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How Uber and the Sharing Economy Can Win Over Regulators

Harvard Business Review:

Interesting given the current discussions in Brookline and other cities.

Originally posted on HBR Blog Network - Harvard Business Review:

Sharing economy firms are disrupting traditional industries across the globe. For proof, look no further than Airbnb which, at $10 billion, can boast a higher valuation than the Hyatt hotel chain. Uber is currently valued at $18.2 billion relative to Hertz at $12.5 billion and Avis at $5.2 billion. Beyond individual firms, there are now more than 1,000 cities across four continents where people can share cars. The global sharing economy market was valued at $26 billion in 2013 and some predict it will grow to become a $110 billion revenue market in the coming years, making it larger than the U.S. chain restaurant industry. The revenue flowing through the sharing economy directly into people’s wallets will surpass $3.5 billion this year, with growth exceeding 25%, according to Forbes. The business model – where peers can offer and purchase goods and services from each other through…

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Channeling the Founding Fathers

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Someone doesn’t want YOU to vote. Don’t let them steal YOUR vote!! Don’t let them steal YOUR voice!!!

Another election season approaches and the forces of voter suppression are out in full force. While there was good news today from North Carolina where the US Court of Appeals struck down two key provisions of that state’s “Voter Suppression” law, the forces seeking to restrict the ability to vote for all but White Christians are hard at work making certain that only certain types of people find it easy to express their constitutional right to vote.

Perhaps it is true that the Founding Fathers never intended anyone other than White, Christian, landowners to participate in our democracy. Of course, there is some evidence that we had moved forward from that including Women’s Suffrage (1920) and the Voting Rights Act (1965).

The Supreme Court’s striking down some of the provisions of the 1965 act has led to a spate of new laws purportedly aimed at curbing voter fraud. This is a case of the cure being worse than the disease, especially if you are a minority voter. More than 30 US States have attempted to implement some form of restrictive voter regulations.

While much of this is common knowledge, there is a much more insidious effort to suppress voter turnout. This is a concerted campaign of misinformation targeted at minorities, the poor, and college students. Now, I can’t prove that one party is responsible for this but the groups targeted do tend to vote a certain way.

College students have become a favorite target of voter misinformation. They vote largely Democratic, are new voters, and may be able to choose where they vote; either in the domicile of their parents homes or in the domicile of their college.

Certain political forces have undertaken to spread the word that if a student registers to vote in the domicile of their college, the will be subject to loss of financial aid. This is a big LIE!! Voter registration has nothing to do with financial aid. No federal loans and grants are tied to the state you vote in.

It’s just an attempt to scare college students into forfeiting their vote.

Now here’s why they lie. Take New Hampshire as an example. There is a US Senatorial election this year in New Hampshire. In the last Senate election, in 2010, 439,000 New Hampshire residents took the time to vote. In 2008, which was a presidential election year, 672,000 people voted in New Hampshire. That year Jean Shaheen a Democrat won election by 42,000 votes. For a small state New Hampshire has a lot of college students. Approximately, 80,000 to be exact. If we assume that these students vote 70% for the Democrats, then fully suppressing college students’ votes could reduce the Democratic plurality by 32,000 votes (56,000 D vs. 24,000 R). That’s huge in a state where there will be a close election with a relatively small number of votes cast.

The votes of college students in a state such as New Hampshire are incredibly valuable.

By the way, this isn’t just about New Hampshire. Voter suppression through legal as well as through coercive means is happening in EVERY state in the US.

So how do you get the facts and exercise YOUR right?

There are a few sites that are set up to make it easy to learn the facts and exercise your rights.

First, try Claim Your Vote, there you will find people that you know giving you the straight facts.

Then try Fair Elections, all the facts about your rights on a state by state basis are here.

Finally, check out Turbovote, everything from information, to easy registration, to reminders about voting are at this amazing site.

Someone out there wants to deprive you of your legal rights. Are you going to let them?

Only In America

I know that I have been absent from my blog for quite some time. The summer has a way of keeping me from doing anything that resembles work. As we spend our last week in Cape Cod before returning to the reality of Boston, we have been been blessed by the best weather imaginable and a dearth of houseguests, finally.

Into this bliss comes the intrusion of yet another “Only in America” moment. This latest moment is the accidental killing of a weapons instructor by a nine year old girl firing an Uzi for fun. All this in the presence of her doting parents who were so proud of their daughter that they videotaped the whole thing. That’s the good news. Aside from the killing the bad news is the scarring of a child. I suspect that this child may have already had issues given the outstanding level of parental supervision.

No, I am not about to go on a rant about gun laws and the ridiculousness of giving private citizens the right to own and use military weapons. I have already discussed my views on this matter at length. The reality is that from a legal perspective, everyone from the innocent child, to the instructor, to the owners of Bullets and Burgers acted in a completely legal manner. These individuals acted within their legal rights as defined by legislatures and courts throughout our nation. While some of us may wish to quip about people in Nevada, the reality is that the parents of the child are from the Blue State of New Jersey. Also, according to Trip Advisor, Bullets and Burgers is the number one tourist attraction in Las Vegas. Apparently many people like to play with Uzis and grenade launchers.

Some have blamed the instructor for carelessness. While that may be the case, The instructor didn’t bring the child 2,500 miles to play with weapons of war.

My question is, what exactly led a nine year old to be holding and firing a military weapon with automatic firing capability? As the parent of two daughters of similar ages I have spent much of the past two days trying to imagine the process through which parents brought a nine year old to Las Vegas to play with an Uzi.

Perhaps this girl begged her parents to bring her. “I hear that Las Vegas is beautiful in August. there’s so much for kids to do and even though I’m not tall enough to go on the roller coaster at New York, New York, we can at least play with an Uzi or two. Thats so much better than going to the beach!” Unlikely.

Or perhaps these parents were just a couple of over-worked, under-vacationed parents (typical Americans) who wanted to go on their annual holiday to a place that they could drink, gamble, and work out some of their frustrations at the range with a grenade or two. What to do with the child? What the heck, bring her along. Nothing like some adult fun! Maybe.

Of course this child could have been the off spring of a couple of individuals who find themselves living in a country with a Black President, in a state with many Blacks, Latinos, Asians, etc. This child may have been the child of people who see government as the enemy and a need to “be prepared to defend their liberties”. Perhaps these parents felt a need to teach their child to be ready to protect what’s “her’s”. Hopefully this isn’t what happened but if I was asked to place a bet, it would be on this scenario. Sadly we see that the number of people with these beliefs seem to be on the rise. After all why did legal gun sales spike in the years following the election of Obama?

So we have a person dead for absolutely no reason. We have a nine year old permanently scarred by her killing of another human being. Of course, its possible that she was already damaged goods.

I know that everyone operated legally.

Can anyone tell me where the common sense is?

Can anyone tell me where the parenting is?

How Not to Run a Restaurant

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Having worked many years in the service sector, I have learned at least one thing. Your customers have options and you need to try really hard to make your business THEIR option!

As the wrap up of the HKS mid career year continues deep into its second month, an intimate group of 45 or so descended upon the Living Room in Boston the other night.

I have spent much of this year organizing dinners with my classmates. Its been a great way to get to know as many of them as possible. It’s also been a great way to get to know some of the better restaurants of my newly adopted hometown.

These dinners have run the gamut from four people at the best Japanese restaurant I’ve ever been to, to 35 people having BBQ and booze in large quantities in a basement. It’s been a great experience all around and each dinner was fun and easy to organize. That is until the other night.

With so many of my classmates staying in town post graduation we decided to have one last dinner. As of a week ago we had 50 people wanting to join. I wondered where could I make a booking for 50 on short notice. After a bit of research, I came upon the Living Room.

When I called I was greeted by a friendly and accommodating person. After about a minute I was informed that they indeed could accommodate 50. I should have questioned what kind of place could accommodate so many on such short notice but I was happy to have a place.

Then things got more and more difficult:

The next day I was told that we must use a prix fixe menu. No big deal thats normal for a large group

The following day they told me we needed to preselect our appetizers and our desserts.

The day after that we were told that we all had to have the same dessert.

The day before the dinner I was told that I had to guarantee the maximum amount, that i couldn’t add anyone that I hadn’t already confirmed and I was liable for the maximum number.

It seems that the manager, John wanted to be totally riskless with a group that was going to fill his restaurant on a Tuesday night. I balked and we came to something of a compromise.

The dinner was actually quite a success. The company was as always excellent. Great conversation and laughs. The food was pretty good even if some of us didn’t get exactly what we PRE ordered. The venue was kind of cool. The best part about it is that it has its own ATM.

Why was that the best part? Well, John had a bit of an issue with us paying with multiple credit cards. The story was that the “system” couldn’t handle it. Now we’ve had groups in excess of 30 at least five times and this has never been an issue. It usually involves me managing the process but heck everyone has a skill. After about 20 minutes of trying, John looked at me and said, “If I had known that you were going to try to pay with more than one credit card I would have refused the reservation.” He said this to someone who just spent $3,000 in his restaurant on a night that otherwise would have been virtually dead. We than began the pride of HKS Alumni to the ATM.

I can only wonder what he would have done if a party of 20 had walked in without a reservation!

Its a shame that I felt compelled to write this negative review about what was essentially a good meal at a reasonable price.

Moral of the story is that the Living Room needs a new manager.

PS: Kudos to Amy who was pleasant and helpful regardless of what her boss did or said.

 

School’s Out

About five years ago, I was chatting with a friend of mine who was and is a tenured New York City public schools teacher. I asked her,” Have you ever worked with anyone who just wasn’t a very good teacher?” To my astonishment she replied, “No!”  Expressing my surprise I then told her that, “It must be amazing to work in a profession in which EVERYONE is good at their jobs. Heck, I worked in finance for 20 years and even at Goldman Sachs and JP Morgan, every year some people get terminated due to poor performance.” I am still waiting for her response to that comment.

This week California Superior Court judge Rolf M. Treu gave my friend and many of her fellow teachers an answer. Judge Rolf ruled in Vergara v. California that California laws governing teacher tenure were unconstitutional. Furthermore, he stated that the results of these laws were unconscionable and perhaps most importantly he drew a bright red line that connects tenure rules to discrimination against low income and minority students stating that the rules create an environment in which the weakest teachers migrate to the poorest schools. While this case is likely to be appealed, it is more likely to serve as a template to overturn tenure rules across America.

Before I extol this ruling, I feel the need to make two things “Perfectly Clear”. First I am the product of a union household. I strongly believe that labor MUST be organized to offset the power of large employers. This is especially true for wage negotiations. Secondly, I have the utmost respect for teachers. For the most part, they do an excellent job educating our children in a country where the role of education has grown and evolved in the past generation. Teachers are not just expected to teach reading and writing but in many cases they have to teach social skills and manage children who get little or no guidance at home. For a good teacher this is anything but a 9 to 3 job.

While the need for unions remains high, the reasons for tenure are no longer very clear.  During the McCarthy era people across many professions lost their jobs due to their beliefs. Since that time not only have Americans (well most Americans) become more tolerant but there has been significant legislation that prevents discrimination on the grounds of race or gender. These additional protections in many cases overlap with tenure, mitigating the need for the latter.

A couple of years ago I realized that my own views on teachers unions and on tenure in particular were evolving. I was no longer dogmatic in my support of both. Now, keep in mind that in many ways I am a typical union supporter. From New York, a Democrat/Liberal, and Jewish, people like me have been supporters of unions for generations. But something was wrong in this case. As evidenced by my conversation with my friend, there was a complete lack of acceptance of any fallibility on the part of teachers and their union.

So now, the tide is shifting and quickly. Many former supporters of teacher unions are no longer so. Even more challenging is many of these “flippers” are highly educated, wealthy, urban individuals, who won’t hesitate to spend their money and influence to force a change in the rules. The California case was financed by an organization called Students Matter which was in large part funded by Silicon Valley entrepreneur David Welsh. Many of his fellow entrepreneurs as well as Hedge Fund managers, Private Equity managers, and other successful individuals want improvement in education and see teacher quality along with length of instruction time as the most important levers to achieve that. In short there is now a developing but significant counterbalance to teacher unions power and influence.

Now, I don’t believe that the correct answer is to eliminate teacher tenure or teacher unions. What I do believe is that all parties need a common sense, procedural justice based set of rules that govern teacher hiring, promotion, compensation, and ultimately retention. If were are to have the education system that we ALL want, then we must have all participants involved in creating a process in which we hire, evaluate, and retain the best teachers that we can get.

It will be very important to have a balanced evaluation process that considers not only standardized test scores, but also on other measures including following years student performance. content design skills, and classroom evaluations. This should support a well defined set of rules that will let everyone know how to get promoted or terminated.

Almost every teacher I know is passionate about educating children.  I would think that good teachers would want to be surrounded by other individuals who are as committed and passionate as they are.

It is time for teachers to move their unions to act for change. Although the California ruling weakens the negotiating stance of teacher unions, it is likely that the legal environment will become more rather than less difficult. Acting now, teachers can lead the move to a set of standards that work for ALL constituents in our education system. Or, they can let the justice system make them individual contractors who have few rights and little security.

I don’t want that for my children.

My Two Cents on the Donald Sterling Turnover

So aside from my annoyance on the amount of time spent on an old man reverting to form, I have a couple of thoughts on how to resolve the Donald Sterling situation.

For those of you who are not-Americans or are Americans who don’t have cable, internet, or electricity, America has spent the past five days talking about an 80 year old former personal injury lawyer who in private conversations with his 31 year old African-American/Hispanic mistress made racists comments about blacks.

The issues in the above paragraph are too many to mention. Sterling, for example is not divorced from his wife. No one seems fussed by that fact. How did the private conversation become public? Sterling has done this before. Oops.

My point is that while his behavior is clearly reprehensible, perhaps we should not be surprised considering the source.

I would like to focus on two elements of the proposed punishments sanctions. (Note: The NBA has just this minute banned Sterling from the NBA for life).

This ban is fine assuming that there was any element of due process. My guess is that if it is similar to bans in MLB (remember George Steinbrenner), Sterling will be able to retain ownership in the team but not be involved in operations.

I think it would have been much better to do two things:

Force Sterling to attend all remaining Clippers games both home and away. Have him sit at center court and announce him along with the players so everyone in the crowd gets a chance to express their view. Might be a bit uncomfortable.

Ultimately, suspending Sterling without forcing him to sell means little. I am pretty sure that the quick ban is due to the other owners reticence in having a real investigation that leads to a forced sale. Why? Once the precedence is set then this could be used against them. I wonder what Marc Cuban is thinking.

So how does this get forced. IMHO there is only one way. That is a Players Strike. Imagine if the players went on strike during the playoffs. Remember that they have been paid all of their salaries for this season, and that the playoffs are the payoff for the owners. Ticket and TV revenue all come NOW.

Imagine the pressure that a strike by the players, 78% of who are African-American would bring on the owners. It may be the only way to force the 3/4 of them required to vote to force Sterling to sell the Clippers.

There is no other way. A proposed fan strike would just cost fans their hard earned money. Advertisers will be back as soon as people stop talking about this which is about five days from now.

If the players go at playoff time then it all goes out the window. Maybe thats why the new NBA commissioner did what he did. Its a response but not the right one.