"The world is changing, and so is Dell." -- CEO Kevin Rollins, promising a turnaround after recent setbacks,including a widening federal inquiry into Dell's accounting
McDonald's (MCD) unveiled a program on Sept. 12 that makes it simpler for its 225,000 European workers to get jobs at its outlets anywhere in the EU. Despite the region's chronic high unemployment, companies say jobs often go begging because few candidates will relocate. Indeed, EU officials applaud the program as the first major effort by an employer to tackle the lack of labor mobility. Just 1.5% of Europeans live and work outside their own countries. In surveys, 60% say they wouldn't make such a move even if they were jobless.
Hoping that its relatively young workers are more inclined to pick up stakes, McDonald's is creating a Web site for employees to find openings and issuing "McPassports" that qualify them for jobs at any outlet. "If they are trained and they need a job, they will get it wherever they are in Europe," says Denis Hennequin, McDonald's European chief.
Well, almost. To wait on customers, they must speak the local language. And McDonald's says it can't guarantee jobs to Central and Eastern Europeans, who still face restrictions on cross-border employment. Even so, the McPassport may make for interesting talk among workers in the kitchen. Hamburguesa mit frites, presto!
Microsoft is gearing up for a new game of catch-up with Google, this time to compete with Google's (GOOG) Web-based word-processing and spreadsheet services. BusinessWeek (MHP) has learned that the software giant is making plans to put some of the technology from Works -- the bare-bones word-processing and spreadsheet software that often ships with new consumer PCs -- at the heart of a new online offering. The company is developing a strategy to offer the service free, hosted on its Office Live Web site. There may also be a subscription version with more bells and whistles.
While it's not a done deal, Microsoft is putting plenty of bodies on the project. "We want to win this space," says Chris Capossela, vice-president for the business division product-management group. The service will probably take shape sometime after the company launches Office 2007 early next year. The idea will be to provide minimal functionality so as not to eat into Office sales. Microsoft could be bolder, says Goldman Sachs (GS) software analyst Rick Sherlund, perhaps giving away some of its valuable Office technology free on the Web to counter Google, even at the risk of cannibalization. "You need to be aggressive in dealing with Google. Don't tie your hands behind your back. Come out swinging."
Sesame Workshop, the nonprofit behind Sesame Street, is celebrating its 10th year in Russia in mid-September with a children's art show at Moscow's Tretyakov Gallery. Public donations are rare in Russia, so Ulitsa Sezam has relied in the past on funds from USAID and even George Soros, whose foundation kicked in $1 million in 1996. Today, "the rock" of its support is Nestl? (NSRGY), says Sesame Workshop President Gary Knell. Nestl?, which has put Ulitsa Sezam Muppets like Zeliboba on cereal boxes in Russia, is launching a branded "Good Nutrition Program" in 5,000 schools throughout the country.
A long-simmering debate about conflicts of interest between public pension funds and the consultants who advise them may get its day in court. On Aug. 25, Patrick Patt, a retired school superintendent from Lake Forest, Ill., filed a lawsuit against Callan Associates, one of the nation's largest fund consultants. A beneficiary of the Illinois Teachers' Retirement System, he claims the consultancy violated a state law that requires a fiduciary to act solely in the interest of the fund it represents.
According to the suit, filed in state court, Callan earned $545,000 a year from 2002 to 2006 as the lead investment adviser to the $36 billion pension fund. But even as Callan was helping pick money managers for the fund, the suit alleges, it was earning up to $54,000 a year from money managers attending its seminars. In part, these seminars teach money managers how to win business from pension funds.
The suit does not allege any favoritism on Callan's part. But the consultants, says J. Brian McTigue, one of the attorneys who filed the lawsuit, "need to be un-conflicted."
Such practices are common in the world of fund advisers. In a report issued last year, the Securities & Exchange Commission said that more than half of 24 consultants it studied for conflict of interest provided services to both money managers and pension funds. The SEC doesn't prohibit these activities, though the agency has issued "tips" for consultants, including suggestions that they disclose payments from money managers to their pension fund clients and implement firewalls to prevent such payments from influencing investment decisions.
Nancy Malinowski, a Callan spokesperson, says the Illinois suit's conflict-of-interest allegations are "absolutely untrue" and that Callan intends to fight the suit. "There's nothing inap-propriate about our business model," she said, adding that the Illinois fund performed well enough to be in the top 10% of funds its size for the four years Callan advised it.
Savvy bloggers sift through thousands of posts and newsfeeds every day to find the magic topics that will send search engines racing in their direction. But Mike Levin, the creator of hittail.com, thinks he's got a better way: To become a click magnet, he says, a blog should study how it got its past hits.
To advise bloggers on what's bringing readers to them, hittail.com uses software based on "long tail" theory. It ignores the most common terms that call up a blogger's Web site on a search engine's results page, analyzing instead a large sample (the long tail) of many other phrases that have led searchers to the blog. It then regularly suggests a list of a half-dozen "headlines," topics that should keep the traffic coming. Bloggers need only supply the posts, Levin says. Michael Duz, whose blog, SEO-blog.com, is about search optimization, gives the service, now free, good reviews. "The more content you add," he writes, "the more long-tail search terms will become apparent, for which you write more content."
Soon, it won't be your mother's QVC. At least that's what executives at the $6.5 billion-a-year TV shopping channel are hoping. To youth-ify its audience, now mostly 40-to-60 year old women, the electronic retailer, owned by Liberty Media, is booking celebrity types with youth appeal.
Viewers have already been pitched by Paula Abdul, who took a break from rehearsals for the American Idol finale in May to sell rings and necklaces from a special QVC stage outside of Hollywood's Kodak Theatre. Also hawking from Hollywood: Cynthia Garret, a VH1 veejay, who hosted a jewelry segment while poolside at the trendy Roosevelt Hotel, another of the nearly 40 remote broadcasts QVC will do this year. (From New York City's Trump Tower, competitors on NBC's The Apprentice have hustled to win approval from The Donald by selling panini grills and cleaning liquids.)
It's all part of CEO Mike George's "cultural relevance program," aimed at wringing more sales out of the estimated 91 million U.S. homes that receive the channel. Now, only about 1 in 10 of these households buy products, George says. "If we can get someone to stop on the channel for 10 seconds longer than they might, our chances of getting them to buy go up dramatically." The channel's revenues increased a robust 14% in 2005, but that growth rate may diminish, since QVC is already available in every cable and satellite home.
QVC's hefty audience may attract buzzworthy types. Model Heidi Klum was slated to appear on Sept. 14. Other young celebs are showing interest, too, says marketing chief Jeff Charney. "We used to call agents all the time and never get a call back," he says. "Now they're the ones calling us."
Kia Motors has announced the name of the snappy new subcompact hatchback it will sell in Europe. Ready? It's the Ceed (short for "Commission Europ?enne" and "European Design"). It's the same name Kia used for a "concept car," much like the final product, introduced at the Geneva Motor Show in March. Covering the show, Motor Trend went so far as to say: "We hope [it] is not the production version's name."
Sorry, MT. Then again, Kia isn't the only automaker having trouble in the name game. The U.S. trademark registry reveals some of the other names and slogans being protected (or given up) by car companies. What may come down the pike? Kia is protecting Seragio for a future model name in the U.S., while Volkswagen has re-registered Scirocco, a name (meaning roughly, "warm wind") it plans to bring back from the 1980s. Sadly, VW gave up protection for the name The Thing and the old ad slogan "Fahrvergn?gen" (The Joy of Driving). It also surrendered Zoon.
Ford (F) has had a devil of a time settling on names for its Lincoln models. After just a year of marketing a compact sedan as Zephyr, Ford is renaming it. The former gentle breeze will be the MKZ in the fall. And as the old Town Car drifts into memory, it will be replaced by the MKS. Ford is also guarding MKSW and MKV in case another company wants to steal those names. No worries, Ford.
I'm a therapist practicing near Detroit, where layoffs are a frequent threat. (When they arrive, it's almost a relief for my patients.) How can a corporation handle these (including the rumors) so that morale isn't destroyed? And how can laid-off employees realistically assess their competence after being dismissed because of market forces? -- S.H., Plymouth, Mich.
You've got your hands full, practicing near Motor City. While layoffs are sometimes required to save a company during downturns or after a strategic miscalculation, they can cause devastating emotional harm. Morale suffers not only because the dismissals signal serious internal problems but also because of the loss of colleagues -- and survivor guilt among those who escaped the ax.
Because the threat of layoffs puts people under chronic strain, employees may indeed be relieved when the pink slip arrives and the suspense is over. But anger, depression, embarrassment, and plummeting self-esteem can follow quickly.
Here's one thing companies can do: Openly acknowledge the suffering they're causing. Calling layoffs "downsizing," "right-sizing," or "adjusting to scale" is an attempt to deny the trauma. It depersonalizes the humans who are suddenly out of work, downplays the aggressiveness of the action, and is a way to assuage the guilt of those making hard choices about who stays and who goes. The only thing worse than being fired when you haven't done anything wrong is that awkward silence from leadership. It leaves you feeling at fault by default.
Senior managers also need to know that unaddressed rumors about impending layoffs will spread rapidly, paralyzing an organization. And they shouldn't assume that those left behind, including themselves, will be unscathed by the experience. (My CEO clients agonize over these decisions.) Through HR or other professionals, senior managers should be attuned to the emotional fallout, including survivor guilt and lingering anxiety. Getting employees to put their feelings into words is one of the best ways to help, though it's remarkable how often people are afraid to do just that.
FOR THE OUT-OF-WORK employee, the biggest challenge may be how to cope with feelings of helpless rage. Being laid off isn't like being fired for cause. It's not a chance to learn from one's mistakes, and there's no easy or obvious solution: It's not so easy to move to a less vulnerable city or industry, for instance. And while most people are rational enough to know that their competence was never the problem, our minds don't work so logically at these times. Self-doubt and anger turned inward take their toll. That's why the best therapy in this case is to redirect that anger toward finding a new job. Even the necessity of listing one's skills for a potential employer is useful. It's a reality check that counters the distorted self-image that depression breeds. Counseling can help, but getting another job is, ultimately, the best medicine.
The spotlight is still on Hewlett-Packard over the use of "pretexting" to get board members' and journalists' phone records in an attempt to trace news leaks. A corporate blunder? Something bigger?
"I'd never heard of this euphemism for impersonation. Impersonating a police officer is a crime. Should that extend to impersonating other people? I think so. I'm a privacy nut, and this is a way of invading privacy. There ought to be a law." -- William Safire, Columnist, The New York Times Magazine
"'Pretexting' is really identity theft. The legality is almost less relevant than the ethics. The issue of leaks is very real. But if you have a leak and a problem, you get at it legally or you have to endure it." -- Harvey L. Pitt, Former Commissioner, SEC
"People are missing the real story at HP. Post-Enron, boards have been granted all this new power, but they haven't had time to deal with their own internal issues -- like setting ground rules for conflict." -- Patrick McGurn, Exec. VP and Special Counsel, Institutional Shareholder Services