And, as noted above it will continue to grow.

And, from an article from the US Energy Information and Administration last October:

In 2015, 11 states generated at least 10% of their total electricity from wind. As recently as 2010, only three states had at least a 10% wind share. Iowa had the largest wind generation share, at 31.3%, and South Dakota (25.5%) and Kansas (23.9%) had wind generation shares higher than 20%. Two additional states, Texas and New Mexico, are on track to surpass a 10% wind generation share in 2016, based on data through July. Wind generation in Texas, the highest wind electricity-producing state, made up 24% of the national total wind generation and 9.9% of Texas’s total electricity generation in 2015.

At the national level, wind’s share of total U.S. electricity generation has risen every year since 2001. Wind facilities produced 190,927 gigawatthours (GWh) of electricity in 2015, accounting for 4.7% of net U.S. electric power generation. This level represents a doubling of wind’s generation share since 2010, when the share was 2.3%. Based on monthly data through July, wind has provided 5.6% of U.S. generation in 2016.”

Both of these quoted articles can be linked to below. As I have said several times, while the President can slow the progress down, the train has left the station on renewable energy due to reduced production pricing coupled with much less maintenance, acquisition, transport and litigation costs.

This is the news that needs to be shouted from the roof tops. And, the benefactors of this progress will not just be our children and grandchildren, it will impact us all now.

 

http://www.eia.gov/todayinenergy/detail.php?id=28512

http://theamericanenergynews.com/energy-news/wind-surpasses-hydro-largest-us-renewable-energy-source

More wisdom from an astronaut

I have written before of some great advice from astronaut Mike Massimino in his book “Spaceman.” As I read further, I came upon this gem which summarizes what matters most which applies to more than being an astronaut.

Massimino was influenced by the movie “The Right Stuff,” which defined by example what it took to be a test pilot and astronaut. But, after becoming an astronaut and watching his fellow astronauts help him when his father was being treated for cancer, he made the following important observation.

“If you’ve ever wondered what the right stuff is….It’s not about being crazy enough to strap yourself to the top of the bomb. That’s actually the easy part. It’s more about character, serving a purpose greater than yourself, putting the other guy first, and being able to do that every single day in every aspect of your life. People ask me all the time what it takes to become an astronaut. It’s not about being the smartest or having the most college degrees. The real qualifications are: Is this someone I’d trust with my life? Will this person help look after my family if I don’t make it home?”

Massimino notes there are smarter people than he who did not make the cut to be considered. Yet, he had been a great teammate in every thing he was involved with and honored the process by seeking help and learning from others. His education was guided by the goal of becoming an astronaut. Yes, he was also smart, but he said these other attributes were essential.

Reading this made me realize how translatable these vital attributes are to other disciplines. Being a good teammate, asking for help and offering help will carry you far in many endeavors. He noted that previous astronauts, like Neil Armstrong, John Glenn and Jim Lovell were most gracious and giving with their time and advice. That is a lesson for us all and an example to the newer crop of astronauts.

You cannot shrink to greatness

I often borrow the phrase “you cannot shrink to greatness,” which I first heard when companies downsized to make their numbers. When leaders don’t know how to grow revenue or if market conditions do not support revenue growth, they cut staff. Lately, I have been using it to define the goal of nationalist thinkers who believe by restricting global trade, they can make things great.

On the whole, global trade is accretive to growth. Yes, we need to constantly review trade agreements to protect workers, but even trade agreements like NAFTA add value and jobs. If NAFTA were done away with, the state of Texas and the US would suffer, as would our key trading partners on our continent.

A venture capitalist said it succinctly. “Do you know what creates jobs? Customers.” The more trade, the more customers. It is that simple. As for the job losses which subtract from trade related gains, we do need to review the causes and effects. Many jobs have been lost dating back to the 1980s. Companies chase cheap labor, always have. So regardless of trade agreements, the companies were offshoring just as our President has done with his clothing lines and ball caps.

Also, where we are losing more jobs is to technology gains. We do much more manufacturing here, but with far fewer workers, than we did in the 1980s. These technology improvements will continue. So, before we blame trade agreements and throw the baby out with the bath water, we need to understand the metrics. What jobs are created, which ones are lost and why?

The other factor that does not get enough airplay is just as US companies are building products closer to customers, so are foreign companies here. Think of all the foreign cars and trucks made here in Tennessee, Kentucky, South Carolina, Alabama, etc. and think of foreign companies like Doosan, Mitsubishi, Michelin, Husqvarna, to name only a few, who have facilities here in the states. These are additive jobs to our economy.

Reducing trade is not conducive to growth. If you recall the movie “A Beautiful Mind,” about the schizophrenic John Nash, who won the Nobel Prize for Economics, ask yourself why he won? His theory called the Nash Equilibrium proved very useful in global deals in growing the pie bigger. The Nash Equilibrium says if we look to maximize only our own gain, while others do the same, the competition squashes trade. Yet, if we work together to make everyone benefit, the economic pie gets larger.

Reducing trade is also not conducive to greater security. The more commerce you do with countries that may not be an ally, the more you both will work to keep the commerce successful. So, military interventions would be harmful to that trade.

So, retrenching from the global markets, would not only be dilutive to growth, it would make us less secure. This is the argument that should be very visibly discussed as we look to improve agreements. Because no agreement is not a good course as it will cause a shrinking effect. And, you cannot shrink to greatness.

 

Our next President may want to give more attention to the larger economies

It seems our President-elect is more consumed with Russia than he should be. Why the undue dalliance is something that the analysts should evaluate. Yet, Russia is not even in the top ten economies in the world.

Of course, we should endeavor to have commerce with countries as bilateral trade breaks down barriers. But, I would be more concerned with our larger partners – China, Japan, Germany, UK, France, India, Brazil Canada, and Italy. These and other trading partners like Mexico have a major impact on the US economy and job markets.

I would be more concerned with impacting trade with China than anything else. That could have a huge bearing on US jobs. Like the mistake with Brexit, we must not forget the jobs created here by foreign companies. Companies wanting to tap the US market have figured out it is more cost effective to build big things here rather than ship them from abroad – think Nissan,  Honda, Mercedes, BMW, Volvo, Hyundai, Husqvarna, Doosan, etc.

An economist said in 2015, China’s slowing growth has a bigger impact on the economy than similar percentage declines elsewhere. Yet, we should seek trade with other partners as well, to diversify and tap other markets. More commerce with Russia is a good thing, just as more commerce with Cuba and Iran is. Conducting trade creates relationships and builds more unity. Countries will be less inclined to upset applecarts. And, in Iran  the median age is 35, so the opportunity to change the future relationship in a positive way exists.

I recognize fully that there are leaders and countries we need to be highly skeptical of such as Russia, Iran, The Philippines right now, Syria and North Korea, e.g. Duterte is a thug, Putin is conniving and Little Kim is bat shit crazy, so we need to be leery of these folks

So, before our President-elect accepts Putin’s offer as a prom date, he may want to consider dancing better with our other successful partners.