The Post Office Has Turned Amazon Into The Worlds Worst Brick and Mortar Retail

For some time, Amazon has been cutting delivery costs by using the United States Post Office as their “last mile” delivery force.  Amazon gets the packages to a Post Office distribution center, and USPS gets it to your house.  The deal is meant to save Amazon money, because the post office is significantly cheaper than UPS or FedEx for last-mile, and save the post office by infusing them with customers in the face of declining first-class mail.  In fact, a post office employee once told me that this was basically the new strategy – use the big logistics companies, Fed-Ex and UPS, for inter-state shipping, and leverage the mail carriers, who have to go door to door everyday anyways, to finish the job.

Except in doing so, Amazon has turned what was once an extremely convenient e-commerce service into the world’s worst brick-and-mortar retail experience, at least for this customer.  Let’s look at one recent case to see how.

A few weeks ago, in time for Thanksgivukkah, my girlfriend ordered me a copy of Ticket to Ride from Amazon.  Everything from ordering through shipping went normal, until we never got the package.  This week, she checked the tracking number, and the last message was from December 1st saying “Delivery Attempted.”

When UPS or FedEx attempts a delivery, they leave a note on your door letting you know when they’ll be back, and giving you a number to call to make other arrangements.  On occasion, I’ve had a similar note from USPS in my mailbox, especially for certified letters, but for packages I’d say it’s a coin toss as to whether they’ll even let me know (this time, it came up tails).  We live in an apartment  building with a locked exterior door, so FedEx and UPS will usually just leave the package near our door.  Not the case with USPS, which needs you to physically take possession (although strangely, not sign for it).

And this is where the fun begins.  The post office only delivers packages once, during the day, at a random time.  I’ve had them ‘attempt delivery’ and not leave a package when I was home, which makes me think that they only sporadically try my buzzer.  So once they skip miss you the first time, you’re left trying to hunt down your package.

The first step to hunting down your package is to try your tracking number.  Unfortunately, tracking a package with USPS is like navigating with a sextant in the clouds.  You know you have a tool that’s supposed to tell you exactly where you are, but the most precision it can give you is “you are somewhere on earth.”  In our case, that was a “Delivery Attempted” message that didn’t tell us when delivery was attempted, how, or when it would be attempted again (it wouldn’t).

So now we got to visit the Post Office, which is where they hold packages that had delivery attempted but not completed.   Remember how you shopped on Amazon so that you wouldn’t have to visit a store, leave work, and wait in line?  That’s not the case anymore.  Now you get to visit a place where service and efficiency are so well-renown, it’s used as a go-to example for bad service and efficiency.

Unlike retail stores that want to capture shoppers when they’re available, the post office is only open during normal work hours – my local branch is from 7:30AM to 7PM.   So if you want to pick up your package, you have to take time off of work, which as turned ordering from Amazon into the workplace equivalent of a doctor’s appointment.

But our story gets better, because once you get to the post office, it’s not a place that prides itself on speed and ease of use.  In fact, second to the DMV, it’s probably the place most often cited as tortuous to deal with.  So now you get to wait while the old lady in front of you pays for stamps in pennies, the crazy guy (who was probably sane when he got in line) rants about how he wants his packages there yesterday, and the person who doesn’t speak English tries to apply for a passport from the wrong window.  And when you get to the front, you’re dealt with by a someone who’s annoyed that you ruined their workday by, you know, making them work.

So now, thanks to the convenience of Amazon, instead of picking something up from any of the literally hundreds of stores dotting a commute home in Manhattan, we’ve paid for the opportunity to wait four days and pick it up from one specific, out of the way location that’s not open in the evening, has awful service, unreasonably long lines, and doesn’t communicate to you that they even have the product in stock.  What a great bargain!

And I wish this was the only time this happened, but it’s becoming a pattern.  I’ve had packages disappear into the ether when the Post Office reported them delivered, even though I never received them.  It took Amazon five days to reship it, which turned Prime’s “2-day Shipping” into “2 week shipping.”  And I’ve found out about “redelivery attempts” from the note that told me it failed.  It makes me excited for Amazon’s new drone delivery force – at least cutting the post office out of the loop will mean I actually get my order.

The End of the PC

Sales of PCs – not just Windows machines, but all personal computers – have fallen 14%, the biggest drop since 1994.  But while many are blaming Windows 8, I actually like.  Instead, a Time article fingers the real culprit:

It’s not just that people are stubbornly refusing to see newer versions of Windows as superior to older versions of Windows. Back in the 1990s and early years of this century, PC hardware was getting better at such a rapid clip that new PCs were often far better than the machine you’d bought two or three years earlier. Today, even a four- or five-year-old PC may still have more processing power, RAM and disk space than you need. And the industry is having trouble coming up with new features that large numbers of people find irresistible.

I’m typing this on my desktop, my primary office computer, which runs on a Core2 Duo that was a mid-range processor when I bought it as an upgrade five years ago.  A year ago, I replaced the video card when it failed after seven years in the machine.

And despite my machine’s age, I don’t see a need to buy a new one.  Applications are responsive, they load quickly, and I’m even able to play most games.  And this is on five year old hardware.  Contrast this with ten years ago, when new versions of basic productivity software needed the latest hardware.  And that’s the problem faced by Microsoft and the PC makers: unlike ten years ago, when I needed a new PC every other year merely to keep up, I feel like I’m doing great on a rig that’s a half decade old.

Banking on Ice Cream

Are you frustrated with your monolithic, impersonal, tasteless bank? Do you love ice cream, waffles, and other treats?  Do you wish you could get rid of your bank AND get more ice cream?  If so, and you live in Pittsburgh, you may be in luck:

Mr. Clay said customers who make deposits earn interest in the form of “exclamation dollars.” A $100 deposit is worth $5.50 a month that can be spent on ice cream, waffles and coffee in his store. It works out to be a straight 5.5% monthly interest rate, he said.

Whalebone Cafe Bank, in an ice cream store, has started accepting deposits,  making small loans, and offering interest in the form of gift cards.  It all started when the owner got frustrated with high bank fees and decided to open his own, more friendly, more delicious bank.   There isn’t a savings account in the country offering  a 5.5% monthly interest rate right now, so even if it is in Ice Cream dollars, it might be worth it.

In case you’re worried about the quality of your return, “State regulators did visit the parlor ‘and reported that the ice cream was good.’”

You can find more, including a dive into the relevant banking regulations at the original Wall Street Journal article: Ice-Cream Bank’s Rocky Road.

A Lesson on Innovation from Steven Colbert

Reading an old Rolling Stone interview with Stephen Colbert, I was struck by this quote:

It’s interesting how by joking about the Colbert Nation, you made it exist.
Yeah, they want in on the fun. That was something we didn’t expect, because we joked about the Colbert Nation and then we said, “Oh shit, it’s real.” That’s an interesting thing, and that’s another improvisational aspect — that discovery is better than invention. We invented the Colbert Nation, but then we discovered it was real. We didn’t make it happen, they self-organized it. I love that relationship. We can’t always have it, and you can’t force that. You just have to acknowledge it. We’re always planting seeds with the show, and the challenge is, will we notice when a flower blooms, and then pick that flower?

We often think that to innovate, we have to come up with something new – something that’s never been tried, that will come out of left field and disrupt the status quo.  But the best innovations aren’t inventions at all, they’re discovery, reproduction, and nurturing of something little-known, but already proven successful.  The greatest ‘innovators’ on the tech scene weren’t to market with their products: Google wasn’t the first search engine, Apple wasn’t the first smartphone manufacturer, and Facebook wasn’t the first social network.  But each took a unique insight, market lesson, or positioning to bring out a product that’s now integrated into our lives.

Professional Services firms can be especially apt to fall into the innovation as invention trap.  I’ve worked with a number of firms who saw ‘new product development’ as creating marketing materials that they could pitch to new clients.  Most of the time, these brochures collect dust for a few months before recycling, and the PowerPoint pitch decks get lost on a Sharepoint site somewhere.

But if you can’t create a new product, how are professional services firms supposed to innovate?  Whenever I’ve seen successful innovation, it’s been through discovery.  First, the firms create an environment where professionals feel free to innovate and try new things, especially on their most trusted client relationships (planting seeds, in Colbert’s analogy).  This can be risky, because many firms are nervous to experiment and fail on their largest relationships, but these are also the clients who are most likely to pay for them to try.  Second, they’re great at paying attention, so they notice when a seed starts to bloom.  They constantly gather feedback from clients, write up case studies, and share knowledge within the firm.  Finally, they have the resources to pluck the most promising flowers,  which can look different depending on the innovation.  Sometimes, it means turning a promising team leader into a practice head, who can then grow other similar accounts, and other teams it means committing central resources to packaging and disseminating  the best practices that were learned on a project.

None of these steps are rocket science, but like growing flowers, they take time and patience, and other than careful tending, there’s very little you can do to accelerate the process.  That can be frustrating to impatient leaders, who want to feel like something is being done, but it’s also the only way to see the phenomenal success you can find from discovering innovation where you didn’t expect it.  Just look at Colbert’s show, which has earned seven Emmy nominations, spawned a SuperPAC, and has Space Treadmill named after him.

Space Shuttle Enterprise on Land, Sea, and Air

This morning, as the space shuttle Enterprise (OV101) moved up the Hudson river, I realized I’ve now seen Enterprise on land, sea, and air – every medium through which it has traveled, and taken a picture of it.  For reference, here are photos of all three:

First up, a picture on land, where I saw Enterprise at the Smithsonian Air and Space Museum’s Udvar Hazy Center back in 2006.

Enterprise at the Udvar Hazy center

Fast forward to a few weeks ago, when I caught the shuttle flying over New York before landing at JFK.  I saw Discovery fly over DC as well, but don’t have pictures.

Enterprise flying over New York

And finally, this morning I got to see Enterprise travel up the Hudson to its new home at the Intrepid Museum.

Enterprise on the Hudson

Now the only thing I missed was seeing a space shuttle from space (although Enterprise never actually flew into orbit).  In a few weeks, I’ll be able to see it at it’s new home at the Intrepid Museum, so that I can say I saw it on Land, Sea, and Air all in New York.

Startup Trail Places Third at Startup Weekend New York: Music and Gaming

Have you ever sat at work, toiling away in the salt mines, and dreamt of running a tech startup – the next Google, Facebook, or even Pets.com?  Did you grow up playing classic simulation games like Sim City or Oregon Trail?  The The Startup Trail is for you – a mobile game that helps you learn about how to run a startup, but in a fun environment.  Whether you’re a hardcore gamer, a successful founder, or you’ve never done either, you’ll be interested in the Startup Trail.

Startup Trail requires you to make the hard business decisions startup founders face every day, like managing cash flow, securing investment, hiring and firing employees, managing a team, making product decisions, and attracting customers.  In doing so, you get exposed to the best thinking about how to manage a successful startup, and an opportunity to practice it in a fun game environment. 

Manage your first employees in The Startup Trail

Unlike most mobile games, we’ve got a social bridge to the ‘real world’ too.  Your in-game startups will be represented on the internet in a mock “launch page,” and you can validate your real startup ideas by seeing if they attract social “Likes” through Facebook, which then also become in-game customers.  You can also co-found startups with your friends, and compete with other customers around the world.   And companies that make products for startups can get involved too, placing their products as options in the game which have tangible effects on gameplay, just like they’d effect a startup in real life.

If this sounds great to you, you’re thinking like the judges at Startup Weekend New York: Musing and Gaming, who awarded us 3rd place.  If you’ve never heard of Startup Weekend, it involves a team of developers, designers, and business-folk coming together to take an idea that’s pitched on Friday night, into a thought out business plan, validated customer interest, and a working prototype by the end of the weekend 58 hours later.

So at the end of an intense weekend, our 60 second pitch for “Oregon Trail for Startups” became the 4-minute presentation you see here, along with a working prototype, mapped out game mechanics, and a series of amazing graphics that brought the game to life.   And none of it would have been possible without an amazing team. 

So what’s next for The Startup Trail?  We’re in talks with some people, dabbling in it as a team, and thinking about a Kickstarter.  If you’ve got any ideas or support, leave them in the comments.  And if you love the graphics, they were made by Ryan Requena, who’s available as a freelancer and does phenomenal work.

The Startup Trail Team

The Big Data Gold Rush

As storage costs plummet, NoSQL databases mature, and processing power continues to follow Moore’s Law into the stratosphere, companies everywhere  are talking about the potential of Big Data to revolutionize business, unlocking hidden value and allowing companies to gain a competitive edge.  If you ask the vendors and consultants involved in this space, every company is sitting on a gold mine of untapped data, just waiting for a clever statistician with the right tools to dig out its value.  But is the whole big data push just hype?  An analyst at Seeking Alpha seems to think so.  First, he breaks down the six sub-hypotheses underpinning the big data impetus:

A) This data collection is a recent phenomenon B) Value is not already being extracted from whatever data is being collected C) Companies will need outside help to extract insights D) Outsiders can help companies extract insights without having deep industry knowledge E) The insights gathered from ever larger data sets have more value and are more accurate than insights gathered from smaller data sets F) Unstructured and cross functional data have huge value waiting to be extracted.

His final conclusion after examining each one?

My personal opinion is that the potential market size and value proposition are both over-hyped. I’m reminded of the hype over biotechnology in late eighties and early nineties. For example, biotechnology was supposed to have brought us juicy red, delicious and stackably cubical tomatoes that would yield square slices that fit a slice of bread. I’m still waiting for my square tomato slices.

In fact, when you look at the “success” stories of companies such as IBM, the ballyhooed results are almost comical (“Reduced Report Generation Time by 63%!”). Another common theme, found on all the data analytics companies websites, is that their focus areas seem to be internet, banking, healthcare, industrial, life sciences, CPG, insurance – the very areas which have traditionally crunched large amounts of data before it became “sexy”.  So where are the big inroads into new markets? One example of such an inroad is law. Law firms’ revenues have beendestroyed by revolutionary data analytics technology, which has replaced law associates with software, leading savvy clients to pay very much less for the same work.

The law firm example is especially apt for this blog, and hopefully I’ll have time to dive into the world of big data in law another time, but for now – I’m even more interested in his point about magic sandwich tomatoes from the early 90s.  The more I hear consultants touting big data as the next big thing, the more it sounds like the exact same language they’ve used to describe any sort of deep analytics over the past ten years.  Big data isn’t new, it’s a repackaging of the same old.

Consider this McKinsey report, widely cited in the industry, which may as well have been written in 1999 and updated to change gigabytes to terabytes or petabytes.  Big data to revolutionize retail?  Wal-mart, Target, and other big-box stores have been doing it for decades – that’s the whole reason grocery stores have loyalty cards.  The big data techniques for marketing have been used for decades in order to improve the effectiveness of direct mail.  In many corporate functions, like supply chain and HR, the promises of Big Data are the same as the promises that enterprise resource planning providers like Oracle and SAP have been touting for years.

So if Big Data is all hype, is there any gold there?  Underneath the surface, there’s still some opportunity.  First, the returns to rudimentary analytical skills continue to grow.  We’re reaching a point where innumeracy in the business world is becoming an even greater handicap, and the ability to analyze and interpret data will take a professional a long way.  Second, analytics is democratizing.  Many sources of big data are being made public, or available at low cost, on cloud computing servers, through services like Twitter, or by academics.  The more eyes looking at data, the greater the likelihood someone will find something revolutionary, which is why Kaggle competitions offer so much potential.    Third, the de-anonymization of the internet has the potential to allow marketers to link together a wide variety of consumer data (of course, with worrying privacy implications), which could open new opportunities.

So while I don’t think Big Data is the Next Big Thing, it’s still the continuation of an exciting trend that’s helping businesses become more effective and more efficient.   And when consultants find a new label for “crunching your numbers to help you find insights,” touting it as The Next Revolution For Business, I’ll probably use this same post again, and update my petabytes to exabytes.

Do Kids Care If We Stick Their Robot Friend in the Closet?

Some researchers decided to figure out how kids viewed friendly robots – are they people? animals? things? some new thing in between?

The session involves a game of “I Spy,” a guessing game where Robovie gives the child verbal clues to help them locate objects around the room. After the game is finished, Robovie asks for a hug, which is another one of those bonding moments, and then the game is played again, this time with the child giving clues and Robovie guessing the objects. Here’s where things get interesting: in the middle of this phase of the game, an adult experimenter enters the lab and cuts the game short with some consequences for Robovie.

Overall, 80 percent of the participants felt that Robovie was intelligent, and 60 percent thought that Robovie had feelings. At the same time, over 80 percent believed that it was just fine for people to own and sell Robovie. Hmm. Only 50 percent of the children felt that it was not all right to put Robovie in the closet, although close to 90 percent agreed with Robovie that it wasn’t fair to put it in the closet and it should have been allowed to at least finish the game it was playing. 

Mentally, I know that the robot is just a thing – I even know that there’s a person controlling it.  Still, it’s disconcerting to force something into a closet while it’s actively asking you not to.  It has to be worse for kids, who are used to anthropormophocizing their completely inanimate toys.

Even more, including a video of Robovie and a teenager, over at IEEE Spectrum:  Do Kids Care If Their Robot Friend Gets Stuffed Into a Closet?

 

What’s the difference between a researcher and a consultant?

My first mini web comic slide:

What's the difference between researchers and consultants?

Why do smart young people go into finance, law, and consulting?

The economists over at George Mason had a discussion this week about professional services firms (it looks like consulting especially, but not exclusively) that led them to try and answer two questions of interest to this blog: why do smart motivated young people join professional services firms, and why do firms hire consultants.  I’m going to try to tackle both questions with my thoughts, so consider this part one of a two part series.

First off, Tyler Cowen offers his theory on why so many smart young people are going into professions like finance, law, and consulting:

The age structure of achievement is being ratcheted upward, due to specialization and the growth of knowledge.  Mathematicians used to prove theorems at age 20, now it happens at age 30, because there is so much to learn along the way.  If you are a smart 22-year-old, just out of Harvard, you probably cannot walk into a widget factory and quickly design a better machine.  (Note that in “immature” economic sectors, such as social networks circa 2006, young people can and do make immediate significant contributions and indeed they dominated the sector.)  Yet you and your parents expect you to earn a high income — now — and to affiliate with other smart, highly educated people, maybe even marry one of them.  It won’t work to move to Dayton and spend four years studying widget machines.

You will seek out jobs which reward a high “G factor,” or high general intelligence.  That means finance, law, and consulting.  You are productive fairly quickly, you make good contacts with other smart people, and you can demonstrate that you are smart, for future employment prospects.

That’s one theory, but I think it only plays into one motivator for a much more complicated decision.  I think Tyler is failing to appreciate just how intimidating graduating from college and choosing a career is for anyone without a technical and focused degree like engineering or accounting.   Up until you graduate college, each step in life is scripted – you go from middle school to high school, and from high school get good grades to apply to college, where you select the best college that you can get into.  All colleges are fairly similar in the sense of what you’ll get out of them is a degree, and all ask for similar inputs in the sense that they really want to see grades, test scores, and extra-curricular activities.  They don’t require you to declare a specialization or have any focused interest, so you can head off to explore the world without the terrifying possibility that you may close off some door to the future.  Law school lets you continue this process for another three years while staying under the comforting protection of the academy.

But applying to jobs is hard.  For starters, unlike colleges where you have a finite number of options conveniently ranked by status on a handful of similar lists, there are tens of thousands of employers in any given community, let alone the country, and the lists that rank them aren’t nearly as thorough or complete (if you ever want to feel good about college rankings, check out the methodology for a best place to work list).  Compare that to law, finance, accounting and consulting, all of which have a smaller number of firms that hire people straight out of school, and which are conveniently ranked by prestige by their own trade publications and sites like vault.com.   In other words, the professions have their own equivalent of the US News rankings to help college graduates decide.

Not only are there tons of firms offering potential employment in the rest of the economy, but finding them is really hard.  They usually publish jobs on their own company’s websites, maybe the occasional job board (although for professional positions, most recruiters I know don’t like them), and through field specific headhunters.  In other words, even for entry level jobs, they want the new graduate to find them, not the other way around.   Professional firms show up on campus, throw giant parties, give presentations on how their application process, and even host the interviews right in the business school.  It doesn’t get much easier than that.

Finally, when it comes time to apply, all the professions are looking for pretty much the same thing, and it’s happily similar to the college application process that you’re not only familiar with, but have demonstrated that you’re pretty good at.  Fill out your GPA and test scores, write an application essay, upload your resume full of extracurriculars, and get ready for a few years of Excel, PowerPoint, and doc review.  Compare that to non-professional firms that want you to demonstrate your ability to do the job, despite your negligible experience, or tailor your cover letter to their culture when you barely understand what work is like.

In some ways, this supports Tyler’s point – these firms are excellent ways to quickly attain status with low risk.  But put another way, they’re also the easy choice for a generation of college graduates that’s never really had to choose, never had to explore what’s out there, and isn’t ready to settle down and make a career.  Some of this may sound condescending or bitter, but in actuality this process is hugely beneficial to the firms that hire these new graduates, and more importantly to those firms’ clients, as I’ll try to cover in Part 2 when I look at why companies hire consultants.